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Performance Management Handbook (Recognition Section) Chapter 4

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Chapter 4. Performance Awards

Introduction

The Department’s Performance Recognition System is two-tiered. It includes: 1) the use of an annual performance award to take into account an employee’s contributions to the accomplishment of organizational goals and objectives; and 2) the use of other awards available for managers to recognize specific achievements at any time during the performance cycle. This balanced approach will ensure that the awards and recognition system provides managers a comprehensive set of tools to build a new performance culture at the Department.

Definition

A performance award is a performance-based cash payment to an employee based on the employee's rating of record for the current appraisal period. The award may not exceed 20 percent of the employee's annual rate of basic pay. A performance award does not increase base pay.

Eligibility

  • To qualify for a performance award, an employee must occupy a position, which is covered by the General Workforce Performance Appraisal System, on the last day of the annual appraisal cycle for which performance awards are being granted.
  • When an employee changes positions within the last 120 days of the appraisal period, the employee may receive an award based on his or her interim rating (which becomes the rating of record at the end of the appraisal period) for the position held immediately before the change in position. For example, if the employee changes positions three months before the end of the appraisal period, the award is based on the nine months of the appraisal period preceding the change in position.

Determining Performance Award Amounts

Performance awards are linked directly to the summary rating score on the employee’s rating of record and are calculated as a percentage of base pay (including locality payment). When determining the appropriate performance award amount, supervisors and managers should consider an employee’s contributions to the achievement of the organization’s mission and goals.

Qualifying Summary Rating Ranges

Rating

Award Ranges (Percent of Base Pay Including Locality Payments)

470 - 500 points

Level 5

up to 10 percent

380 – 469 points

Level 4

up to 6 percent

290 - 379 points

Level 3

up to 3 percent

Linking Performance-Based Awards to Performance

All performance-based awards (i.e., performance awards) must be based on a rating of record of Level 3 (or equivalent) or higher. In addition, the granting of performance-based awards must make meaningful distinctions in performance based on levels of performance.

When performance-based awards are granted, awards are larger for employees with higher rating levels. There is no statutory entitlement to recognition. Performance-based awards must be linked directly to job performance.

Annual Data Reports on Performance Awards

Each year the Department produces an annual report to ensure that performance award amounts and rating levels are consistent with OPM regulations. The data will be reviewed during future applications of the Performance Appraisal Assessment Tool as well as accountability audits.

By March 30 of each year, the Department will notify the bureaus of the results of the prior performance year appraisal cycle. If found to be in noncompliance, the Department will require a bureau(s) to certify no later than July 30 of each year that 100 percent of all bureau managers have received training on how to use performance awards to make meaningful distinctions in levels of performance.

If the result of the next annual data report following the July 30 correction action date does not show compliance with OPM regulations, the Department may take more substantive action. This may include withdrawing a bureau(s) authority for granting performance awards without the prior review and approval by the Department.

Approval

Each operating unit must specify the delegations of authority for approval of performance awards in accordance with the overall awards delegations.

Timing

Approved performance awards must be submitted to the Servicing Human Resources Office within the time frames specified in the operating unit plan, but no later than within 90 days of the end of the appraisal cycle.

NOTE: See APPENDIX A. Guidelines for Total Award Recognition (Performance Awards and Special Acts)




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