(vi) a claims processor. 
(3) EXECUTIVE AGENCY.—The term ‘‘Executive 
agency’’ has the meaning given the term in section 
105 of title 5, United States Code. 
(4) PARTICIPATING AGENCY.—The term ‘‘par-
ticipating agency’’ means an Executive agency, 1 or 
more employees of which are participating employees 
in accordance with section 3(b)(1). 
(5) PARTICIPATING
EMPLOYEE.—The term 
‘‘participating employee’’ means an eligible employee 
who participates in the Program. 
(6) PERFORMANCE METRICS.—The term ‘‘per-
formance metrics’’, with respect to a participating 
agency, means standards for participating employees 
tailored to functions that are specific to the partici-
pating agency, which may include— 
(A) productivity standards, which measure 
quantifiable outputs such as completed cases, 
projects, or responses per quarter; 
(B) quality standards, which measure com-
pliance with protocols, accuracy, and customer 
satisfaction rates; and 
(C) timeliness standards, which measure 
compliance with processing deadlines, efficiency 
improvements, and timely task completion. 
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(7) PROGRAM.—The term ‘‘Program’’ means 
the pilot program established under section 3(a). 
SEC. 3. PILOT PROGRAM ELIGIBILITY AND PROGRAM 
SCOPE. 
(a) IN GENERAL.—During the 5-year period begin-
ning on the date that is 180 days after the date of enact-
ment of this Act, the Director shall carry out a pilot pro-
gram that establishes a performance-based pay structure 
for participating employees. 
(b) PARTICIPATION.— 
(1) IN GENERAL.—Subject to paragraph (2), 
the head of each Executive agency shall ensure that 
not less than 1 percent and not more than 10 per-
cent of eligible employees of the Executive agency 
participate in the Program. 
(2) OPT-OUT.— 
(A) IN GENERAL.—The head of an Execu-
tive agency may elect to not have the Executive 
agency participate in the Program if the head 
of the Executive agency determines that partici-
pation could pose risks to national security or 
public safety. 
(B) TRANSPARENCY
REQUIREMENT.—If 
the head of an Executive agency determines 
that the Executive agency should not partici-
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pate in the Program pursuant to subparagraph 
(A), the head of the Executive agency shall sub-
mit to the Director a written justification for 
the decision. 
SEC. 4. PERFORMANCE MEASUREMENT AND ACCOUNT-
ABILITY. 
(a) ANNUAL PERFORMANCE METRICS.—A partici-
pating agency shall establish annual performance metrics 
for each participating employee related to core functions 
and public service delivery, focusing on productivity, qual-
ity, and timeliness. 
(b) EVALUATION PROCESS.—The Director shall es-
tablish, and each participating agency shall implement, a 
standardized, objective performance evaluation system 
that includes periodic review of the performance of a par-
ticipating employee. 
(c) EMPLOYEE SUPPORT AND TRAINING.—A partici-
pating agency shall provide training and resources to sup-
port participating employees in understanding and meet-
ing performance metrics, including an introductory train-
ing course and quarterly performance feedback sessions. 
SEC. 5. INCENTIVE PAY STRUCTURE AND NON-MONETARY 
BENEFITS. 
(a) TIERED SALARY INCREASE STRUCTURE.— 
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(1) IN GENERAL.—A participating agency shall 
implement a tiered salary adjustment system for 
participating employees based on their annual per-
formance evaluations under section 4 under which, 
effective as of the first day of the first applicable 
pay period beginning on or after the first day of the 
second year of the Program, and of each year there-
after, a participating agency shall adjust (if applica-
ble) the rate of basic pay of a participating employee 
in accordance with this subsection. 
(2) TIER 1 (EXCEEDS EXPECTATIONS).—In the 
case of a participating employee who significantly 
exceeded established performance metrics during the 
preceding year (referred to in this section as a ‘‘tier 
1 employee’’), a participating agency shall increase 
the rate of basic pay of the participating employee 
by not more than 10 percent. 
(3) TIER
(MEETS
EXPECTATIONS).—In the 
case of a participating employee who met established 
performance metrics during the preceding year (re-
ferred to in this section as a ‘‘tier 2 employee’’), a 
participating agency may not adjust the rate of basic 
pay of the participating employee. 
(4) TIER
(BELOW
EXPECTATIONS).—In the 
case of a participating employee who did not meet 
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established performance metrics during the pre-
ceding year (referred to in this section as a ‘‘tier 3 
employee’’), the participating agency shall— 
(A) reduce the rate of basic pay of the par-
ticipating employee by 10 percent; and 
(B) provide training or development oppor-
tunities to assist the participating employee in 
improving performance. 
(b) BONUSES.—The head of a participating agency, 
at the discretion of the agency head, may award a bonus 
to a tier 1 employee. 
(c) NON-MONETARY BENEFITS.—The head of a par-
ticipating agency, at the discretion of the agency head, 
may provide a tier 1 employee or tier 2 employee with 
flexible scheduling, telework options, and other non-mone-
tary benefits or incentives, such as technology upgrades 
and parking options. 
(d) RELATION
TO TITLE 5 PAY ADJUSTMENTS, 
STEP-INCREASES, AND OTHER MONETARY BENEFITS.— 
A participating employee shall not be eligible for any ad-
justment of pay, advancement in pay, or bonus or other 
type of additional monetary compensation under title 5, 
United States Code, based on any service performed while 
the employee is participating in the Program, including— 
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(1) adjustment of the rate of basic pay under 
section 5303, 5304, or 5304a of that title; 
(2) advancement in pay to a higher rate within 
the grade in which the employee’s position is placed 
under section 5335 or 5336 of that title; 
(3) bonuses under section 5753 or 5754 of that 
title; and 
(4) performance awards under section 5384 of 
that title. 
SEC. 6. REPORTING AND ACCOUNTABILITY. 
(a) ANNUAL AGENCY PRODUCTIVITY REPORTS.— 
(1) IN GENERAL.—For each year in which the 
Program is carried out, a participating agency shall 
submit a report to the Director that includes the fol-
lowing information: 
(A) QUANTITATIVE OUTCOMES.—Data on 
cost savings, efficiency gains, and overall pro-
ductivity metrics. 
(B) QUALITATIVE
OUTCOMES.—Examples 
of how productivity improvements have posi-
tively impacted public service outcomes and em-
ployee satisfaction. 
(2) OMB 
OVERSIGHT
AND
RECOMMENDA-
TIONS.—The Director shall— 
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(A) review each report submitted under 
paragraph (1); and 
(B) recommend adjustments to partici-
pating agencies as appropriate. 
(b) ANNUAL OMB ASSESSMENTS.—For each year in 
which the Program is carried out, the Director shall— 
(1) assess the outcomes of the Program with re-
spect to productivity, budgetary impact, and em-
ployee satisfaction; and 
(2) publish and submit to Congress a report on 
the assessment conducted under paragraph (1). 
(c) FINAL REVIEW.—Not later than 1 year after the 
date on which the Program terminates, the Comptroller 
General of the United States and the Director shall assess 
the success of the Program and submit to Congress a re-
port on the impact of the Program on productivity, budg-
ets, and employee engagement. 
SEC. 7. FUNDING. 
(a) NO ADDITIONAL FUNDS.—No additional funds 
are authorized to be appropriated to carry out this Act. 
(b) USE OF EXISTING FUNDS.—The Office of Man-
agement and Budget, the Government Accountability Of-
fice, and each participating agency shall carry out the du-
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ties of the respective agency under this Act using amounts 
otherwise made available to that agency. 
Æ 
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