Following is the portion of the OMB memo on government reorganization that addresses how agencies are to reassess their workforces with an eye to downsizing, along with other federal employee personnel issues including setting performance expectations and taking discipline.
i. Plan to implement the FY 2018 President’s Budget.
To support the goals of the FY 2018 President’s Budget Proposal, OMB directs agencies to identify workforce reductions over a four-year period (FY 2018 through 2022) consistent with discretionary outyear levels included in the FY 2018 Budget this spring and forthcoming OMB guidance on FY 2019 Budget submissions. Agencies should begin planning for these reductions now, as achieving associated personnel reductions takes time to implement and realize savings.
To facilitate any necessary reductions, OPM will provide streamlined templates to agencies for requesting approval to offer Voluntary Early Retirement Authority and Voluntary Separation Incentive Payments (VERA/VSIP) and OPM will provide expedited reviews for most requests within 30 days. However, eliminating unnecessary vacant positions can begin immediately. Additionally, in a manner consistent with current law, agencies should undertake a review of all employees on administrative leave because of performance deficiencies or misconduct to determine whether those individuals should be returned to work and assigned alternative duties, or subjected to other appropriate action, up to and including removal. In addition, in cases where performance-deficient employees are reassigned or detailed to other duties, agencies should ensure that such assignments are contributing to the agency’s ability to carry out its mission, and are not used simply as an alternative to avoid or delay holding an employee accountable. Please visit www.opm.gov/reshaping for a detailed resource guide on workforce restructuring options.
ii. Develop a long-term workforce reduction plan.
As part of their Agency Reform Plan and FY 2019 Budget submission to OMB, agencies should identify long-term staffing plans by considering the following:
Use agency data to determine appropriate FTE baselines. Agencies have the ability to use various data sources including career field benchmarking, time studies, etc., to determine the appropriate staffing levels for different programs to accomplish their objectives. Instead of relying on previous budget allocations that set FTE levels, agencies should better examine how many people are required to perform tasks at the level required.
Examine the total personnel cost. Agencies need to examine the total cost of their personnel and not only the number of employees. Staffing levels may not present the full picture of whether an agency’s workforce is optimally structured. For example, there are situations where it may be more efficient to restructure duties to enable additional lower-graded employees to do lower-level work previously assigned to higher-graded positions, and consolidate the higher-graded work into fewer positions. Employee-related costs include not only total salary and benefits, overtime, training, awards, career ladder progression, but also employee services, and office expenses.
Review and revise (as needed) organizational design and position structures to ensure they are effective and efficient in supporting delivery of the organization’s work and mission. Ensure that spans of control and delegations of authority are optimized to accomplish the work with the fewest amount of management layers needed to provide for appropriate risk management, oversight, and accountability. In particular, agencies should address deputy positions, lower level chief of staff positions, special projects, and management analysts that may duplicate the work performed in such areas as procurement, human resources, and senior management.
Streamline policy creation by eliminating the common tendency to recraft/restate policy for a component or regional office. For example, many bureaus have staff in administrative functions such as human resources and financial management that customize agency-wide policies when it may be more efficient to use agency-wide policies as-is, while other agencies have staff in each field location write local policy on the same subjects even where unique local or regional expertise is not needed.
• Review positions as they become vacant to determine:
–Whether the duties of the position, qualifications and skills requirements, or organizational placement of the duties reflects current mission needs;
–Whether duties can be reassigned to lower organizational levels and replacement, if needed, at a lower grade; and
— How any appropriate changes to the position can be accomplished in a timely and efficient manner.
• Keep positions current. Agencies should assess how technology may have changed or eliminated the need for some positions. Agencies should build in flexibility to adapt to ongoing technological advances while offering separation incentives as needed to create openings. Fields undergoing rapid transformation or availability of shared services, include but are not limited to:
— Database administration;
— Invoice processing;
— Human resources transactional services;
— Financial management; and
— Management analysts.
Agencies will work with their OMB RMO to develop their Agency Reform Plans, including workforce reshaping priorities, but the agency head retains approval authority for the final workforce plan and the workforce reshaping strategies that may be needed to implement the plan. Agencies may also consult with their OPM points of contact and subject-matter experts on workforce reshaping strategies and approaches, particularly in areas where OPM approval may be needed (e.g., use of VERA). Agencies are also encouraged to submit suggestions to OPM for specific statutory and/or regulatory reforms that may be helpful to addressing workforce challenges.
iii. Plan to maximize employee performance.
As agencies are developing long-term plans for reducing the size of the workforce, they should also take near-term actions to ensure that the workforce they retain and hire is as effective as possible. Agencies should determine whether their current policies and practices are barriers to hiring and retaining the workforce necessary to execute their missions as well appropriately managing and, if necessary, removing poor performers.
Agencies should also ensure that performance expectations are appropriately rigorous, aligned to the work that needs to be done and the grade of the employee, and effectively communicated. Regular, ongoing performance feedback should be provided. Moreover, agencies should ensure that managers have the tools and support they need to manage performance effectively to achieve high-quality results for the American people. It is important that managers recognize high performers, help employees identify and address areas in need of improvement, and move quickly to address employees who are not meeting performance expectations.
By June 30, 2017, as an immediate and near-term government-wide workforce priority, all agencies must develop a plan to maximize employee performance by reviewing the systems and structures currently in place within their agencies to support managers in managing employee performance, and developing a timeline for improvement. At a minimum, agencies must address the timeline and implementation actions for agencies to accomplish the following five actions:
1. Review and Update Formal Agency Policy. Agency timelines must include a process for reviewing and updating (or creating, if one does not already exist) the agency’s policy, procedures, and guidance on how to address poor performance and conduct. Agencies should specifically review whether their policies create unnecessary barriers for addressing poor performance. Agencies should remove steps not required in statute/regulation to streamline processes to the maximum extent. In addition, as required once the Administrative Leave Act implementing regulations are finalized, policies should incorporate expectations for limiting the use of unnecessary administrative leave and lay out alternatives (such as assigning other work). Agencies should also provide clear guidance on the use and requirements associated with performance improvement plans. If overarching policy cannot be created for an entire agency, it should be developed at the highest major component level possible. Policies should be created and endorsed by the agency’s Chief Human Capital Officer and General Counsel (or small agency equivalent), in consultation with the agency’s Equal Employment/Civil Rights Office and Labor Relations Office.
2. Provide Transparency around the Performance Improvement Plan (PIP) Process. Agency submissions must include a timeline for providing all supervisors a copy of the rules and guidance regarding performance improvement plans (PIP) pursuant to 5 U.S.C. Chapter 43 (noting PIPs can be started at any point and not just at the end of the rating period) as well as guidance on how unacceptable performance can be addressed pursuant to 5 U.S.C. Chapter 75. Agencies will maintain data on PIPs, including the number of employees placed on them and the number who successfully improve performance.
3. Ensure Managers and Supporting HR Staff are Appropriately Trained. Agency submissions must include a timeline for all Senior Executive Service (SES) members, supervisors, managers, team leads, and any personnel involved in employee relations to complete training on managing employee performance and conduct. Please refer to OPM’s website for current online courses, as well as reports from MSPB and GAO, and regulatory requirements for training and development of supervisors, managers, and executives at 5 C.F.R. 412.202.
4. Ensure Accountability in Manager Performance Plans. Agency submissions must include a timeline for how they will ensure that supervisors and managers are held accountable for managing employee performance and conduct, including reviewing and updating (if necessary) supervisors’ and managers’ performance plans.
5. Establish Real-Time Manager Support Mechanisms. Agency submissions must include a timeline for agencies to identify approaches and plans for providing accessible and “just-in-time” expert assistance and guidance to managers who are addressing performance/conduct issues. These mechanisms should include a real-time forum (e.g., dedicated contact support lines) for managers to receive guidance on addressing performance or conduct issues that require immediate action. Agencies ultimately have discretion to design these mechanisms. The following Manager Support Board structure would meet this requirement:
a. Establish a Manager Support Board comprised of internal experts on employee and labor relations, who may request policy guidance or technical assistance from OPM or other lead agencies if needed;
b. Have at least one non-HR senior management member with experience/expertise to help provide coaching/support on techniques and approaches for managing employee performance, even if not on the specific case;
c. Operate as close to the regional/division level as feasible;
d. Publicize points of contact where managers can go to receive prompt guidance or provide frequent and regular open-meeting times for any managers with questions to receive immediate guidance on appropriate next steps; and
e. Establish regular check-ins with managers currently working on a case to ensure either the employee is improving or steps are being taken towards an appropriate disciplinary action.
When developed and executed in concert, these five actions and others agencies may identify will provide supervisors with the policies, processes, and tools to be empowered, and held accountable, for managing employee performance such as by an improvement on the Federal Employee Viewpoint Survey (FEVS) questions on addressing employee performance. The guidance in this memorandum must be implemented consistent with requirements imposed by applicable current collective bargaining obligations.
In accordance with 5 C.F .R. Part 250, agencies will subsequently further develop the plan as needed and may incorporate it as a government-wide workforce priority into their Agency Strategic Plan and/or Human Capital Operating Plan, which will be published in February 2018. Of note, agencies must meet any lawful collective bargaining obligations related to their workforce accountability and performance management efforts.
For more information, Executive Branch agencies may visit the MAX site to view examples throughout government where departments/agencies are already successfully using these various strategy elements to positive effect.