OPM is establishing four mechanisms for agencies to use to determine a “sufficient number” of names to certify for consideration, and the final rule includes provisions for using the three considerations rule in numerical rating and ranking. Image: Valery Evlakhov/Shutterstock.com
By: FEDweek StaffFollowing is OPM’s explanation of newly finalized rules to carry out a 2018 law requiring replacing the traditional “rule of three” in federal hiring—under which a hiring manager had to pick from one of highest-ranked three candidates for a job vacancy—with a “rule of many”—which states that when a numerical ranking system is used, the hiring choice can come from any number of finalists with a minimum of three.
The National Defense Authorization Act for Fiscal Year 2019 (the “Act”) authorized changes governing the selection of candidates from delegated examining certificates. Sec. 1107, Pub. L. 115-232, 132 Stat. 2002. It eliminated the “rule of three” and authorized agencies to certify a “sufficient number” of names, not less than three, from the top of the appropriate register or list of eligible candidates, to be considered for selection, using a cut-off score or other mechanism established by OPM known as the “rule of many.” The Act also affected how agencies may make selections under 5 CFR Part 302, Employment in the Excepted Service.
On July 21, 2023, OPM issued a proposed rule at 88 FR 47059 to implement these provisions. First, OPM proposed to revise 5 CFR 332.404 to reflect the rule of many that the Act codified in 5 U.S.C. 3317(a). Instead of being required to select from among the top three candidates for each vacancy on a numerically ranked list, an official may select any eligible candidate on the certificate of eligibles.
The Act also codified at 5 U.S.C. 3318(e) the long-standing practice of applying the “three considerations rule.” Under numerical rating and ranking selection procedures, the three considerations rule found in 5 CFR 332.405 allows an appointing officer to remove a candidate from further consideration if they have considered that candidate three times for three separate appointments from the same or different certificates for the same position and makes a valid (legal) selection of another candidate each time. OPM proposed that, when making multiple selections from a certificate under the rule of many, starting with the fourth selection, the three considerations rule would allow one individual to be removed per selection.
Regulatory Analysis
Statement of Need
The longstanding rule of three in numerical rating and ranking required that, for each selection, consideration was limited to the top three candidates on the ranked certificate of eligibles. Many people perceived this process as unnecessarily restrictive for hiring managers, and some argued that it resulted in the selection of candidates that may not be the best suited to a particular position. Hiring managers often opted not to select any candidate, wasting candidates’ and agency resources. The Act authorized OPM to modify the rules governing the selection of candidates from competitive lists of eligibles and eliminated the “rule of three.” The Act, instead, authorizes agencies to certify a “sufficient number” of names, not less than three, from the top of the appropriate register, or list of eligibles, to be considered for selection, using a cut off score or other mechanism established by OPM. The Act also affects how agencies make selections under 5 CFR Part 302 procedures for excepted service appointments. This rule implements those statutory changes. OPM has long permitted agencies to apply a “three considerations rule” by which an agency could remove an eligible candidate from further consideration after having considered the candidate for three separate appointments for the same position. The Act codified this practice; however, current regulations only provide the authority to remove candidates and do not provide any requirements regarding how an agency should do so. This has led to agencies needing assistance in ensuring that adequate consideration is given before candidates are removed from consideration.
Regulatory Alternatives
Congress directed OPM to engage in rulemaking, so no regulatory action was not a viable option. OPM considered several options to implement various provisions of the Act. In the NPRM, OPM proposed requiring a one-for-one mechanism when applying the three considerations rule. That is, a hiring manager could only remove one eligible candidate for each candidate selected. After consideration of comments received, OPM concluded that this mechanism imposed restrictions on the hiring process that were not intended by Congress. OPM also considered not imposing any restrictions on the number of eligible candidates removed, but analysis for various scenarios showed that doing so would effectively provide a regulatory end around statutory veterans’ preference provisions. Accordingly, OPM concluded that some limitations on removal of eligible candidates were necessary to ensure that both the three considerations rule and the veterans’ preference provisions are given effect.
In the NPRM, OPM proposed to define a bona fide consideration to require, at a minimum, an interview. OPM’s goal was to ensure that there was some regulatory criterion to demonstrate consideration. Based on comments received, OPM reconsidered whether an interview was the only – or best – way to demonstrate consideration. OPM concluded that agencies could demonstrate a bona fide consideration in a number of different ways – one of which might be by interviewing each candidate. To reduce regulatory burden on agencies, while still ensuring candidates receive full and fair consideration, OPM adopted a mechanism that provides agencies flexibility but will yield demonstrable, auditable evidence of consideration of any eligible candidate removed from the certificate.
Impact
OPM is establishing four mechanisms for agencies to use to determine a “sufficient number” of names to certify for consideration, and the final rule includes provisions for using the three considerations rule in numerical rating and ranking. The final rule does not change the application of veterans’ preference in competitive examining—veterans are still granted preference points under numerical rating procedures and continue to be entitled to selection preference over non-preference eligibles with the same or lower numerical score unless the requirements for passing over a preference eligible are satisfied.
The final rule also replaces rule of three procedures in excepted service hiring and allows agencies instead to use one of the same mechanisms described under competitive examining procedures to determine a “sufficient number” of names to certify for consideration. The NDAA also amended 5 U.S.C. 3320 to allow agencies to apply 5 U.S.C. 3319, category rating, when making excepted service appointments in the same or similar manner as in the competitive service. OPM’s final rule revises the procedures for accepting, rating, and arranging applications for excepted service in 5 CFR part 302 to include the option of using the category rating procedures similar to those adopted in 5 CFR part 332.
Federal HR practitioners will need to be educated on this new numeric ranking and selection method. Therefore, OPM is providing a 60-day delayed effective date to allow time for training. Agencies will have 180 days to come into compliance with the new method.
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