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###### Department of Defense

###### Office of the Secretary

# AGENCY:

Office of the Under Secretary of Defense for Research and Engineering (OUSD(R&E)), Department of Defense (DoD).

# ACTION:

Notice of amendment; STRL Personnel Demonstration Project reduction-in-force (RIF) procedures.

# SUMMARY:

This notice amends STRL Personnel Demonstration Project reduction-in-force (RIF) procedures. STRL RIF procedures will ensure employees involuntarily separated through a RIF are separated primarily based on performance, as determined under any applicable performance-management system.

# DATES:

                        This proposal may not be implemented until a 30-day comment period is provided, comments addressed, and a final                         **Federal Register**                         notice (FRN) published. To be considered, written comments must be submitted on or before August 27, 2021.                    

# ADDRESSES:

You may submit comments, identified by docket number and title, by any of the following methods:

*Federal eRulemaking Portal: http://www.regulations.gov.*                         Follow the instructions for submitting comments.                    

*Mail:*                         DoD cannot receive written comments at this time due to the COVID-19 pandemic. Comments should be sent electronically to the docket listed above.                              ( print page 40501)    

*Instructions:*                         All submissions received must include the agency name, docket number, and title for this                         **Federal Register**                         document. The general policy for comments and other submissions from members of the public is to make these submissions available for public viewing on the internet at                         *http://www.regulations.gov*                         as they are received, without change, including any personal identifiers or contact information.                    

# FOR FURTHER INFORMATION CONTACT:

*Department of the Air Force:*
      - Air Force Research Laboratory: Ms. Rosalyn Jones-Byrd, 937-656-9747, Rosalyn.Jones-Byrd@us.af.mil .                    
      - Joint Warfare Analysis Center: Ms. Amy Balmaz, 540-653-8598, Amy.T.Balmaz.civ@mail.mil .                    

*Department of the Army:*
      - Army Futures Command: Ms. Johnna Thompson, 830-469-2057, johnna.i.thompson.civ@mail.mil .                    
      - Army Research Institute for the Behavioral and Social Sciences: Dr. Scott Shadrick, 254-288-3800, Scott.B.Shadrick.civ@mail.mil .                    
      - Combat Capabilities Development Command Armaments Center: Mr. Mike Nicotra, 973-724-7764, Michael.J.Nicotra.civ@mail.mil .                    
      - Combat Capabilities Development Command Army Research Laboratory: Mr. Christopher Tahaney, 410-278-9069, Christopher.S.Tahaney.civ@mail.mil .                    
      - Combat Capabilities Development Command Aviation and Missile Center: Ms. Nancy Salmon, 256-876-9647, Nancy.C.Salmon2.civ@mail.mil .                    
      - Combat Capabilities Development Command Chemical Biological Center: Ms. Patricia Milwicz, 410-417-2343, Patricia.L.Milwicz.civ@mail.mil .                    
      - Combat Capabilities Development Command Command, Control, Communications, Computers, Cyber, Intelligence, Surveillance, and Reconnaissance Center: Ms. Angela Clybourn, 443-395-2110, Angela.M.Clyborn.civ@mail.mil .                    
      - Combat Capabilities Development Command Ground Vehicle Systems Center: Ms. Jennifer Davis, 586-306-4166, Jennifer.L.Davis1.civ@mail.mil .                    
      - Combat Capabilities Development Command Soldier Center: Ms. Joelle Montecalvo, 508-206-3421, Joelle.K.Montecalvo.civ@mail.mil .                    
      - Engineer Research and Development Center: Ms. Patricia Sullivan, 601-634-3065, Patricia.M.Sullivan@usace.army.mil .                    
      - Medical Research and Development Command: Ms. Linda Krout, 301-619-7276, Linda.J.Krout.civ@mail.mil .                    
      - Technical Center, Space and Missile Defense Command: Dr. Chad Marshall, 256-955-5697, Chad.J.Marshall.civ@mail.mil .                    

*Department of the Navy:*
      - Naval Air Warfare Center, Weapons Division and Aircraft Division: Mr. Richard Cracraft, 760-939-8115, Richard.Cracraft@navy.mil .                    
      - Naval Facilities Engineering Command Engineering and Expeditionary Warfare Center: Ms. Lori Leigh, 805-901-5917, Lori.Leigh@navy.mil .                    
      - Naval Information Warfare Centers:

                        ○ Naval Information Warfare Center Atlantic: Mr. Michael Gagnon, 843-218-3871,                         *Michael.L.Gagnon@navy.mil*.                    

                        ○ Naval Information Warfare Center Pacific: Ms. Angela Hanson, 619-553-0833,                         *Angela.Hanson@navy.mil*.                    
      - Naval Medical Research Center: Dr. Richard Arnold, 937-938-3877, Richard.Arnold.10@us.af.mil .                    
      - Naval Research Laboratory: Ms. Ginger Kisamore, 202-767-3792, Ginger.Kisamore@nrl.navy.mil .                    
      - Naval Sea Systems Command Warfare Centers: Ms. Diane Brown, 215-897-1619, Diane.J.Brown@navy.mil .                    
      - Office of Naval Research: Ms. Margaret J. Mitchell, 703-588-2364, Margaret.J.Mitchell@navy.mil .                    

*DoD:*
      - Dr. Jagadeesh Pamulapati, Director, Laboratories and Personnel Office, 571-372-6372, Jagadeesh.Pamulapati.civ@mail.mil .                    

# SUPPLEMENTARY INFORMATION:

## 1. Background

Section 342(b) of Public Law (Pub. L.) 103-337, as amended by Section 1109 of the National Defense Authorization Act (NDAA) for FY 2000, Public Law 106-65, Section 1114 of the NDAA for FY 2001, Public Law 106-398, and Section 211 of the NDAA for FY 2017, Public Law 114-328 (10 U.S.C. 2358 note), authorizes the Secretary of Defense (SECDEF), through the USD(R&E), to conduct personnel demonstration projects at DoD laboratories designated as STRLs. An STRL implementing these flexibilities must have an approved personnel demonstration project plan published in a FRN and must fulfill any collective bargaining obligations. Procedures described herein supersede and cancel the RIF procedures described in previously published STRL FRNs (Appendix B) and establish performance, also referred to as “contribution,” as the primary basis for determining which employees will be separated from employment when implementing a RIF. STRL internal operating procedures (IOPs) will describe the use of discretionary flexibilities when conducting a RIF.

*The 21 current STRLS are:*
    - Air Force Research Laboratory
    - Joint Warfare Analysis Center
    - Army Futures Command
    - Army Research Institute for the Behavioral and Social Sciences
    - Combat Capabilities Development Command Army Research Laboratory
    - Combat Capabilities Development Command Armaments Center
    - Combat Capabilities Development Command Aviation and Missile Center
    - Combat Capabilities Development Command Chemical Biological Center
    - Combat Capabilities Development Command Command, Control, Communications, Computers, Cyber, Intelligence, Surveillance, and Reconnaissance Center
    - Combat Capabilities Development Command Ground Vehicle Systems Center
    - Combat Capabilities Development Command Soldier Center
    - Engineer Research and Development Center
    - Medical Research and Development Command
    - Technical Center, U.S. Army Space and Missile Defense Command
    - Naval Air Warfare Center
    - Naval Facilities Engineering Command Engineering and Expeditionary Warfare Center
    - Naval Information Warfare Centers, Atlantic and Pacific
    - Naval Medical Research Center
    - Naval Research Laboratory
    - Naval Sea Systems Command Warfare Centers
    - Office of Naval Research

## 2. Overview

## I. Introduction

### A. Purpose

Section 1597 of Title 10, United States Code (U.S.C.), requires procedures to be established to ensure that, when implementing a RIF, all DoD employees in the competitive or excepted services are separated from employment “primarily on the basis of performance, as determined under any applicable performance management system.” This notice implements RIF procedures for the STRLs and is an overarching FRN applicable to all STRLs.

### B. Required Waivers to Law and Regulations

                    Waivers and adaptations of certain Title 5, U.S.C., and Title 5, Code of Federal Regulations (CFR), provisions are required only to the extent that these statutory and regulatory provisions limit or are inconsistent with the actions authorized under these demonstration                           ( print page 40502)                        projects. Appendix A lists waivers needed to enact authorities described in this FRN. Nothing in this plan is intended to preclude the STRLs from adopting or incorporating any law or regulation enacted, adopted, or amended after the effective date of this FRN.                

### C. Participating Organizations and Employees

All DoD laboratories designated as STRLs under Section 1105 of the NDAA for FY 2010, Public Law 111-84, as amended by Section 1103 of the NDAA for FY 2015, Public Law 113-291, and Section 1104 of the NDAA for FY 2018, Public Law 115-91, including any newly designated STRLs authorized by the SECDEF or subsequent legislation, with approved personnel demonstration project plans published in FRNs must use the provisions described in this FRN.

## II. Personnel System Changes

### A. Authority

For any RIF of civilian employees in the competitive and excepted services in DoD, the determination as to which employees will be separated from employment will be primarily based on performance, also referred to as “contribution.”

The STRLs will consider every reasonably available option to mitigate the impact of a proposed RIF, including but not limited to job changes or retraining, the use of voluntary early retirement authority or voluntary separation incentive payments, hiring freezes, termination of temporary employees, termination of employees in tenure group 0, reduction in work hours, curtailment of discretionary spending, and other pre-RIF placement activities for employees eligible for placement assistance and referral programs. Use of any such options shall be consistent with applicable policies and procedures.

### B. Definitions

Career path—A grouping of occupations with similar characteristics composed of pay bands designed to facilitate career progression. May also be referred to as career track, occupational family, or pay plan.

                    Displace/Displacement—The assignment of an employee to a continuing position that is held by another employee with a lower retention standing (                    *i.e.,*                     “bumping” another employee). Displacement may be at the same band or the next lower band below the employee's existing band as documented in STRL IOPs. A preference-eligible employee with a compensable service-connected disability of 30 percent or more (veteran preference category AD) may displace to positions two bands (or equivalent to five grades) below his/her current band. A released employee may have displacement rights to a position without regard to whether the employee previously held the position of the employee with lower retention standing.                

Flexible and renewable term technical appointment—An appointment that affords eligibility for employee programs and benefits comparable to those provided to similar employees with permanent appointments, to include opportunities for professional development and eligibility for award programs, as described in Section 1109 of the NDAA for FY 2016, as amended by Section 1112 of the NDAA for FY 2019 and in 82 FR 43339, as amended. Appointments may be made in six-year increments and extended without limit in up to six-year increments.

                    Fully qualified—Employee meets the Office of Personnel Management qualification standards, or standard-level descriptors as described in STRL IOPs, and has the capacity, adaptability, and special skills needed to satisfactorily perform the duties of the position without undue interruption,                     *e.g.,*                     within 90 days. Determination as to whether an impacted employee is fully qualified for RIF placement will be made by an STRL subject matter expert.                

Modified term appointment—An appointment used to fill a position for a period of more than one year but not more than five years when the need for an employee's services is not permanent. The modified term appointment differs from the term employment as described in 5 CFR part 316 in that it may be made for up to five years, compared to four years for the term appointment, and may be extended for an additional year. An employee hired under this appointment authority may be eligible for conversion to a career or career-conditional appointment. It may also be referred to as a contingent term appointment.

Non-rated employee—Employee with no rating of record, who is not eligible for a modal or presumptive rating. A non-rated (NR) designation will be used when an employee has not fulfilled the time period, as required by the STRL performance-management system, to receive a rating and has no assessed rating from any DoD-recognized performance-management system within the four-year period preceding the “cutoff date” established for the RIF.

Performance—For the purposes of a RIF in the STRLs, performance is determined by each STRL performance-management system, including contribution-based or performance-based systems, as recorded in the rating of record.

Period of performance—STRL performance-management plans may specify a minimum number of months to receive a performance assessment. Such periods will be at least 90 days and generally allow all employees to receive at least one performance assessment prior to implementation of a RIF.

Retreat—The assignment of an employee released from their competitive level to a position held by another employee lower in retention standing if the position is the same position or an essentially identical position formerly held by the released employee. This assignment may be to an essentially identical position in the released employee's current band or to the next lower band, regardless of career path as documented in STRL IOPs.

Unacceptable rating—Documented ratings of record of unacceptable, unsuccessful, failure, or unsatisfactory are used synonymously and reflect summary level 1 as described in 5 CFR 430.208.

### C. Provisions

                    (1)                     *Identification of Positions Being Abolished.*                     Positions may be identified to be abolished based on budget, research area, project funding, lack of work, reorganization, or other elements identified by the STRL.                

                    (2)                     *Scope of Competition.*                     STRLs will determine the retention standing of each employee competing in the RIF based on any factors outlined in this FRN, as long as performance, as documented in the rating of record, is the primary consideration.                

                    a.                     *Competitive Areas.*                     The STRL may determine the competitive area by career path (pay plan), occupational group, line of business, product line, organizational unit, funding line, occupational series, functional area, competency area, technology directorate, or geographical location, or a combination of these elements, and must include all demonstration project employees within the defined competitive area. The competitive area must be defined at least 90 days prior to the effective date of the RIF and descriptions of all competitive areas must be made readily available for review.                

                    b.                     *Competitive Levels.*                     Competitive levels may or may not be used, as documented in STRL IOPs. If competitive levels are used, they are assigned at the time the position                           ( print page 40503)                        description is classified and may be based on demonstration project criteria, such as specialty areas or functional codes, so long as these criteria serve to define those positions that are similar enough in duties and qualification requirements such that an incumbent of one position may be reassigned to another in the competitive level without causing an undue interruption in work. When competitive levels are used and established, employees will be released as described in II.C.(7)b and II.C.(7)c.2. If competitive levels are not used, employees will be released as described in II.C.(7)c.1.                

                    (3)                     *Retention Standing.*                     Competitive-service employees and excepted-service employees are placed on separate retention registers, with performance as the first factor as documented in ratings of record. Sample retention registers are in Appendix C.                

                    (4)                     *Periods of Assessed Performance.*                     Because the primary consideration is performance, STRL employees with no performance assessment under a DoD-recognized performance system (annotated as “NR”) may not be placed above those with an assessed rating of less than fully successful/acceptable. STRLs may, but are not required to, group employees based on periods of assessed performance (                    *e.g.,*                     those with a period of assessed performance of at least 90 days, those with a period of assessed performance of a least 180 days, etc.), as documented in STRL IOPs.                

                    (5)                     *Retention Factors.*                     Competing employees will first be listed on a retention register based on rating of record (as documented in the personnel data system). If meaningful distinctions do not exist in the rating of record, each STRL may, as secondary criteria, differentiate based on average score or other performance-related factor. Each STRL may further differentiate based on any of the following retention factors: Tenure group; average score or other performance-related factor as determined by the STRL (where not previously utilized); veterans' preference; DoD service computation date-RIF (DoD SCD-RIF); SCD-RIF adjusted by additional service credit for performance; or period of performance.                

                    a.                     *Rating of Record.*                     Rating of record is documented by each STRL in accordance with its designated performance or contribution management cycle. Additionally, STRL procedures may provide that a single rating of record or multiple ratings of record will be used and averaged, as described in its IOPs. When multiple ratings of record are used, they will be drawn from the ratings within the four year period preceding the “cutoff date” established for the RIF. However, when the most recent rating of record is “unacceptable,” only that rating of record will be considered for purposes of a RIF. STRL procedures will provide a method for converting an employee's rating pattern from another system when it does not align with the STRL performance-management system, as documented in STRL IOPs.                

                    1.                     *Presumptive Ratings.*                     A presumptive rating will be used as the current rating of record for purposes of a RIF when an employee did not receive a performance appraisal due to an absence resulting from: Uniformed military service; performance of duties under the expeditionary civilian deployment program; extended leave or sabbatical; a work-related injury approved for compensation pursuant to an Office of Workers' Compensation Program; or other similar absence. The presumptive rating of record will be the employee's last performance appraisal of record prior to the period of absence or as specified in STRL IOPs.                

                    2.                     *Modal Ratings.*                     A modal rating will be used as the rating of record for those employees who do not have any previous performance appraisals under any DoD-recognized performance-management system within the four-year period preceding the cutoff date established for the RIF and have an absence resulting from: Uniformed military service; performance of duties under the expeditionary civilian deployment program; extended leave or sabbatical; a work-related injury approved for compensation pursuant to an Office of Workers' Compensation Program; or other similar absence. The modal rating is the rating of record most frequently used among the actual ratings of record given to employees within the same competitive area for the appropriate rating cycle or cycles.                

                    3.                     *Non-Rated.*                     An NR designation will be used when an employee has not met the time period, as specified in the STRL performance-management plan, to receive a rating and has no assessed rating from any DoD-recognized performance-management system within the four-year period preceding the cutoff date established for the RIF.                

                    b.                     *Average Score or Other Performance-Related Factor as Determined by the STRL.*                     STRLs may assign numeric values to other aspects of their performance-management systems that further differentiate levels of performance or contribution. For example, if an STRL utilizes a contribution-based system, the delta overall contribution score or assessment category score may be used; in a performance-based system, the assigned decimal score may be used, as documented in STRL IOPs. STRLs using Pass/Fail as the rating of record must use average score or other performance-related factor as the second retention factor.                

                    c.                     *Tenure Group.*

1. Tenure groups are defined in 5 CFR 351.501(b) for competitive service and 5 CFR 351.502(b) for excepted service, or in an STRL's FRN. In addition, STRLs may consider tenure group 1 and 2 employees as tenure group 1 for RIF purposes and employees on modified term appointments as tenure group 0 or tenure group 3, as documented in STRL IOPs.

2. Employees on modified term or flexible-length and renewable term appointments who were previously selected through competitive procedures, and who otherwise meet conditions required for such conversion, may be converted to permanent appointments (tenure group 1 or tenure group 2, as appropriate), provided such conversions are effective not less than 90 days prior to the effective date of the RIF.

3. Employees on flexible-length and renewable term appointments who have completed three years of service may be treated as permanent employees (tenure group 1) and those with less than three years may be treated as tenure group 2, as documented in STRL IOPs.

4. Employees treated as tenure group 3 are ranked below any tenure group 1 or 2 employees, notwithstanding any other retention factor.

                    d.                     *Veterans' Preference.*                     Competing employees are placed in a veterans' preference category as described in 5 CFR 351.501(c).                

                    e.                     *DoD SCD-RIF.*                     The SCD-RIF includes all creditable service authorized by 5 CFR 351.503(a) and (b). The STRLs may further differentiate an employee's retention standing by utilizing the retention service credit for performance as described in 5 CFR 351.504. If used, this is referred to as DoD SCD-RIF adjusted.                

                    (6)                     *Creation of the Retention Register.*                     STRLs will determine and document the order of retention in a manner that ensures retention decisions are based primarily on performance, as documented in the rating of record. Other factors which may receive secondary consideration are tenure group, veterans' preference, SCD RIF, SCD RIF adjusted, and period of performance. Factors will be weighted in a manner that generally ensures that high-performing employees are not displaced.                

                    (7)                     *Order of Release.*      ( print page 40504)    

                    a.                     *Employees to be Released First.*

1. STRLs can release Tenure 0 employees prior to RIF competition based on mission needs.

2. STRLs will release employees from the competitive level (if used) with a written decision of removal under 5 CFR 432 or 752 before releasing any employee competing in the RIF.

3. Employees demoted for unacceptable performance who have not received a rating on their current position will have ratings of record drawn from within the four-year period preceding the cutoff date established for the RIF (to include any rating of record of “unacceptable”), if the STRL uses multiple ratings in its retention factors.

b. If competitive levels are utilized by an STRL, employees will be released beginning with the employee with the lowest retention standing on the retention register for that competitive level. An STRL may provide for intervening displacement within the competitive level before final release of the employee with the lowest retention standing from the competitive level.

c. STRL employees have assignment rights under RIF procedures if the current performance appraisal reflects a rating of record of at least minimally successful/minimally acceptable.

d. STRLs may apply assignment rights described in 5 CFR 351.701 or other assignment rights as described below.

                    1.                     *Single Round.*                     When a specific position is to be abolished, the incumbent of that position may displace an employee within the band or at the next lower band, as documented in STRL IOPs, when the incumbent has a higher retention standing and is fully qualified for a position occupied by an employee with a lower retention standing among those competing in the RIF. A preference-eligible employee with a compensable service-connected disability of 30 percent or more (veterans' preference category AD) may displace to positions two bands (or equivalent to five grades) below his/her current band. If there is no position in which an employee can be placed using this process or through assignment to a vacant position, that employee will be separated.                

                    2.                     *Two Round.*                     When reducing positions in the same occupational series and pay band, competitive levels—consisting of such positions that are similar enough in duties, qualification requirements, and working conditions that the incumbent of one position can successfully perform the duties of any other position in the competitive level without unduly interrupting the work program—will be established. In round one, STRLs identify employees for release beginning with the employees with the lowest retention standing in the competitive level. In round two, within each competitive area, an employee identified for release in round one may displace an employee within the band or at the next lower band, as documented in STRL IOPs, when the released employee has a higher retention standing and is fully qualified for a position occupied by an employee with a lower standing among those competing in the RIF. A preference-eligible employee with a compensable service-connected disability of 30 percent or more (veterans' preference category AD) may displace to positions two bands (or equivalent to five grades) below the band of the position from which he/she is released. If there is no position in which an employee can be placed using this process or through assignment to a vacant position, that employee will be separated.                

                    3.                     *Retreat during RIF.*                     STRLs may establish procedures permitting an employee identified for release to displace an employee within the band or at the next lower band when the released employee has a higher retention standing than the displaced employee and previously served in the displaced employee's position, or an essentially identical position, regardless of career path.                

                    4.                     *Offers of Vacant Position.*                     When an STRL chooses to utilize vacancies for which released employees qualify, the STRL must consider the relative retention standing of all released employees and must offer the position to the released employee with the highest retention standing.                

                    e.                     *Exceptions.*                     STRLs must comply with protections afforded employees pursuant to 5 CFR 351.606, including protections under the Uniformed Services Employment and Reemployment Rights Act.                

## III. Required Waivers to Law and Regulations

The following waivers and adaptations of certain Title 5, U.S.C., and Title 5, CFR, provisions are required only to the extent to which these statutory and regulatory provisions limit or are inconsistent with the actions contemplated under these STRL demonstration project RIF procedures. Nothing in this plan is intended to preclude the demonstration projects from adopting or incorporating any law or regulation enacted, adopted, or amended after the effective date of this notice.
      ( print page 40505)          ( print page 40506)          ( print page 40507)          ( print page 40508)          ( print page 40509)    

Dated: July 23, 2021.

Aaron T. Siegel,

Alternate OSD Federal Register Liaison Officer, Department of Defense.

BILLING CODE 5001-06-P

[FR Doc. 2021-16082 Filed 7-27-21; 8:45 am]

BILLING CODE 5001-06-C