I 
108TH CONGRESS 
1ST SESSION H. R. 1601
To provide for reform relating to Federal employment, and for other purposes. 
IN THE HOUSE OF REPRESENTATIVES 
APRIL 3, 2003
Mrs. JO ANN DAVIS of Virginia introduced the following bill; which was 
referred to the Committee on Government Reform 
A BILL 
To provide for reform relating to Federal employment, and 
for other purposes.
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled, 
SECTION 1. SHORT TITLE; TABLE OF CONTENTS. 
(a) SHORT TITLE.—This Act may be cited as the 
‘‘Federal Workforce Flexibility Act of 2003’’. 
(b) TABLE OF CONTENTS.—The table of contents of 
this Act is as follows:
Sec. 1. Short title; table of contents. 
TITLE I—FEDERAL HUMAN RESOURCES MANAGEMENT 
INNOVATIONS 
Sec. 101. Streamlined personnel management demonstration projects. 
Sec. 102. Effective date.
TITLE II—REFORMS RELATING TO FEDERAL HUMAN CAPITAL 
MANAGEMENT 
Sec. 201. Recruitment, relocation, and retention bonuses. 
Sec. 202. Streamlined critical pay authority. 
Sec. 203. Civil service retirement system computation for part-time service. 
Sec. 204. Corrections relating to pay administration. 
TITLE III—REFORMS RELATING TO FEDERAL EMPLOYEE 
CAREER DEVELOPMENT AND BENEFITS 
Sec. 301. Agency training. 
Sec. 302. Annual leave enhancements.
TITLE I—FEDERAL HUMAN RE-
SOURCES MANAGEMENT IN-
NOVATIONS 
SEC. 101. STREAMLINED PERSONNEL MANAGEMENT DEM-
ONSTRATION PROJECTS. 
Chapter 47 of title 5, United States Code, is amend-
ed—
(1) in section 4701—
(A) in subsection (a)—
(i) by striking ‘‘(a)’’; 
(ii) by striking paragraph (1) and in-
serting the following: 
‘‘(1) ‘agency’ means an Executive agency and 
any entity that is subject to any provision of this 
title that could be waived under section 4703, but 
does not include—
‘‘(A) the Federal Bureau of Investigation, 
the Central Intelligence Agency, the Defense In-
telligence Agency, the National Imagery and
Mapping Agency, the National Security Agency, 
and, as determined by the President, any Exec-
utive agency or unit thereof which is designated 
by the President and which has as its principal 
function the conduct of foreign intelligence or 
counterintelligence activities; or 
‘‘(B) the General Accounting Office;’’; 
(iii) in paragraph (4), by striking 
‘‘and’’ at the end; 
(iv) by redesignating paragraph (5) as 
paragraph (6); and 
(v) by inserting after paragraph (4) 
the following: 
‘‘(5) ‘modification’ means a significant change 
in 1 or more of the elements of a demonstration 
project plan as described in section 4703(b)(1); 
and’’; and 
(B) by striking subsection (b); and 
(2) in section 4703—
(A) in subsection (a)—
(i) by striking ‘‘conduct and evaluate 
demonstration 
projects’’ 
and 
inserting 
‘‘conduct, modify, and evaluate demonstra-
tion projects’’;
(ii) by striking ‘‘, including any law or 
regulation relating to—’’ and all that fol-
lows and inserting a period; and 
(iii) by adding at the end the fol-
lowing: ‘‘The decision to initiate or modify 
a project under this section shall be made 
by the Office.’’; 
(B) by striking subsection (b) and insert-
ing the following: 
‘‘(b) Before conducting or entering into any agree-
ment or contract to conduct a demonstration project, the 
Office shall ensure—
‘‘(1) that each project has a plan which de-
scribes—
‘‘(A) its purpose; 
‘‘(B) the employees to be covered; 
‘‘(C) its anticipated outcomes and resource 
implications, including how the project relates 
to carrying out the agency’s strategic plan, in-
cluding meeting performance goals and objec-
tives, and accomplishing its mission; 
‘‘(D) the personnel policies and procedures 
the project will use that differ from those other-
wise available and applicable, including a spe-
cific citation of any provisions of law, rule, or
regulation to be waived and a specific descrip-
tion of any contemplated action for which there 
is a lack of specific authority; 
‘‘(E) the method of evaluating the project; 
and 
‘‘(F) the agency’s system for ensuring that 
the project is implemented in a manner con-
sistent with merit system principles; 
‘‘(2) notification of the proposed project to em-
ployees who are likely to be affected by the project; 
‘‘(3) an appropriate comment period; 
‘‘(4) publication of the final plan in the Federal 
Register; 
‘‘(5) notification of the final project at least 90 
days in advance of the date any project proposed 
under this section is to take effect to employees who 
are likely to be affected by the project; 
‘‘(6) publication of any subsequent modification 
in the Federal Register; and 
‘‘(7) notification of any subsequent modification 
to employees who are included in the project.’’; 
(C) in subsection (c)—
(i) by striking paragraph (1) and in-
serting the following:
‘‘(1) any provision of chapter 63 or subpart G 
of part III of this title;’’; 
(ii) by redesignating paragraphs (4) 
and (5) as paragraphs (6) and (7), respec-
tively; 
(iii) by inserting after paragraph (3) 
the following: 
‘‘(4) section 7342, 7351, or 7353; 
‘‘(5) the Ethics in Government Act of 1978 (5 
U.S.C. App.);’’; and 
(iv) in paragraph (6) as redesignated, 
by striking ‘‘paragraph (1), (2), or (3) of 
this subsection; or’’ and inserting ‘‘para-
graphs (1) through (5);’’; 
(D) by striking subsections (d) and (e) and 
inserting the following: 
‘‘(d)(1) Unless terminated at an earlier date in ac-
cordance with this section, each demonstration project 
shall terminate at the end of the 10-year period beginning 
on the date on which the project takes effect. 
‘‘(2) On or before the end of the 7-year period begin-
ning on the date on which a demonstration project takes 
effect, the Office shall submit a recommendation to Con-
gress on whether Congress should enact legislation to 
make that project permanent.
‘‘(e) The Office may terminate a demonstration 
project under this chapter if the Office determines that 
the project—
‘‘(1) is not consistent with merit system prin-
ciples set forth in section 2301, veterans’ preference 
principles, or the provisions of this chapter; or 
‘‘(2) otherwise imposes a substantial hardship 
on, or is not in the best interests of, the public, the 
Government, employees, or eligibles.’’; and 
(E) by striking subsections (h) and (i) and 
inserting the following: 
‘‘(h) Notwithstanding section 2302(e)(1), for pur-
poses of applying section 2302(b)(11) in a demonstration 
project under this chapter, the term ‘veterans’ preference 
requirement’ means any of the specific provisions of the 
demonstration project plan that are designed to ensure 
that the project is consistent with veterans’ preference 
principles. 
‘‘(i) The Office shall ensure that each demonstration 
project is evaluated. Each evaluation shall assess—
‘‘(1) the project’s compliance with the plan de-
veloped under subsection (b)(1); and 
‘‘(2) the project’s impact on improving public 
management.
‘‘(j) Upon request of the Director of the Office of 
Personnel Management, agencies shall cooperate with and 
assist the Office in any evaluation undertaken under sub-
section (i) and provide the Office with requested informa-
tion and reports relating to the conducting of demonstra-
tion projects in their respective agencies.’’. 
SEC. 102. EFFECTIVE DATE. 
This title shall take effect 180 days after the date 
of enactment of this Act. 
TITLE II—REFORMS RELATING 
TO 
FEDERAL 
HUMAN 
CAP-
ITAL MANAGEMENT 
SEC. 201. RECRUITMENT, RELOCATION, AND RETENTION 
BONUSES. 
(a) BONUSES.—
(1) IN GENERAL.—Chapter 57 of title 5, United 
States Code, is amended by striking sections 5753 
and 5754 and inserting the following: 
‘‘§ 5753. Recruitment and relocation bonuses 
‘‘(a) In this section, the term ‘employee’ has the 
meaning given that term under section 2105, except that 
such term also includes an employee described under sub-
section (c) of that section. 
‘‘(b)(1) The Office of Personnel Management may 
authorize the head of an agency to pay a bonus to an indi-
vidual appointed or moved to a position that is likely to 
be difficult to fill in the absence of such a bonus, if the 
individual—
‘‘(A)(i) is newly appointed as an employee of 
the Federal Government; or 
‘‘(ii) is currently employed by the Federal Gov-
ernment and moves to a new position in the same 
geographic area under circumstances described in 
regulations of the Office; or 
‘‘(B) is currently employed by the Federal Gov-
ernment and must relocate to accept a position sta-
tioned in a different geographic area. 
‘‘(2) Except as provided by subsection (h), a bonus 
may be paid under this section only to an employee cov-
ered by the General Schedule pay system established 
under subchapter III of chapter 53. 
‘‘(c)(1) Payment of a bonus under this section shall 
be contingent upon the employee entering into a written 
service agreement to complete a period of employment 
with the agency, not to exceed 4 years. The Office may, 
by regulation, prescribe a minimum service. 
‘‘(2)(A) The agreement shall include—
‘‘(i) the length of the required service period; 
‘‘(ii) the amount of the bonus; 
‘‘(iii) the method of payment; and
‘‘(iv) other terms and conditions under which 
the bonus is payable, subject to subsections (d) and 
(e) and regulations of the Office. 
‘‘(B) The terms and conditions for paying a bonus, 
as specified in the service agreement, shall include—
‘‘(i) the conditions under which the agreement 
may be terminated before the agreed-upon service 
period has been completed; and 
‘‘(ii) the effect of the termination. 
‘‘(3) The agreement shall be made effective upon em-
ployment with the agency or movement to a new position 
or geographic area, as applicable, except that a service 
agreement with respect to a recruitment bonus may be 
made effective at a later date under circumstances de-
scribed in regulations of the Office, such as when there 
is an initial period of formal basic training. 
‘‘(d)(1) Except as provided in subsection (e), a bonus 
under this section shall not exceed 25 percent of the an-
nual rate of basic pay of the employee at the beginning 
of the service period multiplied by the number of years 
(or fractions thereof) in the service period, not to exceed 
4 years.
‘‘(2) A bonus under this section may be paid as an 
initial lump sum, in installments, as a final lump sum
upon the completion of the full service period, or in a com-
bination of these forms of payment. 
‘‘(3) A bonus under this section is not part of the 
basic pay of an employee for any purpose. 
‘‘(4) Under regulations of the Office, a recruitment 
bonus under this section may be paid to an eligible indi-
vidual before that individual enters on duty. 
‘‘(e) The Office may authorize the head of an agency 
to waive the limitation under subsection (d)(1) based on 
a critical agency need, subject to regulations prescribed 
by the Office. Under such a waiver, the amount of the 
bonus may be up to 50 percent of the employee’s annual 
rate of basic pay at the beginning of the service period 
multiplied by the number of years (or fractions thereof) 
in the service period, not to exceed 100 percent of the em-
ployee’s annual rate of basic pay at the beginning of the 
service period. 
‘‘(f) The Office shall require that, before paying a 
bonus under this section, an agency shall establish a plan 
for paying recruitment bonuses and a plan for paying relo-
cation bonuses, subject to regulations prescribed by the 
Office. 
‘‘(g) The Office may prescribe regulations to carry 
out this section, including regulations relating to the re-
payment of a recruitment or relocation bonus in appro-
‘‘(2) the agency determines that, in the absence 
of a retention bonus, the employee would be likely to 
leave—
‘‘(A) the Federal service; or 
‘‘(B) for a different position in the Federal 
service under conditions described in regula-
tions of the Office. 
‘‘(c) The Office may authorize the head of an agency 
to pay retention bonuses to a group of employees in 1 or 
more categories of positions in 1 or more geographic areas, 
subject to the requirements of subsection (b)(1) and regu-
lations prescribed by the Office, if there is a high risk that 
a significant portion of employees in the group would be 
likely to leave in the absence of retention bonuses. 
‘‘(d) Except as provided in subsection (j), a bonus 
may be paid only to an employee covered by the General 
Schedule pay system established under subchapter III of 
chapter 53. 
‘‘(e)(1) Payment of a retention bonus is contingent 
upon the employee entering into a written service agree-
ment with the agency to complete a period of employment 
with the agency. 
‘‘(2)(A) The agreement shall include—
‘‘(i) the length of the required service period; 
‘‘(ii) the amount of the bonus;
‘‘(iii) the method of payment; and 
‘‘(iv) other terms and conditions under which 
the bonus is payable, subject to subsections (f) and 
(g) and regulations of the Office. 
‘‘(B) The terms and conditions for paying a bonus, 
as specified in the service agreement, shall include—
‘‘(i) the conditions under which the agreement 
may be terminated before the agreed-upon service 
period has been completed; and 
‘‘(ii) the effect of the termination. 
‘‘(3)(A) Notwithstanding paragraph (1), a written 
service agreement is not required if the agency pays a re-
tention bonus in biweekly installments and sets the install-
ment payment at the full bonus percentage rate estab-
lished for the employee with no portion of the bonus de-
ferred. 
‘‘(B) If an agency pays a retention bonus in accord-
ance with subparagraph (A) and makes a determination 
to terminate the payments, the agency shall provide writ-
ten notice to the employee of that determination. Except 
as provided in regulations of the Office, the employee shall 
continue to be paid the retention bonus through the end 
of the pay period in which such written notice is provided.
‘‘(4) A retention bonus for an employee may not be 
based on any period of such service which is the basis for 
a recruitment or relocation bonus under section 5753. 
‘‘(f)(1) Except as provided in subsection (g), a reten-
tion bonus, which shall be stated as a percentage of the 
employee’s basic pay for the service period associated with 
the bonus, may not exceed—
‘‘(A) 25 percent of the employee’s basic pay if 
paid under subsection (b); or 
‘‘(B) 10 percent of an employee’s basic pay if 
paid under subsection (c). 
‘‘(2) A retention bonus may be paid to an employee 
in installments after completion of specified periods of 
service or in a single lump sum at the end of the full pe-
riod of service required by the agreement. An installment 
payment may not exceed the product derived from multi-
plying the amount of basic pay earned in the installment 
period by a percentage not to exceed the bonus percentage 
rate established for the employee. If the installment pay-
ment percentage is less than the bonus percentage rate, 
the accrued but unpaid portion of the bonus is payable 
as part of the final installment payment to the employee 
after completion of the full service period under the terms 
of the service agreement.
‘‘(3) A retention bonus is not part of the basic pay 
of an employee for any purpose. 
‘‘(g) Upon the request of the head of an agency, the 
Office may waive the limit established under subsection 
(f)(1) and permit the agency head to pay an otherwise 
eligible employee or category of employees retention bo-
nuses of up to 50 percent of basic pay, based on a critical 
agency need. 
‘‘(h) The Office shall require that, before paying a 
bonus under this section, an agency shall establish a plan 
for paying retention bonuses, subject to regulations pre-
scribed by the Office. 
‘‘(i) The Office may prescribe regulations to carry out 
this section. 
‘‘(j)(1) At the request of the head of an Executive 
agency, the Office may extend coverage under this section 
to categories of employees within the agency who other-
wise would not be covered by this section. 
‘‘(2) The Office shall not extend coverage under this 
section to the head of an Executive agency, including an 
Executive agency headed by a board or other collegial body 
composed of 2 or more individual members.’’. 
(2) TECHNICAL
AND
CONFORMING
AMEND-
MENT.—The table of sections for chapter 57 of title 
5, United States Code, is amended by striking the
item relating to section 5754 and inserting the fol-
lowing:
‘‘5754. Retention bonuses.’’.
(b) RELOCATION PAYMENTS.—Section 407 of the 
Federal Employees Pay Comparability Act of 1990 (5 
U.S.C. 5305 note; 104 Stat. 1467) is repealed. 
(c) EFFECTIVE DATE AND APPLICATION.—
(1) EFFECTIVE
DATE.—Except as provided 
under paragraphs (2) and (3), this section shall take 
effect on the first day of the first applicable pay pe-
riod beginning on or after 180 days after the date 
of enactment of this Act. 
(2) APPLICATION TO AGREEMENTS.—A recruit-
ment or relocation bonus service agreement that was 
authorized under section 5753 of title 5, United 
States Code, before the effective date under para-
graph (1) shall continue, until its expiration, to be 
subject to section 5753 as in effect on the day before 
such effective date.
(3) APPLICATION TO ALLOWANCES.—Payment 
of a retention allowance that was authorized under 
section 5754 of title 5, United States Code, before 
the effective date under paragraph (1) shall con-
tinue, subject to section 5754 as in effect on the day 
before such effective date, until the retention allow-
ance is reauthorized or terminated (but no longer 
than 1 year after such effective date). 
SEC. 202. STREAMLINED CRITICAL PAY AUTHORITY. 
Section 5377 of title 5, United States Code, is 
amended— 
(1) by striking subsection (c) and inserting the 
following: 
‘‘(c) The Office of Personnel Management, in con-
sultation with the Office of Management and Budget, 
may, upon the request of the head of an agency, grant 
authority to fix the rate of basic pay for 1 or more posi-
tions in such agency in accordance with this section.’’;
(2) in subsection (e)(1), by striking ‘‘Office of 
Management and Budget’’ and inserting ‘‘Office of 
Personnel Management’’; 
(3) by striking subsections (f) and (g) and in-
serting the following: 
‘‘(f) The Office of Personnel Management may not 
authorize the exercise of authority under this section with 
respect to more than 800 positions at any 1 time, of which 
not more than 30 may, at any such time, be positions the 
rate of basic pay for which would otherwise be determined 
under subchapter II. 
‘‘(g) The Office of Personnel Management shall con-
sult with the Office of Management and Budget before
making any decision to grant or terminate any authority 
under this section.’’; and 
(4) in subsection (h), by striking ‘‘The Office of 
Management and Budget shall report to the Com-
mittee on Post Office and Civil Service’’ and insert-
ing ‘‘The Office of Personnel Management shall re-
port to the Committee on Government Reform.’’. 
SEC. 203. CIVIL SERVICE RETIREMENT SYSTEM COMPUTA-
TION FOR PART-TIME SERVICE. 
Section 8339(p) of title 5, United States Code, is 
amended by adding at the end the following: 
‘‘(3) In the administration of paragraph (1)—
‘‘(A) subparagraph (A) of such paragraph 
shall apply to any service performed before, on, 
or after April 7, 1986; 
‘‘(B) subparagraph (B) of such paragraph 
shall apply to all service performed on a part-
time or full-time basis on or after April 7, 
1986; and 
‘‘(C) any service performed on a part-time 
basis before April 7, 1986, shall be credited as 
service performed on a full-time basis.’’.
SEC. 204. CORRECTIONS RELATING TO PAY ADMINISTRA-
TION. 
(a) IN GENERAL.—Chapter 53 of title 5, United 
States Code, is amended—
(1) in section 5302, by striking paragraph (8) 
and inserting the following: 
‘‘(8) the term ‘rates of pay under the General 
Schedule’, ‘rates of pay for the General Schedule’, or 
‘scheduled rates of basic pay’ means the unadjusted 
rates of basic pay in the General Schedule as estab-
lished by section 5332, excluding additional pay of 
any kind; and’’; 
(2) in section 5305—
(A) by striking subsection (a) and insert-
ing the following: 
‘‘(a)(1) Whenever the Office of Personnel Manage-
ment finds that the Government’s recruitment or retention 
efforts with respect to 1 or more occupations in 1 or more 
areas or locations are, or are likely to become, significantly 
handicapped due to any of the circumstances described in 
subsection (b), the Office may establish for the areas or 
locations involved, with respect to individuals in positions 
paid under any of the pay systems referred to in sub-
section (c), higher minimum rates of pay for 1 or more 
grades or levels, occupational groups, series, classes, or 
subdivisions thereof, and may make corresponding in-
creases in all rates of pay range for each such grade or 
level. However, a minimum rate so established may not 
exceed the maximum rate of basic pay (excluding any lo-
cality-based comparability payment under section 5304 or 
similar provision of law) for the grade or level by more 
than 30 percent, and no rate may be established under 
this section in excess of the rate of basic pay payable for 
level IV of the Executive Schedule. In the case of individ-
uals not subject to the provisions of this title governing 
appointment in the competitive service, the President may 
designate another agency to authorize special rates under 
this section. 
‘‘(2) The head of an agency may determine that a 
category of employees of the agency will not be covered 
by a special rate authorization established under this sec-
tion. The head of an agency shall provide written notice 
to the Office of Personnel Management (or other agency 
designated by the President to authorize special rates) 
which identifies the specific category or categories of em-
ployees that will not be covered by special rates authorized 
under this section. If the head of an agency removes a 
category of employees from coverage under a special rate 
authorization after that authorization takes effect, the loss 
of coverage will take effect on the first day of the first 
pay period after the date of the notice.’’;
(B) in subsection (b), by striking para-
graph (4) and inserting the following: 
‘‘(4) any other circumstances which the Office 
of Personnel Management (or such agency as the 
President may designate) considers appropriate.’’; 
(C) in subsection (d)—
(i) by striking ‘‘President’’ and insert-
ing ‘‘Office of Personnel Management’’; 
and 
(ii) by striking ‘‘he’’ and inserting 
‘‘the President’’; 
(D) in subsection (e), by striking ‘‘basic 
pay’’ and inserting ‘‘pay’’; 
(E) by striking subsection (f) and inserting 
the following: 
‘‘(f) When a schedule of special rates established 
under this section is adjusted under subsection (d), a cov-
ered employee’s special rate will be adjusted in accordance 
with conversion rules prescribed by the Office of Personnel 
Management or by such agency as the President may des-
ignate.’’; 
(F) in subsection (g)(1)—
(i) by striking ‘‘basic pay’’ and insert-
ing ‘‘pay’’; and
(ii) by striking ‘‘President (or his des-
ignated agency)’’ and inserting ‘‘Office of 
Personnel Management (or such agency as 
the President may designate)’’; 
(G) by striking subsection (h) and insert-
ing the following: 
‘‘(h) An employee’s entitlement to a rate of pay estab-
lished under this section terminates when the employee is 
entitled to a higher rate of pay (including basic pay as 
adjusted to include any locality-based comparability pay-
ment under section 5304 or similar provision of law).’’; 
and 
(H) by adding at the end the following: 
‘‘(i) When an employee who is receiving a rate of pay 
established under this section moves to a new official duty 
station at which different pay schedules apply, the em-
ployee shall be entitled to the rates of pay applicable in 
the new pay area based on the employee’s position, grade, 
and step (or relative position in the rate range) before the 
movement, as determined under regulations prescribed by 
the Office of Personnel Management or other agency des-
ignated by the President under subsection (a). Such pay 
conversion upon geographic movement shall be effected be-
fore processing any other simultaneous pay action (other 
than a general pay adjustment).
‘‘(j) A rate established under this section shall be con-
sidered to be part of basic pay for purposes of subchapter 
III of chapter 83, chapter 84, chapter 87, subchapter V 
of chapter 55, section 5941, and for such other purposes 
as may be expressly provided for by law or as the Office 
of Personnel Management may by regulation prescribe.’’; 
(3) in section 5334—
(A) in subsection (b), by adding at the end 
the following: 
‘‘If an employee’s rate after promotion or transfer is 
greater than the maximum rate of basic pay for the em-
ployee’s grade, that rate shall be treated as a retained rate 
under section 5363. The Office of Personnel Management 
shall prescribe by regulation the circumstances under 
which and the extent to which special rates under section 
5305 (or similar provision of law) or locality-adjusted 
rates under section 5304 (or similar provision of law) are 
considered to be basic pay in applying this subsection.’’; 
and 
(B) by adding at the end the following: 
‘‘(g) When an employee moves to a new official duty 
station at which different pay schedules apply, the em-
ployee shall be entitled to the rates of pay applicable in 
the new pay area based on the employee’s position, grade, 
and step (or relative position in the rate range) before the
movement. Such pay conversion upon geographic move-
ment shall be effected before processing any other simulta-
neous pay action (other than a general pay adjustment).’’; 
(4) in section 5361—
(A) by striking paragraphs (3) and (4) and 
redesignating paragraphs (5) through (7) as 
paragraphs (3) through (5), respectively; 
(B) in paragraph (4), as redesignated, by 
striking ‘‘and’’ at the end; 
(C) in paragraph (5), as redesignated, by 
striking the period and inserting a semicolon; 
and 
(D) by adding at the end the following: 
‘‘(6) ‘rate of basic pay’ means—
‘‘(A) the rate of pay prescribed by law (in-
cluding regulations) for the position held by an 
employee before any deductions or additions of 
any kind, but including—
‘‘(i) any applicable locality-based pay-
ment under section 5304 or similar provi-
sion of law; 
‘‘(ii) any applicable special salary rate 
under section 5305 or similar provision of 
law; and
‘‘(iii) any applicable existing retained 
rate of pay established under section 5363 
or similar provision of law; and 
‘‘(B) in the case of a prevailing rate em-
ployee, the scheduled rate of pay determined 
under section 5343; 
‘‘(7) ‘former highest applicable rate of basic 
pay’ means the highest applicable rate of basic pay 
payable to the employee immediately before the ac-
tion that triggers pay retention under section 5363; 
and 
‘‘(8) ‘highest applicable basic pay rate range’ 
means the range of rates of basic pay for the grade 
or level of the employee’s current position with the 
highest maximum rate, except as otherwise provided 
in regulations prescribed by the Office of Personnel 
Management in cases where another rate range pro-
vides higher rates only in the lower portion of the 
range.’’; 
(5) in section 5363—
(A) in subsection (a), by amending the 
matter following paragraph (4) to read as fol-
lows: 
‘‘is entitled to pay retention under the conditions set forth 
in this section. Notwithstanding any other provision of
law, this section may not be applied to employees whose 
rate of basic pay is reduced solely because of the recompu-
tation of pay upon movement to a new official duty station 
at which different pay schedules apply. When a geographic 
move is accompanied by a simultaneous pay action that 
reduces the employee’s rate of basic pay after the employ-
ee’s pay has been recomputed to reflect the geographic 
move, this section shall be applied, if otherwise applica-
ble.’’; and 
(B) by striking subsections (b) and (c) and 
inserting the following: 
‘‘(b)(1) If an employee is entitled to pay retention 
under subsection (a), paragraphs (2) and (3) shall apply 
in determining the employee’s rate of pay: 
‘‘(2) If the employee’s former highest applicable rate 
of basic pay is less than or equal to the maximum rate 
of the highest applicable basic pay rate range for the em-
ployee’s current position, the employee is entitled to the 
lowest payable rate of basic pay in that rate range that 
equals or exceeds the former rate, and pay retention 
ceases to apply. 
‘‘(3) If the employee’s former highest applicable rate 
of basic pay exceeds the maximum rate of the highest ap-
plicable basic pay rate range for the employee’s current
position, the employee is entitled to a retained rate equal 
to the lesser of—
‘‘(A) the employee’s former highest applicable 
rate of basic pay; or 
‘‘(B) 150 percent of the maximum rate of the 
highest applicable basic pay rate range for the em-
ployee’s position. 
‘‘(c) An employee’s retained rate shall be increased 
at the time of any increase in the maximum rate of the 
highest applicable basic pay rate range for the employee’s 
position by 50 percent of the dollar increase in that max-
imum rate. 
‘‘(d) The rate of pay for an employee who is receiving 
a retained rate under this section and who is moved to 
a new official duty station at which different pay schedules 
apply shall be determined under regulations prescribed by 
the Office of Personnel Management consistent with the 
purposes of this section. 
‘‘(e) A retained rate shall be considered part of basic 
pay for purposes of this subchapter and for purposes of 
subchapter III of chapter 83, chapters 84 and 87, sub-
chapter V of chapter 55, section 5941, and for such other 
purposes as may be expressly provided for by law or as 
the law or as the Office of Personnel Management may 
by regulation prescribe. For other purposes, the Office
shall prescribe by regulation what constitutes basic pay 
for employees receiving a retained rate. 
‘‘(f) Subsections (a) through (e) do not apply (or shall 
cease to apply) to an employee who—
‘‘(1) has a break in service of 1 workday or 
more; 
‘‘(2) is entitled by operation of this subchapter 
or chapter 51 or 53 to a rate of basic pay which is 
equal to or higher than, or declines a reasonable 
offer of a position the rate of basic pay for which 
is equal to or higher than, the rate to which the em-
ployee is entitled under this section; or 
‘‘(3) is demoted for personal cause or at the 
employee’s request.’’; and 
(6) in section 5365(b) by inserting after ‘‘provi-
sions of this subchapter’’ the following: ‘‘(subject to 
any conditions or limitations the Office may estab-
lish)’’.
(b) SPECIAL RATES FOR LAW ENFORCEMENT OFFI-
CERS.—Section 403(c) of the Federal Employees Pay 
Comparability Act of 1990 (5 U.S.C. 5305 note; Public 
Law 101–509) is amended by striking all after ‘‘provision 
of law)’’ and inserting ‘‘and shall be basic pay for all pur-
poses. The rates shall be adjusted at the time of adjust-
ments in the General Schedule to maintain the step link-
age set forth in subsection (b)(2).’’. 
(c) PAY RETENTION.—Subject to any regulations the 
Office of Personnel Management may prescribe, any em-
ployee in a covered pay schedule who is receiving a re-
tained rate under section 5363 of title 5, United States 
Code, or similar authority on the effective date of this Act 
shall have the pay of that employee converted on that date. 
The newly applicable retained rate shall equal the formerly 
applicable retained rate as adjusted to include any applica-
ble locality-based payment under section 5304 of title 5, 
United States Code, or similar provision of law. Any em-
ployee in a covered pay system receiving a rate that ex-
ceeds the maximum rate of the highest applicable basic 
pay rate range for the employee’s position (as defined 
under section 5361(8) of that title, as amended by this 
Act) under any authority shall be considered to be receiv-
ing a retained rate under section 5363 of that title. 
TITLE III—REFORMS RELATING 
TO FEDERAL EMPLOYEE CA-
REER 
DEVELOPMENT 
AND 
BENEFITS 
SEC. 301. AGENCY TRAINING. 
(a) TRAINING
TO
ACCOMPLISH
PERFORMANCE 
PLANS AND STRATEGIC GOALS.—Section 4103 of title 5,
United States Code, is amended by adding at the end the 
following: 
‘‘(c) The head of each agency shall—
‘‘(1) evaluate each program or plan established, 
operated, or maintained under subsection (a) with 
respect to accomplishing specific performance plans 
and strategic goals in performing the agency mis-
sion; and 
‘‘(2) modify such program or plan to accom-
plish such plans and goals.’’. 
(b) AGENCY TRAINING OFFICER; SPECIFIC TRAINING 
PROGRAMS.—
(1) IN GENERAL.—Chapter 41 of title 5, United 
States Code, is amended by adding after section 
4119 the following:
‘‘§ 4120. Agency training officer 
‘‘Each agency shall appoint or designate a training 
officer who shall be responsible for developing, coordi-
nating, and administering training for the agency. 
‘‘§ 4121. Specific training programs 
‘‘In consultation with the Office of Personnel Man-
agement, each head of an agency shall establish—
‘‘(1) a comprehensive management succession 
program to provide training to employees to develop 
managers for the agency; and
‘‘(2) a program to provide training to managers 
on actions, options, and strategies a manager may 
use in—
‘‘(A) relating to employees with unaccept-
able performances; and 
‘‘(B) mentoring employees and improving 
employee performance and productivity.’’. 
(2) TECHNICAL
AND
CONFORMING
AMEND-
MENT.—The table of sections for chapter 41 of title 
5, United States Code, is amended by adding at the 
end the following:
‘‘4120. Agency training officer. 
‘‘4121. Specific training programs.’’.
SEC. 302. ANNUAL LEAVE ENHANCEMENTS. 
(a) ACCRUAL OF LEAVE FOR NEWLY HIRED FED-
ERAL EMPLOYEES WITH QUALIFIED EXPERIENCE.—
(1) IN
GENERAL.—Section 6303 of title 5, 
United States Code, is amended by adding at the 
end the following: 
‘‘(e)(1) In this subsection, the term ‘period of quali-
fied non-Federal service’ means any equal period of service 
performed by an individual that—
‘‘(A) except for this subsection would not other-
wise be service performed by an employee for pur-
poses of subsection (a); and 
‘‘(B) was performed in a position—
‘‘(i) the duties of which were directly re-
lated to the duties of the position in an agency 
that such individual holds; and
‘‘(ii) which meets such other conditions as 
the Office of Personnel Management shall pre-
scribe by regulation. 
‘‘(2) For purposes of subsection (a), the head of an 
agency may deem a period of qualified non-Federal service 
performed by an individual to be a period of service per-
formed as an employee.’’. 
(2) EFFECTIVE DATE.—This section shall take 
effect 120 days after the date of enactment of this 
Act and shall only apply to an individual hired on 
or after that effective date. 
(b) SENIOR EXECUTIVE SERVICE ANNUAL LEAVE 
ENHANCEMENTS.—
(1) IN GENERAL.—Section 6303(a) of title 5, 
United States Code, is amended—
(A) in paragraph (2), by striking ‘‘and’’ at 
the end; 
(B) in paragraph (3), by striking the pe-
riod at the end and inserting ‘‘; and’’; and 
(C) by adding after paragraph (3) the fol-
lowing:
‘‘(4) one day for each full biweekly pay period 
for an employee in a position paid under section 
5376 or 5383, or for an employee in an equivalent 
category for which the minimum rate of basic pay is 
greater than the rate payable at GS–15, step 10.’’. 
(2) REGULATIONS.—Not later than 120 days 
after the date of enactment of this Act, the Office 
of Personnel Management shall prescribe regulations 
to carry out the amendments made by this sub-
section. 
(3) EFFECTIVE DATES.—
(A) IN
GENERAL.—Paragraph (1) shall 
take effect 120 days after the date of enact-
ment of this Act. 
(B) REGULATIONS.—Paragraph (2) shall 
take effect on the date of enactment of this Act.
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