The Office of Personnel Management (OPM) issued a proposed revision on how federal agencies prioritize workers when implementing reduction-in-force (RIF) policies, or federal layoffs. The proposed amendment will “prioritize performance over length of services when determining which employees will be retained in a RIF.”

OPM is the federal agency responsible for developing policy and guidelines for RIFs in the federal sector. A RIF action can be the result of “reorganization, lack of work, shortage of funds, insufficient personnel ceiling, or the exercise of certain reemployment or restoration rights.” Additionally, a “furlough of more than 30 calendar days, or of more than 22 discontinuous work days” also qualifies as a RIF, regardless of whether it is an administrative or shut-down/emergency furlough.

Currently, 5 CFR § 351.501 “Order of retention - competitive service” states that in the competitive federal services, “employees shall be classified on a retention register based on their tenure of employment, veteran preference, length of service, and performance in descending order.”

In the current law, performance, while at the lowest level of priority, still could assist an employee in the old system, but only if they were with the federal government for over a year. An employee received “20 additional years of service for each rating of record with a Level 5 (Outstanding or equivalent)” 16 for a Level 4, and 12 for a Level 3. Then, “the additional years of service are added together, divided by 3, and rounded up to a whole number… to adjust an employee’s actual service computation date.”

The amendments proposed by OPM move “performance” to the second-highest criteria, surpassing veterans’ preference and length of service. Employees are still sorted into their appropriate tenure group as under the current law, but then they are sorted within that group by their performance “based on the total of the employee’s three most recent ratings of record.” Those three ratings of record will be added together using the numerical name of the level as its numerical value (a Level 5 equals a rating of 5).

Tenure is broken into three groups to create a retention register during a RIF. Group I consists of career employees that are out of their probationary period, Group II includes career-conditional employees who have also finished their probationary period, Group III are those employees serving on indefinite, temporary, status quo, term, or non-status appointments.

In most cases, tenure is established by the length of service. Probationary periods generally last between one and two years, depending on how the employee was hired. During that probationary period, the employer has the discretion to terminate employment for either performance or behavior. After that probationary status is finished, an employee becomes career-conditional (Group II) which could last for several years depending on the agency. Once they become career employees, or Group I, then it becomes very difficult to terminate employees on basis of performance only.

So, while the amendments being made do rank performance over length of service, tenure is still the highest criteria for an employee to be retained, which usually depends on how long an employee has been with an agency. If an employee in Group I has been underperforming for the last three years, they are still more likely to be retained than an employee that is career-conditional and is performing at a much higher level.

Additionally, this proposed rule takes the performance of a supervisor for granted. If an employee is under a supervisor, for any or all of the most recent three rating cycles, who does not keep an accurate record of an employee’s performance, it can be difficult to argue this for retention purposes.

This amendment is in response to President Trump’s Executive Order 13839, “Promoting Accountability and Streamlining Removal Procedures Consistent with Merit Systems and Principles.” It is aligned with the current administration’s goal of making the federal government more efficient by making it easier to remove under-performing federal employees and the multiple executive orders weakening labor organizations in the federal workforce.

The COVID-19 pandemic has made several agencies face the prospect of a RIF with reducing intake of fees such as the U.S. Immigration and Citizenship Services (USCIS) which narrowly averted furloughing 70% of its employees in August 2020.

The proposed rule was posted on the Federal Register on December 17th for 30 days, during which the public may make comments. Following the comment period, the rule will likely take effect during the first quarter of 2021.