Absence and Leave; Creditable Service, 54567-54570 [E6-15423]

Agencies

• Office of Personnel Management
• Personnel Management Office

[Federal Register Volume 71, Number 180 (Monday, September 18, 2006)]
[Rules and Regulations]
[Pages 54567-54570]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E6-15423]


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OFFICE OF PERSONNEL MANAGEMENT

5 CFR PART 630

RIN 3206-AK80


Absence and Leave; Creditable Service

AGENCY: Office of Personnel Management.

ACTION: Final rule.

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SUMMARY: The Office of Personnel Management is issuing final 
regulations to provide Federal agencies with the authority to grant a 
newly appointed or reappointed employee credit for prior work 
experience that otherwise would not be creditable for the purpose of 
determining the employee's annual leave accrual rate. An agency may use 
this authority to recruit an individual with the skills and experience 
necessary to achieve an important agency mission or performance goal.

DATES: The regulations are effective on October 18, 2006.

FOR FURTHER INFORMATION CONTACT: Carey Johnston by telephone at (202) 
606-2858, by fax at (202) 606-0824, or by e-mail at pay-performance-
policy@opm.gov.

SUPPLEMENTARY INFORMATION: On April 29, 2005, the Office of Personnel 
Management (OPM) published interim regulations (70 FR 22245) to 
implement section 202(a) of the Federal Workforce Flexibility Act of 
2004 (Pub. L. 108-411, October 30, 2004), hereafter referred to as 
``the Act.'' Section 202(a) added subsection (e) to 5 U.S.C. 6303, 
which provides OPM with the authority to prescribe regulations to 
permit an agency to grant a newly appointed or reappointed employee 
service credit for prior work experience that otherwise would not be 
creditable for the purpose of determining his or her annual leave 
accrual rate. An employee may receive credit if (1) The experience was 
obtained in a position having duties that directly relate to the duties 
of the position to which he or she is being appointed, and (2) it is 
determined by the head of the agency that crediting service to provide 
a higher annual leave accrual rate is necessary to recruit an 
individual with the skills and experience necessary to achieve an 
important agency mission or performance goal.
    The 60-day public comment period on the interim regulations ended 
on June 28, 2005. During the comment period, OPM received comments from 
1 Federal labor organization, 5 Federal agencies, and 20 individuals.
    Three commenters expressed the view that the effective date of an 
agency's authority to provide credit for non-Federal work experience 
should be the date the Act was signed (October 30, 2004). Section 
6303(e)(1) of title 5, United States Code, provides that, not later 
than 180 days after enactment of the Act, OPM must prescribe 
regulations to permit an agency to provide service credit to a newly 
appointed or reappointed employee for prior work experience that 
otherwise would not be creditable for the purpose of determining his or 
her annual leave accrual rate. The earliest date this new authority 
could become effective was the effective date of OPM's regulations--
i.e., April 28, 2005.
    Several commenters objected to the interim regulations because 
current Federal employees may not receive credit for non-Federal work 
experience for the purpose of redetermining their annual leave accrual 
rate. The commenters believe the new authority provides an unfair 
advantage to newly appointed employees, since current employees must 
have 3 years or more of creditable service before accruing 6 hours of 
annual leave each pay period and 15 years or more of creditable service 
before accruing 8 hours of annual leave each pay period. One commenter 
thought it was unfair that this provision applies only to future 
employees, while section 202(b) of the Act provides an 8-hour annual 
leave accrual rate each pay period to current and future members of the 
Senior Executive Service (SES) and employees in senior-level and 
scientific or professional positions. Creditable service for non-
Federal work experience may not be granted to current Federal employees 
because section 202(c) of the Act prohibits employees who were employed 
before the effective date of OPM's regulations (i.e., April 28, 2005) 
from receiving such credit.
    Two agencies asked whether there are any exceptions to the 
prohibition on crediting non-Federal work experience to reappointed 
employees who held civil service positions within 90 days before their 
reappointment. OPM may not grant any exceptions because 5 U.S.C. 
6303(e)(3) prohibits a reappointed employee who held an appointment in 
the civil service within the previous 90-day period from receiving 
service credit for non-Federal work experience.
    Senate Report 108-223 (January 27, 2004) on the Act stated that the 
law would ``reform the annual leave accrual policy for new mid-career 
federal employees'' so that agencies have an enhanced capability to 
recruit these individuals (pages 9). The Senate Report explained that 
``individuals with substantial private sector experience may be 
hesitant to enter government service if they have to surrender a 
considerable amount of vacation time'' (page 9). OPM's regulations are 
consistent with this expression of congressional intent that this tool 
be available to agencies to recruit individuals with the skills and 
experience necessary to achieve an important agency mission or 
performance goal. The fact that current employees accepted Federal 
employment without receiving this new leave benefit clearly 
demonstrates that a higher annual leave accrual rate was not necessary 
to recruit them.
    An agency recommended revising 5 CFR 630.205(a) by replacing ``a 
newly appointed employee'' with ``an employee receiving his or her 
first appointment (regardless of tenure) as a civilian employee of the 
Federal Government.'' The agency explained that the recommended 
revision would align the language in Sec.  630.205(a) with

[[Page 54568]]

the language in 5 CFR 531.211(a) covering pay setting for new 
appointees. We agree and have revised Sec.  630.205(a) accordingly.
    Another agency recommended that OPM define a newly appointed 
employee to mean an employee who is newly appointed to a permanent 
position in the Federal service. We have not adopted this 
recommendation. Any employee who has an established regular tour of 
duty, including an employee appointed to a temporary position, may earn 
annual leave, with one limited exception. Under 5 U.S.C. 6303(b), a 
newly appointed employee whose appointment is limited to fewer than 90 
days is not entitled to accrue annual leave. However, if the 
appointment is extended or the employee receives one or more successive 
appointments without a break in service, the employee becomes eligible 
to accrue annual leave on the 90th day of employment, and in addition, 
the employee is entitled to the annual leave that would have accrued 
during the initial 90-day period. A decision to provide creditable 
service for prior work experience must be made when an employee is 
newly appointed to a Federal position.
    Under Sec.  630.205(a)(1), an agency may provide credit for service 
that otherwise would not be creditable under 5 U.S.C. 6303(a) for the 
purpose of determining the annual leave accrual rate of an employee if 
the head of the agency or his or her designee determines that the 
skills and experience the employee possesses are essential to the new 
position and were acquired through performance in a non-Federal 
position having duties that directly relate to the duties of the 
position to which the employee is being appointed. An agency 
recommended that OPM remove the term non-Federal in Sec.  630.205(a)(1) 
and throughout the regulations, since the law does not require a prior 
position to be a non-Federal position. Although the law does not 
require a position to be a non-Federal position, we believe most work 
experience that will now be considered for credit will be work 
performed in a non-Federal position. For administrative convenience, we 
refer to this prior work experience in this Supplementary Information 
as non-Federal work experience. However, we have revised the 
regulations at Sec.  630.205 to remove the term non-Federal.
    An agency asked whether the head of the agency or designee may 
redelegate the authority to grant service credit for non-Federal work 
experience. The head of an agency may authorize a designee to 
redelegate this authority to a lower level. The same agency asked 
whether an agency may change its initial determination to provide 
service credit if, for example, the agency learns after the employee 
enters on duty that the employee was fired from the position upon which 
the creditable service was based. Section 6303(e)(2) of title 5, United 
States Code, provides that credit for prior work experience is granted 
to the employee upon the effective date of his or her initial 
appointment or reappointment to the agency and remains creditable for 
annual leave accrual purposes thereafter unless the employee fails to 
complete 1 full year of continuous service with the appointing agency. 
Therefore, an agency may not reduce the amount of creditable service 
under the circumstances described. However, an agency may require, as 
part of the written documentation required by Sec.  630.205(d), that an 
employee provide written self-certification that he or she was not 
fired from the position upon which the creditable service is based.
    Another agency asked whether an employee may appeal an agency's 
decision not to provide creditable service to OPM. Under Sec.  
630.205(a), the authority to provide service credit for non-Federal 
work experience rests solely with the head of the agency or his or her 
designee. An agency's determination not to provide creditable service 
under Sec.  630.205(a) is not appealable to OPM. However, a claim that 
such decision constitutes a prohibited personnel practice under 5 
U.S.C. 2302 could be filed with the Office of Special Counsel.
    An agency recommended that a definition of agency be added to the 
regulations. We agree and have added a definition of agency in Sec.  
630.201.
    Several agencies requested more specific guidance on (1) 
Determining whether an individual possesses the skills and experience 
essential to the new position, (2) determining whether the duties 
performed in the prior position directly relate to the position to 
which the employee is being appointed, (3) determining whether 
providing service credit to an employee is necessary to achieve an 
important agency mission or performance goal, and (4) determining what 
kind and how much directly related experience should be credited. An 
agency recommended that the term important agency mission be defined to 
mean a mission or function that is central or core to the purpose of 
the agency and that the term performance goal be defined to mean a goal 
or objective assigned to a Department or agency by Presidential 
directive, Executive order or other official issuance or through laws 
passed by Congress. Two commenters expressed concern that the lack of 
specific guidance in the regulations may result in widely divergent 
implementation and recruitment strategies among Federal agencies. A 
Federal labor organization stated that it anticipates this new leave 
benefit will be applied equally to all eligible candidates and that the 
conditions prescribed for eligibility appear to be fair to newly 
appointed and reappointed employees.
    OPM has delegated to the head of each agency or his or her designee 
the sole discretion to make these determinations consistent with the 
law and OPM's regulations. Because it is likely that each agency will 
tailor its plan for using this authority to meet its individual 
workforce and mission needs, we do not believe it would be constructive 
to require a uniform, Governmentwide approach, since doing so may 
inappropriately limit the use of an agency's authority. The amount of 
service credit that may be granted may not exceed the actual amount of 
service during which an employee performed duties directly related to 
the position to which he or she is being appointed. (See Sec.  
630.205(c).)
    By enhancing the annual leave accrual policy, Congress has provided 
an additional tool to assist agencies in strategically aligning their 
human resources management policies with their goals and missions. 
Agencies are cautioned to use this new leave benefit for the sole 
purpose for which it was established--i.e., to recruit an individual 
with the skills and experience necessary to achieve an important agency 
mission or performance goal. Agencies should not provide creditable 
service for non-Federal work experience or experience in a uniformed 
service across-the-board for all new hires.
    Three commenters asked whether service credit may be provided for 
non-paid volunteer work experience. Another commenter questioned 
whether service may be credited for previously noncreditable work 
experience in quasi-Federal organizations. Another commenter asked 
whether service may be credited for a combination of prior work 
experience and experience in a uniformed service. Under 5 U.S.C. 
6303(e)(1), an agency may provide service credit for prior work 
experience if the agency determines that the work experience was 
obtained in a position having duties that directly relate to the duties 
of the position to which the employee is being appointed. Therefore, 
agencies may consider non-paid volunteer work, formerly noncreditable

[[Page 54569]]

work experience in a quasi-Federal organization, or a combination of 
prior work experience and experience in a uniformed service as 
creditable for this purpose.
    Section 630.205(d) requires an employee to provide written 
documentation, acceptable to the agency, of his or her non-Federal work 
experience. An agency recommended that OPM require agencies to make the 
determination to approve an employee's qualifying work experience 
before the employee enters on duty. We agree and have revised Sec.  
630.205(d) to include this requirement. The same agency asked whether a 
resum[eacute] or employment application is sufficient. Each agency is 
responsible for determining what constitutes acceptable written 
documentation of an employee's qualifying prior work experience. 
However, the written documentation must be sufficient to allow an 
agency to make the determination that the employee's work experience 
was obtained in a position having duties that directly relate to the 
duties of the position to which the employee is being appointed. A 
resum[eacute] or employment application may be acceptable if it 
provides sufficient information for an agency to make this 
determination.
    An agency recommended that OPM revise Sec.  630.205(d) to require 
an employee to provide written documentation from the military before 
crediting uniformed service. This would be consistent with OPM's 
requirement that an employee or applicant submit documentation from the 
military to credit uniformed service for other purposes, such as 
creditable service for annual leave accrual under 5 U.S.C. 6303(a) and 
veteran's preference in hiring. We agree and have revised Sec.  
630.205(d) to include this requirement. An individual recommended that 
OPM require Standard Form (SF) 813, Verification of A Military 
Retiree's Service in Nonwartime Campaigns or Expeditions, to be used to 
verify military service. We disagree. Agencies use SF 813 to request 
verification of a retiree's military service performed in a nonwartime 
campaign or expedition for which a badge or medal was authorized in 
order to credit such service for determining an annual leave accrual 
rate under 5 U.S.C. 6303(a) and applying reduction-in-force procedures. 
However, SF 813 does not provide sufficient information on the duties 
performed by the retiree.
    An agency asked whether it must document the reasons for not giving 
service credit to an employee. There is no statutory or regulatory 
requirement to document the reasons for not crediting prior work 
experience under Sec.  630.205(a). However, if such a decision is 
appealed as a prohibited personnel action, the agency may be well-
served by contemporaneous documentation that the decision was made 
consistent with an established agency policy and criteria.
    Section 630.205(e) of the interim regulations requires each agency 
to establish documentation and recordkeeping procedures sufficient to 
allow reconstruction of each action. An agency asked whether the Guide 
to Personnel Recordkeeping will be updated to include various documents 
provided by the employee for right-side retention to allow 
reconstruction of the service computation date when additional service 
credit has been granted. The Guide to Personnel Recordkeeping already 
requires documentation that supports an employee's creditable service 
to be retained on the permanent (right) side of the official personnel 
folder.
    Section 630.205(f) provides that credit for prior work experience 
or experience in a uniformed service is granted to the employee and 
remains creditable for annual leave accrual purposes thereafter unless 
the employee fails to complete 1 full year of continuous service with 
the appointing agency. An agency recommended that an employee who 
transfers to a position in the same line of work for which he or she 
received creditable service should retain that service even though the 
position is in a different agency. We have not adopted this 
recommendation. Section 6303(e)(2)(B) of title 5, United States Code, 
allows service to remain creditable unless the employee fails to 
complete a full year of continuous service with the agency. In 
addition, House Report 108-733 (October 5, 2004) states that ``[o]nce 
credited upon the effective date of the employee's appointment, the 
past experience remains creditable for this purpose unless the employee 
does not complete one continuous year of service with the same agency'' 
[page 16, emphasis added].
    Section 630.205(g) provides that if an employee separates from 
Federal service or transfers to another agency before completing 1 full 
year of continuous service with the appointing agency, the agency must 
subtract the creditable service and redetermine the employee's annual 
leave accrual rate under 5 U.S.C. 6303(a). All unused annual leave 
accrued and accumulated by an employee as a result of receiving service 
credit for non-Federal work experience or experience in a uniformed 
service remains to the credit of the employee and must be transferred 
to the new agency under Sec.  630.501 or liquidated by a lump-sum 
payment under Sec.  550.1205, as appropriate. A commenter asked whether 
employees should be required to sign a service agreement. Employees are 
not required to sign a service agreement for this purpose. When an 
agency provides service credit, the agency will use remark code B73 or 
B74 on the SF-50 (Notification of Personnel Action) that effects the 
appointment. The text of these remark codes notifies the employee that 
the service will remain creditable unless the employee fails to 
complete 1 full year of continuous service with the appointing agency.
    Another commenter expressed concern about the increased cost of 
paying a lump-sum payment for accrued and accumulated annual leave 
under 5 CFR part 550, subpart L, for employees who separate from 
Federal service prior to completing 1 year of continuous service. The 
commenter recommended that employees who do not complete 1 full year of 
service be required to repay the Government for the hours of annual 
leave they accrued during their service. Section 6303(e)(2)(B) allows 
an agency to reduce the amount of creditable service granted the 
employee if he or she does not fulfill the 1-year service requirement. 
The law does not allow an agency to reduce the amount of annual leave 
accrued by the employee as a result of the creditable service or 
require the employee to repay the Government for any annual leave 
accrued during this period.
    A commenter asked whether a gaining agency may correct an 
employee's annual leave accrual rate if the agency discovers an error 
made by the losing agency in providing the employee credit for prior 
work experience. The gaining agency must coordinate any proposed 
corrections with the losing agency. However, the losing agency makes 
the final determination on whether a correction is appropriate.
    An agency asked whether an employee's service credit for prior work 
experience would be reduced for periods during which the employee is in 
a nonpay status--e.g., leave without pay. The amount of creditable 
service is not affected by extended periods of leave without pay. 
However, since an employee must remain with the appointing agency for 1 
full continuous year for the service to remain creditable, the 
completion date of the 1-year period must be extended by any period of 
leave without pay. If an employee's absence is due to active duty 
uniformed service or a compensable injury, the period of leave without 
pay must be credited as

[[Page 54570]]

though the employee had remained in a pay and duty status.

E.O. 12866, Regulatory Review

    This rule has been reviewed by the Office of Management and Budget 
in accordance with E.O. 12866.

Regulatory Flexibility Act

    I certify that these regulations will not have a significant 
economic impact on a substantial number of small entities because they 
will apply only to Federal agencies and employees.

List of Subjects in 5 CFR 630

    Government employees.

Office of Personnel Management.
Linda M. Springer,
Director

0
Accordingly, the interim rule amending 5 CFR part 630, which was 
published at 70 FR 22245 on April 29, 2005, is adopted as final with 
the following changes:

PART 630--ABSENCE AND LEAVE

0
1. The authority citation for part 630 is revised to read as follows:

    Authority: 5 U.S.C. 6311; Sec.  630.205 also issued under Pub. 
L. 108-411, 118 Stat 2312; Sec.  630.301 also issued under Pub. L. 
103-356, 108 Stat. 3410 and Pub. L. 108-411, 118 Stat 2312; Sec.  
630.303 also issued under 5 U.S.C. 6133(a); Sec. Sec.  630.306 and 
630.308 also issued under 5 U.S.C. 6304(d)(3), Pub. L. 102-484, 106 
Stat. 2722, and Pub. L. 103-337, 108 Stat. 2663; subpart D also 
issued under Pub. L. 103-329, 108 Stat. 2423; 630.501 and subpart F 
also issued under E.O. 11228, 30 FR 7739, 3 CFR, 1974 Comp., p. 163; 
subpart G also issued under 5 U.S.C. 6305; subpart H also issued 
under 5 U.S.C. 6326; subpart I also issued under 5 U.S.C. 6332, Pub. 
L. 100-566, 102 Stat. 2834, and Pub. L. 103-103, 107 Stat. 1022; 
subpart J also issued under 5 U.S.C. 6362, Pub. L 100-566, and Pub. 
L. 103-103; subpart K also issued under Pub. L. 105-18, 111 Stat. 
158; subpart L also issued under 5 U.S.C. 6387 and Pub. L. 103-3, 
107 Stat. 23; and subpart M also issued under 5 U.S.C. 6391 and Pub. 
L. 102-25, 105 Stat. 92.

Subpart B--Definitions and General Provisions for Annual and Sick 
Leave

0
2. In Sec.  630.201, a definition of agency is added in alphabetical 
order to read as follows:


Sec.  630.201  Definitions.

* * * * *
    Agency means an Executive agency, as defined in 5 U.S.C. 105, and 
any other entity of the Federal Government that employs officers and 
employees to whom subchapter I of chapter 63 of title 5, United States 
Code, applies.
* * * * *

0
3. In Sec.  630.205, the section heading and paragraphs (a), 
introductory text; (a)(1); (c); (d); and (f) are revised to read as 
follows:


Sec.  630.205  Credit for Prior Work Experience and Experience in a 
Uniformed Service for Determining Annual Leave Accrual Rate.

    (a) The head of an agency or his or her designee may, at his or her 
sole discretion, provide credit for service that otherwise would not be 
creditable under 5 U.S.C. 6303(a) for the purpose of determining the 
annual leave accrual rate of an individual receiving his or her first 
appointment (regardless of tenure) as a civilian employee of the 
Federal Government or an employee who is reappointed following a break 
in service of at least 90 calendar days after his or her last period of 
civilian Federal employment. The head of the agency or his or her 
designee must determine that the skills and experience the employee 
possesses are--
    (1) Essential to the new position and were acquired through 
performance in a prior position having duties that directly relate to 
the duties of the position to which he or she is being appointed; and
* * * * *
    (c) When the head of an agency or his or her designee makes a 
determination to provide service credit for prior work experience or 
active duty in the uniformed services under paragraph (a) or (b) of 
this section, he or she must determine the amount of service that will 
be credited. The amount of service credited may not exceed the actual 
amount of service during which the employee performed duties directly 
related to the position to which the employee is being appointed.
    (d) An employee must provide written documentation, acceptable to 
the agency, of his or her prior work experience. An employee must 
provide written documentation from the military, acceptable to the 
agency, of his or her uniformed service. The head of an agency or his 
or her designee must make the determination to approve an employee's 
qualifying prior work experience before the employee enters on duty.
* * * * *
    (f)(1) Credit for prior work experience or experience in a 
uniformed service under paragraphs (a) and (b) of this section is 
granted to the employee upon the effective date of his or her initial 
appointment to the agency or reappointment after a 90-day break in 
service and remains creditable for annual leave accrual purposes 
thereafter unless the employee fails to complete 1 full year of 
continuous service with the appointing agency.
    (2) If an employee is placed in a leave without pay status during 
the 1-year period of continuous service required by paragraph (f)(1) of 
this section, the 1-year period of continuous service must be extended 
by the amount of time in a leave without pay unless--
    (i) The employee separates or is placed in a leave without pay 
status to perform service in the uniformed services (as defined in 38 
U.S.C. 4303 and 5 CFR 353.102) and later returns to civilian service 
through the exercise of a reemployment right provided by law, Executive 
order, or regulation; or
    (ii) The employee separates or is placed in a leave without pay 
status because of an on-the-job injury with entitlement to injury 
compensation under 5 U.S.C. chapter 81 and later recovers sufficiently 
to return to work.
* * * * *
 [FR Doc. E6-15423 Filed 9-15-06; 8:45 am]
BILLING CODE 6325-39-P