B-208766 L/M, DEC 7, 1982, OFFICE OF GENERAL COUNSEL

B-208766 L/M, DEC 7, 1982, OFFICE OF GENERAL COUNSEL

PRECIS-UNAVAILABLE

MR. RALPH C. REEDER, DEPARTMENT OF THE TREASURY:

WE REFER TO YOUR LETTER OF AUGUST 16, 1982, REFERENCE PM:HR:P:EE, REQUESTING OUR OPINION AS TO WHETHER THE INTERNAL REVENUE SERVICE (IRS) MAY GRANT ADMINISTRATIVE LEAVE AS A FORM OF INCENTIVE PAY TO EMPLOYEES WHO EXCEED A SPECIFIED STANDARD OF PERFORMANCE.

YOU STATE THAT THE IRS IS CURRENTLY INVOLVED IN DISCUSSIONS WITH THE NATIONAL TREASURY EMPLOYEES UNION (NTEU), ON THE ISSUE OF INCENTIVE PAY FOR CERTAIN EMPLOYEES IN YOUR SERVICE CENTERS. YOU REPORT THAT SINCE YOU ARE ABLE TO ACCURATELY MEASURE THE PRODUCTIVITY OF THESE EMPLOYEES, YOUR DISCUSSIONS USUALLY FOCUS ON THE CONCEPT OF CASH AWARDS BASED ON THE DEGREE TO WHICH THE EMPLOYEES EXCEED A SPECIFIED STANDARD OF PERFORMANCE. HOWEVER, YOU REPORT THAT SINCE NTEU HAS RECENTLY RAISED THE QUESTION OF GRANTING ADMINISTRATIVE LEAVE TO THESE EMPLOYEES IN LIEU OF CASH AWARDS, YOU HAVE INDICATED TO NTEU THAT YOU WOULD PURSUE THE MATTER TO DETERMINE IF SUCH AN APPROACH IS LEGITIMATE. YOU POINT OUT THAT THIS PROPOSAL WOULD PROVIDE EMPLOYEES WHO EXCEED THE STANDARD WITH EXCUSED ABSENCE, WITHOUT CHARGE TO LEAVE OR LOSS OF PAY, BASED ON AN ESTABLISHED SCHEDULE OF ONE HOUR OF ADMINISTRATIVE LEAVE FOR THE DOLLAR VALUE, SALARY PLUS BENEFITS, OF ONE HOUR OF INCREASED PRODUCTIVITY.

THE ONLY STATUTE OF WHICH WE ARE AWARE THAT AUTHORIZES GOVERNMENT AGENCIES TO MAKE INCENTIVE AWARDS IS THE GOVERNMENT EMPLOYEES' INCENTIVE AWARDS ACT, 5 U.S.C. SECS. 4501-4506 (SUPP. III 1979). SECTION 4503 OF TITLE 5, OF THE U.S.C. PROVIDES AS FOLLOWS:

"THE HEAD OF AN AGENCY MAY PAY A CASH AWARD TO, AND INCUR NECESSARY EXPENSE FOR THE HONORARY RECOGNITION OF, AN EMPLOYEE WHO -

"(1) BY HIS SUGGESTION, INVENTION, SUPERIOR ACCOMPLISHMENT, OR OTHER PERSONAL EFFORT CONTRIBUTES TO THE EFFICIENCY, ECONOMY, OR OTHER IMPROVEMENT OF GOVERNMENT OPERATIONS; OR ACHIEVES A SIGNIFICANT REDUCTION IN PAPERWORK; OR

"(2) PERFORMS A SPECIAL ACT OR SERVICE IN THE PUBLIC INTEREST IN CONNECTION WITH OR RELATED TO HIS OFFICIAL EMPLOYMENT."

THE OFFICE OF PERSONNEL MANAGEMENT WAS GIVEN WIDE LATITUDE TO ISSUE REGULATIONS TO IMPLEMENT THE GOVERNMENT EMPLOYEES' INCENTIVE AWARDS ACT. 5 U.S.C. SEC. 4506 (SUPP. III 1979). THE REGULATIONS IT ADOPTED WERE DESIGNED TO "ENCOURAGE AGENCIES TO MAKE MAXIMUM USE OF THEIR AUTHORITIES *** TO ESTABLISH AND ADMINISTER AWARDS PROGRAMS THAT BEST SUPPORT AND ENHANCE AGENCY AND NATIONAL GOALS, AND MEET EMPLOYEE RECOGNITION NEEDS." 5 C.F.R. SEC. 451.202 (1982). TO ACHIEVE THIS GOAL, THE OFFICE OF PERSONNEL MANAGEMENT GAVE GREAT LATITUDE TO THE INDIVIDUAL AGENCIES TO DEVELOP INCENTIVE AWARDS PROGRAMS WHICH WOULD MEET THEIR UNIQUE REQUIREMENTS. 5 C.F.R. SEC. 451.206 (1982).

INCENTIVE AWARDS MAY TAKE THE FORM OF AN HONORARY AWARD, A CASH AWARD, OR BOTH. 5 C.F.R. SEC. 451.203 (1982). AN HONORARY AWARD IS A, "MEDAL, CERTIFICATE, PLAQUE, OR OTHER ITEM THAT CAN BE WORN OR DISPLAYED." FEDERAL PERSONNEL MANUAL, CHAPTER 451, SEC. 1-5(11) (AUGUST 14, 1981). CASH AWARDS ARE NOT DEFINED BEYOND DECLARING THEM TO BE IN ADDITION TO THE EMPLOYEE'S REGULAR PAY AND SUBJECT TO THE WITHHOLDING OF INCOME TAX. U.S.C. SEC. 4502(C) (1976); 5 C.F.R. SEC. 451.209(A) (1982). HOWEVER, A "NON-CASH AWARD" IS DEFINED AS A, "LETTER OF APPRECIATION OR OTHER APPROPRIATE MEANS *** TO RECOGNIZE EMPLOYEE CONTRIBUTIONS WHICH DO NOT MEET THE STANDARD FOR A CASH AWARD." FEDERAL PERSONNEL MANUAL, CHAPTER 451, SEC. 1-5(14) (AUGUST 14, 1981). NEITHER THE STATUTE ITSELF NOR THE OFFICE OF PERSONNEL MANAGEMENT REGULATIONS AND GUIDELINES, CONTAIN ANY PROVISION TO SUGGEST THAT ADMINISTRATIVE LEAVE WAS CONTEMPLATED TO BE USED AS A NON-CASH AWARD.

THE GOVERNMENT EMPLOYEES' INCENTIVE AWARDS ACT REPEALED ALL PREVIOUSLY EXISTING LAWS GOVERNING INCENTIVE AWARDS PROGRAMS, CONSOLIDATED ALL AUTHORITIES FOR ALL TYPES OF AWARDS, AND MADE THE CIVIL SERVICE COMMISSION (NOW OFFICE OF PERSONNEL MANAGEMENT) RESPONSIBLE FOR DIRECTION OF THE ENTIRE GOVERNMENT'S INCENTIVE AWARDS PROGRAM. THE EFFECT OF THESE CHANGES WAS TO ASSURE UNIFORMITY IN THE APPLICATION OF THE LAW TO ALL EMPLOYEES. SEE LETTERS FROM THE SECRETARY, DEPARTMENT OF AGRICULTURE, AND ASSISTANT SECRETARY OF DEFENSE TO CHAIRMAN, POST OFFICE AND CIVIL SERVICE COMMITTEE, UNITED STATES SENATE, REPRINTED IN S.REP. 1992, 83RD CONG., 2D SESS., U.S.C. CONG. & ADM. NEWS 3838 AND 3842 (1954). THEREFORE, BOTH THE ACT AND THE LEGISLATIVE HISTORY INDICATE THAT IT WAS THE INTENT OF THE CONGRESS TO ESTABLISH UNIFORMITY IN CARRYING OUT THE INCENTIVE AWARDS PROGRAM.

THE ABOVE ANALYSIS HAS REVEALED NO CURRENT AUTHORITY WHICH WOULD AUTHORIZE OR SUPPORT THE PROPOSED USE OF ADMINISTRATIVE LEAVE.

AS INDICATED ABOVE, THE OPM HAS BEEN GIVEN WIDE LATITUDE TO ISSUE REGULATIONS TO IMPLEMENT THE GOVERNMENT EMPLOYEES' INCENTIVE AWARDS ACT, AND IS THE AGENCY WITH PRIMARY JURISDICTION TO IMPLEMENT THAT ACT. WOULD SUGGEST THAT YOU CONSIDER SEEKING APPROVAL FROM THE OPM FOR YOUR PROPOSAL.

YOU HAVE ALSO REQUESTED THAT WE WAIVE EXISTING REGULATIONS TO PERMIT A ONE YEAR TEST OF THE PROPOSED SYSTEM. WE DO NOT HAVE THE AUTHORITY TO WAIVE REGULATIONS ISSUED BY THE OPM. HOWEVER, YOU MAY WISH TO CONSIDER SEEKING USE OF THE AUTHORITY CONTAINED IN 5 U.S.C. SECS. 4701 ET SEQ. (SUPP. III 1979) FOR THE OPM TO CONDUCT AND EVALUATE DEMONSTRATION PROJECTS UNDER AGREEMENTS WITH OTHER AGENCIES. WITHOUT PRESUPPOSING TO JUDGE OPM'S POSITION IN THIS REGARD, IT MAY BE THAT OPM WOULD CONSIDER YOUR PROPOSAL AS QUALIFYING UNDER ITS DEMONSTRATION PROJECT STANDARDS.

IN ANY EVENT, IN THE ABSENCE OF OPM'S APPROVAL, BASED UPON EITHER 5 U.S.C. SECS. 4701 ET SEQ., REVISED REGULATIONS, OR ADDITIONAL STATUTORY AUTHORITY AS MAY BE DEEMED NECESSARY, WE DO NOT BELIEVE THAT YOU MAY INSTITUTE THE INCENTIVE AWARDS PROGRAM YOU HAVE PROPOSED.