[Federal Register Volume 76, Number 13 (Thursday, January 20, 2011)]
[Notices]
[Pages 3744-3787]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2011-976]



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Part III





Department of Defense





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Science and Technology Reinvention Laboratory Personnel Management 
Demonstration Project, Department of the Army, Army Research, 
Development and Engineering Command, Armament Research, Development and 
Engineering Center (ARDEC); Notice

Federal Register / Vol. 76 , No. 13 / Thursday, January 20, 2011 / 
Notices

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DEPARTMENT OF DEFENSE

Office of the Secretary


Science and Technology Reinvention Laboratory Personnel 
Management Demonstration Project, Department of the Army, Army 
Research, Development and Engineering Command, Armament Research, 
Development and Engineering Center (ARDEC)

AGENCY: Office of the Deputy Under Secretary of Defense (Civilian 
Personnel Policy), DoD.

ACTION: Notice.

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SUMMARY: Section 342(b) of the National Defense Authorization Act 
(NDAA) for Fiscal Year (FY) 1995, Public Law 103-337 (10 U.S.C. 2358 
note), as amended by section 1109 of NDAA for FY 2000, Public Law 106-
65, and section 1114 of NDAA for FY 2001, Public Law 106-398, 
authorizes the Secretary of Defense to conduct personnel demonstration 
projects at DoD laboratories designated as Science and Technology 
Reinvention Laboratories (STRLs) to determine whether a specified 
change in personnel management policies or procedures would result in 
improved Federal personnel management. Section 1105 of the NDAA for FY 
2010, Public Law 111-84, 123 Stat. 2486, October 28, 2009, designates 
additional DoD laboratories as STRLs for the purpose of designing and 
implementing personnel management demonstration projects for conversion 
of employees from the personnel system which applied on October 28, 
2009. The ARDEC is listed in subsection 1105(a) of NDAA for FY 2010 as 
one of the newly designated STRLs.

DATES: Implementation of this demonstration project will begin no 
earlier than March 9, 2011.

FOR FURTHER INFORMATION CONTACT: ARDEC: Ms. Christina Duncan, U.S. Army 
ARDEC, Human Capital Management Office, Building 1, 3rd Floor, RDAR-
EIH, Picatinny Arsenal NJ 07806-5000.
    DoD: Ms. Betty Duffield, CPMS-PSSC, Suite B-200, 1400 Key 
Boulevard, Arlington, VA 22209-5144.

SUPPLEMENTARY INFORMATION: 

1. Background

    Since 1966, many studies of DoD laboratories have been conducted on 
laboratory quality and personnel. Almost all of these studies have 
recommended improvements in civilian personnel policy, organization, 
and management. Pursuant to the authority provided in section 342(b) of 
Public Law 103-337, as amended, a number of DoD STRL personnel 
demonstration projects were approved. These projects are ``generally 
similar in nature'' to the Department of Navy's ``China Lake'' 
Personnel Demonstration Project. The terminology, ``generally similar 
in nature,'' does not imply an emulation of various features, but 
rather implies a similar opportunity and authority to develop personnel 
flexibilities that significantly increase the decision authority of 
laboratory commanders and/or directors.
    This demonstration project involves:
    (1) Two appointment authorities (permanent and modified term);
    (2) Modified probationary period for newly hired employees;
    (3) Modified supervisory and managerial probationary period;
    (4) Pay banding;
    (5) Streamlined delegated examining;
    (6) Modified reduction-in-force (RIF) procedures;
    (7) Simplified job classification;
    (8) A contribution-based appraisal system;
    (9) Academic degree and certificate training;
    (10) Sabbaticals;
    (11) A Volunteer Emeritus Corps;
    (12) Direct hire authority for candidates with advanced degrees for 
scientific and engineering positions; and
    (13) Distinguished Scholastic Achievement Appointment Authority.

2. Overview

    The NDAA for FY 2010 not only designated new STRLs but also 
repealed the National Security Personnel System (NSPS) mandating 
conversion of NSPS covered employees to their former personnel system 
or one that would have applied absent the NSPS. A number of ARDEC 
employees are covered by the NSPS and must be converted to another 
personnel system. Section 1105 of NDAA for FY 2010 stipulates the STRLs 
designated in subsection (a) of section 1105 may not implement any 
personnel system, other than a personnel system under an appropriate 
demonstration project as defined in section 342(b) of Public Law 103-
337, as amended, without prior congressional authorization. In 
addition, any conversion under the provisions of section 1105 shall not 
adversely affect any employee with respect to pay or any other term or 
condition of employment; shall be consistent with section 4703(f) of 
title 5 United States Code (U.S.C.), and shall be completed within 18 
months after enactment of NDAA for FY 2010. Therefore, since ARDEC is 
both designated an STRL by section 1105 of NDAA for FY 2010 and has 
NSPS covered employees, it must convert, at a minimum, its NSPS covered 
employees to a personnel management demonstration project (Lab Demo) 
before the end of April 2011.
    The proposed STRL Demonstration Project Plan for ARDEC was 
published on September 9, 2010 in 75 Federal Register (FR) 55200 that 
was subsequently corrected by 75 FR 60091 published on September 29, 
2010. During the public comment period ending October 9, 2010, DoD 
received 40 comments. All comments were carefully considered. Some 
comments addressed topics that were outside the project's scope or the 
demonstration authority of 5 U.S.C. 4703. These comments are not 
included in the summary below.
    The following summary addresses the pertinent comments received, 
provides responses, and notes resultant changes to the original project 
plan in the first Federal Register notice.

A. General

    Seven general comments were received; responses are provided below.
    (1) Comment: Employees should be returned to the GS system because 
it is viewed that the NSPS performance system lost the classification 
restrictions and allowed for growth in salaries beyond the GS 
classification guides. Also, the merit compensation system allowed for 
compensation growth not based on merit. It would be most beneficial to 
only have one performance system, that being the GS system.
    Response: Public Law 111-84, section 1105, prevents ARDEC from 
returning to the GS system and requires ARDEC to develop a Lab Demo. 
The ARDEC Lab Demo has been designed to capture the positive features 
of various personnel management systems/projects in use today. 
Specifically, in reference to this comment, the ARDEC Lab Demo design 
is founded on the principle that standard classification criteria are 
the basis for both performance assessment and pay setting. In reference 
to the comment that it would be beneficial to have only one performance 
system, the ARDEC Lab Demo performance management system is designed to 
be the performance management system for the ARDEC workforce. No change 
to the Lab Demo plan is required.
    (2) Comment: The unions have already rejected participation in this 
Lab Demo, as they have rejected participation in the previous two 
attempts to revise the General Schedule system. All implications that 
this Lab Demo is a full workforce management process need to be 
stricken from the descriptions and pay bands. This

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proposal is only for the management officials at ARDEC, and should be 
described as such, particularly when addressing the expected benefits 
on page 55202.
    Response: The public law directed ARDEC to develop a personnel 
system that could cover the majority of the workforce, not just 
management officials. The Lab Demo plan was designed to cover both 
bargaining and non-bargaining unit eligible employees. The intent is 
for ARDEC to continue to pursue Union acceptance. Upon initial 
conversion, there will be both non-management and management employees 
within the ARDEC in Lab Demo positions spanning the full spectrum of 
the pay bands and associated occupational families. No change to the 
Lab Demo plan is required.
    (3) Comment: Return to the Acquisition Demonstration project 
without any modifications.
    Response: Public Law 111-84, section 1105, prevents ARDEC from 
returning to the Acquisition Demonstration Project and requires ARDEC 
to convert eligible employees to a personnel system under an 
appropriate demonstration project as referred to in section 342(b) of 
Public Law 103-337, October 5, 1994. No change to the Lab Demo plan is 
necessary.
    (4) Comment: If as stated, ``The primary benefit expected from this 
demonstration project is greater organizational effectiveness through 
increased employee satisfaction.'' Why was employee opinion on this 
modification not considered?
    Response: As an integral part of the process used to develop the 
ARDEC Lab Demo Project, a number of employee outreach venues were used, 
including Town Halls, ARDEC Web-Site, Focus Groups, Union Meetings and 
ARDEC Lab Demo mail box to solicit employee ideas and recommendations 
for improvement. As a result of these outreach initiatives significant 
changes were incorporated into the Lab Demo project plan. No change to 
the initial Lab Demo Federal Register notice is needed.
    (5) Comment: The fact that the unions non-concur suggests that 
employees will not be satisfied with the proposed system.
    Response: The ARDEC Lab Demo project has been designed to capture 
the positive features of the personnel management systems/projects in 
use today with a key objective being employee acceptance and 
satisfaction. By incorporating employee suggestions into the design and 
with continuing employee feedback as the design matures, the full 
expectation is that employees will be satisfied. No change to the 
initial Federal Register notice is required.
    (6) Comment: I believe that this system is inherently unfair and 
not in line with standard US Government personnel practices. This 
system suggests ``pay for contribution.'' Contribution level is 
inherently tied to job assignment. A supervisor, upper management, or 
fiscal events could dictate responsibility reduction, at no fault of an 
employee, which would eventually result in a lower contribution rating 
and reduced salary. A salary reduction without merit is not fair and 
will definitely not result in ``increased employee satisfaction.''
    Response: The ARDEC Lab Demo project uses a contribution-based 
compensation system in that both employees' contributions assessments 
and subsequent base pay are determined by reference to the 
classification system criteria. In as much as the pay setting and 
contribution evaluation are one in the same, employees' pay would be 
comparable to the level of work and contribution results. Position 
classification defines job responsibilities and, therefore, base pay 
level. It is expected that all employees will perform, at a minimum, to 
their position responsibilities. Supervisors assign objectives and work 
assignments commensurate with position responsibilities. No change to 
the Federal Register notice is required.
    (7) Comment: This system does not capture nor reward the experience 
and expertise brought to an organization by seasoned professionals. A 
5-year employee who mentors five 1-year employees could be considered 
to contribute more than a 30-year employee who mentors three 5-year 
employees. In measuring and rewarding current ``contribution'' it 
negates and fails to reward experience and wisdom.
    Response: The ARDEC Lab Demo project uses a contribution-based 
compensation system. In as much as the pay setting and contribution 
evaluation are one in the same employees base pay would be comparable 
for the work they perform and the value of their contributions. The 
system is not designed to reward employees for experience and wisdom 
alone but rather how they apply wisdom and experience to their job. In 
addition, as in other personnel systems, employee compensation is not 
based on amount of workload but rather the level of work accomplished 
successfully. No change to the Federal Register notice is required.

B. Participating Employees

    Two similar comments regarding participating employees were 
received and the response is provided below.
    (1) Comment (two similar comments combined): ARDEC should have the 
right to exclude When Actually Employed (WAE), Summer Hires (i.e., 
STEPs) and Co-ops (i.e., SCEPs) from Lab Demo coverage at least until 
the bargaining unit employees are included. ARDEC needs to be able to 
use discretion on that point.
    Response: Public Law 111-84, section 1105(b) indicates that the 
personnel of each STRL designated in section 1105(a), which includes 
ARDEC, are to convert to an appropriate demonstration project as 
referred to in Public Law 103-337, section 342(b). These conversions 
must be consistent with title 5 U.S.C. 4703(f) and be completed before 
April 28, 2011. The conversion provisions do not apply to prevailing 
rate employees or senior executives. Thus, the categories of employees 
mentioned in the comment are covered by the conversion requirements of 
Public Law 111-84, section 1105(b).

C. Pay Administration

    Eight comments regarding Pay Administration were received and the 
responses are provided below.
    (1) Comment: Reassignments to positions of similar responsibility 
should not result in an increase to base pay.
    Response: The ARDEC Lab Demo does not provide for pay increases for 
reassignments to positions with similar responsibilities. However, pay 
increases can be granted when a reassignment significantly increases 
the complexity, responsibility, and authority or for other compelling 
reasons. Such an increase is subject to the specific guidelines 
established by the PMB. No change to the Federal Register notice is 
required.
    (2) Comment: The Federal Register does not state anything about 
overtime. The only good thing about NSPS, you actually got time and a 
half for anything over 8 hours.
    Response: The NSPS overtime feature had been considered for 
implementation in our initial Federal Register notice but was 
determined to be inconsistent with existing public law that established 
Lab Demo projects and therefore not included. The ARDEC Lab Demo will 
be using the existing GS rules for overtime. No change to the Lab Demo 
plan is needed.
    (3) Comment: It is not clear if the contribution bonus is 
continuous bonus or a onetime bonus.
    Response: The Contribution Bonus is a onetime payment to be paid 
out on a

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yearly basis corresponding to the annual rating cycle. Language has 
been changed in the Lab Demo plan paragraph III.C.5.c(2), from `` * * * 
is a lump sum payment * * * '' to `` * * * is a onetime lump sum 
payment * * *.''
    (4) Comment: It is not clear how and when the General Pay Increase 
(GPI) will be decreased for employees that fall above the Normal Pay 
Range or above the upper rail.
    Response: Employees who fall above the Normal Pay Range or above 
the upper rail may have their GPI partially reduced or denied. The 
specific rules covering when and how much the GPI is reduced is a 
responsibility of the PMB. These rules will define under what 
circumstances the GPI will be denied or, if reduced, the amount of 
reduction. To address this concern, the Federal Register notice will be 
changed to reflect that the PMB will be responsible for establishing 
the rules for instances where implementation and operating procedures 
are required such as withholding GPI for employees that fall above the 
Normal Pay Range (NPR). The Lab Demo plan paragraph II.G.2 is changed 
from ``At a minimum, duties executed by the board will be to:'' to 
``The PMB is responsible for establishing the implementation and 
operating rules as required. At a minimum, duties executed by the board 
will be to:''. Also, a new paragraph II.G.2.s has been added stating, 
``Establish rules and procedures for denying or reducing GPI for 
employees whose contributions are in region A (above the NPR).''
    (5) Comment: Will employees that fall above the rail receive the 
full locality pay increase regardless of GPI reduction?
    Response: Yes, employees will receive locality pay regardless of a 
reduction in GPI. Locality pay is separate from the Contribution-Based 
Compensation System. No change to the Federal Register notice is 
required.
    (6) Comment: Traditionally employee recognition is not sufficient 
compared to private industry. Recommend raising the invention 
disclosures and patent award amounts to a larger limit more comparable 
to private industry.
    Response: Appreciate your comment, however after further review, 
employee recognition for invention disclosures and patents is not a 
Federal Register notice issue. These awards are controlled at the 
component level (Army) and will be further investigated through other 
channels. No change to the Federal Register notice is required.
    (1) Comment: The Federal Register does not seem to adequately 
address pay setting for employees on temporary assignments at the time 
of transition.
    Response: It is a requirement for conversion from the National 
Security Personnel System and the intent of the Lab Demo project to 
ensure an employee does not have any loss in pay on conversion to the 
project regardless if the employee is on a permanent or a temporary 
assignment prior to conversion. Employees on a temporary assignment 
will convert back to their permanent position of record and then 
convert to a new temporary assignment within the demonstration project. 
In these cases, section 1113(c)(1) would also apply to the temporary 
position, i.e., there will be no loss or decrease in pay as a result of 
the conversion of positions and employees from NSPS. This is already 
covered in paragraph V.B.2 of the Federal Register notice and no change 
is required.
    (2) Comment: For paragraph III.F.1, change ``Employees whose 
performance is acceptable and not on pay retention will receive the 
full annual general pay increase and the full locality pay.'' to, 
``Employees whose performance is acceptable and not on pay retention 
will receive the full annual general pay increase and the full locality 
pay, with the exception of those employees covered under paragraph 
III.C.5.c.(3).''
    Response: Employees whose Assessed Overall Contribution Score falls 
in the ``above the rail'' region may not be officially identified as 
``unacceptable;'' however, their GPI is subject to being withheld or 
reduced. Therefore, for clarity and completeness the Federal Register 
paragraph III.F.1 has been changed as follows: change ``Employees whose 
performance is acceptable and not on pay retention will receive the 
full annual general pay increase and the full locality pay'' to, 
``Employees whose performance is acceptable and not on pay retention 
will receive the full annual general pay increase and the full locality 
pay, with the exception of those employees' whose rating is as 
described in paragraph III.C.5.c.(3).''

D. Base Pay

    One comment regarding base pay was received and the response is 
provided below.
    (1) Comment: For persons capped at the top rate under current NSPS 
equivalent to GS-15, Step 10, + 5% or $165,300:
    Since the executive level cap does not rise by the cost of living 
and the Locality Market supplement percentage is set, then the base pay 
does not go up as much as it normally would. It seems unreasonable and 
unfair, that the distribution of pay between the local market 
supplement and base pay which comprises the full salary should be at 
the expense of base pay. While the pay is capped, the base pay should 
rise relative to the Local Market Supplement. If one were to transfer 
to a lower cost of living area where the local market supplement was 
less, then one would end up with reduced pay even after they have not 
received full or any pay raises for prior years due to the executive 
level cap. It is unclear if the same situation exists under the new 
demo project but this issue should be fixed.
    Response: The situation as described in the comment above will not 
occur in the ARDEC Lab Demo project. In the Lab Demo project an 
employee's base pay may rise to the annual GS-15, Step 10, base pay 
cap. Locality pay adjustments are added to this base pay and are 
subject to the overall total Executive Level IV salary cap. The ARDEC 
Lab Demo project uses base pay for contribution calculations/payouts 
adjustments. All salary adjustments at the end of a rating cycle are 
applied to base pay and limited to the base pay salary caps for each of 
the pay bands. Locality pay and other salary adjustments are added as 
appropriate and are also subject to overall pay cap limitations, more 
specifically Executive Level IV. This comment does not require any 
change to the Federal Register notice.

E. Conversion

    Five comments regarding conversion were received and the responses 
are provided below.
    (1) Comment (two similar comments combined): Clarify what is the 
deciding factor for putting a YF-2 supervisor in Pay Band III or Pay 
Band IV? Page 55203 (first Federal Register notice) shows that a first-
level supervisory position would be a pay band IV, however, Table 1--
Equivalent NSPS pay bands shows YF-2 (first-level supervisory position) 
in both Pay Band III and Pay Band IV. I thought it was equal pay for 
equal work?
    Response: Employees will convert to the appropriate band based on 
position classification. Table 1 identifies the possible bands to which 
employees may convert. The verbiage on Page 55203 is solely intended to 
provide examples of the types of positions that could be in each band 
but they are not absolute. Case in point, an employee's position can be 
a first-line supervisor position in pay bands II, III, IV, or V 
depending on the position's responsibilities and type and complexity of 
work supervised. The Federal Register notice has been changed to better 
reflect the potential position matching upon conversion. Paragraph 
III.A.1 has been changed by

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adding the following at the end of the paragraph: ``The following 
descriptions of positions for the bands in the occupational families 
illustrate examples of the types of positions included.'' In addition, 
to ensure pay equity, it is the intent to set the base pay for an 
employee at the minimum base pay of the pay band to which the 
employee's position is classified. For clarification the Federal 
Register notice has been changed as follows: In section V.B.2, the 
following has been added to the end of the first paragraph, ``If the 
employee's base pay is less than the minimum rate for his/her 
position's assigned demonstration project pay band, the base pay rate 
will be increased to the minimum of that pay band.''
    (2) Comment: Conversion from NSPS is not redressing the problems 
created by the GS-Demo-NSPS-Demo sequence at ARDEC over the last 5-10 
years. The Acquisition Demo created GS-14/15 bands, where once 
selected, an employee could move up, without competition, through the 
entire pay scale of the band. In NSPS, ARDEC ``gated'' some of these 
employees, such that their max pay would be capped at essentially a GS-
14, Step 10, level. In other words, the full range of opportunity was 
taken away from some people. It would seem reasonable that under this 
Lab Demo proposal, any employee who was competitively selected for a 
GS-14/15 band in the past, be converted to a Pay Band V under this Lab 
Demo.
    Response: Employees will convert to the appropriate band based on 
classification for the position they occupy at the time of conversion. 
Table 1 (Pay Band Charts) identifies the possible bands to which 
employees may convert. Any employee that has a base pay that exceeds 
the band will be place on indefinite pay retention until such time as 
their pay falls within the Normal Pay Range. No change to the Federal 
Register notice is required.
    (3) Comment: Paragraph V.B.4, Transition Equity. Recommend this 
paragraph also apply to GS employees under paragraph V.A.
    Response: It has been determined that adding the provision of 
Transition Equity in the NSPS conversion section to the GS conversion 
section of the Federal Register notice is appropriate. The notice has 
been changed by adding the following paragraphs to the end of section 
V.A. as a new paragraph 6:
    ``6. During the first 12 months following conversion to the 
demonstration project, management may approve certain adjustments 
within the pay band for pay equity reasons stemming from conversion. 
For example, if an employee would have been otherwise promoted but 
demonstration project pay band placement no longer provides the 
opportunity for promotion, a pay equity adjustment may be authorized 
provided the adjustment does not cause the employee's base pay to 
exceed the maximum rate of his or her assigned pay band and the 
employee's performance warrants an adjustment. The decision to grant a 
pay equity adjustment is at the sole discretion of the ARDEC Director 
and is not subject to employee appeal procedures.
    During the first 12 months following conversion, management may 
approve an adjustment of not more than 20 percent, provided the 
adjustment does not cause the employee's base pay to exceed the maximum 
rate of his or her assigned pay band and the employee's performance 
warrants an adjustment, to mitigate compensation inequities that may be 
caused by artifacts of the process of conversion into STRL pay bands.''
    (4) Comment: Recommend deleting the last part of the paragraph 
V.A.5.a. and V.B.7.a, ``and may have their initial period extended in 
accordance with the demonstration project regulation and implementing 
issuances.'' This is a change in contract with a person as that person 
was promoted with the understanding of only having a one-year 
probationary period and this is not considered reasonable.
    Response: It has been determined that to change an employee's 
original probationary period contract, as defined when hired, during 
conversion to the ARDEC Lab Demo would be an unreasonable change to the 
employee's employment contract. The Federal Register notice paragraphs 
V.A.5.a. and V.B.7.a, have been changed by deleting the last part of 
the paragraph, ``and may have their initial period extended in 
accordance with the demonstration project regulation and implementing 
issuances.''

F. Contributing Factors

    Two similar comments regarding Contributing Factors were received; 
and the response is provided below.
    (1) Comments (two similar comments received): The Contribution-
Based Compensation System (CBCS) is based on 6 factors, which duplicate 
to a great degree the GS Position Classification system, and introduce 
duplication and unnecessary administrative costs. In one case, Factor 6 
on Resource Management actually proposes to add more words, and more 
confusion, to the legal definition of appropriation laws (page 55205).
    Response: The factors, descriptors, and discriminators are intended 
to be used as guides for determining the level of contribution for each 
employee across all bands and occupational families. They are not 
intended to, nor does the Federal Register notice prescribe, changes to 
the legal definition of the appropriation laws. However, additional 
clarity has been achieved by revising some of the Descriptors and 
Discriminators in Appendix C of the Federal Register notice.

G. Pay Pool Funding

    One comment regarding Pay Pool Funding was received. The response 
is provided below.
    (1) Comment: The 2 percent base pay and 1 percent bonus funding 
levels appear to be too low for proper recognition of the workforce.
    Response: The Federal Register notice identifies these pay pool 
funding levels as minimums and permits the ARDEC Director to increase 
these funding levels as needed. These minimums are base pay pool 
funding levels, not the limit to the total compensation adjustments for 
an individual employee. The system does not preclude other recognition/
awards to employees that are not part of the CBCS compensation. No 
change to the Federal Register notice is required.

H. Pay Bands

    Three comments regarding Pay Bands were received; and the responses 
are provided below.
    (1) Comment: (Two similar comments received.) Gating within bands, 
similar to what was done under the NSPS system is highly undesirable. 
The system that is put in place should prevent ARDEC managers from 
setting arbitrary limits on the pay bands and limiting the flexibility.
    Response: The ARDEC Lab Demo project has reduced the need for 
gating (control points) within a band by placing salary limits on bands 
that are commensurate with the level and difficulty of work assignments 
across the occupational families for the given bands. The notice does 
have provisions to use control points should the need arise in the 
future based on experience in operating the system to ensure employees 
are appropriately paid for the work they perform. No change to the 
Federal Register notice is required.
    (2) Comment: The equivalent NSPS Pay Band by Occupational Family 
Table appears to be missing the YH category personnel and there are at 
least two at Picatinny, ARDEC. Where do they fit in?
    Response: There was an oversight in the initial Federal Register 
notice. A revision to this table was made by

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adding the NSPS YH category into Table 1 (Equivalent NSPS Pay Bands). 
Additionally, the General Health Science Series (0601) was moved from 
the Business and Technical to the Engineering and Science Occupational 
Family in Appendix B of the Federal Register notice to accommodate 
employees in the YH category.

I. Personnel Management Board

    One comment regarding the Personnel Management Board was received. 
The response is provided below.
    (1) Comment: It appears that the PMB is assuming responsibilities 
that should reside with Line Management. The responsibility of each 
should be clearly delineated. Suggest deleting the following paragraphs 
as these are more management functions to be performed by the line 
managers than the PMB.
    II.G.2.m. ensure in-house budget discipline
    II.G.2.n. manage the number of employees by Occupational Family and 
pay band.
    Response: After further review the following management functions 
were determined to be not required for the PMB as they are line 
management responsibilities as such. The following paragraphs were 
deleted:
    II.G.2.m. ensure in-house budget discipline.
    II.G.2.n. manage the number of employees by Occupational Family and 
pay band.

J. Employee Developmental Programs

    One comment regarding Employee Developmental Programs was received; 
and the response is provided below.
    (1) Comment: It is suggested that the language in paragraph 
II.G.2.o.--``Developmental Opportunity Programs'' be changed to 
``Employee Developmental Programs'' to be consistent with language of 
paragraph III.G.
    Response: There is an inconsistent use of terminology in the 
Initial Federal Register notice. Developmental Opportunity Programs 
should be changed to Employee Developmental Programs for consistency. 
The Federal Register notice has been changed as follows: paragraph 
II.G.2.o.--Changed from ``Developmental Opportunity Programs'' to 
``Employee Developmental Programs''.

K. Annual Appraisal Cycle

    Two comments regarding Annual Appraisal Cycle were received; and 
the responses provided below.
    (1) Comment: The Contribution-Based Compensation System requires a 
mid-point review be conducted for all employees. For employees entering 
the Lab Demo late in the rating cycle this may be an issue.
    Response: The Federal Register notice did not adequately account 
for conducting midpoint reviews for employees entering the Lab Demo 
project late in the rating cycle. The notice has been changed as 
follows: In paragraph ``III.C.4 Annual Appraisal Cycle and Rating 
Process,'' the verbiage in the third paragraph was changed from ``At 
least one review, normally the mid-point review, will be documented as 
a progress review.'' to, ``At least one review, normally the mid-point 
review, will be documented as a progress review. Exceptions may be 
established by the PMB and approved by the ARDEC Director based on 
employees that will be in the Lab Demo for less than 180 days at the 
end of the rating cycle.''
    (2) Comment: The scoring system seems unbalanced over the bands 
with different levels to score. The program should provide for more 
levels for each pay band level, either by adding a ``very high'' 
category to each or use of the five bands as in Level II.
    Response: Employees may score anywhere within the full spectrum of 
scores for their occupational family. The ``very high'' categorical 
rating exists at the top pay band level for each occupational family 
and provides the potential for employees in a top pay band level to 
score above their band level as can employees in other band levels. The 
scoring range for employees in pay band II of the Engineer and Science 
and Business and Technical occupational family is greater than other 
pay bands reflecting the broader range (equivalent to GS-05 to GS-11 
grades) of contribution levels contained in that pay band. The 
additional categorical ratings (Medium High and Medium Low) in pay band 
II facilitate the ability to assess and categorize employee 
contributions within pay band II. No change to the notice is needed.

L. Probationary Periods

    One comment regarding Probationary Periods was received. The 
response is provided below.
    (1) Comment: Consider adding written documentation for 
reassignments of supervisors on probationary periods similar to what is 
being done for the employee probationary period.
    Response: There is an inconsistent requirement for written 
documentation for different probationary periods. It is appropriate to 
document the supervisory probationary period reassignments in the same 
manner as required for the employee probationary period. The notice has 
been modified to add the following to paragraph III.D.9, ``When a 
supervisor determines to reassign a probationary supervisor to a non-
supervisory position during the probationary period because his/her 
work performance or conduct is unacceptable, the probationary 
employee's supervisor will provide written notification subject to 
higher level management approval.''

M. Position Classification

    One comment regarding Position Classification was received. The 
response is provided below.
    (1) Comment: Should specialty codes be used for Lab Demo position 
descriptions? Can any position description be established without them? 
Suggest changing from ``will'' to ``may'' or remove from the Federal 
Register notice.
    Response: Concur with the recommendation to change ``will'' to 
``may'' in paragraph III.B.2.

N. Reduction in Force

    Three comments regarding reduction in force were received. The 
responses are provided below.
    (1) Comment: Do Specialty Work Codes have any effect if ARDEC were 
to conduct a reduction in force?
    Response: The Lab Demo Federal Register notice does not mandate the 
use of Specialty Work Codes on position descriptions; and, therefore, 
the notice will not specifically make the use of Specialty Work Codes 
mandatory when conducting a reduction in force (RIF). No change to the 
Federal Register notice is required.
    (2) Comment: Paragraph III.H--Recommend changing the RIF credit 
lines to define them as 3 points below the Expected Overall 
Contribution Score (EOCS). Using 94 percent would mean 3 Overall 
Contribution Score (OCS) points for an EOCS of 50 and 6 OCS points for 
an EOCS of 100. Also, since ratings are not given to people on a 
Contribution Improvement Period (CIP), recommend deleting the 
requirement for OCS to be less than 92 percent (actually 4 points) as 
well as CIP to get 0 years of credit. Define the year as the year that 
the employee enters a CIP, so as not to penalize two years should the 
CIP overlap two years.
    Response: The use of percent was in error and the intent was to 
define the years of service augmentation based upon the delta between 
an employee's Assessed Overall Contribution Score (AOCS) and an 
employee's EOCS at the end of a rating cycle. Additionally, the Federal 
Register notice has been adjusted (see service augmentation rule 3 
below) to clarify when zero years of

[[Page 3749]]

service augmentation are applied. The following are the service 
augmentation rules:
    1. Seven (7) years of service augmentation for each year the AOCS 
is greater than or equal to the EOCS minus 3 (AOCS <ls-thn-eq>= EOCS -
3).
    2. Four (4) years of service augmentation for each year the AOCS is 
less than the EOCS minus 3 (AOCS < EOCS -3).
    3. Zero (0) years of service augmentation for each year the 
employee was placed on a CIP at any time during the rating cycle.
    (3) Comment: The RIF procedures have a predictable outcome on the 
rating process. If ARDEC gets into a long downsizing cycle, such as in 
the 1990s, rating will be progressively exaggerated, until almost all 
employees get the seven years of extra credit. This will return the 
workforce to the standard, GS RIF ranking of tenure, veterans' 
preference and years of service.
    Response: The Lab Demo project has been designed to improve the 
discipline of the rating process and reduces the possibility of 
inflated ratings. No change to the Federal Register notice is required.

O. Hiring Authority

    One comment regarding Hiring Authority was received. The response 
is provided below.
    (1) Comment: For paragraph III.D.3.a, change the beginning to ``The 
ARDEC has and is forecasted to have for the near future an urgent 
need.* * *'' This is not a one time need, but will continue.
    Response: The verbiage in the Federal Register notice does not 
address the anticipated near future hiring need. The following 
rewording provides for the current and future hiring needs of ARDEC. 
Change paragraph III.D.3.a from The ARDEC has an urgent need * * *'' to 
``The ARDEC has and is forecasted to have for the foreseeable future an 
urgent need.* * *'' This is not a one time need, but will continue.

P. Projected Annual Expenses

    One comment regarding Projected Annual Expenses was received; and 
the response is provided below.
    (1) Comment: The costs need to be re-visited and validated. NSPS 
costs of implementation need to be obtained and used as a comparable 
set of figures. The operating costs of NSPS, meaning the paperwork, the 
administrative support costs, the automation costs, the employee and 
supervisor time spent feeding the system need to be compiled. There 
needs to be some realistic comparison between the value of a 2% 
incentive to the life cycle cost of operating a system. The investment 
ARDEC has made in its previous attempts to shed the GS system must by 
now total millions. By the way, the $85k shown does not cover the 
salary of the lead admin officer for the project, so it can hardly be 
right.
    Response: The projected annual expenses in the initial Federal 
Register notice were determined based on benchmarks of other lab demo 
projects and do not include the normal managerial labor expenses 
typically incurred in the execution of other personnel systems. 
Subsequently, ARDEC has obtained and developed additional cost data and 
revised Table 6 of the Federal Register notice as follows:

                                                           Table 6--Projected Annual Expenses
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                              FY10                    FY11                    FY12                   FY13                   FY14
--------------------------------------------------------------------------------------------------------------------------------------------------------
Training...........................  0K....................  15K...................  10K..................  5K...................  5K
Project Evaluation.................  40K...................  80K...................  30K..................  30K..................  30K
Automation.........................  97K...................  400K..................  400K.................  50K..................  50K
                                    --------------------------------------------------------------------------------------------------------------------
    Totals.........................  137K..................  495K..................  440K.................  85K..................  85K
--------------------------------------------------------------------------------------------------------------------------------------------------------

3. Access to Flexibilities of Other STRLs

    Flexibilities published in this Federal Register notice shall be 
available for use by the STRLs previously enumerated in section 
9902(c)(2) of title 5, United States Code, which are now designated in 
section 1105 of the NDAA for FY 2010, Public Law 111-84, 123 Stat. 
2486, October 28, 2009, if they wish to adopt them in accordance with 
DoD Instruction 1400.37; pages 73248 to 73252 of volume 73, Federal 
Register; and after the fulfilling of any collective bargaining 
obligations.

    Dated: January 13, 2011.
Morgan F. Park,
Alternate OSD Federal Register Liaison Officer, Department of Defense.

Table of Contents

I. Executive Summary
II. Introduction
    A. Purpose
    B. Problems With the Present System
    C. Changes Required/Expected Benefits
    D. Participating Organizations
    E. Participating Employees and Union Representation
    F. Project Design
    G. Personnel Management Board
III. Personnel System Changes
    A. Pay Banding
    B. Classification
    C. Contribution-Based Contribution System (CBCS)
    D. Hiring Authority
    E. Internal Placement
    F. Pay Administration
    G. Employee Development
    H. Reduction-in-Force (RIF) Procedures
IV. Implementation Training
V. Conversion
    A. Conversion From the GS System to the Demonstration Project
    B. Conversion From NSPS to the Demonstration Project
    C. Conversion From Other Personnel Systems
    D. Movement Out of the Demonstration Project
VI. Other Provisions
    A. Personnel Administration
    B. Automation
    C. Experimentation and Revision
VII. Project Duration
VIII. Evaluation Plan
    A. Overview
    B. Evaluation Model
    C. Evaluation
    D. Method of Data Collection
IX. Demonstration Project Costs
    A. Cost Discipline
    B. Developmental Costs
X. Required Waivers to Law and Regulation
    A. Waivers to Title 5, U.S.C.
    B. Waivers to Title 5, CFR
Appendix A: ARDEC Employees by Duty Locations
Appendix B: Occupational Series by Occupational Family
Appendix C: Contribution Factors and Level Descriptors
Appendix D: Intervention Model

I. Executive Summary

    The Armament Research, Development and Engineering Center includes 
the ARDEC organizations at Picatinny Arsenal, NJ; Watervliet Arsenal, 
NY; Rock Island Arsenal, IL; and ARDEC employees with duty stations at 
other sites. The intent of this demonstration project is to cover all 
employees, subject to bargaining unit agreement.

[[Page 3750]]

    The ARDEC provides integrated science, technology, and engineering 
solutions to address the armament, munitions, and fire control needs 
for the Army. The ARDEC's core competency is working with weapon 
systems at all stages of the materiel life cycle. The ARDEC maintains 
the following fundamental capabilities:
    (1) Armaments and Weapons;
    (2) Fire Control;
    (3) Energetics, Warheads, and Ammunition;
    (4) Ammunition Logistics;
    (5) Explosive Ordnance Disposal; and
    (6) Homeland Defense Technology.
    In order to sustain these unique capabilities, the ARDEC must be 
able to hire, retain, and continually motivate enthusiastic, 
innovative, and highly-educated scientists and engineers, supported by 
accomplished business management and administrative professionals, as 
well as a skilled administrative and technical support staff.
    The goal of the project is to enhance the quality and 
professionalism of the ARDEC workforce through improvements in the 
efficiency and effectiveness of the human resource system. The project 
interventions will strive to achieve the best workforce for the ARDEC 
mission, adjust the workforce for change, and improve workforce 
satisfaction. With some modifications, this project mirrors the STRL 
personnel management demonstration project, designed by the U.S. Army 
Edgewood Chemical Biological Center (ECBC). The ARDEC Demonstration 
Project was built on the ECBC concepts and uses much of the same 
language; however, it includes several concepts from the Air Force 
Research Laboratory (AFRL), Naval Research Laboratory (NRL), and the 
DoD Civilian Acquisition Workforce (Acq Demo) personnel management 
demonstration projects. Of significant note is the inclusion of a 
contribution-based compensation and assessment system similar to that 
used in the Acq Demo program. The results of the project will be 
evaluated within five years of implementation.

II. Introduction

A. Purpose

    The purpose of the project is to demonstrate that the effectiveness 
of DoD STRLs can be enhanced by expanding opportunities available to 
employees and by allowing greater managerial control over personnel 
functions through a more responsive and flexible personnel system. 
Federal laboratories need more efficient, cost effective, and timely 
processes and methods to acquire and retain a highly-creative, 
productive, educated, and trained workforce. This project, in its 
entirety, attempts to improve employees' opportunities and provide 
managers, at the lowest practical level, the authority, control, and 
flexibility needed to achieve the highest quality organization, and 
hold them accountable for the proper exercise of this authority within 
the framework of an improved personnel management system.
    Many aspects of a demonstration project are experimental. 
Modifications may be made from time to time as experience is gained, 
results are analyzed, and conclusions are reached on how the system is 
working. The provisions of this project plan will not be modified, or 
extended to individuals or groups of employees not included in the 
project plan without the approval of the DUSD(CPP). The provisions of 
DoDI 1400.37 are to be followed for any modifications, adoptions, or 
changes to this demonstration project plan.

B. Problems With the Present System

    The ARDEC has participated in a number of personnel systems and 
personnel demonstrations over the past 25 years. These include the 
current Civil Service General Schedule (GS) system (80 percent of ARDEC 
employees are currently in this GS system); Acq Demo Project from 2001 
to 2006; and NSPS from 2006 to the present (20 percent of ARDEC 
employees are currently in NSPS). The ARDEC's experience with each of 
these prior personnel systems was that, although each had positive 
features, each also had negative aspects. As a result of the ARDEC's 
experience, it was determined that certain features from the earlier 
systems were worthwhile to carry forward and certain shortcomings/
limitations needed to be corrected or alleviated.
    The current Civil Service GS system has existed in essentially the 
same form since 1949. Work is classified into one of fifteen 
overlapping pay ranges that correspond with the fifteen grades. Base 
pay is set at one of those fifteen grades and the ten interim steps 
within each grade. The Classification Act of 1949 rigidly defines types 
of work by occupational series and grade, with very precise 
qualifications for each job. This system does not quickly or easily 
respond to new ways of designing work and changes in the work itself.
    The performance management model that has existed since the passage 
of the Civil Service Reform Act in 1980 has come under extreme 
criticism. Employees frequently report there is inadequate 
communication of performance expectations and feedback on performance. 
There are perceived inaccuracies in performance ratings with general 
agreement that the ratings are inflated and often unevenly distributed 
by grade, occupation, and geographic location.
    The need to change the current hiring system is essential as the 
ARDEC must be able to recruit and retain scientific, engineering, 
acquisition support and other professionals and skilled technicians. 
The ARDEC must be able to compete with the private sector for the best 
talent and be able to make job offers in a timely manner with the 
attendant bonuses and incentives to attract high quality employees and 
be in compliance with public law.
    Finally, current limitations on training, retraining, and otherwise 
developing employees make it difficult to correct skill imbalances and 
to prepare current employees for new lines of work to meet changing 
missions and emerging technologies.
    The ARDEC's proposed personnel management demonstration project, by 
building on previous strengths and addressing shortcomings, is intended 
to provide the highest potential for movement to a single system that 
will meet the needs of the ARDEC and all its employees.

C. Changes Required/Expected Benefits

    The primary benefit expected from this demonstration project is 
greater organizational effectiveness through increased employee 
satisfaction. The long-standing Department of the Navy ``China Lake'' 
and National Institute of Standards and Technology (NIST) demonstration 
projects have produced impressive statistics on increased job 
satisfaction and quality of employees versus that for the Federal 
workforce in general. This project will demonstrate that a human 
resource system tailored to the mission and needs of the ARDEC 
workforce will facilitate increased:
    1. Quality in the workforce and resultant products;
    2. timeliness of key personnel processes;
    3. retention of excellent performers;
    4. success in recruitment of personnel with critical skills;
    5. management authority and accountability;
    6. satisfaction of customers; and
    7. workforce satisfaction.
    An evaluation model was developed for the Director, Defense, 
Research, and Engineering (DDR&E) in conjunction with STRL service 
representatives and the Office of Personnel Management (OPM). The model 
will measure the

[[Page 3751]]

effectiveness of this demonstration project, as modified in this plan, 
and will be used to measure the results of specific personnel system 
changes.

D. Participating Organizations

    The ARDEC is comprised of employees headquartered at Picatinny 
Arsenal, NJ. The ARDEC employees are geographically dispersed at the 
locations shown in Appendix A. It should be noted that some sites 
currently employ fewer than ten people and that the sites may change 
should ARDEC reorganize or realign. Successor organizations will 
continue coverage in the demonstration project.

E. Participating Employees and Union Representation

    This demonstration project will cover approximately 3,400 ARDEC 
civilian employees under title 5 U.S.C. in the occupational series 
listed in Appendix B. The project plan does not cover members of the 
Senior Executive Service (SES), Scientific and Professional (ST) 
employees, Federal Wage System (FWS) employees, employees presently 
covered by the Defense Civilian Intelligence Personnel System (DCIPS), 
or Department of Army (DA), Army Command centrally funded interns and 
centrally funded students employed under the Student Career Experience 
Program (SCEP).
    The International Federation of Professional and Technical 
Engineers (IFPTE) Local 1437; the American Federation of Government 
Employees (AFGE) Local 225; the American Federation of Government 
Employees (AFGE) Local 15; and the National Federation of Federal 
Employees (NFFE) Local 2109 represent a majority of the ARDEC 
employees. Of those employees assigned to the ARDEC, approximately 75 
percent are represented by labor unions.
    To foster union acceptance of the ARDEC's proposed personnel 
demonstration project, initial discussions with the four unions began 
in November 2009. The ARDEC will continue to fulfill its obligation to 
consult and/or negotiate with all labor organizations in accordance 
with 5 U.S.C. 4703(f) and 7117, as applicable.

F. Project Design

    In October 2009, the 2010 National Defense Authorization Act 
directed the ARDEC to transition to a laboratory personnel management 
demonstration project. Following review and analysis of existing DoD 
demonstration projects, the ARDEC senior leadership decided to adapt 
the ECBC model, one of the latest Army projects. A series of focus 
groups, benchmarking and other sensing sessions were completed to 
determine the unique ARDEC needs and requirements. One key departure 
from the ECBC model is the shift from their Performance Management 
System to a Contribution-Based Compensation System (CBCS), similar to 
the Acq Demo project.

G. Personnel Management Board (PMB)

    1. ARDEC will create a PMB to oversee and monitor the fair, 
equitable, and consistent implementation of the provisions of the 
demonstration project to include establishment of internal controls and 
accountability. Members of the board will be senior leaders appointed 
by the ARDEC Director. As needed, ad hoc members (such as labor 
counsel, human resource representatives, etc.) will serve as advisory 
members to the board.
    2. The PMB is responsible for establishing the implementation and 
operating rules as required. At a minimum, duties executed by the board 
will be to:
    a. Determine the composition of the pay pools in accordance with 
the guidelines of this proposal and internal procedures;
    b. review operation of pay pools and provide guidance to pay pool 
managers;
    c. oversee disputes in pay pool issues;
    d. formulate and manage the civilian pay pool budget;
    e. formulate and manage the civilian bonus pool budget;
    f. determine hiring, reassignment, and promotion base pay as well 
as exceptions to Contribution-Based Compensation System base pay 
increases;
    g. conduct classification review and oversight, monitor and adjust 
classification practices, and decide board classification issues;
    h. approve major changes in position structure;
    i. address issues associated with multiple pay systems during the 
demonstration project;
    j. manage standard Contribution Factors and Descriptors;
    k. identify and implement improvements to demonstration project 
procedures and policies;
    l. review requests for Supervisory/Team Leader Base Pay Adjustments 
and provide recommendations to the Director;
    m. develop policies and procedures for administering Employee 
Developmental Programs;
    n. ensure that all employees are treated in a fair and equitable 
manner in accordance with all policies, regulations, and guidelines 
covering this demonstration project;
    o. monitor the evaluation of the project;
    p. establish and manage the Accelerated Compensation for 
Developmental Positions (ACDP); and
    q. Establish rules and procedures for denying or reducing GPI for 
employees whose contributions are in region A (above the NPR).

III. Personnel System Changes

A. Pay Banding

    The design of the ARDEC pay banding system takes advantage of the 
many reviews performed by DA, DoD, OPM, and others. The design also has 
the benefit of being preceded by exhaustive studies of pay banding 
systems currently practiced in the Federal sector, to include those 
practiced by the China Lake experiment and NIST. The ARDEC pay banding 
system will replace the current GS grade and NSPS pay band structures.
1. Occupational Families
    Occupations with similar characteristics will be grouped together 
into one of three Occupational Families with career paths and pay band 
levels designed to facilitate pay progression. These Occupational 
Families are Engineering and Science (E&S), Business and Technical 
(B&T), and General (GEN). Each Occupational Family's career path will 
be composed of pay bands corresponding to recognized advancement and 
career progression patterns within the covered occupations. These 
career paths and their pay bands will replace the NSPS pay band 
structure and the individual GS grades and will not be the same for 
each Occupational Family. Each Occupational Family will be divided into 
three to six pay bands. Employees track into an Occupational Family 
based on their current OPM classification series as provided in 
Appendix B. All employees are initially assigned to the Occupational 
Family and pay band in which their comparable grade fits based on 
position classification using the GS classification standards. 
Comparison to the GS grades is used in setting the upper and lower base 
pay dollar limits of the pay band levels with the exception of Pay Band 
VI of the E&S Occupational Family (refer to III.A.3). The current 
occupations have been examined; and their characteristics and 
distribution have served as guidelines in the development of the three 
Occupational Families. The following descriptions of positions in the 
pay bands of each occupational family illustrate examples of the types 
of positions included.

[[Page 3752]]

    a. Engineering and Science (E&S) (Pay Plan DB): This Occupational 
Family includes positions as defined in Appendix B. Specific course 
work or educational degrees are required for these occupations. Six 
bands have been established for the E&S career path: (refer to Table 
1).
    (1) Band I includes student trainee positions.
    (2) Band II includes developmental positions.
    (3) Band III includes full-performance technical positions.
    (4) Band IV includes technical specialist and first level 
supervisory positions.
    (5) Band V includes senior technical and managerial positions.
    (6) Band VI includes positions classified above the GS-15 level.
    b. Business and Technical (B&T) (Pay Plan DE): This Occupational 
Family includes positions as defined in Appendix B. Employees in these 
positions may or may not require specific course work or educational 
degrees. Five bands have been established for the B&T career path: 
(refer to Table 1).
    (1) Band I includes student trainee positions.
    (2) Band II includes developmental positions.
    (3) Band III includes full-performance technical and first level 
supervisory positions.
    (4) Band IV includes senior technical specialist and supervisory 
positions.
    (5) Band V includes managerial positions.
    c. General Support (GEN) (Pay Plan DK): This Occupational Family 
includes positions as defined in Appendix B. Employees in these 
positions may or may not require specific course work or educational 
degrees. Three bands have been established for the GEN career path: 
(refer to Table 1).
    (1) Band I covers entry-level and student positions.
    (2) Band II covers full-performance positions.
    (3) Band III includes supervisory and senior positions.
2. Pay Band Design
    The pay bands for the Occupational Families and how they relate to 
the current GS/NSPS frameworks are shown in Table 1.

                                                                Table 1--Pay Band Charts
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                   Equivalent GS grades
       Occupational family       -----------------------------------------------------------------------------------------------------------------------
                                           I                  II                  III                 IV                   V                  VI
--------------------------------------------------------------------------------------------------------------------------------------------------------
E&S.............................  GS-01-04..........  GS-05-11..........  GS-12-13..........  GS-14.............  GS-15.............  >GS-15
Business & Technical............  GS-01-04..........  GS-05-11..........  GS-12-13..........  GS-14.............  GS-15.............  ..................
General Support.................  GS-01-04..........  GS-05--08.........  GS-9..............  ..................  ..................  ..................
--------------------------------------------------------------------------------------------------------------------------------------------------------


--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                               Equivalent NSPS Pay bands1, 2
       Occupational family       -----------------------------------------------------------------------------------------------------------------------
                                           I                  II                  III                 IV                   V                  VI
--------------------------------------------------------------------------------------------------------------------------------------------------------
E&S.............................  YP-1..............  YD-1, YF-1, YF-2,   YD-2, YF-2........  YD-3, YF-2, YF-3,   YD-3,.............  ..................
(DB)............................                       YP-1.                                   YH-3.              YF-3..............
Business & Technical............  YP-1,.............  YA-1, YA-2, YB-1,   YA-2, YB-3, YC-2,   YA-3, YC-2, YC-3..  YA-3,.............  ..................
(DE)............................  YB-1,.............   YB-2, YB-3, YC-1,   YE-3, YE-4.                            YC-3..............
                                  YE-1..............   YC-2, YE-1, YE-2,
                                                       YE-3, YP-1.
General Support.................  YB-1,.............  YB-1, YB-2, YE-1,   YB-2, YE-2, YP-1..  ..................  ..................  ..................
(DK)............................  YE-1,.............   YE-2, YP-1.
                                  YP-1..............
--------------------------------------------------------------------------------------------------------------------------------------------------------
\1\ NSPS Pay Bands overlap Lab Demo bands and Occupational Families.
\2\ Student Career Experience Program participants in YP pay bands are not included in this Demonstration Project.

    As the rates of the GS are increased due to the annual general pay 
increases, the upper and lower base pay rates of the pay bands will 
also be adjusted. Since pay progression through the bands depends 
directly on contribution, there will be no scheduled Within-Grade 
Increases (WGIs) or Quality Step Increases (QSIs) for former GS 
employees once the pay banding system is in place. GS special rate 
schedules and NSPS Targeted Local Market Supplements (TLMS) will no 
longer be applicable to demonstration project employees. Special 
provisions have been included to ensure no loss of pay upon conversion 
(refer to III.F.11 Staffing Supplements). Except for those receiving a 
staffing supplement and employees on pay retention, employees will 
receive locality pay in addition to their base pay in the same amount 
and to the same extent as established for GS employees in accordance 
with 5 U.S.C. 5304 and 5304a. However, adjusted pay (base + locality) 
for employees in Band V or below cannot exceed Executive Level IV. 3. 
Science and Engineering Positions Classified Above GS-15.
    The career path for the E&S Occupational Family includes a pay band 
VI to provide the ability to accommodate positions having duties and 
responsibilities that exceed the GS-15 classification criteria. This 
pay band is based on the Above GS-15 Position concept found in other 
STRL personnel management demonstration projects that was created to 
solve a critical classification problem. The STRLs have positions 
warranting classification above GS-15 because of the technical 
expertise requirements including inherent supervisory and managerial 
responsibilities. However, these positions are not considered to be 
appropriately classified as Scientific or Professional Positions (STs) 
because of the degree of supervision and level of managerial 
responsibilities. Neither are these positions appropriately classified 
as Senior Executive Service (SES) positions because of the requirement 
for advanced specialized scientific or engineering expertise, and 
because the positions are not at the level of the general managerial 
authority and impact that is required for an SES position.
    The original Above GS-15 Position concept was to be tested for a 
five-year period. The number of trial positions was set at 40 with 
periodic reviews to determine appropriate position

[[Page 3753]]

requirements. The Above GS-15 Position concept is currently being 
evaluated by DoD management for its effectiveness, continued 
applicability to the current STRL scientific, engineering, and 
technology workforce needs and appropriate allocation of billets based 
on mission requirements. The degree to which the laboratory plans to 
participate in this concept and develop classification, compensation, 
and performance management policy, guidance, and implementation 
processes will be based on the final outcome of the DoD evaluation.

B. Classification

1. Occupational Series
    The GS classification system has over 400 occupational series which 
are divided into 23 occupational groupings. The ARDEC currently has 
positions in approximately 60 occupational series that fall into 
approximately 16 occupational groupings. All positions listed in 
Appendix B will be included in the classification structure. Provisions 
will be made for including other occupations in response to changing 
missions.
2. Classification Standards and Position Descriptions
    The ARDEC may use an automated classification system. The current 
OPM classification standards will be used for the identification of 
proper series and occupational titles of positions within the 
demonstration project. The grading criteria in the OPM classification 
standards will be used as a framework to develop new and simplified pay 
band factor level descriptors for each pay band determination. The 
objective is to record the essential criteria for each pay band within 
each Occupational Family by stating the characteristics of the work, 
the responsibilities of the position, the competencies required, and 
the expected contributions. The Factor Descriptors will serve as both 
classification criteria and contribution assessment criteria and may be 
found in Appendix C. New position descriptions will replace the current 
position/job descriptions. The Factor Descriptors of each pay band will 
serve as an important component in the new position description, which 
will also include position-specific information and provide data 
element information pertinent to the job. The new descriptions will be 
easier to prepare, minimize the amount of writing time, and make the 
position description a more useful and accurate tool for other 
personnel management functions.
    Specialty work codes (narrative descriptions) may be used to 
further differentiate types of work and the competencies required for 
particular positions within an Occupational Family and pay band. Each 
code represents a specialization or type of work within the occupation.
3. Fair Labor Standards Act
    Fair Labor Standards Act (FLSA) exemption and non-exemption 
determinations will be consistent with criteria found in 5 CFR part 
551. All demonstration project positions are covered by the FLSA unless 
they meet the criteria for exemption. Positions will be evaluated as 
needed by comparing the duties and responsibilities assigned the pay 
band factor level descriptors for each pay band level, and the 5 CFR 
part 551 FLSA criteria. As a general rule, the FLSA status of a 
position can be matched to an Occupational Family, career path, and pay 
band level as indicated in Table 2. For example, positions classified 
in Pay Band I of the E&S Occupational Family are typically nonexempt, 
meaning they are covered by the overtime entitlements prescribed by the 
FLSA. An exception to this guideline includes supervisors/managers 
whose primary duty meets the definitions outlined in the OPM GS 
Supervisory Guide. Therefore, supervisors/managers in any of the pay 
bands who meet the foregoing criteria are exempt from the FLSA. 
Supervisors with classification authority will make the determinations 
on a case-by-case basis by comparing assigned duties and 
responsibilities and pay band factor level descriptors to the 5 CFR 
part 551 FLSA criteria. Additionally, the advice and assistance of the 
servicing Civilian Personnel Advisory Center (CPAC) will be obtained in 
making determinations. The position descriptions will not be the sole 
basis for the determination. The basis for exemption will be documented 
and attached to each position description. Exemption criteria will be 
narrowly construed and applied only to those employees who clearly meet 
the spirit of the exemption. Changes will be documented and provided to 
the CPAC.

                                              Table 2--FLSA Status
                                                   [Pay bands]
----------------------------------------------------------------------------------------------------------------
       Occupational family              I            II           III           IV           V            VI
----------------------------------------------------------------------------------------------------------------
E&S.............................  N             N/E           E            E            E            E
B&T.............................  N             N/E           E            E            E            ...........
GEN.............................  N             N             E            ...........  ...........  ...........
----------------------------------------------------------------------------------------------------------------
N--Non-Exempt from FLSA; E--Exempt from FLSA; and N/E--Exemption status determined on a case-by-case basis.


    Note:  Although typical exemption status under the various pay 
bands is shown in the above table, actual FLSA exemption 
determinations are made on a case-by-case basis.

4. Classification Authority
    The ARDEC Director will have delegated classification authority and 
may in turn, re-delegate this authority to appropriate levels. Position 
descriptions will be developed to assist managers in exercising 
delegated position classification authority. Managers will identify the 
Occupational Family, occupational series, functional code, specialty 
work code, pay band level, and the appropriate acquisition codes. 
Personnel specialists will provide ongoing consultation and guidance to 
managers and supervisors throughout the classification process. These 
decisions will be documented on the position description.
5. Classification Appeals
    Classification appeals under this demonstration project will be 
processed using the following procedures: An employee may appeal the 
determination of Occupational Family, occupational series, position 
title, and pay band of his/her position at any time. An employee must 
formally raise the area of concern to supervisors in the immediate 
chain of command, either verbally or in writing. If the employee is not 
satisfied with the supervisory response, he/she may then appeal to the 
DoD appellate level. Appeal decisions rendered by DoD will be final and 
binding on all administrative, certifying, payroll, disbursing, and 
accounting officials of the Government. Classification appeals are not 
accepted on positions which

[[Page 3754]]

exceed the equivalent of a GS-15 level. Time periods for cases 
processed under 5 CFR part 511 apply.
    An employee may not appeal the accuracy of the position 
description, the demonstration project classification criteria, or the 
pay-setting criteria; the assignment of occupational series to an 
Occupational Family; the propriety of a pay schedule; matters grievable 
under an administrative or negotiated grievance procedure; or a 
decision reached using an alternative dispute resolution procedure.
    The evaluations of classification appeals under this demonstration 
project are based upon the demonstration project classification 
criteria. Case files will be forwarded for adjudication through the 
servicing Civilian Personnel Advisory Center (CPAC) and will include 
copies of appropriate demonstration project criteria.

C. Contribution-Based Compensation System

1. Overview
    The purpose of the Contribution-Based Compensation System (CBCS) is 
to provide an effective, efficient, and flexible method for assessing, 
compensating, and managing the ARDEC workforce. CBCS is essential for 
the development and continued growth of the high quality, extremely 
productive and innovative workforce needed to meet mission 
requirements. The CBCS allows for greater employee involvement in the 
assessment process, fosters increased communication between supervisor 
and employee, promotes a clear accountability of performance, 
facilitates employee career progression, and provides an understandable 
and rational basis for base pay changes by linking pay, performance, 
and contribution. The CBCS process described herein applies to all 
Occupational Families and pay band levels except Pay Band VI of the E&S 
Occupational Family. The assessment process for E&S Pay Band VI 
positions will be based on the final outcome of the DoD evaluation and 
documented in ARDEC Internal Operating Instructions.
    CBCS is an assessment system that measures the employee's level of 
contribution to the organization's mission and how well the employee 
performed. Contribution is simply defined as the measure of the 
demonstrated value of employee actions in terms of accomplishing or 
advancing the organizational objectives and mission impact. CBCS 
promotes base pay adjustment decisions made on the basis of an 
individual's overall annual contributions and current base pay in 
relation to other employees' contributions and their level of 
compensation in the pay pool. The measurement of overall contribution 
is determined through a rating process which determines the Overall 
Contribution Score (OCS). OCS is a key component to the CBCS assessment 
system in that it:
    (1) Provides a consistent scoring scale linked to base pay even as 
salaries increase in accordance with GPI increases.
    (2) Provides a rating scale that enables direct comparison of the 
level and quality of employee contributions to the current base pay of 
that employee.
    To accomplish (2) above, the employee's current base pay is 
converted to an Expected OCS (EOCS). The other OCS score, Assessed OCS 
(AOCS) is the measurement of the employee's contributions in the 
appraisal process. AOCS is the result of measuring contribution and 
performance by using the pay band level descriptors for a set of 
contribution factors and discriminators each of which is relevant to 
mission success of the organization. The comparison of EOCS and AOCS 
determines if the employee is appropriately compensated. The same 
factor level descriptors used for classification will also be used for 
the annual CBCS employee assessments (see Appendix C).
2. Contribution Factors
    The following six (6) factors will be used for evaluating the 
yearly contribution of the ARDEC personnel in all three Occupational 
Families:
    (1) Problem Solving
    (2) Teamwork/Cooperation
    (3) Customer Relations
    (4) Leadership/Supervision
    (5) Communication
    (6) Resource Management

Each factor has multiple levels of increasing contribution 
corresponding to the pay band levels. Each factor contains descriptors 
for each respective pay band level within the relevant Occupational 
Family.
    The appropriate Occupational Family pay band level factor 
descriptors will be used by the rating official to determine the 
employee's actual contribution score. Employees can score within, 
above, or below their pay band level. For example, a pay band level II 
employee could score in the pay band level I, II, III, or IV range.
3. Pay Pools
    The ARDEC employees will be placed into pay pools that are defined 
for the purpose of determining performance payouts under the CBCS. Pay 
pools will be established and operated in accordance with the 
guidelines provided in the following paragraphs. These guidelines will 
be followed noting the following exception. The ARDEC Director may 
deviate from the guidelines provided there is a compelling need. The 
rationale must be documented in writing.
    The ARDEC Director will establish pay pools. Typically, pay pools 
will have between 35 and 300 employees. A pay pool should be large 
enough to encompass a reasonable distribution of ratings but not so 
large as to compromise rating consistency. Neither the pay pool manager 
nor supervisors within a pay pool will recommend or set their own 
individual pay. Decisions regarding the amount of the contribution 
payout are based on the established formal payout calculations.
    Funds within a pay pool available for contribution payouts are 
divided into two components, base pay and bonus. These funds will be 
determined based on historical data. The base pay fund will be set at 
no less than two percent of total base pay of employees eligible for 
compensation adjustment in CBCS. The bonus fund will be set at no less 
than one percent of total base pay. The ARDEC PMB will annually review 
the pay pool funding and recommend adjustments to the ARDEC Director to 
ensure cost discipline over the life of the demonstration project. CBCS 
payouts can be in the form of increases to base pay and/or bonuses that 
are not added to base pay but rather are given as a lump-sum payment. 
Other awards such as special acts, time-off awards, etc., will be 
managed separately from the CBCS payouts.
4. Annual Appraisal Cycle and Rating Process
    The annual appraisal cycle normally begins on October 1 and ends on 
September 30 of the following year. The minimum rating period will be 
90 days. At the beginning of the annual appraisal period, the pay band 
level descriptors for each factor will be provided to employees so that 
they know the basis on which their performance will be assessed. At the 
discretion of the pay pool manager, weights will be applied to the 
factors. If weighting is used, the same weighting will be applied to 
all similar positions within an Occupational Family in a pay pool. 
Also, if weighting is used, the minimum weighting will be 10 percent 
and the sum of all weights must equal 100 percent. Employees will be 
informed of

[[Page 3755]]

the weights at the beginning of the rating cycle.
    Each supervisor will discuss work assignment, performance and 
conduct standards, and provide clear objectives to their employees. 
Typically, the rating official is the first-level supervisor. If the 
current first-level supervisor has been in place for less than 90 days 
during the rating cycle, the second-level supervisor serves as the 
initial rating official. If the second-level supervisor is in place for 
less than 90 days during the rating cycle, the next higher level 
supervisor in the employee's rating chain conducts the assessment.
    Employees and supervisors alike are expected to actively 
participate in on-going formal and informal performance discussions 
regarding expectations. The timing of these discussions will vary based 
on the nature of work performed, but will occur at least at the mid-
point and end of the rating period. At least one review, normally the 
mid-point review, will be documented as a progress review. Exceptions 
may be established by the PMB and approved by the ARDEC Director based 
on employees that will be in the Lab Demo for less than 180 days at the 
end of the rating cycle. More frequent, task specific, discussions may 
be appropriate in some organizations.
    The employee will provide a list of his/her accomplishments to the 
supervisor at both the mid-point and end of the rating period. An 
employee may elect to provide self-ratings on the contribution factors 
and/or solicit input from team members, customers, peers, supervisors 
in other units, subordinates, and other sources which will assist the 
supervisor in fully evaluating contributions. At the end of the annual 
appraisal period, the immediate supervisor (rating official), from 
employees' inputs and his/her own knowledge, identifies for each 
employee the appropriate contribution level for each factor, and 
recommends the AOCS.
    To determine the AOCS, numerical values are assigned based on the 
contribution levels of individuals, using the ranges shown in Table 3. 
The AOCS is calculated by averaging the numerical values (as weighted 
if applicable) assigned for each of the six contribution factors. (All 
AOCS's will be rounded to the nearest tenth of a point. If the decimal 
is .05 or higher, the AOCS will be rounded up.) The rating official in 
conjunction with the second-level supervisor reviews the AOCS for all 
employees, correcting any inconsistencies identified and making the 
appropriate adjustments in the factor ratings.

                            Table 3--Contribution Score Ranges By Occupational Family
----------------------------------------------------------------------------------------------------------------
                                       Engineering and Science   Business and Technical      General Support
Pay Band Levels                       --------------------------------------------------------------------------
                                             Point Range              Point Range              Point Range
----------------------------------------------------------------------------------------------------------------
VI               ....................                      TBD                       --                       --
                 Very High...........                  101-115                  101-115                       --
                 High................                   97-100                   97-100                       --
V                Med.................                    91-96                    91-96                       --
                 Low.................                    87-90                    87-90                       --
                 High................                    91-95                    91-95                       --
IV               Med.................                    84-90                    84-90                       --
                 Low.................                    79-83                    79-83                       --
                 Very High...........                       --                       --                    60-64
                 High................                    81-86                    81-86                    53-59
III              Med.................                    68-80                    68-80                    47-52
                 Low.................                    62-67                    62-67                    43-46
                 High................                    62-68                    62-68                    46-54
                 Med High............                    51-61                    51-61                       --
II               Med.................                    41-50                    41-50                    30-45
                 Med Low.............                    30-40                    30-40                       --
                 Low.................                    22-29                    22-29                    22-29
                 High................                    24-30                    24-30                    24-30
I                Med.................                     6-23                     6-23                     6-23
                 Low.................                      0-5                      0-5                      0-5
----------------------------------------------------------------------------------------------------------------

    The pay pool panel conducts a final review of the AOCS for each 
employee in the pay pool. The pay pool panel has the authority to make 
AOCS adjustments, after discussion with the initial rating officials, 
to ensure equity and consistency. Final approval of AOCS rests with the 
pay pool manager, the individual within the organization responsible 
for managing the CBCS process. The AOCS, as approved by the pay pool 
manager, becomes the rating of record. Rating officials will 
communicate the factor scores and AOCS to each employee and discuss the 
results.
    If on the last day of the appraisal cycle the employee has served 
under CBCS for less than 90 days, the first rating will be provided at 
the end of the next annual rating cycle. The first CBCS appraisal must 
be rendered within 18 months after entering the demonstration project.
    When an employee cannot be evaluated readily by the normal CBCS 
appraisal process due to special circumstances that take the individual 
away from normal duties or duty station (e.g., long-term full-time 
training, active military duty, extended sick leave, leave without pay, 
etc.), the rating official will document the special circumstances on 
the appraisal form. The rating official will then determine which of 
the following options to use:
    a. Re-certify the employee's last contribution appraisal; or
    b. Presume the employee is contributing consistently at his/her pay 
level.
5. Linking OCS to Compensation Adjustment
a. The Normal Pay Range (NPR)
    The CBCS integrated pay schedule provides a direct link between 
contribution level and base pay. This is shown by the graph in Figure 
1. The horizontal axis spans from 0 to the maximum OCS of 100 for 
positions in pay band levels I through V. Impact of Band VI will be 
determined after receiving DoD guidance on Band VI

[[Page 3756]]

positions. The vertical axis spans from zero dollars to the dollar 
equivalent of the highest positions covered by CBCS. This encompasses 
the full base pay range (excluding locality pay and staffing 
supplements) under this demonstration for the given calendar year 
(note: Figure 1 currently depicts Calendar Year (CY) 10). Each year the 
rails for the NPR are adjusted based on the GS general pay increase 
under 5 U.S.C. 5303. The area between the upper and lower rails is 
considered the NPR. This pay range represents a base pay range of plus 
or minus eight percent from the Standard Pay Line (SPL). The SPL is a 
mapping of the GS base pay scale to OCS values (see formula below) that 
shows the expected level of contributions (EOCS) from an employee at a 
specific base pay rate. The SPL and NPR provide the means to link base 
pay and contribution using a scale that does not change even as a base 
pay range changes with GPI increases. This scale is not a linear scale 
but rather adopts and reflects the provision that the former GS basic 
pay increases (e.g., GPI, step increases) are percentage increases. 
Thus, the scale reflects that each point increase in OCS reflects a 
fixed percent increase in base pay. For example, an OCS of 61 reflects 
an approximate two percent base pay difference over an OCS of 60 and an 
OCS of 87 reflects an approximate two percent base pay difference over 
an OCS of 86. The SPL and NPR are established using the following 
parameters:
    (1) The lowest possible score is an OCS of 0, which equates to the 
lowest base pay under this demonstration project, GS-1, step 1,
    (2) The OCS of 100 equates to the base pay of GS-15, step 10.
    The SPL is calculated as:
    Standard Pay Line (SPL) = (GS-1, Step 1) * (1.020043) \OCS\
    The factor 1.020043 is called the SPL factor and reflects the 
percent increase of salary corresponding to a one point increase in 
OCS:
    SPL Factor = (GS-15, Step 10)/(GS-1, Step 1)\(0.01)\
    The SPL Factor will remain the same value (1.020043) for as long as 
GPI increases are applied as the same percentage increase to GS-1, Step 
1, to GS-15, Step 10.
    The upper rail is calculated as: Upper Rail = SPL * 1.08
    The lower rail is calculated as: Lower Rail = SPL * 0.92
    The upper and lower rails encompass an area of +/- 8.0 percent in 
terms of base pay which correlates to approximately +/- 4.0 OCS points.
    The EOCS is the intersection of the employee's current base pay and 
the SPL. In the instance of an employee on retained pay, the EOCS is 
determined by using the maximum base pay of the employee's assigned pay 
band in lieu of their current base pay.
[GRAPHIC] [TIFF OMITTED] TN20JA11.002

    The NPR is the same for all the Occupational Families. What varies 
among the Occupational Families are the beginnings and endings of the 
pay band levels. The minimum and maximum numerical OCS values and 
associated base pay for each pay band level by Occupational Family are 
provided in Table 4. These minimum and maximum breakpoints represent 
the lowest and highest base pay for the bands; and the minimum and 
maximum base pay possible for each pay band level. Locality pay or 
staffing supplements are not included in the NPR but are added to base 
pay as appropriate.

[[Page 3757]]



                                                        Table 4--OCS and Pay Band Base Pay Ranges
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                    $ (CY10 OCS salaries)
        Occupational family         --------------------------------------------------------------------------------------------------------------------
                                             I                  II                III                 IV                   V                 VI\1\
--------------------------------------------------------------------------------------------------------------------------------------------------------
E&S................................    $17,803-$32,288    $27,548-$68,634    $60,930-$98,100    $85,377-$117,283    $100,066-$129,517
                                                  0-30              22-68              62-86               79-95               87-100
Business & Technical...............    $17,803-$32,288    $27,548-$68,634    $60,930-$98,100    $85,377-$117,283    $100,066-$129,517
                                                  0-30              22-68              62-86               79-95               87-100
General Support....................    $17,803-$32,288    $27,548-$51,986    $41,791-$57,409
                                                  0-30              22-54              43-59
--------------------------------------------------------------------------------------------------------------------------------------------------------
\1\ Band VI pay and OCS range will be determined based on DoD guidance.

b. OCS-Based Compensation Adjustment Guidelines
    After the pay pool manager approves the OCS for all employees in 
the pay pool, the current base pay versus AOCS is plotted for all 
employees on a chart similar to Figure 2. This plot relates 
contribution to base pay, and identifies the placement of each employee 
into one of three regions: Region A--Above-the-NPR, Region C--Within-
the-NPR, or Region B--Below-the-NPR. When an employee is placed in the 
Region A--Above-the-NPR, the employee is considered to be 
overcompensated. When an employee is placed in the Region B--Below-the-
NPR the employee is considered to be undercompensated and when an 
employee is placed in the Region C--Within-the-NPR, the employee is 
considered to be adequately compensated.
[GRAPHIC] [TIFF OMITTED] TN20JA11.003

    c. The following delineates compensation adjustment guidelines for 
employees in each of the three regions:
    (1) All employees are entitled to the full locality pay or a 
staffing supplement, as appropriate (subject to overall salary pay 
limitations).
    (2) The employees whose base pay falls within the NPR (Region C) 
must receive the full GPI, may receive a Contribution Base Pay Increase 
of up to 6 percent, and may receive a Contribution Bonus. The 
Contribution Base Pay Increase is included as a permanent increase in 
base pay, but the Contribution Bonus is a onetime lump sum payment that 
does not affect base pay.
    (3) The employees whose base pay falls above the NPR (Region A) 
could be denied part or all of the GPI and will receive no Contribution 
Base Pay Increase or Contribution Bonus. The intent of the 
demonstration project is to allow managers to retain the ability to 
determine how much, if any, of the GPI an Overcompensated (Region A) 
employee shall receive, on a case-by-case basis.
    (4) The employees whose base pay falls below the NPR (Region B) 
must receive the full GPI, may receive up to a 20 percent Contribution 
Base Pay Increase (higher amounts require the approval of the ARDEC 
Director), and may also receive a Contribution Bonus.
    (5) The employees on retained pay in the demonstration project will 
receive base pay adjustments in accordance with 5 U.S.C. 5363 and 5 CFR 
Part 536. An employee receiving retained pay is not eligible for a 
Contribution Base Pay Increase, but may receive a Contribution Bonus.

[[Page 3758]]

    (6) Table 5 illustrates the additional pay adjustments possible for 
the three groupings of employees.

                                     Table 5--Compensation Eligibility Chart
----------------------------------------------------------------------------------------------------------------
                                                                                                 Locality pay/
            Category                 General pay       Contribution base  Contribution bonus       staffing
                                       increase          pay increase                           supplement \1\
----------------------------------------------------------------------------------------------------------------
--Above the NPR................  Could be reduced or  NO................  NO................  YES
                                  denied.
Within the NPR--...............  YES................  YES \2\--Up to 6    YES \5\...........  YES
                                                       percent.
--Below the NPR................  YES................  YES 3 4--Up to 20   YES \5\...........  YES
                                                       percent.
----------------------------------------------------------------------------------------------------------------
\1\ Base pay plus locality pay/staffing supplement may not exceed Executive Level IV, except for Band VI.
\2\ May not exceed upper rail of NPR for employee's AOCS or maximum base pay for current pay band level.
\3\ Over 20 percent requires ARDEC Director's approval.
\4\ May not exceed 6 percent above the lower rail or the maximum base pay for current pay band level.
\5\ Pay pool manager approves up to $10,000. Amounts exceeding $10,000 require ARDEC Director's approval.

    (7) In general, those employees whose base pay falls below the NPR 
should expect to receive greater percentage base pay increases than 
those whose base pay is above the NPR. Over time, people will migrate 
closer to the normal pay range and base pay appropriate for their level 
of contribution.
    (8) Employees whose AOCS would result in awarding a Contribution 
Base Pay Increase such that the base pay exceeds the maximum base pay 
for their current pay band level may receive a Contribution Bonus 
equaling the difference.
6. Accelerated Compensation for Developmental Positions (ACDP)
    ACDP provides for an increase to base pay, bonus, or a combination 
of these to employees participating in training programs or in other 
developmental capacities as determined by the ARDEC policy. ACDP 
recognizes growth and development in the acquisition of job-related 
competencies combined with successful contribution. In order to receive 
an ACDP, the employee must be in a pay and duty status and have been on 
an approved performance plan (may be from any system) for 90 days. Most 
ACDP increases will occur yearly, comparable to the GS intern career 
progression. However, when warranted (e.g., high turnover positions, 
hard-to-fill positions, exceptional performance by the employee), an 
ACDP increase may occur anytime during the year. Employees under an 
ACDP will follow the standard CBCS rating cycle. The employee is only 
entitled to the bonus component as a result of CBCS rating.
7. Extraordinary Achievement Recognition
    A pay pool manager may request approval from the ARDEC Director for 
use of an Extraordinary Achievement Recognition. Such recognition 
grants a base pay increase and/or bonus to an employee. The funds 
available for an Extraordinary Achievement Recognition are separately 
funded within budget constraints.
8. Awards
    To provide additional flexibility in motivating and rewarding 
individuals and groups, some portion of the award budget will be 
reserved for special acts and other categories as they occur. Awards 
may include, but are not limited to, special acts, patents, 
suggestions, on-the-spot, and time-off. The funds available to be used 
for traditional title 5 U.S.C. awards are separately funded within 
budget constraints.
    While not directly linked to the CBCS, this additional flexibility 
is important to encourage outstanding contribution and innovation in 
accomplishing the diverse mission of the ARDEC. Additionally, to foster 
and encourage teamwork among its employees, organizations may give 
group awards. The delegation of awards authority is an internal Army 
decision and will be considered as such.
9. Adverse Actions
    Except where specifically waived or modified in this plan, adverse 
action procedures under 5 CFR part 752 remain unchanged.
10. Grievance of Assessed Overall Contribution Score
    An employee may grieve the AOCS received under the CBCS. Non-
bargaining unit employees and bargaining unit employees covered by a 
negotiated grievance procedure that does not permit grievances over 
performance ratings must file under administrative grievance 
procedures. Bargaining unit employees whose negotiated grievance 
procedures cover performance rating grievances must file under those 
negotiated procedures. Payout amounts resulting from the contribution 
assessment cannot be grieved.
11. Inadequate Employee Performance/Contribution
    Inadequate performance/contribution at any time during the 
appraisal period is considered grounds for initiation of a reduction-
in-pay or removal action. The following procedures replace those 
established in 5 U.S.C. 4303 pertaining to reductions in grade or 
removal for unacceptable performance except with respect to appeals of 
such actions. 5 U.S.C. 4303(e) provides the statutory authority for 
appeals of contribution-based actions. As is currently the situation 
for performance-based actions taken under 5 U.S.C. 4303, contribution-
based actions shall be sustained if the decision is supported by 
substantial evidence; and the Merit Systems Protection Board shall not 
have mitigation authority with respect to such actions. The separate 
statutory authority to take contribution-based actions under 5 U.S.C. 
75, as modified in the waiver section of this notice (section IX), 
remains unchanged by these procedures.
    When an employee's AOCS plots above the upper rail of the NPR and 
the employee is considered to be under-performing/contributing, the 
supervisor has two options. The first is to take no action but to 
document this decision in a memorandum for the record. A copy of this 
memorandum will be provided to the employee and management. The second 
option is to inform the employee, in writing, that unless the 
contribution increases to, and is sustained at, a higher level, the 
employee may be reduced in pay, pay band level, or removed.
    The second option will include a Contribution Improvement Plan 
(CIP). The CIP must include standards for acceptable contribution, 
actions required of the employee, and time in

[[Page 3759]]

which they must be accomplished to increase and sustain the employee's 
contribution at an acceptable level. When an employee is placed on a 
CIP, the rating official will afford the employee a reasonable 
opportunity (a minimum of 60 days) to demonstrate acceptable 
contribution. These provisions also apply to an employee whose 
contribution deteriorates during the year.
    Employees who are on a CIP at the time pay determinations are made 
do not receive performance payouts or the annual GPI. Employees who are 
on a CIP will not receive any portion of the GPI or RIF service credit 
until such time as his/her performance improves to the acceptable level 
and remains acceptable for at least 90 days. When the employee has 
performed acceptably for at least 90 days, the GPI and RIF service 
credit will be reinstated at the beginning of the next pay period. No 
retroactive GPI will be paid for time lost under a CIP.
    Once an employee has been afforded a reasonable opportunity to 
demonstrate acceptable contribution but fails to do so, a reduction-in-
pay (which may include a change to a lower pay band level and/or 
reassignment) or removal action may be proposed. If the employee's 
contribution increases to an acceptable level and is again determined 
to deteriorate in any factor within two years from the beginning of the 
opportunity period, actions may be initiated to effect reduction in pay 
or removal with no additional opportunity to improve. If an employee 
has contributed acceptably for two years from the beginning of an 
opportunity period, and the employee's overall contribution once again 
declines to an unacceptable level, the employee will be afforded an 
additional opportunity to demonstrate acceptable contribution before it 
is determined whether or not to propose a reduction in pay or removal.
    An employee whose reduction in pay or removal is proposed is 
entitled to a 30-day advance notice of the proposed action that 
identifies specific instances of unacceptable contribution by the 
employee on which the action is based. The employee will be afforded a 
reasonable time to answer the notice of proposed action orally and/or 
in writing.
    A decision to reduce pay or remove an employee for unacceptable 
contribution may be based only on those instances of unacceptable 
contribution that occurred during the two-year period ending on the 
date of issuance of the proposed action. The employee will be issued 
written notice at or before the time the action will be effective. Such 
notice will specify the instances of unacceptable contribution by the 
employee on which the action is based and will inform the employee of 
any applicable appeal or grievance rights.
    All relevant documentation concerning a reduction-in-pay or removal 
that is based on unacceptable contribution will be preserved and made 
available for review by the affected employee or a designated 
representative. At a minimum, the records will consist of a copy of the 
notice of proposed action; the written answer of the employee or a 
summary when the employee makes an oral reply; and the written notice 
of decision and the reasons thereof, along with any supporting material 
including documentation regarding the opportunity afforded the employee 
to demonstrate acceptable contribution.

D. Hiring Authority

1. Qualifications
    The qualifications required for placement into a position in a pay 
band within an Occupational Family will be determined using the OPM 
``Operating Manual for Qualification Standards for GS Positions.'' 
Since the pay bands are anchored to the GS grade levels, the minimum 
qualification requirements for a position will be those corresponding 
to the lowest GS grade incorporated into that pay band. For example, 
for a position in the E&S Occupational Family, Pay Band II individuals 
must meet the basic requirements for a GS-5 as specified in the OPM 
``Qualification Standard for Professional and Scientific Positions.''
    Selective factors may be established for a position in accordance 
with the OPM ``Operating Manual for Qualification Standards for GS 
Positions'' when determined to be critical to successful job 
performance. These factors will become part of the minimum requirements 
for the position; and applicants must meet them in order to be 
eligible. If used, selective factors will be stated as part of the 
qualification requirements in vacancy announcements and recruiting 
bulletins.
2. Delegated Examining
    Competitive service positions will be filled through Merit 
Staffing, Direct Hire Authority, or Delegated Examining. Where 
delegated to the laboratory level, hiring authority will be exercised 
in accordance with the requirements of the delegation of authority. The 
Rule of Three will be eliminated. When there are no more than fifteen 
qualified applicants and no preference eligibles, all eligible 
applicants are immediately referred to the selecting official without 
rating and ranking. Rating and ranking will be required only when the 
number of qualified candidates exceeds fifteen or there is a mix of 
preference and non-preference applicants. Statutes and regulations 
covering veterans' preference will be observed in the selection process 
and when rating and ranking are required.
3. Direct Hire Authority for Candidates With Advanced Degrees for 
Scientific and Engineering Positions
    a. Background:
    The ARDEC has, and is forecasted to have, for the foreseeable 
future an urgent need for direct hire authority to appoint qualified 
candidates possessing an advanced degree to scientific and engineering 
positions. The market is extremely competitive with industry and 
academia for the small supply of highly-qualified and security 
clearable candidates with a Masters Degree or Ph.D. in science or 
engineering. There are 35,000 scientists and engineers employed in the 
DoD laboratories; 27 percent hold Masters Degrees, while 10 percent are 
in possession of a Ph.D. The ARDEC employs over 2,300 scientists and 
engineers; 34 percent holding Masters Degrees, while 2.6 percent are in 
possession of a Ph.D. Over the next five years, the ARDEC plans to hire 
approximately 500 of the country's best and brightest scientists and 
engineers (S&Es) just to keep pace with attrition. This number does not 
include the impact that actions such as Base Realignment and Closure 
may have on the attrition of S&Es from the ARDEC. Statistics indicate 
that the available pool of advanced degree, security clearable 
candidates is substantially diminished by the number of non-U.S. 
citizens granted degrees by U.S. institutions. For instance, in 2006, 
20 percent of Masters Degrees in science and over 35 percent of Ph.D.s 
in science were awarded to temporary residents.
    It is expected that this hiring authority, together with 
streamlined recruitment processes, will be very effective in hiring 
candidates possessing a Masters or Ph.D. and accelerating the hiring 
process. For instance, under a similar authority found in the NDAA for 
FY 09, section 1108, Public Law 110-417, October 28, 2009, one STRL had 
fifteen Ph.D. selectees in 2009 for the sixteen vacancies for which 
they were using this hiring authority. Another STRL, using this 
expedited hiring authority in calendar year 2009, made thirty firm 
hiring offers in an average of thirteen days from receipt of paper work 
in the Human Resources Office. Of these

[[Page 3760]]

thirty selectees, twenty-three possessed Ph.D.s.
    b. Definitions:
    (1) Scientific and engineering positions are defined as all 
professional positions in scientific and engineering occupations (with 
a positive education requirement) utilized by the laboratory.
    (2) An advanced degree is a Master's or higher degree from an 
accredited college or university in a field of scientific or 
engineering study directly related to the duties of the position to be 
filled.
    (3) Qualified candidates are defined as candidates who:
    (a) Meet the minimum standards for the position as published in 
OPM's operating manual, ``Qualification Standards for General Schedule 
Positions,'' or the laboratory's demonstration project qualification 
standards specific to the position to be filled;
    (b) Possess an advanced degree; and
    (c) Meet any selective factors.
    (4) The term ``employee'' is defined by section 2105 of title 5, 
U.S.C.
    c. Provisions:
    (1) Use of this appointing authority must comply with merit system 
principles when recruiting and appointing candidates with advanced 
degrees to covered occupations.
    (2) Qualified candidates possessing an advanced degree may be 
appointed without regard to the provisions of subchapter 1 of chapter 
33 of title 5, United States Code, other than sections 3303, 3321, and 
3328 of such title.
    (3) The hiring threshold for this authority shall be consistent 
with DoD policy and legislative language as expressed in any National 
Defense Authorization Act addressing such.
    (4) Positions and candidates must be counted on a full-time 
equivalent basis.
    (5) Science and engineering positions that are filled as of the 
close of the fiscal year are those positions encumbered on the last day 
of the fiscal year.
    (6) When completing the personnel action, the following will be 
given as the authority for the Career-Conditional, Career, Term, 
Temporary, or special demonstration project appointment authority: 
Section 1108, NDAA for FY 09.
    (7) Evaluation of this hiring authority will include information 
and data on its use, such as numerical limitation, hires made, how many 
veterans hired, declinations, difficulties encountered, and/or 
recognized efficiencies.
4. Distinguished Scholastic Achievement Appointment
    ARDEC will establish a Distinguished Scholastic Achievement 
Appointment using an alternative examining process which provides the 
authority to appoint undergraduates and graduates through the doctoral 
level to professional positions at the equivalent of GS-7 through GS-
11, and GS-12 positions. At the undergraduate level, candidates may be 
appointed to positions at a pay level no greater than the equivalent of 
GS-7, step 10, provided that: they meet the minimum standards for the 
position as published in OPM's operating manual, ``Qualification 
Standards for General Schedule Positions,'' plus any selective factors 
stated in the vacancy announcement; the occupation has a positive 
education requirement; and the candidate has a cumulative grade point 
average of 3.5 or better (on a 4.0 scale) in those courses in those 
fields of study that are specified in the qualifications standards for 
the occupational series. Appointments may also be made at the 
equivalent of GS-9 through GS-12 on the basis of graduate education 
and/or experience for those candidates with a grade point average of 
3.5 or better (on a 4.0 scale) for graduate level courses in the field 
of study required for the occupation. Veterans' preference procedures 
will apply when selecting candidates under this authority. Preference 
eligibles who meet the above criteria will be considered ahead of 
nonpreference eligibles. In making selections, to pass over any 
preference eligible(s) to select a nonpreference eligible requires 
approval under current pass-over or objection procedures. Priority must 
also be given to displaced employees as may be specified in OPM and DoD 
regulations. Distinguished Scholastic Achievement Appointments will 
enable ARDEC to respond quickly to hiring needs with eminently 
qualified candidates possessing distinguished scholastic achievements.
5. Legal Authority
    For actions taken under the auspices of this demonstration project, 
the legal authorities, Public Law 103-337, as amended, and Public Law 
111-84 will be used. For all other actions, the nature of action codes 
and legal authority codes prescribed by OPM, DoD, or DA will continue 
to be used.
6. Modified Term Appointments
    The ARDEC conducts a variety of projects that range from three to 
six years. The current four-year limitation on term appointments for 
competitive service employees often results in the termination of these 
employees prior to completion of projects they were hired to support. 
This disrupts the research and development process and affects the 
organization's ability to accomplish the mission and serve its 
customers.
    The ARDEC will continue to have career and career-conditional 
appointments and temporary appointments not-to-exceed one year. These 
appointments will use existing authorities and entitlements. Under the 
demonstration project, ARDEC will have the added authority to hire 
individuals under a modified term appointment. These appointments will 
be used to fill positions for a period of more than one year, but not 
more than a total of five years when the need for an employee's 
services is not permanent. The modified term appointments differ from 
term employment as described in 5 CFR part 316 in that they may be made 
for a period not to exceed five, rather than four years. The ARDEC 
Director is authorized to extend a modified term appointment one 
additional year.
    Employees hired under the modified term appointment authority are 
in a non-permanent status, but may be eligible for non-competitive 
conversion to career-conditional or career appointments. To be 
converted, the employee must:
    (1) Have been selected for the term position under competitive 
procedures, with the announcement specifically stating that the 
individual(s) selected for the term position may be eligible for 
conversion to a career-conditional or career appointment at a later 
date;
    (2) have served two years of continuous service in the term 
position; and
    (3) be performing at an acceptable level of performance.
    Employees serving under term appointments at the time of conversion 
to the demonstration project will be converted to the new modified term 
appointments provided they were hired for their current positions under 
competitive procedures. These employees will be eligible for conversion 
to career-conditional or career appointments if they:
    (1) Have served two years of continuous service in the term 
position;
    (2) are selected under merit promotion procedures for the permanent 
position; and
    (3) have not been placed on a Contribution Improvement Period 
(CIP).

Time served in term positions prior to conversion to the modified term 
appointment is creditable, provided the service was continuous.
7. Initial Probationary Period
    The probationary period will not be less than one year and will not 
exceed three years for all newly hired employees as defined in 5 CFR 
part 315.

[[Page 3761]]

The specific probationary period will be defined and controlled by the 
ARDEC Director. The purpose of the probationary period is to allow 
supervisors an adequate period of time to fully evaluate an employee's 
ability to complete a cycle of work and to fully assess an employee's 
contribution and conduct. All other features of the current 
probationary period are retained including the potential to remove an 
employee without providing the full substantive and procedural rights 
afforded a non-probationary employee. Any employee fulfilling this 
probationary period prior to the implementation date will not be 
affected.
8. Termination of Initial Probationary Period Employees
    Probationary employees may be terminated when they fail to 
demonstrate proper conduct, technical competency, and/or acceptable 
performance for continued employment and for conditions arising before 
employment. When a supervisor decides to terminate an employee during 
the probationary period because his/her work performance or conduct is 
unacceptable, the supervisor shall terminate the employee's services by 
written notification subject to higher level management approval. This 
notification shall state the reason(s) for termination and the 
effective date of the action. The information in the notice shall, at a 
minimum, consist of the supervisor's conclusions as to the inadequacies 
of the employee's performance or conduct or those conditions arising 
before employment that support the termination.
9. Supervisory and Managerial Probationary Periods
    Supervisory and managerial probationary periods will be made 
consistent with 5 CFR part 315. Current government employees, selected 
for an initial appointment to a supervisory or managerial position in 
ARDEC are required to successfully complete a two-year probationary 
period. If the employee is transferred to a different supervisory 
position, he or she does not have to repeat the probationary period, 
but may continue the duration of the probationary period if the time 
was not completed in the previous supervisory position. If, during this 
probationary period, the decision is made to return the employee to a 
non-supervisory/managerial position for reasons related to supervisory/
managerial performance, the employee will be returned to a comparable 
position of no lower pay than the position from which promoted or 
reassigned. When a supervisor determines to reassign a probationary 
supervisor to a non-supervisory position during the probationary period 
because of his/her work performance or conduct is unacceptable, the 
probationary employee's supervisor will provide written notification 
subject to higher level management approval.
10. Volunteer Emeritus Corps
    Under the demonstration project, the ARDEC Director will have the 
authority to offer retired or separated employees voluntary positions. 
The ARDEC Director may re-delegate this authority. Volunteer Emeritus 
Corps assignments are not considered employment by the Federal 
government (except for purposes of injury compensation). Thus, such 
assignments do not affect an employee's entitlement to buyouts or 
severance payments based on an earlier separation from Federal service. 
The volunteer's Federal retirement pay (whether military or civilian) 
is not affected while serving in a voluntary capacity. Retired or 
separated Federal employees may accept an emeritus position without a 
break or mandatory waiting period.
    The Volunteer Emeritus Corps will ensure continued quality services 
while reducing the overall salary line by allowing higher paid 
employees to accept retirement incentives with the opportunity to 
retain a presence in the ARDEC community. The program will be 
beneficial during manpower reductions, as employees accept retirement 
and return to provide a continuing source of corporate knowledge and 
valuable on-the-job training or mentoring to less experienced 
employees.
    To be accepted into the Volunteer Emeritus Corps, a volunteer must 
be recommended by an ARDEC manager to the Director or delegated 
authority. Not everyone who applies is entitled to an emeritus 
position. The responsible official will document acceptance or 
rejection of the applicant. For acceptance, documentation must be 
retained throughout the assignment. For rejection, documentation will 
be maintained for two years.
    Volunteer Emeritus Corps volunteers will not be permitted to 
monitor contracts on behalf of the Government or to participate on any 
contracts or solicitations where a conflict of interest exists. The 
volunteers may be required to submit a financial disclosure form 
annually. The same rules that currently apply to source selection 
members will apply to volunteers.
    An agreement will be established among the volunteer, the 
responsible official, and the CPAC. The agreement must be finalized 
before the assumption of duties and shall include the following:
    (a) Statement that the voluntary assignment does not constitute an 
appointment in the Civil Service, is without compensation, and the 
volunteer waives any claims against the Government based on the 
voluntary assignment;
    (b) statement that the volunteer will be considered a Federal 
employee only for the purpose of injury compensation;
    (c) volunteer's work schedule;
    (d) length of agreement (defined by length of project or time 
defined by weeks, months, or years);
    (e) support provided by the organization (travel, administrative 
support, office space, and supplies);
    (f) statement of duties;
    (g) statement providing that no additional time will be added to a 
volunteer's service credit for such purposes as retirement, severance 
pay, and leave as a result of being a volunteer;
    (h) provision allowing either party to void the agreement with two 
working days written notice;
    (i) level of security access required by the volunteer (any 
security clearance required by the position will be managed by the 
employing organization);
    (j) provision that any publication(s) resulting from his/her work 
will be submitted to the ARDEC Director for review and approval;
    (k) statement that he/she accepts accountability for loss or damage 
to Government property occasioned by his/her negligence or willful 
action;
    (l) statement that his/her activities on the premises will conform 
to the regulations and requirements of the organization;
    (m) statement that he/she will not release any sensitive or 
proprietary information without the written approval of the employing 
organization and further agrees to execute additional non-disclosure 
agreements as appropriate, if required, by the nature of the 
anticipated services;
    (n) statement that he/she agrees to disclose any inventions made in 
the course of work performed at ARDEC. The ARDEC Director has the 
option to obtain title to any such invention on behalf of the U.S. 
Government. Should the ARDEC Director elect not to take title, the 
ARDEC, shall at a minimum, retain a non-exclusive, irrevocable, paid-
up, royalty-free license to practice or have practiced the invention 
worldwide on behalf of the U.S. Government; and

[[Page 3762]]

    (o) statement that he/she agrees to comply with designated 
mandatory training.
    Exceptions to the provisions in this procedure may be granted by 
the ARDEC Director on a case-by-case basis.

E. Internal Placement

1. Promotion
    A promotion is the movement of an employee to a higher pay band in 
the same Occupational Family or to another pay band in a different 
Occupational Family, wherein the band in the new Occupational Family 
has a higher maximum base pay than the band from which the employee is 
moving. The move from one band to another must result in an increase in 
the employee's base pay to be considered a promotion unless the 
employee is on retained pay. Positions with known promotion potential 
to a higher band within an Occupational Family career path will be 
identified when they are filled. Movement from one Occupational Family 
to another will depend upon individual competencies, qualifications, 
and the needs of the organization. Supervisors may consider promoting 
employees at any time, since promotions are not tied to the CBCS. 
Progression within a pay band is based upon contribution base pay 
increases; as such, these actions are not considered promotions and are 
not subject to the provisions of this section. Except as specified in 
III.E.6, promotions will be processed under competitive procedures in 
accordance with Merit System Principles and requirements of the local 
merit promotion plan.
    To be promoted competitively or non-competitively from one band to 
the next, an employee must meet the minimum qualifications for the job 
and have an acceptable level of performance. If an employee does not 
have a current performance rating, the employee will be treated the 
same as an employee with an acceptable rating as long as there is no 
documented evidence of unacceptable performance.
2. Reassignment
    A reassignment is the movement of an employee from one position to 
a different position within the same Occupational Family and pay band 
or to another Occupational Family and pay band wherein the pay band in 
the new family has the same maximum base pay. The employee must meet 
the qualifications requirements for the Occupational Family and pay 
band.
3. Demotion or Placement in a Lower Pay Band
    A demotion is a placement of an employee into a lower pay band 
within the same Occupational Family or placement into a pay band in a 
different Occupational Family with a lower maximum base pay. Demotions 
may be for cause (performance or conduct) or for reasons other than 
cause (e.g., erosion of duties, reclassification of duties to a lower 
pay band, application under competitive announcements, at the 
employee's request, or placement actions resulting from RIF 
procedures).
4. Simplified Assignment Process
    Today's environment of downsizing and workforce fluctuations 
mandates that the organization have maximum flexibility to assign 
duties and responsibilities to individuals. Pay banding can be used to 
address this need, as it enables the organization to have maximum 
flexibility to assign an employee with either no change or an increase 
in base pay within broad descriptions consistent with the needs of the 
organization and the individual's qualifications and level. Subsequent 
assignments to projects, tasks, or functions anywhere within the 
organization requiring the same level, area of expertise, and 
qualifications would not constitute an assignment outside the scope or 
coverage of the current position description. For instance, a technical 
expert could be assigned to any project, task, or function requiring 
similar technical expertise. Likewise, a manager could be assigned to 
manage any similar function or organization consistent with that 
individual's qualifications. This flexibility allows broader latitude 
in assignments and further streamlines the administrative process and 
system while providing management the option of granting additional 
base pay in recognition of more complex work or broader scope of 
responsibility.
5. Detail Assignment
    Under the demonstration project, the ARDEC's approving manager 
would have the authority:
    (1) To effect details up to one year to demonstration project 
positions without the current 120-day renewal requirement; and
    (2) To effect details to a higher level position in the 
demonstration project up to one year within a 24-month period without 
competition.
    Detail assignments beyond one-year require the approval of the 
ARDEC Director, and are not subject to the 120-day renewal requirement.
6. Expanded Temporary Promotions
    Current regulations require that temporary promotions for more than 
120 days to a higher level position than previously held must be made 
competitively. Under the demonstration project, the ARDEC would be able 
to effect temporary promotions of not more than one year within a 24-
month period without competition to positions within the demonstration 
project.
7. Exceptions to Competitive Procedures
    The following actions are excepted from competitive procedures:
    (a) Re-promotion to a position which is in the same pay band or GS 
equivalent and Occupational Family as the employee previously held on a 
permanent basis within the competitive service.
    (b) Promotion, reassignment, demotion, transfer, or reinstatement 
to a position having promotion potential no greater than the potential 
of a position an employee currently holds or previously held on a 
permanent basis in the competitive service.
    (c) A position change permitted by reduction-in-force procedures.
    (d) Promotion without current competition when the employee was 
appointed through competitive procedures to a position with a 
documented career ladder.
    (e) A temporary promotion or detail to a position in a higher pay 
band of one year or less in a 24-month period.
    (f) A promotion due to the reclassification of positions based on 
accretion (addition) of duties.
    (g) A promotion resulting from the correction of an initial 
classification error or the issuance of a new classification standard.
    (h) Consideration of a candidate who did not receive proper 
consideration in a competitive promotion action.
    (i) Impact of person in the job and Factor IV process (application 
of the Research Grade Evaluation Guide, Equipment Development Grade 
Evaluation Guide, Part III, or similar guides) promotions.

F. Pay Administration

1. General
    Pay administration policies will be established by the PMB. These 
policies will be exempt from Army Regulations or Higher Headquarter pay 
fixing policies but will conform to basic governmental pay fixing 
policy. Employees whose performance is acceptable and not on pay 
retention will receive the full annual general pay increase and the 
full locality pay, with the exception of those employees'

[[Page 3763]]

whose rating is as described in paragraph III.C.5.c.(3). The ARDEC may 
make full use of recruitment, retention, and relocation payments as 
provided for by OPM under 5 U.S.C. and 5 CFR pay flexibilities except 
as waived by this FRN.
2. Pay and Compensation Ceilings
    An employee's total monetary compensation paid in a calendar year 
may not exceed the rate of pay for Level I of the Executive Schedule 
consistent with 5 CFR 530.201. In addition, each pay band will have its 
own base pay ceiling. Base pay rates for the various pay bands were 
established to approximately cover the pay ranges for the GS grade 
equivalents. Other than where retained rate applies, base pay will be 
limited to the maximum base pay rate for each pay band. (See Table 4)
3. Pay Setting for Appointment
    Upon initial appointment, the individual's pay may be set at the 
lowest base pay in the pay band or anywhere within the band level 
consistent with the special qualifications of the individual and the 
unique requirements of the position. These special qualifications may 
be in the form of education, training, experience, or any combination 
thereof that is pertinent to the position in which the employee is 
being placed. Guidance on pay setting for new hires will be established 
by the PMB.
4. Highest Previous Rate
    Highest Previous Rate (HPR) will be considered in placement actions 
authorized under rules similar to the HPR rules in 5 CFR 531.221. Use 
of HPR will be at the supervisor's discretion; but if used, HPR is 
subject to policies established by the PMB.
5. Pay Setting for Promotion
    The minimum base pay increase upon promotion to a higher pay band 
will be six percent or the amount necessary to set the new base pay at 
the minimum base pay rate of the new pay band, whichever is greater. 
The maximum amount of a base pay increase for a promotion will not 
exceed $10,000 or other such amount as established by the PMB. The 
maximum base pay increase for promotion may be exceeded when necessary 
to allow for the minimum base pay increase. For employees promoted from 
positions external to Lab Demo covered by special rates, the new 
demonstration project base pay rate will be calculated to assure an 
adjusted base pay increase of a minimum of six percent.
    When a temporary promotion is terminated, the employee's pay 
entitlements will be re-determined based on the employee's position of 
record, with appropriate adjustments to reflect pay events during the 
temporary promotion, subject to the specific policies and rules 
established by the PMB. In no case may those adjustments increase the 
base pay for the position of record beyond the applicable pay band 
maximum base pay rate.
6. Pay Setting for Reassignment
    A reassignment may be effected without a change in base pay. 
However, a base pay increase may be granted where a reassignment 
significantly increases the complexity, responsibility, and authority 
or for other compelling reasons. Such an increase is subject to the 
specific guidelines established by the PMB.
7. Pay Setting for Demotion or Placement in a Lower Pay Band
    Employees demoted for cause (performance or conduct) are not 
entitled to pay retention and will receive a minimum of a five percent 
decrease in base pay provided that decrease does not result in base pay 
falling below the minimum rate for the pay band. Employees demoted for 
reasons other than cause (e.g., erosion of duties, reclassification of 
duties to a lower pay band, application under competitive 
announcements, at the employee's request, or placement actions 
resulting from RIF procedures) may be entitled to pay retention in 
accordance with the provisions of 5 U.S.C. 5363 and 5 CFR part 536, 
except as waived or modified in section X of this plan.
8. Pay Setting for Employees on a CIP
    Employees who are on a CIP do not receive contribution payouts or 
the general pay increase. This action may result in a base pay that is 
below the assigned band. This occurs because the minimum rate of base 
pay in a pay band increases as the result of the general pay increase 
(5 U.S.C. 5303). For this situation, the employee will remain in the 
assigned band until such time as the CIP is resolved. Upon resolution 
of the CIP, pay or band adjustments shall be made in accordance with 
this document. This action will not be considered an adverse action, 
nor will it be grievable.
9. Supervisory and Team Leader Pay Adjustments
    a. Supervisory and team leader pay adjustments may be approved by 
the ARDEC Director based on the recommendation of the PMB to compensate 
employees with supervisory or team leader responsibilities. Only 
employees in supervisory or team leader positions may be considered for 
the pay adjustment. These pay adjustments are funded separately from 
performance pay pools. These pay adjustments are increases to base pay 
ranging up to ten percent of the employee's base pay rate. Pay 
adjustments are subject to the constraint that the adjustment may not 
cause the employee's base pay to exceed the pay band maximum base pay. 
Criteria to be considered in determining the base pay increase 
percentage include:
    (1) Needs of the organization to attract, retain, and motivate 
high-quality supervisors/team leaders;
    (2) budgetary constraints;
    (3) years and quality of related experience;
    (4) relevant training;
    (5) performance appraisals and experience as a supervisor/team 
leader;
    (6) organizational level of position; and
    (7) impact on the organization.
    b. After the date of conversion into the demonstration project, a 
base pay adjustment may be considered under the following conditions:
    (1) New hires into supervisory/team leader positions will have 
their initial rate of base pay set at the supervisor's discretion 
within the base pay range of the applicable pay band, subject to 
approval of the ARDEC Director. This rate of pay may include a base pay 
adjustment determined by using the ranges and criteria outlined above.
    (2) A career employee selected for a supervisory/team leader 
position that is within the employee's current pay band may also be 
considered for a base pay adjustment. If a supervisor/team leader is 
already authorized a base pay adjustment and is subsequently selected 
for another supervisor/team leader position within the same pay band, 
the base pay adjustment will be re-determined.
    c. Supervisors and team leaders will not receive a base pay 
adjustment at the time of initial conversion into the demonstration 
project. The supervisor/team leader pay adjustment will be reviewed 
annually, with possible increases or decreases based on the AOCS. The 
initial dollar amount of a base pay adjustment will be removed when the 
employee voluntarily leaves the position. The cancellation of the base 
pay adjustment under these circumstances is not an adverse action and 
is not subject to appeal. If an employee is removed from a supervisory/
team leader position for

[[Page 3764]]

personal cause (performance or conduct), the base pay adjustment will 
be removed under adverse action procedures. However, if an employee is 
removed from a non-probationary supervisory/team leader position for 
conditions other than voluntary or for personal cause, pay retention 
will follow current law and regulations at 5 U.S.C. 5362 and 5363 and 5 
CFR part 536, except as waived or modified in section X.
10. Supervisory and Team Leader Pay Differentials
    a. Supervisory and team leader pay differentials may be used by the 
ARDEC Director to provide an incentive and reward supervisors and team 
leaders. Pay differentials are not funded from performance pay pools. A 
pay differential is a cash incentive that may range up to ten percent 
of base pay for supervisors and for team leaders. It is paid on a pay 
period basis with a specified not-to-exceed (NTE) of one year or less 
and is not included as part of the base pay. Criteria to be considered 
in determining the amount of the pay differential are the same as those 
identified for Supervisory and Team Leader Pay Adjustments. The 
differential must be terminated if the employee is removed from a 
supervisory/team leader position, regardless of cause.
    b. After initiation of the demonstration project, all personnel 
actions involving a supervisory or team leader differential will 
require a statement signed by the employee acknowledging that the 
differential may be terminated or reduced at the discretion of the 
ARDEC Director. The termination or reduction of the differential is not 
an adverse action and is not subject to appeal.
11. Staffing Supplements
    Employees assigned to occupational categories and geographic areas 
covered by GS special rates will be entitled to a staffing supplement 
if the maximum adjusted base pay for the banded GS grades to which 
assigned is a special rate that exceeds the maximum GS locality rate 
for the banded grades. The staffing supplement is added to the base 
pay, much like locality rates are added to base pay. For employees 
being converted into the demonstration project, total pay immediately 
after conversion will be the same as immediately before (excluding the 
impact of any WGI buy-in for GS employees), but a portion of the total 
pay will be in the form of a staffing supplement. Adverse action and 
pay retention provisions will not apply to the conversion process, as 
there will be no loss or decrease in total pay.
    The staffing supplement is calculated as follows. Upon conversion, 
the demonstration base rate will be established by dividing the 
employee's former GS basic pay (including any locality pay or special 
salary rate) or, for former NSPS employees, the NSPS adjusted base 
salary (the higher of GS special rate, NSPS targeted local market 
supplement, or locality rate) by the staffing factor. The staffing 
factor will be determined by dividing the maximum special rate for the 
banded grades by the GS unadjusted rate corresponding to that special 
rate (step 10 of the GS rate for the same grade as the special rate). 
The employee's demonstration staffing supplement is derived by 
multiplying the demonstration base pay rate by the staffing factor 
minus one. Therefore, the employee's final demonstration special 
staffing rate equals the demonstration base pay rate plus the staffing 
supplement. This amount will equal the employee's former GS adjusted 
basic pay rate or NSPS adjusted base salary rate. Simplified, the 
formula is this:
[GRAPHIC] [TIFF OMITTED] TN20JA11.026

    If an employee is in a band where the maximum GS adjusted basic pay 
or NSPS adjusted base salary rate for the banded grades is a locality 
rate, when the employee enters into the demonstration project, the 
demonstration base pay rate is derived by dividing the employee's 
former GS adjusted basic pay rate (the higher of locality rate or 
special rate) by the applicable locality pay factor. The employee's 
demonstration locality-adjusted base pay rate will equal the employee's 
former GS adjusted basic pay rate in accordance with the above 
provisions using the new special salary rate. Any GS or special rate 
schedule adjustment will require computing the staffing supplement 
again. Employees receiving a staffing supplement remain entitled to an 
underlying locality rate, which may over time supersede the need for a 
staffing supplement. If OPM discontinues or decreases a special rate 
schedule, pay retention provisions will be applied. Upon geographic 
movement, an employee who receives the staffing supplement will have 
the supplement recomputed. Any resulting reduction in pay will not be 
considered an adverse action or a basis for pay retention.
    An established base pay rate plus the staffing supplement will be 
considered

[[Page 3765]]

adjusted base pay for the same purposes as a locality rate under 5 CFR 
531.610, e.g., for purposes of retirement, life insurance, premium pay, 
severance pay, and advances in pay. It will also be used to compute 
worker's compensation payments and lump-sum payments for accrued and 
accumulated annual leave.
    If an employee is in an occupational category covered by a new or 
modified special salary rate table, and the pay band to which assigned 
is not entitled to a staffing supplement, then the employee's adjusted 
base pay may be reviewed and adjusted to accommodate the rate increase 
provided by the special salary rate table. The review may result in a 
one-time base pay increase if the employee's adjusted base pay equals 
or is less than the highest special salary rate grade and step that 
exceeds the comparable locality grade and step. Demonstration project 
operating procedures will identify the officials responsible to make 
such reviews and determinations.
12. Pay Retention
    For purposes of actions within the ARDEC demonstration project that 
provide entitlement to pay retention, the standard provisions of pay 
retention under 5 U.S.C. 5362 and 5363 and 5 CFR part 536 shall apply 
to employees after conversion to the demonstration project, except as 
waived or modified in Section X of this plan. Wherever the term 
``grade'' is used in the law or regulation, the term ``pay band'' will 
be substituted. The intent is to only use pay retention for all 
situations. Grade retention provisions will not be applicable to the 
ARDEC Demonstration Project. The ARDEC Director may grant pay retention 
to employees who meet general eligibility requirements, but do not have 
specific entitlement by law, provided they are not specifically 
excluded.

G. Employee Development

1. Expanded Developmental Opportunity Program
    The Expanded Developmental Opportunity Program will be available to 
all demonstration project employees. Expanded developmental 
opportunities complement existing developmental opportunities such as 
long-term training; rotational job assignments; developmental 
assignments to Army Materiel Command, Army, or DoD; and self-directed 
study via correspondence courses, local colleges, and universities. 
Each developmental opportunity must result in a product, service, 
report, or study that will benefit the ARDEC or customer organization 
as well as increase the employee's individual effectiveness. The 
developmental opportunity period will not result in loss of (or 
reduction) in base pay, leave to which the employee is otherwise 
entitled, or credit for service time. The positions of employees on 
expanded developmental opportunities may be back-filled (i.e., with 
temporarily assigned, detailed, or promoted employees or with term 
employees). However, that position or its equivalent must be made 
available to the employee upon return from the developmental period. 
The PMB will provide written guidance for employees on application 
procedures and develop a process that will be used to review and 
evaluate applicants for development opportunities.
    a. Sabbatical. The ARDEC Director has the authority to grant paid 
or unpaid sabbaticals to all career employees. The purpose of a 
sabbatical will be to permit employees to engage in study or 
uncompensated work experience that will benefit the organization and 
contribute to the employee's development and effectiveness. Each 
sabbatical must result in a product, service, report, or study that 
will benefit the ARDEC mission as well as increase the employee's 
individual effectiveness. Various learning or developmental experiences 
may be considered, such as advanced academic teaching, research, self-
directed or guided study, and on-the-job work experience.
    One paid sabbatical of up to twelve months in duration or one 
unpaid sabbatical of up to six months in a calendar year may be granted 
to an employee in any seven-year period. Employees will be eligible to 
request a sabbatical after completion of seven years of Federal 
service. Employees approved for a paid sabbatical must sign a service 
obligation agreement to continue in service in the ARDEC for a period 
three times the length of the sabbatical. If an employee voluntarily 
leaves the ARDEC organization before the service obligation is 
completed, he/she is liable for repayment of expenses incurred by ARDEC 
that are associated with training during the sabbatical. Expenses do 
not include salary costs. The ARDEC Director has the authority to waive 
this requirement. Criteria for such waivers will be addressed in the 
operating procedures. Specific procedures will be developed for 
processing sabbatical applications upon implementation of the 
demonstration project.
    b. Critical Skills Training. The ARDEC Director has the authority 
to approve academic degree training consistent with 5 U.S.C. 4107. 
Training is an essential component of an organization that requires 
continuous acquisition of advanced and specialized knowledge. Degree 
training is also a critical tool for recruiting and retaining employees 
with or requiring critical skills.
    Each academic degree training program in its entirety can be 
approved based upon a complete individual degree study program plan; it 
will ensure continuous acquisition of advanced specialized knowledge 
essential to the organization and enhance our ability to recruit and 
retain personnel critical to the present and future requirements of the 
organization. Degree or certificate payment may not be authorized where 
it would result in a tax liability for the employee without the 
employee's express and written consent. Any variance from this policy 
must be rigorously determined and documented. Guidelines will be 
developed to ensure competitive approval of degree or certificate 
payment and that such decisions are fully documented. Employees 
approved for degree training must sign a service obligation agreement 
to continue service in the ARDEC for a period three times the length of 
the training period commencing after the completion of the entire 
degree program. If an employee voluntarily leaves the ARDEC before the 
service obligation is completed, he/she is liable for repayment of 
expenses incurred by the ARDEC that are related to the critical skills 
training. Expenses do not include salary costs. The ARDEC Director has 
the authority to waive this requirement. Criteria for such waivers will 
be addressed in the operating procedures.
    c. Student Career Experience Program (SCEP) Service Agreement. The 
extended repayment period also applies to employees under the SCEP who 
have received tuition assistance. They will be required to sign a 
service agreement up to three times the length of the academic training 
period or periods (semesters, trimesters, or quarters).

H. Reduction-in-Force (RIF) Procedures

    The competitive area may be determined by Occupational Family, 
lines of business, product lines, organizational units, funding lines, 
occupational series, functional area, and/or geographical location, or 
a combination of these elements, and must include all Demonstration 
Project employees within the defined competitive area. The RIF system 
has a single round of competition to replace the current GS two-round 
process. Once the position to be abolished has been identified, the 
incumbent of that position may displace another employee

[[Page 3766]]

when the incumbent has a higher retention standing and is fully 
qualified for the position occupied by the employee with a lower 
standing.
    Retention standing is based on tenure, veterans' preference, and 
length of service augmented by performance. Modified term appointment 
and temporary employees are in tenure group III for RIF purposes. RIF 
procedures are not required when separating these employees when their 
appointments expire.
    Displacement is limited to one pay band level below the employee's 
present pay band level within the Occupational Family career path. Pay 
band level I employees can displace within their current pay band 
level. A veterans' preference eligible employee with a compensable 
service connected disability of 30 percent or more may displace up to 
two pay band levels below the employee's present level within the 
Occupational Family career path. A pay band level I preference eligible 
employee (with a compensable service connected disability of 30 percent 
or more) can displace within their current pay band. Employees bumped 
to lower pay band levels are entitled to pay retention. The same 
``undue disruption'' standard currently utilized, serves as the 
criteria to determine if an employee is fully qualified.
    The additional reduction-in-force years of service augmentation for 
performance shall be based upon the delta between an employee's AOCS 
and an employee's EOCS at the end of a rating cycle. The following are 
the years of service augmentation rules:
    a. Seven (7) years of service augmentation for each year the AOCS 
is greater than or equal to the EOCS minus 3 (AOCS <ls-thn-eq>= EOCS -
3).
    b. Four (4) years of service augmentation for each year the AOCS is 
less than the EOCS minus 3 (AOCS < EOCS -3).
    c. Zero (0) years of service augmentation for each year the 
employee was placed on a CIP at any time during the rating cycle.
    An employee on a CIP, any time during the rating cycle, may only 
displace an employee who was also on a CIP during the same rating 
cycle. The displaced individual may similarly displace another employee 
on a CIP during the same rating cycle. If there is no position in which 
an employee can be placed by this process or assigned to a vacant 
position, that employee will be separated. If an employee has not been 
rated under the demonstration project, their rating will be considered 
acceptable and they will be given the full 21 years of service 
augmentation. After completion of the first or second rating cycle, the 
total years of service augmentation will be prorated based on ratings 
received to date.

IV. Implementation Training

    A. Critical to the success of the demonstration project is the 
training developed to promote understanding of the broad concepts and 
finer details needed to implement and successfully execute this 
project. Pay banding, a new position classification system, and a new 
CBCS all represent significant cultural change for the organization. 
Training will be tailored to address employee concerns and to encourage 
comprehensive understanding of the demonstration project. Training will 
be required both prior to implementation and at various times during 
the life of the demonstration project.
    B. A training program will begin prior to implementation and will 
include modules tailored for employees, supervisors, senior managers, 
and administrative staff. Typical modules are:
    1. An overview of the demonstration project;
    2. conversion in and out of the system;
    3. pay banding;
    4. the CBCS;
    5. defining objectives;
    6. assigning weights;
    7. assessing performance, including feedback;
    8. new position descriptions; and
    9. demonstration project administration and formal evaluation.
    C. Various types of training are being considered, including 
videos, on-line tutorials, and train-the-trainer concepts.

V. Conversion

A. Conversion From the GS System to the Demonstration Project

1. Placement Into Demonstration Project Occupational Families, Career 
Paths, and Pay Bands
    Conversion will be into the Occupational Family and career path 
that corresponds to the employee's current GS grade and basic pay. If 
conversion into the demonstration project is accompanied by a 
simultaneous change in the geographic location of the employee's duty 
station, the employee's overall GS entitlements (including locality 
rate) in the new area will be determined before converting the 
employee's pay to the demonstration project pay system. Employees will 
be assured of placement within the new system without loss of total 
pay.
2. WGI Buy-In
    For GS employees, rules governing WGIs will continue in effect 
until conversion. Adjustments to the employee's GS basic pay for WGI 
equity will be computed as of the effective date of conversion. WGI 
equity will be acknowledged by increasing basic pay by a prorated share 
based upon the number of full weeks an employee has completed toward 
the next higher step. Payment will equal the value of the employee's 
next WGI times the proportion of the waiting period completed (weeks 
completed in waiting period/weeks in the waiting period) at the time of 
conversion. GS employees at step 10 or receiving a retained rate, on 
the day of implementation will not be eligible for WGI equity 
adjustments. GS employees serving on retained grade will receive WGI 
equity adjustments provided they are not at step 10 or receiving a 
retained rate.
3. Conversion of Term and Temporary Limited Appointments
    Employees serving under a term appointment at the time of 
demonstration project implementation will be converted to the modified 
term appointment if all requirements (refer to III.D.6, Modified Term 
Appointments) have been satisfied. Employees serving under temporary 
limited appointments at the time of demonstration implementation will 
be converted to temporary limited appointments.
4. Conversion of Special Salary Rate Employees
    Employees who are in positions covered by a special salary rate 
prior to the demonstration project will no longer be considered a 
special salary rate employee under the demonstration project. These 
employees will be eligible for full locality pay. The adjusted pay for 
these employees will not change. The employees will receive a new 
staffing adjusted base pay rate computed under the staffing supplement 
rules in section III.F.11.
5. Probationary Periods
    a. Initial probationary period. GS employees who have completed an 
initial probationary period prior to conversion from GS will not be 
required to serve a new or extended initial probationary period. GS 
employees who are serving an initial probationary period upon 
conversion from GS will serve the time remaining on their initial 
probationary period.
    b. Supervisory probationary period. GS employees who have completed 
a supervisory probationary period prior to conversion from GS will not 
be required

[[Page 3767]]

to serve a new or extended supervisory probationary period while in 
their current position. GS employees who are serving a supervisory 
probationary period upon conversion from GS will serve the time 
remaining on their supervisory probationary period.
6. Transition Equity
    During the first 12 months following conversion to the 
demonstration project, management may approve certain adjustments 
within the pay band for pay equity reasons stemming from conversion. 
For example, if an employee would have been otherwise promoted but 
demonstration project pay band placement no longer provides the 
opportunity for promotion, a pay equity adjustment may be authorized 
provided the adjustment does not cause the employee's base pay to 
exceed the maximum rate of his or her assigned pay band and the 
employee's performance warrants an adjustment. The decision to grant a 
pay equity adjustment is at the sole discretion of the ARDEC Director 
and is not subject to employee appeal procedures.
    During the first 12 months following conversion, management may 
approve an adjustment of not more than 20 percent, provided the 
adjustment does not cause the employee's base pay to exceed the maximum 
rate of his or her assigned pay band and the employee's performance 
warrants an adjustment, to mitigate compensation inequities that may be 
caused by artifacts of the process of conversion into STRL pay bands.

B. Conversion From NSPS to the Demonstration Project

1. Placement Into Demonstration Project Occupational Families, Career 
Paths, Pay Plans, and Pay Bands
    The employee's NSPS occupational series, pay plan, pay band, and 
supervisory code will be considered upon converting into the 
demonstration project as follows.
    a. Determine the appropriate demonstration project pay plan. 
Employees will be converted into an occupational family career path and 
pay plan based on the occupational series of their position. In cases 
where the employee is assigned to a NSPS-unique occupational series, a 
corresponding OPM occupational series must be identified using OPM GS 
classification standards and guidance to determine the proper 
demonstration project pay plan.
    b. Determine the appropriate demonstration project pay band. The 
appropriate pay band will be determined by establishing the 
corresponding GS grade for the employee's NSPS position using OPM GS 
classification standards and guidance. Once the GS grade has been 
determined, the employee's position will be placed in the appropriate 
demonstration project pay band in the occupational family career path.
2. Pay Upon Conversion From NSPS
    Conversion from NSPS into the demonstration project will be 
accomplished with full employee pay protection. Adverse action 
provisions will not apply to the conversion action. In accordance with 
section 1113(c)(1) of NDAA 2010, which prohibits a loss of or decrease 
in pay upon transition from NSPS, employees converting to the 
demonstration project will retain the adjusted salary (as defined in 5 
CFR 9901.304) from their NSPS permanent or temporary position at the 
time the position converts. Upon conversion, the retained NSPS adjusted 
salary may not exceed Level IV of the Executive Schedule plus five 
percent. If the employee's base pay exceeds the maximum rate for his or 
her assigned demonstration project pay band, the employee will be 
placed on indefinite pay retention until an event, as described in 5 
CFR 536.308, results in a loss of eligibility for or termination of pay 
retention. If an employee's base pay is less than the minimum rate for 
his/her assigned demonstration project pay band, the employee will have 
his/her base pay rate increased to the minimum of the pay band.
    Employees covered by an NSPS targeted local market supplement 
(TLMS) prior to conversion to the demonstration project will no longer 
be covered by a TLMS. Instead, they will receive a staffing supplement. 
The adjusted base pay upon conversion will not change.
3. Fair Labor Standards Act (FLSA) Status
    Since FLSA provisions were not waived under NSPS and duties do not 
change upon conversion to the demonstration project, the FLSA status 
determination will remain the same upon conversion. Employees will be 
converted to the demonstration project with the same FLSA status they 
had under NSPS.
4. Transition Equity
    During the first 12 months following conversion to the 
demonstration project, management may approve certain adjustments 
within the pay band for pay equity reasons stemming from conversion. 
For example, if an employee would have been otherwise promoted but 
demonstration project pay band placement no longer provides the 
opportunity for promotion, a pay equity adjustment may be authorized 
provided the adjustment does not cause the employee's base pay to 
exceed the maximum rate of his or her assigned pay band and the 
employee's performance warrants an adjustment. The decision to grant a 
pay equity adjustment is at the sole discretion of the ARDEC Director 
and is not subject to employee appeal procedures.
    During the first 12 months following conversion, management may 
approve an adjustment of not more than 20 percent, provided the 
adjustment does not cause the employee's base pay to exceed the maximum 
rate of his or her assigned pay band and the employee's performance 
warrants an adjustment, to mitigate compensation inequities that may be 
caused by artifacts of the process of conversion into STRL pay bands.
5. Pay Band Retention
    Employees converting from NSPS to the demonstration project will 
not be granted pay band retention based on the pay band formerly 
assigned to their NSPS position.
6. Converting Employees on NSPS Term and Temporary Appointments
    a. Employees serving under term appointments at the time of 
conversion to the demonstration project will be converted to modified 
term appointments provided they were hired for their current positions 
under competitive procedures. These employees will be eligible for 
conversion to career or career-conditional appointments in the 
competitive service provided they:
    (1) Have served two years of continuous service in the term 
position;
    (2) were selected for the term position under competitive 
procedures; and
    (3) are performing at a satisfactory level.

Converted term employees who do not meet these criteria may continue on 
their term appointment up to the not-to-exceed date established under 
NSPS. Extensions of term appointments after conversion may be granted 
in accordance with 5 CFR part 316, subpart D.

    b. Employees serving under temporary appointments under NSPS when 
their organization converts to the demonstration project will be 
converted and may continue on their temporary appointment up to the 
not-to-exceed date established under NSPS. Extensions of temporary 
appointments after conversion may be granted in

[[Page 3768]]

accordance with 5 CFR 213.104 for excepted service employees and 5 CFR 
part 316, subpart D, for competitive service employees.
7. Probationary Periods
    a. Initial probationary period. NSPS employees who have completed 
an initial probationary period prior to conversion from NSPS will not 
be required to serve a new or extended initial probationary period. 
NSPS employees who are serving an initial probationary period upon 
conversion from NSPS will serve the time remaining on their initial 
probationary period.
    b. Supervisory probationary period. NSPS employees who have 
completed a supervisory probationary period prior to conversion from 
NSPS will not be required to serve a new or extended supervisory 
probationary period while in their current position. NSPS employees who 
are serving a supervisory probationary period upon conversion from NSPS 
will serve the time remaining on their supervisory probationary period.

C. Conversion From Other Personnel Systems

    Employees who enter the demonstration project from other personnel 
systems (e.g., Defense Civilian Intelligence Personnel System, Civilian 
Acquisition Workforce Demonstration Project, or other STRLs) will be 
subject to the pay rules that govern conversion out of their respective 
systems. Conversion into Lab Demo will be based upon the position 
classification of the employee's new position and the Lab Demo rules, 
consistent with the intent as outlined for GS and NSPS above.

D. Movement out of the ARDEC Demonstration Project

1. Termination of Coverage Under the ARDEC Demonstration Project Pay 
Plans
    In the event employees' coverage under the ARDEC demonstration 
project pay plans is terminated, employees move with their 
demonstration project position to another system applicable to ARDEC 
employees. The grade of their demonstration project position in the new 
system will be based upon the position classification criteria of the 
gaining system. Employees when converted to their positions classified 
under the new system will be eligible for pay retention under 5 CFR 
part 536, if applicable.
2. Determining a GS-Equivalent Grade and GS-Equivalent Rate of Pay for 
Pay Setting Purposes When an ARDEC Employee's Coverage by a 
Demonstration Project Pay Plan Terminates or the Employee Voluntarily 
Exits the ARDEC Demonstration Project
    a. If a demonstration project employee is moving to a GS or other 
pay system position, the following procedures will be used to translate 
the employee's project pay band to a GS-equivalent grade and the 
employee's project base pay to the GS-equivalent rate of pay for pay 
setting purposes. The equivalent GS grade and GS rate of pay must be 
determined before movement out of the demonstration project and any 
accompanying geographic movement, promotion, or other simultaneous 
action. For lateral reassignments, the equivalent GS grade and rate 
will become the employee's converted GS grade and rate after leaving 
the demonstration project (before any other action). For transfers, 
promotions, and other actions, the converted GS grade and rate will be 
used in applying any GS pay administration rules applicable in 
connection with the employee's movement out of the project (e.g., 
promotion rules, highest previous rate rules, pay retention rules), as 
if the GS converted grade and rate were actually in effect immediately 
before the employee left the demonstration project.
(1) Equivalent GS-Grade-Setting Provisions
    An employee in a pay band corresponding to a single GS grade is 
provided that grade as the GS-equivalent grade. An employee in a pay 
band corresponding to two or more grades is determined to have a GS-
equivalent grade corresponding to one of those grades according to the 
following rules:
    (a) The employee's adjusted base pay under the demonstration 
project (including any locality payment or staffing supplement) is 
compared with step 4 rates in the highest applicable GS rate range. For 
this purpose, a GS rate range includes a rate in:
    i. the GS base schedule;
    ii. the locality rate schedule for the locality pay area in which 
the position is located; or
    iii. the appropriate special rate schedule for the employee's 
occupational series, as applicable.

If the series is a two-grade interval series, only odd-numbered grades 
are considered below GS-11.

    (b) If the employee's adjusted base pay under the demonstration 
project equals or exceeds the applicable step 4 adjusted base pay rate 
of the highest GS grade in the band, the employee is converted to that 
grade.
    (c) If the employee's adjusted base pay under the demonstration 
project is lower than the applicable step 4 adjusted base pay rate of 
the highest grade, the adjusted base pay under the demonstration 
project is compared with the step 4 adjusted base pay rate of the 
second highest grade in the employee's pay band. If the employee's 
adjusted base pay under the demonstration project equals or exceeds the 
step 4 adjusted base pay rate of the second highest grade, the employee 
is converted to that grade.
    (d) This process is repeated for each successively lower grade in 
the band until a grade is found in which the employee's adjusted base 
pay under the demonstration project rate equals or exceeds the 
applicable step 4 adjusted base pay rate of the grade. The employee is 
then converted at that grade. If the employee's adjusted base pay is 
below the step 4 adjusted base pay rate of the lowest grade in the 
band, the employee is converted to the lowest grade.
    (e) Exception: An employee will not be provided a lower grade than 
the grade held by the employee immediately preceding a conversion, 
lateral reassignment, or lateral transfer into the project, unless 
since that time the employee has either undergone a reduction in band 
or a reduction within the same pay band due to unacceptable 
performance.
(2) Equivalent GS-Rate-of-Pay-Setting Provisions
    An employee's pay within the converted GS grade is set by 
converting the employee's demonstration project rates of pay to GS 
rates of pay in accordance with the following rules:
    (a) The pay conversion is done before any geographic movement or 
other pay-related action that coincides with the employee's movement or 
conversion out of the demonstration project.
    (b) An employee's adjusted base pay under the demonstration project 
(i.e., including any locality payment or staffing supplement) is 
converted to a GS adjusted base pay rate on the highest applicable GS 
rate range for the converted GS grade. For this purpose, a GS rate 
range includes a rate range in:
    i. the GS base schedule,
    ii. an applicable locality rate schedule, or
    iii. an applicable special rate schedule.
    (c) If the highest applicable GS rate range is a locality pay rate 
range, the employee's adjusted base pay under the demonstration project 
is converted to a

[[Page 3769]]

GS locality rate of pay. If this rate falls between two steps in the 
locality-adjusted schedule, the rate must be set at the higher step. 
The converted GS unadjusted rate of base pay would be the GS base rate 
corresponding to the converted GS locality rate (i.e., same step 
position).
    (d) If the highest applicable GS rate range is a special rate 
range, the employee's adjusted base pay under the demonstration project 
is converted to a special rate. If this rate falls between two steps in 
the special rate schedule, the rate must be set at the higher step. The 
converted GS unadjusted rate of base pay will be the GS rate 
corresponding to the converted special rate (i.e., same step position).
    (3) Employees With Pay Retention
    If an employee is receiving a retained rate under the demonstration 
project, the employee's GS-equivalent grade is the highest grade 
encompassed in his or her pay band level. Demonstration project 
operating procedures will outline the methodology for determining the 
GS-equivalent pay rate for an employee retaining a rate under the 
demonstration project.

VI. Other Provisions

A. Personnel Administration

    All personnel laws, regulations, and guidelines not waived by this 
plan will remain in effect. Basic employee rights will be safeguarded 
and Merit System Principles will be maintained. Servicing CPACs will 
continue to process personnel-related actions and provide consultative 
and other appropriate services.

B. Automation

    The ARDEC will continue to use standard systems such as the Defense 
Civilian Personnel Data System (DCPDS) for the processing of personnel-
related data. Payroll servicing will continue from the respective 
payroll offices.
    An automated tool will be used to support computation of 
performance related pay increases and bonus and other personnel 
processes and systems associated with this project.

C. Experimentation and Revision

    Many aspects of a demonstration project are experimental. 
Modifications may be made from time to time as experience is gained, 
results are analyzed, and conclusions are reached on how the new system 
is working. DoDI 1400.37, July 28, 2009, provides instructions for 
making minor changes to an existing demonstration project and 
requesting new initiatives.

VII. Project Duration

    Public Law 103-337 removed any mandatory expiration date for 
section 342(b) demonstration projects. The ARDEC, DA, and DoD will 
ensure this project is evaluated for the first five years after 
implementation in accordance with 5 U.S.C. 4703. Modifications to the 
original evaluation plan or any new evaluation will ensure the project 
is evaluated for its effectiveness, its impact on mission, and any 
potential adverse impact on any employee groups. Major changes and 
modifications to the interventions would be made if formative 
evaluation data warrants and will be published in the Federal Register 
to the extent required. At the five-year point, the demonstration will 
be reexamined for permanent implementation, modification and additional 
testing, or termination of the entire demonstration project.

VIII. Evaluation Plan

A. Overview

    Chapter 47 of 5 U.S.C. requires that an evaluation be performed to 
measure the effectiveness of the demonstration project and its impact 
on improving public management. A comprehensive evaluation plan for the 
entire demonstration program, originally covering 24 DoD laboratories, 
was developed by a joint OPM/DoD Evaluation Committee in 1995. This 
plan was submitted to the Office of Defense Research and Engineering 
and was subsequently approved. The main purpose of the evaluation is to 
determine whether the waivers granted result in a more effective 
personnel system and improvements in ultimate outcomes (i.e., 
organizational effectiveness, mission accomplishment, and customer 
satisfaction).

B. Evaluation Model

    1. Appendix D shows an intervention model for the evaluation of the 
demonstration project. The model is designed to evaluate two levels of 
organizational performance: Intermediate and ultimate outcomes. The 
intermediate outcomes are defined as the results from specific 
personnel system changes and the associated waivers of law and 
regulation expected to improve human resource (HR) management (i.e., 
cost, quality, and timeliness). The ultimate outcomes are determined 
through improved organizational performance, mission accomplishment, 
and customer satisfaction. Although it is not possible to establish a 
direct causal link between changes in the HR management system and 
organizational effectiveness, it is hypothesized that the new HR system 
will contribute to improved organizational effectiveness.
    2. Organizational performance measures established by the 
organization will be used to evaluate the impact of a new HR system on 
the ultimate outcomes. The evaluation of the new HR system for any 
given organization will take into account the influence of three 
factors on organizational performance: Context, degree of 
implementation, and support of implementation. The context factor 
refers to the impact which intervening variables (i.e., downsizing, 
changes in mission, or the economy) can have on the effectiveness of 
the program. The degree of implementation considers:
    a. The extent to which the HR changes are given a fair trial 
period;
    b. the extent to which the changes are implemented; and
    c. the extent to which the changes conform to the HR interventions 
as planned.

The support of implementation factor accounts for the impact that 
factors such as training, internal regulations, and automated support 
systems have on the support available for program implementation. The 
support for program implementation factor can also be affected by the 
personal characteristics (e.g., attitudes) of individuals who are 
implementing the program.
    3. The degree to which the project is implemented and operated will 
be tracked to ensure that the evaluation results reflect the project as 
it was intended. Data will be collected to measure changes in both 
intermediate and ultimate outcomes as well as any unintended outcomes, 
which may happen as a result of any organizational change. In addition, 
the evaluation will track the impact of the project and its 
interventions on veterans and other protected groups, the Merit System 
Principles, and the Prohibited Personnel Practices. Additional measures 
may be added to the model in the event that changes or modifications 
are made to the demonstration plan.
    4. The intervention model at Appendix D will be used to measure the 
effectiveness of the personnel system interventions implemented. The 
intervention model specifies each personnel system change or 
intervention that will be measured and shows:
    a. The expected effects of the intervention,
    b. the corresponding measures, and
    c. the data sources for obtaining the measures.


[[Page 3770]]


Although the model makes predictions about the outcomes of specific 
intervention, causal attributions about the full impact of specific 
interventions will not always be possible for several reasons. For 
example, many of the initiatives are expected to interact with each 
other and contribute to the same outcomes. In addition, the impact of 
changes in the HR system may be mitigated by context variables (e.g., 
the job market, legislation, and internal support systems) or support 
factors (e.g., training, automation support systems).

C. Evaluation

    A modified quasi-experimental design will be used for the 
evaluation of the STRL Personnel Demonstration Program. Because most of 
the eligible laboratories are participating in the program, a title 5 
U.S.C. comparison group will be compiled from the Central Personnel 
Data File (CPDF). This comparison group will consist of workforce data 
from Government-wide research organizations in civilian Federal 
agencies with missions and job series matching those in the DoD 
laboratories. This comparison group will be used primarily in the 
analysis of pay banding costs and turnover rates.

D. Method of Data Collection

    1. Data from several sources will be used in the evaluation. 
Information from existing management information systems and from 
personnel office records will be supplemented with perceptual survey 
data from employees to assess the effectiveness and perception of the 
project. The multiple sources of data collection will provide a more 
complete picture as to how the interventions are working. The 
information gathered from one source will serve to validate information 
obtained through another source. In so doing, the confidence of overall 
findings will be strengthened as the different collection methods 
substantiate each other.
    2. Both quantitative and qualitative data will be used when 
evaluating outcomes. The following data will be collected:
    a. Workforce data;
    b. personnel office data;
    c. employee attitude surveys;
    d. focus group data;
    e. local site historian logs and implementation information;
    f. customer satisfaction surveys; and
    g. core measures of organizational performance.
    3. The evaluation effort will consist of two phases, formative and 
summative evaluation, covering at least five years to permit inter- and 
intra-organizational estimates of effectiveness. The formative 
evaluation phase will include baseline data collection and analysis, 
implementation evaluation, and interim assessments. The formal reports 
and interim assessments will provide information on the accuracy of 
project operation, and current information on impact of the project on 
veterans and protected groups, Merit System Principles, and Prohibited 
Personnel Practices. The summative evaluation will focus on an overall 
assessment of project outcomes after five years. The final report will 
provide information on how well the HR system changes achieved the 
desired goals, which interventions were most effective, and whether the 
results can be generalized to other Federal installations.

IX. Demonstration Project Costs

A. Cost Discipline

    An objective of the demonstration project is to ensure in-house 
cost discipline. A baseline will be established at the start of the 
project and labor expenditures will be tracked yearly. Implementation 
costs (including project development, automation costs, step buy-in 
costs, and evaluation costs) are considered one-time costs and will not 
be included in the cost discipline.
    The PMB will track personnel cost changes and recommend adjustments 
if required to achieve the objective of cost discipline.

B. Developmental Costs

    Costs associated with the development of the personnel 
demonstration project include software automation, training, and 
project evaluation. All funding will be provided through the 
organization's budget. The Projected Annual Expenses are summarized in 
Table 6. Project evaluation costs are not expected to continue beyond 
the first five years unless the results and external requirements 
warrant further evaluation.

                                       Table 6--Projected Annual Expenses
----------------------------------------------------------------------------------------------------------------
                                                     FY10         FY11         FY12         FY13         FY14
----------------------------------------------------------------------------------------------------------------
Training.......................................           0K          15K          10K           5K           5K
Project Evaluation.............................           0K          80K          30K          30K          30K
Design.........................................          40K           0K           0K           0K           0K
Automation.....................................          97K         400K         400K          50K          50K
                                                ----------------------------------------------------------------
    Totals.....................................         137K         495K         440K          85K          85K
----------------------------------------------------------------------------------------------------------------

X. Required Waivers to Law and Regulation

    Public Law 106-398 gave the DoD the authority to experiment with 
several personnel management innovations. In addition to the 
authorities granted by the law, the following are waivers of law and 
regulation that will be necessary for implementation of the 
demonstration project. In due course, additional laws and regulations 
may be identified for waiver request.
    The following waivers and adaptations of certain title 5 U.S.C. and 
5 CFR provisions are required only to the extent that these statutory 
provisions limit or are inconsistent with the actions contemplated 
under this demonstration project. Nothing in this plan is intended to 
preclude the demonstration project from adopting or incorporating any 
law or regulation enacted, adopted, or amended after the effective date 
of this demonstration project.

A. Waivers to Title 5, U.S.C.

    Chapter 5, section 552a: Records maintained on individuals. This 
section is waived only to the extent required to clarify that 
volunteers under the Volunteer Emeritus Corps are considered employees 
of the Federal government for purposes of this section.
    Chapter 31, section 3111: Acceptance of Volunteer Service. Waived 
to allow for a Volunteer Emeritus Corps in addition to student 
volunteers.
    Chapter 33, subchapter 1, section 3318(a): Competitive Service, 
Selection from Certificate. Waived to the extent necessary to eliminate 
the requirement for selection using the ``Rule of Three.''
    Chapter 33, section 3319: Alternative Ranking and Selection 
Procedures. This

[[Page 3771]]

section is waived to eliminate quality categories.
    Chapter 33, section 3321: Competitive Service; Probationary Period. 
This section waived only to the extent necessary to replace grade with 
``pay band level.''
    Chapter 33, section 3341: Details. Waived in entirety.
    Chapter 41, section 4107a(1) and b(2) to the extent required to 
allow ARDEC to pay for all courses related to a degree program approved 
by the ARDEC Director.
    Chapter 41, section 4108(a)-(c): Employee Agreements; Service After 
Training. Waived to the extent necessary to: (1) Provide that the 
employee's service obligation is to the ARDEC organization for the 
period of the required service; (2) permit the Director, ARDEC, to 
waive in whole or in part a right of recovery; and (3) require 
employees under the Student Career Experience Program who have received 
tuition assistance to sign a service agreement up to three times the 
length of the training.
    Chapter 43, section 4302 and 4303: Waived to the extent necessary 
to: (1) Substitute pay band for grade and (2) provide that moving to a 
lower pay band as a result of not receiving the general pay increase 
because of poor performance is not an action covered by the provisions 
of sections 4303(a) through (d).
    Chapter 43, section 4304(b)(1) and (3): Responsibilities of the 
OPM. Waived in its entirety to remove the responsibilities of the OPM 
with respect to the performance appraisal system.
    Chapter 45, subchapter I, section 4502(a) and (b)-Waiver to permit 
ARDEC to approve awards up to $25,000 for individual employees.
    Chapter 51, sections 5101-5112: Classification. Waived as necessary 
to allow for the demonstration project pay banding system.
    Chapter 53, sections 5301, 5302 (8) and (9), 5303, and 5304: Pay 
Comparability System. Sections 5301, 5302, and 5304 are waived to the 
extent necessary to allow:
    (1) Demonstration project employees to be treated as GS employees 
and (2) basic rates of pay under the demonstration project to be 
treated as scheduled rates of pay. Occupational Family Chapter 53, 
section 5305: Special Pay Authority. Waived to the extent necessary to 
allow for use of a staffing supplement in lieu of the special pay 
authority.
    Chapter 53, sections 5331-5336: General Schedule Pay Rates. Waived 
in its entirety to allow for the demonstration project's pay banding 
system and pay provisions.
    Chapter 53, sections 5361-5366: Grade and Pay Retention. These 
sections waived to the extent necessary to: (1) Replace grade with 
``pay band;'' and (2) allow Demonstration project employees to be 
treated as GS employees.
    Chapter 55, section 5542(a)(1)-(2): Overtime rates; computation. 
Waived to the extent necessary to provide that the GS-10 minimum 
special rate (if any) for the special rate category to which a project 
employee belongs is deemed to be the ``applicable special rate'' in 
applying the pay cap provisions.
    Chapter 55, section 5545(d): Hazardous duty differential. Waived to 
the extent necessary to allow demonstration project employees to be 
treated as GS employees.
    Chapter 55, section 5547(a)-(b): Limitation on premium pay. Waived 
to the extent necessary to provide that the GS-15 maximum special rate 
(if any) for the special rate category to which an employee belongs is 
deemed to be the applicable special rate in applying the pay cap 
provisions in 5 U.S.C. 5547.
    Chapter 57, section 5753, 5754, and 5755: Recruitment and 
relocation bonuses, retention incentives and supervisory differentials. 
Waived to the extent necessary to allow: (1) Employees and positions 
under the demonstration project to be treated as employees and 
positions under the GS; and (2) that management may offer a bonus to 
incentivize geographic mobility to a SCEP student.
    Chapter 59, section 5941: Allowances based on living costs and 
conditions of environment; employees stationed outside continental U.S. 
or Alaska. Waived to the extent necessary to provide that cost of 
living allowances paid to employees under the demonstration project are 
paid in accordance with regulations prescribed by the President (as 
delegated to OPM).
    Chapter 75, sections 7501(1), 7511(a)(1)(A)(ii), and 
7511(a)(1)(C)(ii): Adverse Actions--Definitions. Waived to the extent 
necessary to allow for up to a three-year probationary period and to 
permit termination during the extended probationary period without 
using adverse action procedures for those employees serving a 
probationary period under an initial appointment except for those with 
veterans' preference.
    Chapter 75, section 7512(3): Adverse actions. Waived to the extent 
necessary to replace ``Grade'' with ``Pay Band.''
    Chapter 75, section 7512(4): Adverse actions. Waived to the extent 
necessary to provide that adverse action provisions do not apply to: 
(1) Conversions from GS special rates to demonstration project pay, as 
long as total pay is not reduced; (2) reductions in pay due to the 
removal of a supervisory or team leader pay adjustment upon voluntary 
movement to a non-supervisory or non-team leader position; and (3) 
reduction in supervisory pay due to a performance review.

B. Waivers to Title 5, CFR

    Part 300, sections 300.601 through 605: Time-in-Grade restrictions. 
Waived to eliminate time-in-grade restrictions in the demonstration 
project.
    Part 308, sections 308.101 through 308.103: Volunteer service. 
Waived to allow for a Volunteer Emeritus Corps in addition to student 
volunteers.
    Part 315, section 315.801(a), 315.801(b)(1), (c), and (e), and 
315.802(a) and (b)(1): Probationary period and Length of probationary 
period. Waived to the extent necessary to allow for up to a three-year 
probationary period and to permit termination during the extended 
probationary period without using adverse action procedures for those 
employees serving a probationary period under an initial appointment 
except for those with veterans' preference.
    Part 315, section 315.901 and 315.907: Probation on Initial 
Appointment to a Supervisory or Managerial Position. This section 
waived only to the extent necessary to replace ``grade'' with ``pay 
band level.''
    Part 316, sections 316.301, 316.303, and 316.304: Term Employment. 
These sections are waived to allow modified term appointments as 
described in this Federal Register notice.
    Part 332, sections 332.401 and 332.404: Order on Registers and 
Order of Selection from Certificates. These sections are waived to the 
extent necessary to allow: (1) No rating and ranking when there are 15 
or fewer qualified applicants and no preference eligibles; (2) the 
hiring and appointment authorities as described in this Federal 
Register notice; and (3) elimination of the ``rule of three.''
    Part 335, section 335.103: Agency promotion programs. Waived to the 
extent necessary to extend the length of details and temporary 
promotions without requiring competitive procedures or numerous short-
term renewals.
    Part 337, section 337.101(a): Rating applicants. Waived to the 
extent necessary to allow referral without rating when there are 15 or 
fewer qualified candidates and no qualified preference eligibles.

[[Page 3772]]

    Part 340, subpart A, subpart B, and subpart C: Other than Full-Time 
Career Employment. These subparts are waived to the extent necessary to 
allow a Volunteer Emeritus Corps.
    Part 351, Reduction in Force. This part is waived to the extent 
necessary to allow provisions of the RIF plan as described in this 
Federal Register notice. In accordance with this FR, ARDEC will define 
the competitive area, retention standing, and displacement limitations. 
Specific waivers include:
    Sections 351.402-351.404: Scope of Competition: this part is waived 
to the extent necessary to allow for modification of the competitive 
area;
    Sections 351.501-351.504: Retention Standing: this part is waived 
to the extent necessary to allow for modification of the calculation of 
the retention standing;
    Sections 351.601-351.608: Release from Competitive Level: this part 
is waived to the extent necessary to allow for the use of pay bands in 
lieu of grades; and
    Section 351.701: Assignment involving displacement. Waived to the 
extent that bump and retreat rights are limited to one pay band with 
the exception of 30 percent preference eligibles who are limited to two 
pay bands (or equivalent of five GS grades), and to limit the 
assignment rights of employees with an unacceptable current rating of 
record to a position held by another employee with an unacceptable 
rating of record.
    Part 410, section 410.308(a) and (c) sufficient to allow ARDEC to 
pay for all courses related to an academic degree program approved by 
the ARDEC Director.
    Part 410, section 410.309: Agreements to continue in service. 
Waived to the extent necessary to allow the ARDEC Director to determine 
requirements related to continued service agreements, including 
employees under the Student Career Experience Program who have received 
tuition assistance.
    Part 430, subpart B: Performance Appraisal for GS and Certain Other 
Employees. Waived to the extent necessary to be consistent with the 
CBCS.
    Part 430, section 430.208(a)(1) and (2): Rating Performance. Waived 
to allow presumptive ratings for new employees hired 90 days or less 
before the end of the appraisal cycle or for other situations not 
providing adequate time for an appraisal.
    Part 432, sections 432.101-432.105: Regarding performance based 
reduction in grade and removal actions. These sections are waived to 
the extent necessary to: (1) Replace grade with ``pay band''; (2) 
exclude reductions in pay band level not accompanied by a reduction in 
pay; and (3) allow provisions of CBCS. For employees who are reduced in 
pay band level without a reduction in pay, sections 432.105 and 432.106 
(a) do not apply.
    Part 451, subpart A, section 451.103(c)(2): Waived with respect to 
performance awards under the ARDEC CBCS.
    Part 451, sections 451.106(b) and 451.107(b): Awards. Waived to 
permit ARDEC to approve awards up to $25,000 for individual employees.
    Part 511, subpart A: General Provisions and subpart B: Coverage of 
the GS. Waived to the extent necessary to allow for the demonstration 
project classification system and pay banding structure.
    Part 511, section 511.601: Applicability of regulations. 
Classification appeals modified to the extent that white collar 
positions established under the project plan, although specifically 
excluded from title 5 CFR, are covered by the classification appeal 
process outlined in this FRN section III.B.5., as amended below.
    Part 511, section 511.603(a): Right to appeal. Waived to the extent 
necessary to substitute pay band for grade.
    Part 511, section 511.607(b): Non-Appealable Issues. Add to the 
list of issues that are neither appealable nor reviewable, the 
assignment of series under the project plan to appropriate Occupational 
Families and the demonstration project classification criteria.
    Part 530, subpart C: Special Rate Schedules for Recruitment and 
Retention. Waived in its entirety to allow for staffing supplements.
    Part 531, subparts B: Determining Rate of Basic Pay. Waived to the 
extent necessary to allow for pay setting and pay for performance under 
the provisions of the demonstration project.
    Part 531, subparts D and E: Within-Grade Increases and Quality Step 
Increases. Waived in its entirety.
    Part 531, subpart F: Locality-Based Comparability Payments. Waived 
to the extent necessary to allow (1) demonstration project employees to 
be treated as GS employees, and (2) base rates of pay under the 
demonstration project to be treated as scheduled annual rates of pay.
    Part 536: Grade and Pay Retention: These sections waived to the 
extent necessary to: (1) Replace grade with ``pay band;'' (2) allow 
demonstration project employees to be treated as GS employees; and (3) 
to allow provisions of this Federal Register notice pertaining to ARDEC 
pay band and pay retention provisions.
    Part 550, sections 550.105 and 550.106: Bi-weekly and annual 
maximum earnings limitations. Waived to the extent necessary to provide 
that the GS-15 maximum special rate (if any) for the special rate 
category to which a project employee belongs is deemed to be the 
applicable special rate in applying the pay cap provisions in 5 U.S.C. 
5547.
    Part 550, section 550.703: Definitions. Waived to the extent 
necessary to modify the definition of ``reasonable offer'' by replacing 
``two grade or pay levels'' with ``one band level'' and ``grade or pay 
level'' with ``band level.''
    Part 550, section 550.902: Definitions. Waived to the extent 
necessary to allow demonstration project employees to be treated as GS 
employees.
    Part 575, subparts A, B, and C: Recruitment, Relocation, and 
Retention Incentives. Waived to the extent necessary to allow: (1) 
Employees and positions under the demonstration project covered by pay 
banding to be treated as employees and positions under the GS; (2) 
Occupational Family relocation incentives to new SCEP students; and (3) 
relocation incentives to SCEP students whose worksite is in a different 
geographic location than that of the college enrolled.
    Part 575, subpart D: Supervisory Differentials. Subpart D is waived 
in its entirety.
    Part 591, subpart B: Cost-of-Living Allowance and Post 
Differential--Non-foreign Areas. Waived to the extent necessary to 
allow demonstration project employees to be treated as employees under 
the GS system.
    Part 752, sections 752.101, 752.201, 752.301 and 752.401: Principal 
statutory requirements and Coverage. Waived to the extent necessary to 
allow for up to a three-year probationary period and to permit 
termination during the extended probationary period without using 
adverse action procedures for those employees serving a probationary 
period under an initial appointment except for those with veterans' 
preference.
    Part 752, section 752.401: Coverage. Waived to the extent necessary 
to replace grade with pay band and to provide that a reduction in pay 
band level is not an adverse action if it results from the employee's 
rate of base pay being exceeded by the minimum rate of base pay for 
his/her pay band.
    Part 752, section 752.401(a)(4): Coverage. Waived to the extent 
necessary to provide that adverse action provisions do not apply to: 
(1) Conversions from GS special rates or

[[Page 3773]]

NSPS Targeted Local Market Supplements to demonstration project pay, as 
long as total pay is not reduced; (2) reductions in pay due to the 
removal of a supervisory or team leader pay adjustment upon voluntary 
movement to a non-supervisory or non-team leader position; or (3) 
decreases in the amount of a supervisory or team leader pay adjustment 
based on the annual review.

                                  Appendix A--ARDEC Employees by Duty Location
                                [Totals exclude SES, ST, DCIPS and FWS employees]
----------------------------------------------------------------------------------------------------------------
              Duty location                   Employees                  Servicing Personnel Office
----------------------------------------------------------------------------------------------------------------
Picatinny Arsenal, NJ...................             2,956  NE Region.
Aberdeen Proving Ground, MD.............                23  NE Region.
Rock Island, IL.........................               155  NC Region.
Adelphi, MD.............................                31  NE Region.
Watervliet, NY..........................               239  NE Region.
Washington, DC..........................                 5  NE Region.
Ft. Benning, GA.........................                 1  NE Region.
Ft. Knox, KY............................                 1  NE Region.
Ft. Lee, VA.............................                 1  NE Region.
Ft. Leonardwood, MO.....................                 1  NE Region.
Ft. Shafter, HI.........................                 1  NE Region.
Ft. Sill, OK............................                 2  NE Region.
Indianhead, MD..........................                 1  NE Region.
MacDill AFB, FL.........................                 1  NE Region.
Redstone Arsenal, AL....................                 3  SC Region.
                                         ------------------
    Total All Employees.................             3,421  ....................................................
----------------------------------------------------------------------------------------------------------------

Appendix B: Occupational Series by Occupational Family

I. Engineering & Science

0601 General Health Science Series
0801 General Engineering Series
0803 Safety Engineering Series
0806 Materials Engineering Series
0819 Environmental Engineering Series
0830 Mechanical Engineering Series
0840 Nuclear Engineering Series
0850 Electrical Engineering Series
0854 Computer Engineering Series
0855 Electronics Engineering Series
0858 Bioengineering and Biomedical Engineering Series
0861 Aerospace Engineering Series
0893 Chemical Engineering Series
0896 Industrial Engineering Series
0899 Engineering and Architecture Trainee Series
1301 General Physical Science Series
1306 Health Physics Series
1310 Physics Series
1320 Chemistry Series
1321 Metallurgy Series
1399 Physical Science Student Trainee Series
1501 General Mathematics and Statistics Series
1515 Operations Research Series
1520 Mathematics Series
1550 Computer Science Series
1599 Mathematics and Statistics Student Trainee Series

II. Business/Technical

0018 Safety and Occupational Health Management Series
0301 Miscellaneous Administration and Program Series
0340 Program Management Series
0341 Administrative Officer Series
0342 Support Services Administration Series
0343 Management and Program Analysis Series
0346 Logistics Management Series
0501 Financial Administration and Program Series
0510 Accounting Series
0802 Engineering Technical Series
0856 Electronics Technical Series
0895 Industrial Engineering Technical Series
0905 General Attorney Series
0950 Paralegal Specialist Series
1001 Information and Arts Group Series General Arts and Information 
Series
1035 Public Affairs Series
1071 Audiovisual Production Series
1083 Technical Writing and Editing Series
1084 Visual Information Series
1101 Business and Industry Series
1102 Contracting Series
1222 Patent Attorney Series
1311 Physical Science Technician Series
1410 Librarian Series
1412 Technical Information Services Series
1670 Equipment Services Series
1702 Education and Training Technician Series
1712 Training Instruction Series
1801 General Inspection, Investigation, Enforcement, and Compliance 
Series
1910 Quality Assurance Series
2032 Packaging Series
2210 Information Technology Management Series

III. General Support

0303 Miscellaneous Clerk and Assistant Series
0318 Secretary Series
0326 Office Automation Clerical and Assistance Series
0335 Computer Clerk and Assistant Series
0344 Management and Program Clerical and Assistance Series

Appendix C: Contribution Factors and Level Descriptors

1. Occupational Family DB--Engineering and Science (E&S)

Factor 1-1: Problem Solving
    Factor Description: This factor describes/captures personal and 
organizational problem-solving results.
    Expected Performance Criteria (Applicable to all contributions at 
all levels): Work is timely, efficient, appropriately coordinated and 
of acceptable quality. Completed work meets projects/programs 
objectives. Recommendations are sound. Flexibility, adaptability, and 
decisiveness are exercised appropriately.
    Descriptors indicate the type of contribution appropriate for the 
high end of each level. Descriptors are not to be used individually to 
assess contributions, but rather are to be taken as a group to derive a 
single evaluation of the factor.

[[Page 3774]]



----------------------------------------------------------------------------------------------------------------
            Level descriptors                                          Discriminators
----------------------------------------------------------------------------------------------------------------
LEVEL I:
    <bullet> Performs activities on a      --Scope/Impact.
     task; assists supervisor or other
     appropriate personnel.
    <bullet> Resolves routine problems     --Complexity/Difficulty.
     within established guidelines.
    <bullet> Independently performs        --Independence.
     assigned tasks within area of
     responsibility; refers situations to
     supervisor or other appropriate
     personnel when existing guidelines
     do not apply.
    <bullet> Takes initiative in           --Creativity.
     determining and implementing
     appropriate procedures.
LEVEL II:
    <bullet> Plans and conducts            --Scope/Impact.
     functional technical activities for
     projects/programs.
    <bullet> Identifies, analyzes, and     --Complexity/Difficulty.
     resolves moderately complex/
     difficult problems.
    <bullet> Independently identifies and  --Independence.
     resolves conventional problems which
     may require deviations from accepted
     policies or instructions.
    <bullet> Adapts existing plans and     --Creativity.
     techniques to accomplish moderately
     complex projects/programs.
     Recommends improvements to the
     design or operation of systems,
     equipment, or processes.
LEVEL III:
    <bullet> Independently defines,        --Scope/Impact.
     directs, or leads highly challenging
     projects/programs. Identifies and
     resolves highly complex problems not
     susceptible to treatment by accepted
     methods.
    <bullet> Develops, integrates, and     --Complexity/Difficulty.
     implements solutions to diverse,
     highly complex problems across
     multiple areas and disciplines.
    <bullet> Anticipates problems,         --Independence.
     develops sound solutions and action
     plans to ensure program/mission
     accomplishment.
    <bullet> Develops plans and            --Creativity.
     techniques to fit new situations to
     improve overall program and
     policies. Establishes precedents in
     application of problem-solving
     techniques to enhance existing
     processes.
LEVEL IV:
    <bullet> Plans and performs work       --Scope/Impact.
     across a broad range of highly
     complex activities that require
     substantial depth of analysis and
     expertise and/or organizational
     problem solving skills. The work
     significantly affects policies/major
     programs. Actively engages in
     organizational planning.
    <bullet> Resolves critical,            --Complexity/Difficulty.
     multifaceted problems and/or
     develops new theories or methods
     that affect the work of other
     experts, major aspects of management
     programs, or a large number of
     people.
    <bullet> Independently plans and       --Independence.
     carries out work from general
     objectives. Work results are
     considered authoritative. Expertise
     is recognized both internally and
     externally.
    <bullet> Uses judgment and ingenuity   --Creativity.
     in making decisions or developing
     methodologies for areas with
     substantial uncertainty. Adapts to
     tasks with changing/competing
     requirements. Approaches to solving
     problems require interpretation,
     deviation from traditional methods,
     or research of trends and patterns
     to develop new methods, scientific
     knowledge, or organizational
     principles.
LEVEL V:
    <bullet> Defines, establishes, and     -- Scope/Impact.
     directs organizational focus (on
     challenging and highly complex
     project/programs). Identifies and
     resolves highly complex problems
     that cross organizational boundaries
     and promulgates solutions.
     Resolution of problems requires
     mastery of the field to develop new
     hypotheses or fundamental new
     concepts.
    <bullet> Assesses and provides         --Complexity/Difficulty.
     strategic direction for resolution
     of mission critical problems,
     policies, and procedures.
    <bullet> Works at senior level to      --Independence.
     define, integrate, and implement
     strategic direction for vital
     programs with long-term impact on
     large numbers of people. Initiates
     actions to resolve major
     organizational issues. Promulgates
     innovative solutions and
     methodologies.
    <bullet> Works strategically with      --Creativity.
     senior management to establish new
     fundamental concepts and criteria
     and stimulate the development of new
     policies, methodologies, and
     techniques. Converts strategic goals
     into programs or policies.
LEVEL VI:
    <bullet> TBD.........................
----------------------------------------------------------------------------------------------------------------

Factor 1-2: Teamwork/Cooperation
    Factor Description: This factor, applicable to all teams, 
describes/captures individual and organizational teamwork and 
cooperation.
    Expected Performance Criteria (Applicable to all contributions at 
all levels): Work is timely, efficient, appropriately coordinated and 
of acceptable quality. Personal and organizational interactions exhibit 
and foster cooperation and teamwork. Flexibility, adaptability, and 
decisiveness are exercised appropriately.
    Descriptors indicate the type of contribution appropriate for the 
high end of each level. Descriptors are not to be used individually to 
assess contributions, but rather are to be taken as a group to derive a 
single evaluation of the factor.

----------------------------------------------------------------------------------------------------------------
            Level descriptors                                          Discriminators
----------------------------------------------------------------------------------------------------------------
LEVEL I:
    <bullet> Works with others to          --Scope of Team Effort.
     accomplish routine tasks.
    <bullet> Contributes ideas in own      --Contribution to Team.
     area of expertise. Interacts
     cooperatively with others.
    <bullet> Regularly completes           --Effectiveness.
     assignments in support of team goals.

[[Page 3775]]

 
LEVEL II:
    <bullet> Works with others to          --Scope of Team Effort.
     accomplish projects/programs.
    <bullet> Uses varied approaches to     --Contribution to Team.
     resolve or collaborate on projects/
     programs issues. Facilitates
     cooperative interactions with others.
    <bullet> Guides/supports others in     --Effectiveness.
     executing team assignments.
     Proactively functions as an integral
     part of the team.
LEVEL III:
    <bullet> Works with/leads others to    --Scope of Team Effort.
     accomplish complex projects/programs.
    <bullet> Applies innovative            --Contribution to Team.
     approaches to resolve unusual/
     difficult issues significantly
     impacting important policies or
     programs. Promotes and maintains
     environment for cooperation and
     teamwork.
    <bullet> Leads, guides and mentors     --Effectiveness.
     others in formulating and executing
     team plans. Expertise is sought by
     peers.
LEVEL IV:
    <bullet> Leads team(s) working on      --Scope of Team Effort.
     critical aspects of technology areas
     or programmatic/business management
     efforts. Team results significantly
     affect internal/external
     organizations and/or relationships.
    <bullet> Is accountable for quality    --Contribution to Team.
     and effectiveness of team efforts.
     Integrates efforts across
     disciplines.
    <bullet> Leads/guides/mentors team(s)  --Effectiveness.
     on highly complex, high priority
     programs. Is sought out for
     leadership roles and for
     consultation on complex issues with
     internal/external impact.
LEVEL V:
    <bullet> Leads/guides/mentors          --Scope of Team Effort.
     workforce in dealing with complex
     problems.
    <bullet> Solves broad organizational   --Contribution to Team.
     issues. Implements strategic plans
     within and across organizational
     components. Ensures a cooperative
     teamwork environment. Develops
     future team leaders and supervisors.
    <bullet> Leads/guides workforce in     -- Effectiveness.
     achieving organizational goals. Is
     sought out for leadership roles for
     critical issues and strategy.
     Fosters teamwork throughout the
     organization.
LEVEL VI:
    <bullet> TBD.........................
----------------------------------------------------------------------------------------------------------------

Factor 1-3: Customer Relations
    Factor Description: This factor describes/captures the 
effectiveness of personal and organizational interactions with 
customers (anyone to whom services or products are provided), both 
internal (within an assigned organization) and external (outside an 
assigned organization).
    Expected Performance Criteria (Applicable to all contributions at 
all levels): Work is timely, efficient, appropriately coordinated and 
of acceptable quality. Personal and organizational interactions enhance 
customer relations and actively promote rapport with customers. 
Flexibility, adaptability, and decisiveness are exercised 
appropriately.
    Descriptors indicate the type of contribution appropriate for the 
high end of each level. Descriptors are not to be used individually to 
assess contributions, but rather are to be taken as a group to derive a 
single evaluation of the factor.

------------------------------------------------------------------------
             Level descriptors                     Discriminators
------------------------------------------------------------------------
LEVEL I:
    <bullet> Independently carries out      --Breadth of Influence.
     routine customer requests.
    <bullet> Participates as a team member  --Customer Needs.
     to meet customer needs.
    <bullet> Interacts with customers on    --Customer Interaction
     routine issues with appropriate         Level.
     guidance.
LEVEL II:
    <bullet> Guides the technical/          --Breadth of Influence.
     functional efforts of individuals or
     team members as they interact with
     customers.
    <bullet> Initiates meetings and         --Customer Needs.
     interactions with customers to
     understand customer needs/
     expectations.
    <bullet> Interacts independently with   --Customer Interaction
     customers to communicate information    Level.
     and coordinate actions.
LEVEL III:
    <bullet> Guides and integrates          --Breadth of Influence.
     functional efforts of individuals or
     teams in support of customer
     interaction. Seeks innovative
     approaches to satisfy customers.
    <bullet> Establishes customer           --Customer Needs.
     alliances, anticipates and fulfills
     customer needs, and translates
     customer needs to programs/projects.
    <bullet> Interacts independently and    --Customer Interaction
     proactively with customers to           Level.
     identify and define complex/difficult
     problems and to develop and implement
     strategies or techniques for
     resolving program/project problems
     (e.g., determining priorities and
     resolving conflict among customers'
     requirements).
LEVEL IV:
    <bullet> Leads efforts involving        --Breadth of Influence.
     extensive customer interactions and
     partnerships. Establishes successful
     working relationships with customers
     to address and resolve highly complex
     or controversial issues.
    <bullet> Identifies and fosters new     --Customer Needs.
     customer alliances. Anticipates
     customer needs to avoid potential
     problems and improve customer
     satisfaction.

[[Page 3776]]

 
    <bullet> Works proactively at senior    --Customer Interaction
     level to assure customer satisfaction   Level.
     on programs and issues with a high
     level of customer interest and
     concern.
LEVEL V:
    <bullet> Leads and manages the          --Breadth of Influence.
     organizational interactions with
     customers from a strategic standpoint.
    <bullet> Works to assess and            --Customer Needs.
     promulgate political, fiscal, and
     other factors affecting customer and
     program/project needs. Works with
     customer at management levels to
     resolve problems affecting programs/
     projects (e.g., problems that involve
     determining priorities and resolving
     conflicts among customers'
     requirements).
    <bullet> Collaborates at senior level   --Customer Interaction
     to stimulate customer alliances for     Level.
     program/project support. Stimulates,
     organizes, and leads overall customer
     interactions.
LEVEL VI:
    <bullet> TBD..........................
------------------------------------------------------------------------

Factor 1-4: Leadership/Supervision
    Factor Description: This factor describes/captures individual and 
organizational leadership and/or supervision. Recruits, develops, 
motivates, and retains quality team members in accordance with EEO/AA 
and Merit Principles. Takes timely/appropriate personnel actions, 
communicates mission and organizational goals; by example, creates a 
positive, safe, and challenging work environment; distributes work and 
empowers team members.
    Expected Performance Criteria (Applicable to all contributions at 
all levels): Work is timely, efficient, appropriately coordinated and 
of acceptable quality. Leadership and/or supervision effectively 
promotes commitment to mission accomplishment. Flexibility, 
adaptability, and decisiveness are exercised appropriately.
    Descriptors indicate the type of contribution appropriate for the 
high end of each level. Descriptors are not to be used individually to 
assess contributions, but rather are to be taken as a group to derive a 
single evaluation of the factor.

------------------------------------------------------------------------
             Level descriptors                     Discriminators
------------------------------------------------------------------------
LEVEL I:
    <bullet> Takes initiative in            --Leadership Role.
     accomplishing assigned tasks.
    <bullet> Provides inputs to others in   --Breadth of Influence.
     own technical/functional area.
    <bullet> Seeks and takes advantage of   --Mentoring/Employee
     developmental opportunities.            Development.
LEVEL II:
    <bullet> Actively contributes as a      --Leadership Role.
     team member/leader; provides insight
     and recommends changes or solutions
     to problems.
    <bullet> Proactively guides,            --Breadth of Influence.
     coordinates, and consults with others
     to accomplish projects.
    <bullet> Identifies and pursues         --Mentoring/Employee
     individual/team development             Development.
     opportunities.
LEVEL III:
    <bullet> Provides guidance to           --Leadership Role.
     individuals/teams; resolves
     conflicts. Considered a functional/
     technical expert by others in the
     organization; is regularly sought out
     by others for advice and assistance.
    <bullet> Fosters individual/team        --Breadth of Influence.
     development by mentoring.
    <bullet> Pursues or creates training    --Mentoring/Employee
     development programs for self and       Development.
     others.
LEVEL IV:
    <bullet> As a program area expert,      --Leadership Role.
     resolves highly complex team problems
     and conflicts. Effectively seeks out
     and capitalizes on opportunities for
     teams/work units to achieve
     significant results that support
     organizational goals. Is sought out
     for consultation and leadership roles.
    <bullet> Leads teams engaged in highly  --Breadth of Influence.
     complex and critical work, with
     accountability for employee
     motivation, quality, and
     effectiveness and for team success.
    <bullet> Fosters and initiates          --Mentoring/Employee
     effective team development to meet      Development.
     current and future organizational
     needs. Actively seeks out
     opportunities for and engages in
     mentoring, coaching, and instruction.
     Pursues personal professional
     development.
LEVEL V:
    <bullet> Establishes and/or leads       --Leadership Role.
     teams to carry out complex projects
     or programs. Creates an
     organizational climate where
     empowerment and creativity thrive.
     Mentors and motivates workforce.
    <bullet> Leads, defines, manages, and   --Breadth of Influence.
     integrates efforts involving large
     numbers of people. Ensures
     organizational mission and program
     success.
    <bullet> Fosters workforce              --Mentoring/Employee
     development. Encourages cross           Development.
     functional growth to meet mission
     needs. Pursues personal professional
     development as a model for staff.
LEVEL VI:
    <bullet> TBD..........................
------------------------------------------------------------------------

Factor 1-5: Communication
    Factor Description: This factor describes/captures the 
effectiveness of oral/written communications.
    Expected Performance Criteria (Applicable to all contributions at 
all levels): Work is timely, efficient, appropriately coordinated and 
of acceptable quality.
    Communications are clear, concise, and at appropriate level. 
Flexibility,

[[Page 3777]]

adaptability, and decisiveness are exercised appropriately.
    Descriptors indicate the type of contribution appropriate for the 
high end of each level. Descriptors are not to be used individually to 
assess contributions, but rather are to be taken as a group to derive a 
single evaluation of the factor.

------------------------------------------------------------------------
             Level descriptors                     Discriminators
------------------------------------------------------------------------
LEVEL I:
    <bullet> Communicates routine task      --Level of Interaction
     status/results as required.             (Audience).
    <bullet> Provides timely data and       --Written.
     written analyses for input to
     management/technical reports or
     contractual documents.
    <bullet> Explains status/results of     --Oral.
     assigned tasks.
LEVEL II:
    <bullet> Communicates team or group     --Level of Interaction
     tasking results, internally and         (Audience).
     externally, at peer levels.
    <bullet> Writes, or is a major          --Written.
     contributor to, management/technical
     reports or contractual documents.
    <bullet> Presents informational         --Oral.
     briefings.
LEVEL III:
    <bullet> Communicates project or        --Level of Interaction
     program results to all levels,          (Audience).
     internally and externally.
    <bullet> Reviews and approves, or is a  --Written.
     major contributor to/lead author of,
     management reports or contractual
     documents for external distribution.
     Provides inputs to policies.
    <bullet> Presents briefings to obtain   --Oral.
     consensus/approval.
LEVEL IV:
    <bullet> Communicates complex           --Level of Interaction
     technical, programmatic, and/or         (Audience).
     management information across
     multiple organizational levels to
     drive decisions by senior leaders
     internally and externally.
    <bullet> Leads efforts in documenting   --Written.
     diverse and highly complex
     information, concepts, and ideas.
     Authors and enables authoritative
     reports pertaining to multiple areas
     of expertise, incorporating diverse
     viewpoints. Reviews communications of
     others for appropriate and accurate
     content.
    <bullet> Demonstrates expert speaking   --Oral.
     skills and the adaptability to be
     effective in critical briefings.
LEVEL V:
    <bullet> Determines and communicates    --Level of Interaction
     organizational positions on major       (Audience).
     projects or policies to senior level.
    <bullet> Prepares, reviews, and         --Written.
     approves major reports or policies of
     organization for internal and
     external distribution. Resolves
     diverse viewpoints/controversial
     issues.
    <bullet> Presents organizational        --Oral.
     briefings to convey strategic vision
     or organizational policies.
LEVEL VI:
    <bullet> TBD..........................
------------------------------------------------------------------------

Factor 1-6: Resource Management
    Factor Description: This factor describes/captures personal and 
organizational utilization of resources to accomplish the mission. 
(Resources include, but are not limited to, personal time, equipment 
and facilities, human resources, and funds.)
    Expected Performance Criteria (Applicable to all contributions at 
all levels): Work is timely, efficient, appropriately coordinated and 
of acceptable quality. Resources are utilized effectively to accomplish 
mission. Flexibility, adaptability, and decisiveness are exercised 
appropriately.
    Descriptors indicate the type of contribution appropriate for the 
high end of each level. Descriptors are not to be used individually to 
assess contributions, but rather are to be taken as a group to derive a 
single evaluation of the factor.

------------------------------------------------------------------------
             Level descriptors                     Discriminators
------------------------------------------------------------------------
LEVEL I:
    <bullet> Uses assigned resources        --Scope of Responsibility.
     needed to accomplish tasks.
    <bullet> Plans individual time and      --Planning/Budgeting.
     assigned resources to accomplish
     tasks.
    <bullet> Effectively accomplishes       --Execution/Efficiency.
     assigned tasks.
LEVEL II:
    <bullet> Plans and utilizes             --Scope of Responsibility.
     appropriate resources to accomplish
     project goals.
    <bullet> Optimizes resources to         --Planning/Budgeting.
     accomplish projects/programs within
     established schedules.
    <bullet> Effectively accomplishes       --Execution/Efficiency.
     projects/programs goals within
     established resource guidelines.
LEVEL III:
    <bullet> Plans and allocates resources  --Scope of Responsibility.
     to accomplish multiple projects/
     programs.
    <bullet> Identifies and optimizes       --Planning/Budgeting.
     resources to accomplish multiple
     projects/programs goals.
    <bullet> Effectively accomplishes       --Execution/Efficiency.
     multiple projects/programs goals
     within established guidelines.
LEVEL IV:

[[Page 3778]]

 
    <bullet> Plans, allocates, and          --Scope of Responsibility.
     monitors resources in a complex
     environment with substantial
     instability in resources/requirements.
    <bullet> Anticipates changes in         --Planning/Budgeting.
     workload and other resource
     requirements for multiple programs/
     projects and develops and advocates
     solutions in advance.
    <bullet> Leads others in using          --Execution/Efficiency.
     resources more efficiently and
     implements innovative ideas to
     stretch limited resources.
LEVEL V:
    <bullet> Develops, acquires, and        --Scope of Responsibility.
     allocates resources to accomplish
     mission goals and strategic
     objectives.
    <bullet> Formulates organizational      --Planning/Budgeting.
     strategies, tactics, and budget/
     action plan to acquire and allocate
     resources.
    <bullet> Optimizes, controls, and       --Execution/Efficiency.
     manages all resources across projects/
     programs. Develops and integrates
     innovative approaches to attain goals
     and minimize expenditures.
LEVEL VI:
    <bullet> TBD..........................
------------------------------------------------------------------------

2. Occupational Family DE--Business and Technical (B&T)

Factor 2-1: Problem Solving
    Factor Description: This factor describes/captures personal and 
organizational problem-solving results.
    Expected Performance Criteria (Applicable to all contributions at 
all levels): Work is timely, efficient, appropriately coordinated and 
of acceptable quality. Completed work meets projects/programs 
objectives. Flexibility, adaptability, and decisiveness are exercised 
appropriately.
    Descriptors indicate the type of contribution appropriate for the 
high end of each level. Descriptors are not to be used individually to 
assess contributions, but rather are to be taken as a group to derive a 
single evaluation of the factor.

------------------------------------------------------------------------
             Level descriptors                     Discriminators
------------------------------------------------------------------------
LEVEL I:                                    ............................
    <bullet> Performs activities on a       --Scope/Impact.
     task; assists supervisor or other
     appropriate personnel.
    <bullet> Resolves routine problems      --Complexity/Difficulty.
     within established guidelines.
    <bullet> Independently performs         --Independence.
     assigned tasks within area of
     responsibility; refers situations to
     supervisor or other appropriate
     personnel when existing guidelines do
     not apply.
    <bullet> Takes initiative in            --Creativity.
     determining and implementing
     appropriate procedures.
LEVEL II:                                   ............................
    <bullet> Plans and conducts functional  --Scope/Impact.
     technical activities for projects/
     programs.
    <bullet> Identifies, analyzes, and      --Complexity/Difficulty.
     resolves complex/difficult problems.
    <bullet> Independently identifies and   --Independence.
     resolves conventional problems which
     may require deviations from accepted
     policies or instructions.
    <bullet> Adapts existing plans and      --Creativity.
     techniques to accomplish complex
     projects/programs. Recommends
     improvements to the design or
     operation of systems, equipment, or
     processes.
LEVEL III:                                  ............................
    <bullet> Independently defines,         --Scope/Impact.
     directs, or leads highly challenging
     projects/programs. Identifies and
     resolves highly complex problems not
     susceptible to treatment by accepted
     methods.
    <bullet> Develops, integrates, and      --Complexity/Difficulty.
     implements solutions to diverse,
     highly complex problems across
     multiple areas and disciplines.
    <bullet> Anticipates problems,          --Independence.
     develops sound solutions and action
     plans to ensure program/mission
     accomplishment.
    <bullet> Develops plans and techniques  --Creativity.
     to fit new situations to improve
     overall program and policies.
     Establishes precedents in application
     of problem-solving techniques to
     enhance existing processes.
LEVEL IV:                                   ............................
    <bullet> Plans and performs work        --Scope/Impact.
     across a broad range of highly
     complex activities that require
     substantial depth of analysis and
     expertise and/or organizational
     problem solving skills. The work
     significantly affects policies/major
     programs. Actively engages in
     organizational planning.
    <bullet> Resolves critical,             --Complexity/Difficulty.
     multifaceted problems and/or develops
     new theories or methods that affect
     the work of other experts, major
     aspects of management programs, or a
     large number of people.
    <bullet> Independently plans and        --Independence.
     carries out work from general
     objectives. Work results are
     considered authoritative. Expertise
     is recognized both internally and
     externally.
    <bullet> Uses judgment and ingenuity    --Creativity.
     in making decisions or developing
     methodologies for areas with
     substantial uncertainty. Adapts to
     tasks with changing/competing
     requirements. Approaches to solving
     problems require interpretation,
     deviation from traditional methods,
     or research of trends and patterns to
     develop new methods, scientific
     knowledge, or organizational
     principles.
LEVEL V:                                    ............................

[[Page 3779]]

 
    <bullet> Defines, establishes, and      --Scope/Impact.
     directs organizational focus (on
     challenging and highly complex
     project/programs). Identifies and
     resolves highly complex problems that
     cross organizational boundaries and
     promulgates solutions. Resolution of
     problems requires mastery of the
     field to develop new hypotheses or
     fundamental new concepts.
    <bullet> Assesses and provides          --Complexity/Difficulty.
     strategic direction for resolution of
     mission critical problems, policies,
     and procedures.
    <bullet> Works at senior level to       --Independence.
     define, integrate, and implement
     strategic direction for vital
     programs with long-term impact on
     large numbers of people. Initiates
     actions to resolve major
     organizational issues. Promulgates
     innovative solutions and
     methodologies.
    <bullet> Works strategically with       --Creativity.
     senior management to establish new
     fundamental concepts and criteria and
     stimulate the development of new
     policies, methodologies, and
     techniques. Converts strategic goals
     into programs or policies.
------------------------------------------------------------------------

Factor 2-2: Teamwork/Cooperation
    Factor Description: This factor, applicable to all teams, 
describes/captures individual and organizational teamwork and 
cooperation.
    Expected Performance Criteria (Applicable to all contributions at 
all levels): Work is timely, efficient, appropriately coordinated and 
of acceptable quality. Personal and organizational interactions exhibit 
and foster cooperation and teamwork. Flexibility, adaptability, and 
decisiveness are exercised appropriately.
    Descriptors indicate the type of contribution appropriate for the 
high end of each level. Descriptors are not to be used individually to 
assess contributions, but rather are to be taken as a group to derive a 
single evaluation of the factor.

------------------------------------------------------------------------
             Level descriptors                     Discriminators
------------------------------------------------------------------------
LEVEL I:                                    ............................
    <bullet> Works with others to           --Scope of Team Effort.
     accomplish routine tasks.
    <bullet> Contributes ideas in own area  --Contribution to Team.
     of expertise. Interacts cooperatively
     with others.
    <bullet> Regularly completes            --Effectiveness.
     assignments in support of team goals.
LEVEL II:                                   ............................
    <bullet> Works with others to           --Scope of Team Effort.
     accomplish projects/programs.
    <bullet> Uses varied approaches to      --Contribution to Team.
     resolve or collaborate on projects/
     programs issues. Facilitates
     cooperative interactions with others.
    <bullet> Guides/supports others in      --Effectiveness.
     executing team assignments.
     Proactively functions as an integral
     part of the team.
LEVEL III:                                  ............................
    <bullet> Works with/leads others to     --Scope of Team Effort.
     accomplish complex projects/programs.
    <bullet> Applies innovative approaches  --Contribution to Team.
     to resolve unusual/difficult issues
     significantly impacting important
     policies or programs. Promotes and
     maintains environment for cooperation
     and teamwork.
    <bullet> Leads guides and mentors       --Effectiveness.
     others in formulating and executing
     team plans. Expertise is sought by
     peers.
LEVEL IV:                                   ............................
    <bullet> Leads team(s) working on       --Scope of Team Effort.
     critical aspects of technology areas
     or programmatic/business management
     efforts. Team results significantly
     affect internal/external
     organizations and/or relationships.
    <bullet> Is accountable for quality     --Contribution to Team.
     and effectiveness of team efforts.
     Integrates efforts across disciplines.
    <bullet> Leads/guides/mentors team(s)   --Effectiveness.
     on highly complex, high priority
     programs. Is sought out for
     leadership roles and for consultation
     on complex issues with internal/
     external impact.
LEVEL V:                                    ............................
    <bullet> Leads/guides/mentors           --Scope of Team Effort.
     workforce in dealing with complex
     problems.
    <bullet> Solves broad organizational    --Contribution to Team.
     issues. Implements strategic plans
     within and across organizational
     components. Ensures a cooperative
     teamwork environment. Develops future
     team leaders and supervisors.
    <bullet> Leads/guides workforce in      --Effectiveness.
     achieving organizational goals. Is
     sought out for leadership roles for
     critical issues and strategy. Fosters
     teamwork throughout the organization.
------------------------------------------------------------------------

Factor 2-3: Customer Relations
    Factor Description: This factor describes/captures the 
effectiveness of personal and organizational interactions with 
customers (anyone to whom services or products are provided), both 
internal (within an assigned organization) and external (outside an 
assigned organization).
    Expected Performance Criteria (Applicable to all contributions at 
all levels): Work is timely, efficient, appropriately coordinated and 
of acceptable quality. Personal and organizational interactions enhance 
customer relations and actively promote rapport with customers. 
Flexibility, adaptability, and decisiveness are exercised 
appropriately.
    Descriptors indicate the type of contribution appropriate for the 
high

[[Page 3780]]

end of each level. Descriptors are not to be used individually to 
assess contributions, but rather are to be taken as a group to derive a 
single evaluation of the factor.

------------------------------------------------------------------------
             Level descriptors                     Discriminators
------------------------------------------------------------------------
LEVEL I:                                    ............................
    <bullet> Independently carries out      --Breadth of Influence.
     routine customer requests.
    <bullet> Participates as a team member  --Customer Needs.
     to meet customer needs.
    <bullet> Interacts with customers on    --Customer Interaction
     routine issues with appropriate         Level.
     guidance.
LEVEL II:                                   ............................
    <bullet> Guides the technical/          --Breadth of Influence.
     functional efforts of individuals or
     team members as they interact with
     customers.
    <bullet> Initiates meetings and         --Customer Needs.
     interactions with customers to
     understand customer needs/
     expectations.
    <bullet> Interacts independently with   --Customer Interaction
     customers to communicate information    Level.
     and coordinate actions.
LEVEL III:                                  ............................
    <bullet> Guides and integrates          --Breadth of Influence.
     functional efforts of individuals or
     teams in support of customer
     interaction. Seeks innovative
     approaches to satisfy customers.
    <bullet> Establishes customer           --Customer Needs.
     alliances, anticipates and fulfills
     customer needs, and translates
     customer needs to programs/projects.
    <bullet> Interacts independently and    --Customer Interaction
     proactively with customers to           Level.
     identify and define complex/difficult
     problems and to develop and implement
     strategies or techniques for
     resolving program/project problems
     (e.g., determining priorities and
     resolving conflict among customers'
     requirements).
LEVEL IV:                                   ............................
    <bullet> Leads efforts involving        --Breadth of Influence.
     extensive customer interactions and
     partnerships. Establishes successful
     working relationships with customers
     to address and resolve highly complex
     or controversial issues.
    <bullet> Identifies and fosters new     --Customer Needs.
     customer alliances. Anticipates
     customer needs to avoid potential
     problems and improve customer
     satisfaction.
    <bullet> Works proactively at senior    --Customer Interaction
     level to assure customer satisfaction   Level.
     on programs and issues with a high
     level of customer interest and
     concern.
LEVEL V:                                    ............................
    <bullet> Leads and manages the          --Breadth of influence.
     organizational interactions with
     customers from a strategic standpoint.
    <bullet> Works to assess and            --Customer Needs.
     promulgate political, fiscal, and
     other factors affecting customer and
     program/project needs. Works with
     customer at management levels to
     resolve problems affecting programs/
     projects (e.g., problems that involve
     determining priorities and resolving
     conflicts among customers'
     requirements).
    <bullet> Collaborates at senior level   --Customer Interaction
     to stimulate customer alliances for     Level.
     program/project support. Stimulates,
     organizes, and leads overall customer
     interactions.
------------------------------------------------------------------------

Factor 2-4: Leadership/Supervision
    Factor Description: This factor describes/captures individual and 
organizational leadership and/or supervision. Recruits, develops, 
motivates, and retains quality team members in accordance with EEO/AA 
and Merit Principles. Takes timely/appropriate personnel actions, 
communicates mission and organizational goals; by example, creates a 
positive, safe, and challenging work environment; distributes work and 
empowers team members.
    Expected Performance Criteria (Applicable to all contributions at 
all levels):
    Work is timely, efficient, appropriately coordinated and of 
acceptable quality. Leadership and/or supervision effectively promotes 
commitment to mission accomplishment. Flexibility, adaptability, and 
decisiveness are exercised appropriately.
    Descriptors indicate the type of contribution appropriate for the 
high end of each level. Descriptors are not to be used individually to 
assess contributions, but rather are to be taken as a group to derive a 
single evaluation of the factor.

------------------------------------------------------------------------
             Level descriptors                     Discriminators
------------------------------------------------------------------------
LEVEL I:                                    ............................
    <bullet> Takes initiative in            --Leadership Role.
     accomplishing assigned tasks.
    <bullet> Provides inputs to others in   --Breadth of Influence.
     own technical/functional area.
    <bullet> Seeks and takes advantage of   --Mentoring/Employee
     developmental opportunities.            Development.
LEVEL II:                                   ............................
    <bullet> Actively contributes as a      --Leadership Role.
     team member/leader; provides insight
     and recommends changes or solutions
     to problems.
    <bullet> Proactively guides,            --Breadth of Influence.
     coordinates, and consults with others
     to accomplish projects.
    <bullet> Identifies and pursues         --Mentoring/Employee
     individual/team development             Development.
     opportunities.
LEVEL III:                                  ............................
    <bullet> Provides guidance to           --Leadership Role.
     individuals/teams; resolves
     conflicts. Considered a functional/
     technical expert by others in the
     organization; is regularly sought out
     by others for advice and assistance.

[[Page 3781]]

 
    <bullet> Defines, organizes, and        --Breadth of Influence.
     assigns activities to accomplish
     projects/programs goals. Guides,
     motivates, and oversees the
     activities of individuals and teams
     with focus on projects/programs
     issues.
    <bullet> Fosters individual/team        --Mentoring/Employee
     development by mentoring. Pursues or    Development.
     creates training development programs
     for self and others.
LEVEL IV:                                   ............................
    <bullet> As a program area expert,      --Leadership Role.
     resolves highly complex team problems
     and conflicts. Effectively seeks out
     and capitalizes on opportunities for
     teams/work units to achieve
     significant results that support
     organizational goals. Is sought out
     for consultation and leadership roles.
    <bullet> Leads teams engaged in highly  --Breadth of Influence.
     complex and critical work, with
     accountability for employee
     motivation, quality, and
     effectiveness and for team success.
    <bullet> Fosters and initiates          --Mentoring/Employee
     effective team development to meet      Development.
     current and future organizational
     needs. Actively seeks out
     opportunities for and engages in
     mentoring, coaching, and instruction.
     Pursues personal professional
     development.
LEVEL V:                                    ............................
    <bullet> Establishes and/or leads       --Leadership Role.
     teams to carry out complex projects
     or programs. Creates an
     organizational climate where
     empowerment and creativity thrive.
     Mentors and motivates workforce.
    <bullet> Leads, defines, manages, and   --Breadth of Influence.
     integrates efforts of several
     involving large numbers of people.
     Ensures organizational mission and
     program success.
    <bullet> Fosters workforce              --Mentoring/Employee
     development. Encourage cross-           Development.
     functional growth to meet
     organizational needs. Pursues
     personal professional development as
     a model for staff.
------------------------------------------------------------------------

Factor 2-5: Communication
    Factor Description: This factor describes/captures the 
effectiveness of oral/written communications.
    Expected Performance Criteria (Applicable to all contributions at 
all levels): Work is timely, efficient, appropriately coordinated and 
of acceptable quality.
    Communications are clear, concise, and at appropriate level. 
Flexibility, adaptability, and decisiveness are exercised 
appropriately.
    Descriptors indicate the type of contribution appropriate for the 
high end of each level. Descriptors are not to be used individually to 
assess contributions, but rather are to be taken as a group to derive a 
single evaluation of the factor.

------------------------------------------------------------------------
             Level descriptors                     Discriminators
------------------------------------------------------------------------
LEVEL I:
    <bullet> Communicates routine task      --Level of Interaction
     status/results as required.             (Audience).
    <bullet> Provides timely data and       --Written.
     written analyses for input to
     management/technical reports or
     contractual documents.
    <bullet> Explains status/results of     --Oral.
     assigned tasks.
LEVEL II:
    <bullet> Communicates team or group     --Level of Interaction
     tasking results, internally and         (Audience).
     externally, at peer levels.
    <bullet> Writes, or is a major          --Written.
     contributor to, management/technical
     reports or contractual documents.
    <bullet> Presents informational         --Oral.
     briefings.
LEVEL III:
    <bullet> Communicates project or        --Level of Interaction
     program results to all levels,          (Audience).
     internally and externally.
    <bullet> Reviews and approves, or is a  --Written.
     major contributor to/lead author of,
     management reports or contractual
     documents for external distribution.
     Provides inputs to policies.
    <bullet> Presents briefings to obtain   --Oral.
     consensus/approval.
LEVEL IV:
    <bullet> Communicates complex           --Level of Interaction
     technical, programmatic, and/or         (Audience).
     management information across
     multiple organizational levels to
     drive decisions by senior leaders
     internally and externally.
    <bullet> Leads efforts in documenting   --Written.
     diverse and highly complex
     information, concepts, and ideas in a
     highly responsive and effective
     manner. Authors and enables
     authoritative reports pertaining to
     multiple areas of expertise,
     incorporating diverse viewpoints,
     with minimal guidance from others.
     Reviews communications of others for
     appropriate and accurate content.
    <bullet> Demonstrates expert speaking   --Oral.
     skills and the adaptability to be
     effective in critical briefings.
LEVEL V:
    <bullet> Determines and communicates    --Level of Interaction
     organizational positions on major       (Audience).
     projects or policies to senior level.
    <bullet> Prepares, reviews, and         --Written.
     approves major reports or policies of
     organization for internal and
     external distribution. Resolves
     diverse viewpoints/controversial
     issues.
    <bullet> Presents organizational        --Oral.
     briefings to convey strategic vision
     or organizational policies.
------------------------------------------------------------------------


[[Page 3782]]

Factor 2-6: Resource Management
    Factor Description: This factor describes/captures personal and 
organizational utilization of resources to accomplish the mission. 
(Resources include, but are not limited to, personal time, equipment 
and facilities, human resources, and funds.)
    Expected Performance Criteria (Applicable to all contributions at 
all levels): Work is timely, efficient, appropriately coordinated and 
of acceptable quality. Resources are utilized effectively to accomplish 
mission. Flexibility, adaptability, and decisiveness are exercised 
appropriately.
    Descriptors indicate the type of contribution appropriate for the 
high end of each level. Descriptors are not to be used individually to 
assess contributions, but rather are to be taken as a group to derive a 
single evaluation of the factor.

------------------------------------------------------------------------
             Level descriptors                     Discriminators
------------------------------------------------------------------------
LEVEL I:
    <bullet> Uses assigned resources        --Scope of Responsibility.
     needed to accomplish tasks.
    <bullet> Plans individual time and      --Planning/Budgeting.
     assigned resources to accomplish
     tasks.
    <bullet> Effectively accomplishes       --Execution/Efficiency.
     assigned tasks.
LEVEL II:
    <bullet> Plans and utilizes             --Scope of Responsibility.
     appropriate resources to accomplish
     project goals.
    <bullet> Optimizes resources to         --Planning/Budgeting.
     accomplish projects/programs within
     established schedules.
    <bullet> Effectively accomplishes       --Execution/Efficiency.
     projects/programs goals within
     established resource guidelines.
LEVEL III:
    <bullet> Plans and allocates resources  --Scope of Responsibility.
     to accomplish multiple projects/
     programs.
    <bullet> Identifies and optimizes       --Planning/Budgeting.
     resources to accomplish multiple
     projects/programs goals.
    <bullet> Effectively accomplishes       --Execution/Efficiency.
     multiple projects/programs goals
     within established guidelines.
LEVEL IV:
    <bullet> Plans, allocates, and          --Scope of Responsibility.
     monitors resources in a complex
     environment with substantial
     instability in resources/requirements.
    <bullet> Anticipates changes in         --Planning/Budgeting.
     workload and other resource
     requirements for multiple programs/
     projects and develops and advocates
     solutions in advance.
    <bullet> Leads others in using          --Execution/Efficiency.
     resources more efficiently and
     implements innovative ideas to
     stretch limited resources.
LEVEL V:
    <bullet> Develops, acquires, and        --Scope of Responsibility.
     allocates resources to accomplish
     mission goals and strategic
     objectives.
    <bullet> Formulates organizational      --Planning/Budgeting.
     strategies, tactics, and budget/
     action plan to acquire and allocate
     resources.
    <bullet> Optimizes, controls, and       --Execution/Efficiency.
     manages all resources across projects/
     programs. Develops and integrates
     innovative approaches to attain goals
     and minimize expenditures.
------------------------------------------------------------------------

3. Occupational Family DK--General Support

Factor 3-1: Problem Solving
    Factor Description: This factor describes/captures personal and 
organizational problem solving.
    Expected Performance Criteria (Applicable to all contributions at 
all levels): Work is timely, efficient, appropriately coordinated and 
of acceptable quality. Completed work meets project/program objectives. 
Flexibility, adaptability, and decisiveness are exercised 
appropriately.
    Descriptors indicate the type of contribution appropriate for the 
high end of each level. Descriptors are not to be used individually to 
assess contributions, but rather are to be taken as a group to derive a 
single evaluation of the factor.

------------------------------------------------------------------------
             Level descriptors                     Discriminators
------------------------------------------------------------------------
LEVEL I:
    <bullet> Conducts activities on a       --Scope/Impact.
     segment of a task. Assists supervisor
     or other appropriate personnel.
    <bullet> Applies standard rules,        --Complexity/Difficulty.
     procedures, or operations to resolve
     routine problems.
    <bullet> Independently carries out      --Independence
     routine tasks..
    <bullet> Takes initiative in selecting  --Creativity.
     and implementing appropriate
     procedures.
LEVEL II:
    <bullet> Plans and conducts             --Scope/Impact.
     administrative activities for
     projects.
    <bullet> Develops, modifies, and/or     --Complexity/Difficulty.
     applies rules, procedures, or
     operations to resolve problems of
     moderate complexity/difficulty.
    <bullet> Independently plans and        --Independence.
     executes assignments; resolves
     problems and handles deviations.
    <bullet> Identifies and adapts          --Creativity.
     guidelines for new or unusual
     situations.
LEVEL III:
    <bullet> Plans and conducts complex     --Scope/Impact.
     administrative activities.
    <bullet> Develops rules, procedures,    --Complexity/Difficulty.
     or operations for complex/difficult
     organizational tasks.

[[Page 3783]]

 
    <bullet> Identifies issues and          --Independence.
     determines approaches and methods to
     accomplish tasks. Initiates effective
     actions and resolves related
     conflicts.
    <bullet> Identifies issues requiring    --Creativity.
     new procedures and develops
     appropriate guidelines.
------------------------------------------------------------------------

Factor 3-2: Teamwork/Cooperation
    Factor Description: This factor describes/captures individual and 
organizational teamwork and cooperation.
    Expected Performance Criteria (Applicable to all contributions at 
all levels): Work is timely, efficient, appropriately coordinated and 
of acceptable quality. Personal and organizational interactions exhibit 
and foster cooperation and teamwork. Flexibility, adaptability, and 
decisiveness are exercised appropriately.
    Descriptors indicate the type of contribution appropriate for the 
high end of each level. Descriptors are not to be used individually to 
assess contributions, but rather are to be taken as a group to derive a 
single evaluation of the factor.

------------------------------------------------------------------------
             Level descriptors                     Discriminators
------------------------------------------------------------------------
LEVEL I:
    <bullet> Works with others to           --Scope of Team Effort.
     accomplish routine tasks.
    <bullet> Contributes ideas on routine   --Contribution to Team.
     procedures. Interacts cooperatively
     with others.
    <bullet> Regularly completes tasks in   --Effectiveness.
     support of team goals.
LEVEL II:
    <bullet> Works with/leads to            --Scope of Team Effort.
     accomplish tasks.
    <bullet> Resolves administrative        --Contribution to Team.
     problems; facilitates cooperative
     interactions with others.
    <bullet> Guides others and coordinates  --Effectiveness.
     activities in support of team goals.
     Proactively functions as an integral
     part of the team.
LEVEL III:
    <bullet> Works with/leads others on     --Scope of Team Effort.
     complex issues/problems that may
     cross-functional areas.
    <bullet> Applies expertise in           --Contribution to Team.
     resolving complex administrative
     issues. Promotes and maintains
     environment for cooperation/teamwork.
     Sets tone for internal/external
     cooperation.
    <bullet> Leads and guides others in     --Effectiveness.
     formulating and executing plans in
     support of team goals.
------------------------------------------------------------------------

Factor 3-3: Customer Relations
    Factor Description: This factor describes/captures the 
effectiveness of personal and organizational interactions with 
customers (anyone to whom services or products are provided), both 
internal (within an assigned organization) and external (outside an 
assigned organization).
    Expected Performance Criteria (Applicable to all contributions at 
all levels): Work is timely, efficient, appropriately coordinated and 
of acceptable quality. Personal and organizational interactions enhance 
customer relations and actively promote rapport with customers. 
Flexibility, adaptability, and decisiveness are exercised 
appropriately.
    Descriptors indicate the type of contribution appropriate for the 
high end of each level. Descriptors are not to be used individually to 
assess contributions, but rather are to be taken as a group to derive a 
single evaluation of the factor.

------------------------------------------------------------------------
             Level descriptors                     Discriminators
------------------------------------------------------------------------
LEVEL I:
    <bullet> Assists customer support       --Breadth of Influence
     activities.
    <bullet> Meets routine customer needs.  --Customer Needs.
    <bullet> Interacts with customers on    --Customer Interaction
     routine issues within specific          Level.
     guidelines.
LEVEL II:
    <bullet> Guides the administrative      --Breadth of Influence
     efforts of individuals or team
     members as they interact with
     customers.
    <bullet> Independently interacts with   --Customer Needs.
     customers to understand customer
     needs/expectations.
    <bullet> Interacts independently with   --Customer Interaction
     customers to communicate information    Level.
     and coordinate actions.
LEVEL III:
    <bullet> Identifies, defines, and       --Breadth of Influence.
     guides administrative efforts in
     support of customer interactions;
     coordinates and focuses activities to
     support multiple customers.
    <bullet> Establishes customer           --Customer Needs.
     alliances and translates needs to
     customer service.
    <bullet> Works independently with       --Customer Interaction
     customers at all levels to define       Level.
     services and resolve non-routine
     problems.
------------------------------------------------------------------------

Factor 3-4: Leadership/Supervision
    Factor Description: This factor describes/captures individual and 
organizational leadership and/or supervision. Recruits, develops, 
motivates, and retains quality team members in accordance with EEO/AA 
and Merit Principles. Takes timely/appropriate personnel actions,

[[Page 3784]]

communicates mission and organizational goals; by example, creates a 
positive, safe, and challenging work environment; distributes work and 
empowers team members.
    Expected Performance Criteria (Applicable to all contributions at 
all levels): Work is timely, efficient, appropriately coordinated and 
of acceptable quality. Leadership and/or supervision effectively 
promotes commitment to mission accomplishment. Flexibility, 
adaptability, and decisiveness are exercised appropriately.
    Descriptors indicate the type of contribution appropriate for the 
high end of each level. Descriptors are not to be used individually to 
assess contributions, but rather are to be taken as a group to derive a 
single evaluation of the factor.

------------------------------------------------------------------------
             Level descriptors                     Discriminators
------------------------------------------------------------------------
LEVEL I:
    <bullet> Takes initiative in            --Leadership Role.
     accomplishing assigned tasks. Asks
     for assistance as appropriate.
    <bullet> Provides input in              --Breadth of Influence.
     administrative/functional area.
    <bullet> Seeks and takes advantage of   -- Mentoring/Employee
     developmental opportunities.            Development.
LEVEL II:
    <bullet> Actively contributes as team   -- Leadership Role.
     member or leader; takes initiative to
     accomplish assigned projects.
    <bullet> Guides others in               --Breadth of Influence.
     accomplishing projects.
    <bullet> Identifies and pursues         --Mentoring/Employee
     individual/team developmental           Development.
     opportunities.
LEVEL III:
    <bullet> Provides guidance to           -- Leadership Role.
     individuals/teams; resolves
     conflicts. Expertise solicited by
     others.
    <bullet> Guides and accounts for        -- Breadth of Influence.
     results or activities of individuals,
     teams, or projects.
    <bullet> Promotes individual/team       -- Mentoring/Employee
     development; leads development of       Development.
     training programs for self and others.
------------------------------------------------------------------------

Factor 3-5: Communication
    Factor Description: This factor describes/captures the 
effectiveness of oral/written communications.
    Expected Performance Criteria (Applicable to all contributions at 
all levels): Work is timely, efficient, appropriately coordinated and 
of acceptable quality. Communications are clear, concise, and at 
appropriate level. Flexibility, adaptability, and decisiveness are 
exercised appropriately.
    Descriptors indicate the type of contribution appropriate for the 
high end of each level. Descriptors are not to be used individually to 
assess contributions, but rather are to be taken as a group to derive a 
single evaluation of the factor.

------------------------------------------------------------------------
             Level descriptors                     Discriminators
------------------------------------------------------------------------
LEVEL I:
    <bullet> Communicates routine task/     --Level of Interaction
     status results as required.             (Audience).
    <bullet> Writes timely and accurate     --Written.
     draft documentation.
    <bullet> Explains status/results of     --Oral.
     assigned tasks..
LEVEL II:
    <bullet> Interprets and communicates    --Level of Interaction
     administrative procedures within        (Audience).
     immediate organization.
    <bullet> Prepares, coordinates, and     --Written.
     consolidates documents, reports, or
     briefings.
    <bullet> Communicates/presents          --Oral.
     internal administrative/functional
     procedures and tasks internally and
     externally.
LEVEL III:
    <bullet> Develops and advises on        --Level of Interaction
     administrative procedures and           (Audience).
     communicates them to all levels, both
     internally and externally.
    <bullet> Prepares, reviews, and/or      --Written.
     approves documents, reports, or
     briefings.
    <bullet> Explains and/or communicates   --Oral.
     complex/controversial administrative/
     functional procedures at all levels.
------------------------------------------------------------------------

Factor 3-6: Resource Management
    Factor Description: This factor describes/captures personal and 
organizational utilization of resources to accomplish the mission. 
(Resources include, but are not limited to, personal time, equipment 
and facilities, human resources, and funds.)
    Expected Performance Criteria (Applicable to all contributions at 
all levels): Work is timely, efficient, appropriately coordinated and 
of acceptable quality. Available resources are utilized effectively to 
accomplish mission. Flexibility, adaptability, and decisiveness are 
exercised appropriately.
    Descriptors indicate the type of contribution appropriate for the 
high end of each level. Descriptors are not to be used individually to 
assess contributions, but rather are to be taken as a group to derive a 
single evaluation of the factor.

------------------------------------------------------------------------
             Level descriptors                     Discriminators
------------------------------------------------------------------------
LEVEL I:
    <bullet> Uses assigned resources to     --Scope of Responsibility
     accomplish tasks.
    <bullet> Plans individual time and      --Planning/Budgeting.
     assigned resources to accomplish
     tasks.

[[Page 3785]]

 
    <bullet> Effectively accomplishes       --Execution/Efficiency.
     assigned tasks.
LEVEL II:
    <bullet> Identifies and uses resources  --Scope of Responsibility.
     to accomplish projects.
    <bullet> Plans resources to achieve     --Planning/Budgeting.
     project schedules.
    <bullet> Effectively accomplishes       --Execution/Efficiency.
     projects within established resource
     guidelines.
LEVEL III:
    <bullet> Plans, acquires, and           --Scope of Responsibility.
     allocates resources to accomplish
     objectives.
    <bullet> Coordinates resources across   --Planning/Budgeting.
     projects.
    <bullet> Optimizes resource             --Execution/Efficiency.
     utilization across projects.
------------------------------------------------------------------------

Appendix D

                                               Intervention Model
----------------------------------------------------------------------------------------------------------------
             Intervention                  Expected effects             Measures               Data sources
----------------------------------------------------------------------------------------------------------------
1. COMPENSATION:
    a. Pay banding...................  Increased                Perceived flexibility..  Attitude survey.
                                        organizational
                                        flexibility.
                                       Reduced administrative   Actual/perceived time    Personnel office data,
                                        workload, paperwork      savings.                 PME results, attitude
                                        reduction.                                        survey.
                                       Advanced in-hire rates.  Starting salaries of     Workforce data.
                                                                 banded v. non-banded
                                                                 employees.
                                       Slower pay progression   Progression of new       Workforce data.
                                        at entry levels.         hires over time by
                                                                 band, career path.
                                       Increased pay potential  Mean salaries by band,   Workforce data.
                                                                 group, demographics.
                                                                Total payroll costs....  Personnel office data.
                                       Increased satisfaction   Employee perceptions of  Attitude survey.
                                        with advancement.        advancement.
                                       Increased pay            Pay satisfaction,        Attitude survey.
                                        satisfaction.            internal/external
                                                                 equity.
                                       Improved recruitment...  Offer/acceptance         Personnel office data.
                                                                 ratios; Percent
                                                                 declinations.
    b. Conversion buy-in.............  Employee acceptance....  Employee perceptions of  Attitude survey.
                                                                 equity, fairness.
                                                                Cost as a percent of     Workforce data.
                                                                 payroll.
    c. Pay differentials/adjustments.  Increased incentive to   Perceived motivational   Attitude survey.
                                        accept supervisory/      power.
                                        team leader positions.
2. PERFORMANCE MANAGEMENT:
    a. Cash awards/bonuses...........  Reward/motivate          Perceived motivational   Attitude survey.
                                        performance.             power.
                                       To support fair and      Amount and number of     Workforce data.
                                        appropriate              awards by group,
                                        distribution of awards.  demographics.
                                                                Perceived fairness of    Attitude survey.
                                                                 awards.
                                                                Satisfaction with        Attitude survey.
                                                                 monetary awards.
    b. Performance based pay           Increased pay-           Perceived pay-           Attitude survey.
     progression.                       performance link.        performance link.
                                                                Perceived fairness of    Attitude survey.
                                                                 ratings.
                                       Improved performance     Satisfaction with        Attitude survey.
                                        feedback.                ratings.
                                                                Employee trust in        Attitude survey.
                                                                 supervisors.
                                                                Adequacy of performance  Attitude survey.
                                                                 feedback.
                                       Decreased turnover of    Turnover by performance  Workforce data.
                                        high performers/         rating scores.
                                        Increased turnover of
                                        low performers.
                                       Differential pay         Pay progression by       Workforce data.
                                        progression of high/     performance scores,
                                        low performers.          career path.
                                       Alignment of             Linkage of performance   Performance objectives,
                                        organizational and       objectives to            strategic plans.
                                        individual performance   strategic plans/goals.
                                        objectives and results.
                                       Increased employee       Perceived involvement..  Attitude survey/
                                        involvement in          Performance management.  focus groups.
                                        performance planning                             Personnel regulations.
                                        and assessment.

[[Page 3786]]

 
    c. New appraisal process.........  Reduced administrative   Employee and supervisor  Attitude survey.
                                        burden.                  perceptions of revised
                                                                 procedures.
                                       Improved communication.  Perceived fairness of    Focus groups.
                                                                 process.
    d. Performance development.......  Better communication of  Feedback and coaching    Focus groups.
                                        performance              procedures used.        Personnel office data.
                                        expectations.
                                                                Time, funds spent on     Training records.
                                                                 training by
                                                                 demographics.
                                       Improved satisfaction    Perceived workforce      Attitude survey.
                                        and quality of           quality.
                                        workforce.
3. ``WHITE COLLAR'' CLASSIFICATION:                                                      .......................
    a. Improved classification         Reduction in amount of   Time spent on            Personnel office data.
     systems with generic standards.    time and paperwork       classification
                                        spent on                 procedures..
                                        classification.
                                                                Reduction of paperwork/  Personnel office data.
                                                                 number of personnel
                                                                 actions
                                                                 (classification/
                                                                 promotion).
                                       Ease of use............  Managers' perceptions    Attitude survey.
                                                                 of time savings, ease
                                                                 of use.
    b. Classification authority        Increased supervisory    Perceived authority....  Attitude survey.
     delegated to managers.             authority/
                                        accountability.
                                       Decreased conflict       Number of                Personnel records.
                                        between management and   classification
                                        personnel staff.         disputes/appeals pre/
                                                                 post.
                                                                Management satisfaction  Attitude survey.
                                                                 with service provided
                                                                 by personnel office.
                                       No negative impact on    Internal pay equity....  Attitude survey.
                                        internal pay equity.
    c. Dual career ladder............  Increased flexibility    Assignment flexibility.  Focus groups, surveys.
                                        to assign employees.
                                       Improved internal        Perceived internal       Attitude survey.
                                        mobility.                mobility.
                                       Increased pay equity...  Perceived pay equity...  Attitude survey.
                                       Flatter organization...  Supervisory/non-         Workforce data.
                                                                 supervisory ratios.     Attitude survey.
                                       Improved quality of      Employee perceptions of  Attitude survey.
                                        supervisory staff.       quality or supervisory.
4. MODIFIED RIF:.....................  Minimize loss of high    Separated employees by   Workforce data,
                                        performing employees     demographics,            attitude survey/focus
                                        with needed skills.      performance scores.      group.
                                       Contain cost and         Satisfaction with RIF    Attitude survey/focus
                                        disruption.              Process.                 group.
                                                                Cost comparison of       Personnel office/budget
                                                                 traditional vs.          data.
                                                                 Modified RIF.
                                                                Time to conduct RIF-     Personnel office data.
                                                                 personnel office data.
                                                                Number of appeals/       Personnel office data.
                                                                 reinstatements.
5. HIRING AUTHORITY:
    a. Delegated Examining...........  Improved ease and        Perceived flexibility    Attitude survey.
                                        timeliness of hiring     in authority to hire.
                                        process.
                                       Improved recruitment of  Offer/accept ratios....  Personnel office data.
                                        employees in shortage
                                        categories.
                                                                Percent declinations...  Personnel office data.
                                                                Timeliness of job        Personnel office data.
                                                                 offers.
                                                                GPAs of new hires,       Personnel office data.
                                                                 educational levels.
                                       Reduced administrative   Actual/perceived skills  Attitude survey.
                                        workload/paperwork
                                        reduction.
    b. Term Appointment Authority....  Increased capability to  Number/percentage of     Workforce data.
                                        expand and contract      conversions from        Personnel office data.
                                        workforce.               modified term to
                                                                 permanent appointments.
    c. Flexible Probationary Period..  Expanded employee        Average conversion       Workforce data.
                                        assessment.              period to permanent     Personnel office data.
                                                                 status.
                                                                Number/percentage of     Workforce data.
                                                                 employees completing    Personnel office data.
                                                                 probationary period.

[[Page 3787]]

 
                                                                Number of separations    Workforce data.
                                                                 during probationary     Personnel office data.
                                                                 period.
6. EXPANDED DEVELOPMENT
 OPPORTUNITIES:
    a. Sabbaticals...................  Expanded range of        Number and type of       Workforce data.
                                        professional growth      opportunities taken.
                                        and development.
                                       Application of enhanced  Employee and supervisor  Attitude survey.
                                        knowledge and skills     perceptions.
                                        to work product.
    b. Critical Skills Training......  Improved organizational  Number and type of       Personnel office data.
                                        effectiveness.           training, Placement of
                                                                 employees, skills
                                                                 imbalances corrected.
                                                                Employee and supervisor  Personnel office data.
                                                                 perceptions.            Attitude survey.
                                                                Application of           Attitude survey/focus
                                                                 knowledge gained from    group.
                                                                 training.
7. COMBINATION OF ALL INTERVENTIONS:
    All..............................  Improved organizational  Combination of           All data sources.
                                        effectiveness.           personnel measures.
                                       Improved management of   Employee/Management job  Attitude survey.
                                        workforce.               satisfaction
                                                                 (intrinsic/extrinsic).
                                       Improved planning......  Planning procedures....  Strategic planning
                                                                                          documents.
                                                                Perceived effectiveness  Attitude survey.
                                                                 of planning procedures.
                                       Improved cross           Actual/perceived         Organizational charts.
                                        functional               coordination.
                                        coordination.
                                       Increased product        Customer satisfaction..  Customer satisfaction
                                        success.                                          surveys.
                                       Cost of innovation.....  Project training/        Demo project office
                                                                 development costs        records.
                                                                 (staff salaries,        Contract documents.
                                                                 contract cost,
                                                                 training hours per
                                                                 employee).
8. CONTEXT:
    Regionalization..................  Reduced servicing        HR servicing ratios....  Personnel office data,
                                        ratios/costs.                                     workforce data.
                                                                Average cost per         Personnel office data,
                                                                 employee served.         workforce data.
                                       No negative impact on    Service quality,         Attitude survey/focus
                                        service quality.         timeliness.              groups.
----------------------------------------------------------------------------------------------------------------

[FR Doc. 2011-976 Filed 1-19-11; 8:45 am]
BILLING CODE 5001-06-P