How Payouts Would Work

Upon OPM approval of agency plans for using the performance fund, agencies could make annual payouts to up to 15 percent of their employees, although those in certain high-level pay systems such as the Senior Executive Service (who already are eligible for performance-based awards) would be excluded. The maximum payment would be 10 percent of the employee’s basic pay, up to a total compensation cap of executive level IV ($134,000 this year). The amount available in the first year, fiscal 2004, would be $500 million, a tenth of which could be spent on training, with the amount in future years undefined. Ninety percent of the money would be prorated to agencies with approved plans according to their share of the overall federal payroll, and the other 10 percent would be targeted to agencies with “exceptionally high-quality plans.”