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sion of law, the Special Counsel (established by section 
1211 of title 5) may terminate an investigation of a pro-
hibited personnel practice alleged by an employee or 
former employee of the Department after the Special 
Counsel provides to the employee or former employee a 
written statement of the reasons for the termination of 
the investigation. Such statement may not be admissible 
as evidence in any judicial or administrative proceeding 
without the consent of such employee or former employee. 
‘‘(h) VACANCIES.—In the case of an individual who 
is removed or demoted under subsection (a), to the max-
imum extent feasible, the Secretary shall fill the vacancy 
arising as a result of such removal or demotion. 
‘‘(i) SEMI-ANNUAL REPORT ON TRANSFERRED EM-
PLOYEES.—The Secretary shall submit to the Committees 
on Veterans’ Affairs of the Senate and House of Rep-
resentatives semi-annual reports on senior executive em-
ployees who are transferred within the Department. Each 
such report shall include, for each such senior executive 
employee transferred during the period covered by the re-
port, the reason for the transfer and any costs associated 
with the transfer. 
‘‘(j) DEFINITIONS.—In this section: 
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‘‘(1) The term ‘individual’ means an individual 
occupying a position at the Department but does not 
include— 
‘‘(A) an individual appointed pursuant to 
section 7306, 7401(1), or 7405 of this title; 
‘‘(B) an individual who has not completed 
a probationary or trial period; or 
‘‘(C) a political appointee. 
‘‘(2) The term ‘suspend’ means the placing of 
an employee, for disciplinary reasons, in a temporary 
status without duties and pay for a period in excess 
of 14 days. 
‘‘(3) The term ‘grade’ has the meaning given 
such term in section 7511(a) of title 5. 
‘‘(4) The term ‘misconduct’ includes neglect of 
duty, malfeasance, or failure to accept a directed re-
assignment or to accompany a position in a transfer 
of function. 
‘‘(5) The term ‘political appointee’ means an in-
dividual who is— 
‘‘(A) employed in a position described 
under sections 5312 through 5316 of title 5 
(relating to the Executive Schedule); 
‘‘(B) a limited term appointee, limited 
emergency appointee, or noncareer appointee in 
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the Senior Executive Service, as defined under 
paragraphs (5), (6), and (7), respectively, of 
section 3132(a) of title 5; or 
‘‘(C) employed in a position of a confiden-
tial or policy-determining character under 
schedule C of subpart C of part 213 of title 5 
of the Code of Federal Regulations.’’. 
(b) REPEAL OF SUPERCEDED PROVISION OF LAW.— 
(1) IN
GENERAL.—Section 713 of title 38, 
United States Code, is hereby repealed. 
(2) CLERICAL AMENDMENT.—The table of sec-
tions at the beginning of chapter 7 is amended by 
striking the item relating to section 713. 
(c) CLERICAL AND CONFORMING AMENDMENTS.— 
(1) CLERICAL.—The table of sections at the be-
ginning of chapter 7 is amended by inserting after 
the item relating to section 717 the following new 
item: 
‘‘719. Employees: removal, demotion, or suspension based on performance or 
misconduct.’’. 
(2) CONFORMING.—Section 4303(f) of title 5, 
United States Code, is amended— 
(A) by striking ‘‘or’’ at the end of para-
graph (2); 
(B) by striking the period at the end of 
paragraph (3) and inserting ‘‘, or’’; and 
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(C) by adding at the end the following: 
‘‘(4) any removal or demotion under section 
719 of title 38.’’. 
(d) TEMPORARY EXEMPTION FROM CERTAIN LIMI-
TATION ON INITIATION FROM REMOVAL FROM SENIOR 
EXECUTIVE SERVICE.—During the 120-day period begin-
ning on the date of enactment of this Act, an action to 
remove an individual from the Senior Executive Service 
at the Department of Veterans Affairs pursuant to this 
section may be initiated, notwithstanding section 3592(b) 
of title 5, United States Code, or any other provision of 
law. 
SEC. 4. REDUCTION OF BENEFITS FOR DEPARTMENT OF 
VETERANS AFFAIRS EMPLOYEES CONVICTED 
OF CERTAIN CRIMES. 
(a) REDUCTION OF BENEFITS.— 
(1) IN GENERAL.—Subchapter I of chapter 7 is 
further amended by inserting after section 719, as 
added by section 3, the following new section: 
‘‘§ 721. Reduction of benefits of employees convicted 
of certain crimes 
‘‘(a) REDUCTION OF ANNUITY FOR REMOVED EM-
PLOYEE.—(1) The Secretary shall order that the covered 
service of an employee of the Department removed from 
a position for performance or misconduct under section 
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719 or 7461 of this title or any other provision of law 
shall not be taken into account for purposes of calculating 
an annuity with respect to such individual under chapter 
83 or chapter 84 of title 5, if— 
‘‘(A) the Secretary determines that the indi-
vidual is convicted of a felony that influenced the in-
dividual’s performance while employed in the posi-
tion; 
‘‘(B) before such order is made, the individual 
is afforded— 
‘‘(i) notice of the proposed order; and 
‘‘(ii) an opportunity to respond to the pro-
posed order by not later than ten business days 
following receipt of such notice; and 
‘‘(C) the Secretary issues the order— 
‘‘(i) in the case of a proposed order to 
which an individual responds under subpara-
graph (B)(ii), not later than five business days 
after receiving the response of the individual; or 
‘‘(ii) in the case of a proposed order to 
which an individual does not respond, not later 
than 15 business days after the Secretary pro-
vides notice to the individual under subpara-
graph (B)(i). 
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‘‘(2) Upon the issuance of an order by the Secretary 
under paragraph (1), the individual shall have an oppor-
tunity to appeal the order to the Director of the Office 
of Personnel Management before the date that is seven 
business days after the date of such issuance. 
‘‘(3) The Director of the Office of Personnel Manage-
ment shall make a final decision with respect to an appeal 
under paragraph (2) within 30 business days of receiving 
the appeal. 
‘‘(b) REDUCTION OF ANNUITY FOR RETIRED EM-
PLOYEE.—(1) The Secretary may order that the covered 
service of an individual who is removed for performance 
or misconduct under section 719 or 7461 of this title or 
any other provision of law but who leaves employment at 
the Department prior to the issuance of a final decision 
with respect to such action shall not be taken into account 
for purposes of calculating an annuity with respect to such 
individual under chapter 83 or chapter 84 of title 5, if— 
‘‘(A) the Secretary determines that the indi-
vidual is convicted of a felony that influenced the in-
dividual’s performance while employed in the posi-
tion; 
‘‘(B) before such order is made, the individual 
is afforded— 
‘‘(i) notice of the proposed order; and 
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fice of Personnel Management shall recalculate the annu-
ity of the individual. 
‘‘(d) LUMP-SUM ANNUITY CREDIT.—Any individual 
with respect to whom an annuity is reduced under sub-
section (a) or (b) shall be entitled to be paid so much of 
such individual’s lump-sum credit as is attributable to the 
period of covered service. 
‘‘(e) SPOUSE OR CHILDREN EXCEPTION.—The Sec-
retary, in consultation with the Office of Personnel Man-
agement, shall prescribe regulations that may provide for 
the payment to the spouse or children of any individual 
referred to in subsection (a) or (b) of any amounts which 
(but for this subsection) would otherwise have been non-
payable by reason of such subsections. Any such regula-
tions shall be consistent with the requirements of sections 
8332(o)(5) and 8411(l)(5) of title 5, as the case may be. 
‘‘(f) DEFINITIONS.—In this section: 
‘‘(1) The term ‘covered service’ means, with re-
spect to an individual subject to a removal for per-
formance or misconduct under section 719 or 7461 
of this title or any other provision of law, the period 
of service beginning on the date that the Secretary 
determines under such applicable provision that the 
individual engaged in activity that gave rise to such 
action and ending on the date that the individual is 
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removed from or leaves a position of employment at 
the Department prior to the issuance of a final deci-
sion with respect to such action. 
‘‘(2) The term ‘lump-sum credit’ has the mean-
ing given such term in section 8331(8) or section 
8401(19) of title 5, as the case may be. 
‘‘(3) The term ‘service’ has the meaning given 
such term in section 8331(12) or section 8401(26) 
of title 5, as the case may be.’’. 
(2) CLERICAL AMENDMENT.—The table of sec-
tions at the beginning of chapter 7 is amended by 
inserting after the item relating to section 719, as 
added by section 3, the following new item: 
‘‘721. Reduction of benefits of employees convicted of certain crimes.’’. 
(b) APPLICATION.—Section 721 of title 38, United 
States Code, as added by subsection (a)(1), shall apply 
to any action of removal of an employee of the Department 
of Veterans Affairs under section 719 or 7461 of this title 
or any other provision of law, commencing on or after the 
date of the enactment of this Act. 
SEC. 5. AUTHORITY TO RECOUP BONUSES OR AWARDS 
PAID TO EMPLOYEES OF DEPARTMENT OF 
VETERANS AFFAIRS. 
(a) IN GENERAL.—Subchapter I of chapter 7 is fur-
ther amended by inserting after section 721, as added by 
section 4, the following new section: 
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‘‘§ 723. Recoupment of bonuses or awards paid to em-
ployees of Department 
‘‘(a) IN GENERAL.—Notwithstanding any other pro-
vision of law, the Secretary may issue an order directing 
an employee of the Department to repay the amount, or 
a portion of the amount, of any award or bonus paid to 
the employee under title 5, including under chapter 45 or 
53 of such title, or this title if— 
‘‘(1) the Secretary determines that the indi-
vidual engaged in misconduct or poor performance 
prior to payment of the award or bonus, and that 
such award or bonus would not have been paid, in 
whole or in part, had the misconduct or poor per-
formance been known prior to payment; 
‘‘(2) before such repayment, the employee is af-
forded— 
‘‘(A) notice of the proposed order; and 
‘‘(B) an opportunity to respond to the pro-
posed order by not later than ten business days 
after the receipt of such notice; and 
‘‘(3) the Secretary issues the order— 
‘‘(A) in the case of a proposed order to 
which an individual responds under paragraph 
(2)(B), not later than five business days after 
receiving the response of the individual; or 
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‘‘(B) in the case of a proposed order to 
which an individual does not respond, not later 
than 15 business days after the Secretary pro-
vides notice to the individual under paragraph 
(2)(A). 
‘‘(b) APPEALS.—Upon the issuance of an order by 
the Secretary under subsection (a), the individual shall 
have an opportunity to appeal the order to another depart-
ment or agency of the Federal Government before the date 
that is seven business days after the date of such issuance. 
‘‘(c) FINAL DECISIONS.—The head of the applicable 
department or agency of the Federal Government shall 
make a final decision with respect to an appeal under sub-
section (b) within 30 business days after receiving such 
appeal.’’. 
(b) CLERICAL AMENDMENT.—The table of sections 
at the beginning of such chapter, as amended by section 
4, is amended by inserting after the item relating to sec-
tion 721, as added by section 4(a)(2), the following new 
item: 
‘‘723. Recoupment of bonuses or awards paid to employees of Department.’’. 
(c) EFFECTIVE DATE.—Section 723 of title 38, 
United States Code, as added by subsection (a), shall 
apply with respect to an award or bonus paid by the Sec-
retary of Veterans Affairs to an employee of the Depart-
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ment of Veterans Affairs on or after the date of the enact-
ment of this Act. 
(d) CONSTRUCTION.—Nothing in this Act or the 
amendments made by this Act may be construed to modify 
the certification issued by the Office of Personnel Manage-
ment and the Office of Management and Budget regarding 
the performance appraisal system of the Senior Executive 
Service of the Department of Veterans Affairs. 
SEC. 6. AUTHORITY TO RECOUP RELOCATION EXPENSES 
PAID TO OR ON BEHALF OF EMPLOYEES OF 
DEPARTMENT OF VETERANS AFFAIRS. 
(a) IN GENERAL.—Subchapter I of chapter 7 is fur-
ther amended by adding at the end the following new sec-
tion: 
‘‘§ 725. Recoupment of relocation expenses paid to or 
on behalf of employees of Department 
‘‘(a) IN GENERAL.—Notwithstanding any other pro-
vision of law, the Secretary may issue an order directing 
an employee of the Department to repay the amount, or 
a portion of the amount, paid to or on behalf of the em-
ployee under title 5 for relocation expenses, including any 
expenses under section 5724 or 5724a of such title, or 
this title if— 
‘‘(1) the Secretary determines that relocation 
expenses were not lawfully authorized or that the 
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employee committed an act of fraud, waste, or mal-
feasance that influenced the authorization of the re-
location expenses; 
‘‘(2) before such repayment, the employee is af-
forded— 
‘‘(A) notice of the proposed order; and 
‘‘(B) an opportunity to respond to the pro-
posed order not later than ten business days 
following the receipt of such notice; and 
‘‘(3) the Secretary issues the order— 
‘‘(A) in the case of a proposed order to 
which an individual responds under paragraph 
(2)(B), not later than five business days after 
receiving the response of the individual; or 
‘‘(B) in the case of a proposed order to 
which an individual does not respond, not later 
than 15 business days after the Secretary pro-
vides notice to the individual under paragraph 
(2)(A). 
‘‘(b) APPEALS.—Upon the issuance of an order by 
the Secretary under subsection (a), the individual shall 
have an opportunity to appeal the order to another depart-
ment or agency of the Federal Government before the date 
that is seven business days after the date of such issuance. 
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‘‘(c) FINAL DECISIONS.—The head of the applicable 
department or agency of the Federal Government shall 
make a final decision with respect to an appeal under sub-
section (b) within 30 days after receiving such appeal.’’. 
(b) CLERICAL AMENDMENT.—The table of sections 
at the beginning of such chapter is further amended by 
inserting after the item relating to section 723, as added 
by section 5(b), the following new item: 
‘‘725. Recoupment of relocation expenses paid to or on behalf of employees of 
Department.’’. 
(c) EFFECTIVE DATE.—Section 725 of title 38, 
United States Code, as added by subsection (a), shall 
apply with respect to an amount paid by the Secretary 
of Veterans Affairs to or on behalf of an employee of the 
Department of Veterans Affairs for relocation expenses on 
or after the date of the enactment of this Act. 
SEC. 7. TIME PERIOD FOR RESPONSE TO NOTICE OF AD-
VERSE ACTIONS AGAINST SUPERVISORY EM-
PLOYEES WHO COMMIT PROHIBITED PER-
SONNEL ACTIONS. 
Section 733(a)(2)(B) is amended— 
(1) in clause (i), by striking ‘‘14 days’’ and in-
serting ‘‘10 days’’; and 
(2) in clause (ii), by striking ‘‘14-day period’’ 
and inserting ‘‘10-day period’’. 
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SEC. 8. DIRECT HIRING AUTHORITY FOR MEDICAL CENTER 
DIRECTORS AND VISN DIRECTORS. 
(a) IN GENERAL.—Section 7401 is amended by add-
ing at the end the following new paragraph: 
‘‘(4) Medical center directors and directors of 
Veterans Integrated Service Networks with dem-
onstrated ability in the medical profession, in health 
care administration, or in health care fiscal manage-
ment.’’. 
(b) CONFORMING AMENDMENT.—Section 7404(a)(1) 
is amended by inserting ‘‘and 7401(4)’’ after ‘‘7306’’. 
SEC. 9. TIME PERIODS FOR REVIEW OF ADVERSE ACTIONS 
WITH RESPECT TO CERTAIN EMPLOYEES. 
(a) PHYSICIANS, DENTISTS, PODIATRISTS, CHIRO-
PRACTORS, OPTOMETRISTS, REGISTERED NURSES, PHY-
SICIAN ASSISTANTS, AND EXPANDED-FUNCTION DENTAL 
AUXILIARIES.—Section 7461(b)(2) is amended to read as 
follows: 
‘‘(2) In any case other than a case described in para-
graph (1) that involves or includes a question of profes-
sional conduct or competence in which a major adverse 
action was not taken, such an appeal shall be made 
through Department grievance procedures under section 
7463 of this title.’’. 
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(b) MAJOR ADVERSE ACTIONS INVOLVING PROFES-
SIONAL CONDUCT
OR COMPETENCE.—Section 7462 is 
amended— 
(1) in subsection (b)— 
(A) in paragraph (1)— 
(i) in subparagraph (A), by striking 
‘‘At least 30’’ and inserting ‘‘Ten busi-
ness’’; and 
(ii) in subparagraph (B)— 
(I) by striking ‘‘A reasonable 
time, but not less than seven days’’ 
and inserting ‘‘The opportunity, with-
in the ten-day notice period’’; and 
(II) by striking ‘‘orally and’’; 
(B) in paragraph (3)— 
(i) by striking ‘‘(A) If a proposed ad-
verse action covered by this section is not 
withdrawn’’ and inserting ‘‘After consid-
ering the employee’s answer, if any’’; 
(ii) by striking ‘‘21 days’’ and insert-
ing ‘‘5 business days’’; 
(iii) by striking ‘‘answer. The decision 
shall include a statement of’’ and inserting 
‘‘answer stating’’; and 
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(iv) by striking subparagraph (B); 
and 
(C) in paragraph (4)— 
(i) by striking ‘‘(A) The Secretary’’ 
and all that follows through ‘‘(B) The Sec-
retary’’ and inserting ‘‘The Secretary’’; 
and 
(ii) by striking ‘‘30 days’’ and insert-
ing ‘‘7 business days’’; 
(2) in subsection (c)— 
(A) in paragraph (3), by inserting ‘‘the 
hearing must be concluded not later than 30 
business days after the date on which the ap-
peal is filed, and’’ after ‘‘If such a hearing is 
held,’’; and 
(B) in paragraph (4)— 
(i) by striking ‘‘45 days’’ and insert-
ing ‘‘15 business days’’; and 
(ii) by striking ‘‘120 days’’ and insert-
ing ‘‘45 business days’’; and 
(3) in subsection (d)(1), by striking ‘‘90 days’’ 
and inserting ‘‘15 business days’’. 
(c) OTHER ADVERSE ACTIONS.—Section 7463 is 
amended— 
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(1) by striking subsection (b) and redesignating 
subsections (c) through (e) as subsections (b) 
through (d), respectively; and 
(2) in subsection (b)(2), as so redesignated— 
(A) in subparagraph (A), by striking ‘‘an 
advance’’ and inserting ‘‘ten business days’’; 
and 
(B) in subparagraph (B)— 
(i) by striking ‘‘a reasonable time’’ 
and inserting ‘‘the opportunity, within the 
ten business day notice period,’’; and 
(ii) by striking ‘‘orally and’’. 
SEC. 10. ANNUAL REPORT ON PERFORMANCE AWARDS AND 
BONUSES 
AWARDED 
TO 
CERTAIN 
HIGH- 
LEVEL EMPLOYEES OF THE DEPARTMENT OF 
VETERANS AFFAIRS. 
(a) IN GENERAL.—Chapter 7 of title 38, United 
States Code, is further amended by inserting after section 
723, as added by section 5, the following new section: 
‘‘§ 724. Annual report on performance awards and bo-
nuses awarded to certain high-level em-
ployees 
‘‘(a) IN GENERAL.—Not later than 30 days after the 
end of each fiscal year, the Secretary shall submit to the 
appropriate committees of Congress a report that con-
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