Science and Technology Reinvention Laboratory Personnel Management Demonstration Project, Department of the Navy (DON), Space and Naval Warfare Systems Center (SSC), SSC Atlantic and SSC Pacific, 1924-1964 [2011-237]

Agencies

• Office of the Secretary
• DEPARTMENT OF DEFENSE

[Federal Register Volume 76, Number 7 (Tuesday, January 11, 2011)]
[Notices]
[Pages 1924-1964]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2011-237]



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Part V





Department of Defense





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Science and Technology Reinvention Laboratory Personnel Management 
Demonstration Project, Department of the Navy (DON), Space and Naval 
Warfare Systems Center (SSC), SSC Atlantic and SSC Pacific; Notice

Federal Register / Vol. 76 , No. 7 / Tuesday, January 11, 2011 / 
Notices

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DEPARTMENT OF DEFENSE

Office of the Secretary


Science and Technology Reinvention Laboratory Personnel 
Management Demonstration Project, Department of the Navy (DON), Space 
and Naval Warfare Systems Center (SSC), SSC Atlantic and SSC Pacific

AGENCY: Office of the Deputy Under Secretary of Defense (Civilian 
Personnel Policy) (DUSD (CPP)), DoD.

ACTION: Notice.

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SUMMARY: Section 342(b) of the National Defense Authorization Act 
(NDAA) for Fiscal Year (FY) 1995, Public Law (Pub. L.) 103-337 (10 
U.S.C. 2358 note), as amended by section 1109 of NDAA for FY 2000, 
Public Law 106-65, and section 1114 of NDAA for FY 2001, Public Law 
106-398, authorizes the Secretary of Defense to conduct personnel 
demonstration projects at DoD laboratories designated as Science and 
Technology Reinvention Laboratories (STRLs). The above-cited 
legislation authorizes DoD to conduct demonstration projects to 
determine whether a specified change in personnel management policies 
or procedures would result in improved Federal personnel management. 
Section 1105 of the NDAA for FY 2010, Public Law 111-84, 123 Stat. 
2486, October 28, 2009, designates additional DoD laboratories as STRLs 
for the purpose of designing and implementing personnel management 
demonstration projects for conversion of employees from the personnel 
system which applied on October 28, 2009. The SSC Atlantic and SSC 
Pacific are listed in subsection 1105(a) of NDAA for FY 2010 as two of 
the newly designated STRLs. These two STRLs will be the participants in 
the demonstration project proposal described in this Federal Register 
notice (FRN).

DATES: Implementation of this demonstration project will begin no 
earlier than March 1, 2011.

FOR FURTHER INFORMATION CONTACT: SSC Atlantic: Ms. Carissa Miller, SSC 
Atlantic STRL Transition Project Lead, SSC Atlantic, P.O. Box 190022, 
North Charleston, SC 29419-9022: or via e-mail: 
Carissa.miller@navy.mil.
    SSC Pacific: Mr. Michael McMillan, SSC Pacific STRL Transition 
Project Lead, Space and Naval Warfare Systems Center Pacific, 53560 
Hull Street, San Diego CA 92152-5001; or via email: 
Michael.mcmillan1@navy.mil
    DoD: Ms. Betty A. Duffield, CPMS-PSSC, Suite B-200, 1400 Key 
Boulevard, Arlington, VA 22209-5144

SUPPLEMENTARY INFORMATION:

1. Background

    SSC Atlantic and SSC Pacific are in a unique position relative to 
most DoD STRL laboratories. They previously participated in the 
development of and operated under the China Lake/Naval Ocean Systems 
Center demonstration project before being converted to the National 
Security Personnel System (NSPS). As a direct result of these personnel 
system experiences, SSC Atlantic and SSC Pacific have the benefit of 
being in earlier personnel systems designed to correct and alleviate 
shortfalls related to flexibilities in hiring, compensating, and 
retaining employees while assessing performance and its results in a 
dynamic environment. Given this exposure, SSC Atlantic and SSC Pacific 
consider STRL conversion an ideal evolutionary opportunity in employee 
management, and further intend to incorporate the most effective 
philosophies, methods, practices, and procedures from both legacy 
systems, as well as the experiences of other DoD STRL projects.
    The Centers' organizational experience indicates that the 
contribution-based personnel management and compensation methodology 
affords the best opportunity to appropriately evaluate and compensate 
employees, while emphasizing the employees' contributions towards 
organizational goals and objectives.
    SSC Atlantic and SSC Pacific must be able to compete with the 
private sector for the best talent, and be able to make job offers in a 
timely manner with the attendant compensation that attracts high-
quality employees. Once these employees are hired, it is necessary to 
have the means to appropriately reward and incentivize their 
contribution to ensure that the creative and motivational process is 
continually renewed. Compensation must be directly linked to the levels 
of individual contributions to the organization. High contributors must 
be rewarded both to encourage their continued contributions and to 
increase the probability of their retention. Similarly, lower 
contributing individuals should receive less compensation than high 
contributors and unacceptable performance must be addressed by 
appropriate corrective measures (e.g., an improvement plan, demotion, 
or removal). Compensation must also be appropriate to the position held 
and its responsibilities relative to the organizational goals.
    The Systems Centers will also take advantage of flexibilities that 
will simplify and speed classification and staffing actions for 
employees, such as competitive examining, expanded details and 
temporary promotions, and modified term appointments.

2. Overview

    The NDAA for FY 2010 not only designated new STRLs but also 
repealed the National Security Personnel System (NSPS) mandating 
conversion of NSPS covered employees to their former personnel system 
or one that would have applied absent the NSPS. A number of SSC 
Atlantic and SSC Pacific employees are covered by the NSPS and must be 
converted to another personnel system. Section 1105 of NDAA for FY 2010 
stipulates the STRLs designated in subsection (a) of section 1105 may 
not implement any personnel system, other than a personnel system under 
an appropriate demonstration project as defined in section 342(b) of 
Public Law 103-337, as amended, without prior congressional 
authorization. In addition, any conversion under the provisions of 
section 1105 shall not adversely affect any employee with respect to 
pay or any other term or condition of employment; shall be consistent 
with title 5 United States Code (U.S.C.) 4703(f); and shall be 
completed within 18 months after enactment of NDAA for FY 2010. 
Therefore, since SSC Atlantic and SSC Pacific are both designated STRLs 
by section 1105 of NDAA for FY 2010 and have NSPS covered employees, 
they must convert, at a minimum, their NSPS covered employees to a 
personnel management demonstration project before the end of April 
2011.
    On August 24, 2010, DoD published the proposed demonstration 
project plan in the Federal Register, Volume 75, No. 163 pages 52139 
through 52171. During the public comment period ending September 23, 
2010, DoD received 48 comments from 8 individuals. All comments and 
recommendations were carefully considered.
    The following summary addresses comments received, provides 
responses, and notes resultant changes from the original project plan 
as presented in the first Federal Register Notice. Most commenters 
addressed multiple comments which were counted separately, resulting in 
a number of comments which exceeds the number of individual commenters 
cited.

A. Editorial and General Comments

    1. Comment: One commenter addressed the fact that the introductory 
section of the Federal Register Notice contains an error. The contact 
section cites the SSC Atlantic Transition Project

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Lead as Mr. Erick Fry. Ms. Carissa Miller has replaced Mr. Fry in this 
function. Recommend updating the contact section with current 
information.
    Response: SSC Atlantic and SSC Pacific agree with the commenter and 
have made that correction.
    2. Comment: One commenter noted three errors in the Table of 
Contents (TOC) section of the FRN. Sections II.6.a, II.2.b, and II.5.e, 
are all missing from the TOC.
    Response: Concur. We have corrected this administrative oversight.
    3. Comment: Commenter noted inconsistent sub-titling throughout 
TOC.
    Response: Concur. We have corrected this administrative oversight.
    4. Comment: Commenter noted that the TOC, section VIII.B. ``waivers 
to Title 5'' is missing ``CFR'' which appears in the title later in the 
document.
    Response: Concur. We have corrected this administrative oversight.
    5. Comment: Commenter noted that section II.1/f.(3). Titled 
``Provisions:'' has an inconsistent numbering convention, and 
recommended that the subsection numbering ``(2), (3), (4), (5),'' be 
replaced with ``(b), (c), (d), and (e).''
    Response: We agree with the commenter and have made this 
correction.
    6. Comment: One commenter noted that Section IV contains mis-
numbered sub-sections. Section IV, Paragraph one, references sections 
V.B., V.C., and V.D. to IV.B, IV.C, and IV.D.
    Response: Concur. We have corrected this administrative oversight.
    7. Comment: Commenter noted inconsistencies throughout the document 
in the use of capitalization of titles and sub-titles, and recommended 
a review to ensure consistency.
    Response: Concur with commenter. We have reviewed and addressed 
consistency of titling.
    8. Comment: Commenter noted inconsistencies throughout the document 
in the use and appearance of the e.g., and i.e., and recommended a 
review to ensure consistent nomenclature.
    Response: We concur with the commenter and have reviewed and 
addressed consistency in use of referenced terms.
    9. Comment: One commenter noted that Figure 3.1 in Section V., 
Demonstration Project Costs, shows no costs associated with project 
evaluation in FY 2011, yet the demonstration project is required to 
conduct a baseline workforce survey prior to transition. The commenter 
requested clarification relative to this being an administrative 
oversight, and recommended providing an amended table.
    Response: We concur with the commenter and have corrected this 
oversight, adding funds to evaluation costs for FY 2011.

B. Methodology and Personnel System

1. Hiring and Appointment Authorities
    a. Comment: One commenter requested clarification of the following 
sentence in section II.B.1.a, Expanded Detail Authority: ``Effect 
details up to one year to specified positions at the same or similar 
level.'' Commenter also requested the definition of ``similar.''
    Response: In this case, ``similar'' positions would be ones at a 
pay band with the same maximum base salary.
    b. Comment: One commenter recommended changing the following 
sentence in section II.B.1.b, ``If a non-citizen candidate is the only 
qualified candidate for the position, the candidate may be appointed.'' 
To: ``If a non-citizen candidate is the only qualified candidate for 
the position, the candidate may be appointed with documentation/
justification of recruiting efforts and selection made. Neither SSC 
Atlantic nor SSC Pacific establish or maintain the files of qualified 
citizen candidates.''
    Response: Concur with commenter, and have amended section 
appropriately. Section II.B.1.b details the extensive recruitment 
efforts that must occur prior to hiring a non-citizen to include use of 
``paid advertisements * * * as well as normal recruiting methods.'' 
Recruitment files are maintained for two years at the Human Resource 
Servicing Centers (HRSC) and will be available for audit if necessary. 
Local guidance will further define the justification package necessary 
to support approval by the local Technical Directors.
    c. Comment: Two commenters addressed section II.B.1.g.(1), 
Delegated Examining. One noted that SSC STRL does not seem to have 
Delegated Examining while other DoD labs do; a second commenter 
suggested that Delegated Examining should be delegated to HRSCs (vice 
the applicable HRO) and not be further delegated.
    Response: The STRL does intend to make use of Delegated Examining 
as part of its implementation. The laboratory has engaged both Navy and 
DoD on this issue throughout the development of this demonstration 
project plan. Other STRL's have shown that having this ability is very 
important to the success of the demonstration project. To maintain 
flexibility in the use of delegated examining, it is intended to 
maintain the original language on the administration of this authority.
    d. Comment: One commenter addressed the examining process in 
Section II.B.1.g.(2), relative to our elimination of the rule of three, 
and recommended a rewording of the entire section to comply with 
upcoming hiring reforms that will be in effect November 1, 2010.
    Response: After a review of the Presidential Memorandum dated May 
11, 2010 on Improving the Federal Recruitment and Hiring Process and 
subsequent component guidance issued September 17, 2010, the 
commenter's suggestion was adopted. These documents direct the use of 
category rating to fill positions through Delegated Examining and 
eliminate the use of the ``rule of three'' not later than November 1, 
2010. This section will be modified accordingly.
    e. Comment: One commenter noted that in section II.B.1.f.(3), 
``Provisions:'' contains some confusing language in its reference to 
declinations and difficulties relative to veteran hiring. It was not 
clear if the reference to declinations and difficulties were as a 
result of veteran hiring, or were in the process of veteran hiring or 
somehow unrelated.
    Response: The language was clarified and the redundant listing of 
declinations removed to clarify that it was not associated with veteran 
hires. The number of veterans hired is one of many items in a list of 
items that will be reviewed in the evaluation of this flexibility.
    f. Comment: Two commenters noted that in section II.B.1.f.(2).a, 
``Definitions,'' and II.B.1.h. Distinguished Scholastic Achievement 
Appointment, science and engineering (S&E) positions should be defined 
``in accordance with OPM guidance.'' And that similarly, the next 
subsection b., should refer to ``accredited colleges'' as those so 
defined by OPM.
    Response: The commenter's suggestion is adopted and these changes 
have been made.
    g. Comment: One commenter noted that in section II.B.1.f.(6), 
evaluation of direct hire, that the Navy's Human Resources Reporting 
System (HRRS) tool might be a good source for some of the data required 
for the evaluation.
    Response: SSC management appreciates the insight and will explore 
using that tool for some of the requirements.
2. Career Path Pay Band Structure
    a. Comment: One commenter recommended adding to Section II.B.2.d., 
Seamless Movement to a Higher Band Level, to clarify that such band 
movement can only occur as a result of competitive merit promotion

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procedures or via an alternate method of promotion such as an 
assessment board.
    Response: This recommendation is not adopted as it defies the 
original intent and practice associated with Seamless Pay Band Movement 
as previously defined and accepted by other laboratories. As 
implemented at other STRLs, Seamless Pay Band Movement is in and of 
itself an alternative method of personnel action.
    b. Comment: One commenter recommended changes to the wording in 
section II.B.2.a, Career Path and Pay Band Structure, as follows: 
Change ``GS occupations are further broken down into five separate 
career paths'' To: ``The five distinct career paths within SSC STRL 
are:'' for clarity.
    Response: Concur with commenter and made the change as recommended.
    c. Comment: One commenter addressed the description of the 
Supervisor/Manager Career Path noting that the definition of the 
requirement for the Supervisor/Manager Career Path only requires more 
than one employee and felt the number should be three or more and those 
with less should only get the supervisory differential in an effort to 
be fiscally responsible.
    Response: The commenter may not understand the intended use of the 
Differential for Supervisory Functions. The intent is not to apply the 
Differential for Supervisory Functions to every position in the 
Supervisor/Manager Career Path, but to utilize this differential for 
very specific and targeted managerial functions of high significance to 
the organization. As the differential will not be applied ``across the 
board'' to the Supervisor/Manager Career Path and pay bands, the 
description of a supervisory position not being established on the 
basis of one subordinate position enables us to designate and groom 
supervisors and managers, generating a culture of leadership which is 
initiated early in a supervisory career. As the differential for 
supervisory functions is a targeted mechanism, not a general one, the 
supervisory differential assumes no additional fiscal burden on the 
demonstration project.
    d. Comment: One commenter requested clarification of language in 
section II.B.2.c, which describes and summarizes the career path 
structure. The ND (S&E) career path originally had a pay band 6, which 
was to be the Professional, Scientific, and Technical Corps positions. 
Upon discussion with DoD, this pay band was re-designated NM-6 
(Supervisor/Manager Career Path) to be consistent with requirements 
associated with those positions. The language in the FRN still has some 
references to the previous ND-6 pay band. Another commenter noted a 
similar discrepancy in section II.B.3b.
    Response: Concur with commenters. We have reworded these sections 
to clarify placement of the Above GS-15 positions in the NM-6 pay band.
    e. Comment: Three commenters addressed the issue of Above GS-15 
Positions in section II.B.2.c. In two cases, the questions addressed 
the ability of SSC Atlantic and SSC Pacific to exercise this 
flexibility (held by other existing STRL organizations) via this FRN. 
In the third case, the commenter questioned the intent that the 
positions are ``scientific and engineering'' while also being 
managerial.
    Response: Under the SSC STRL demonstration project, it is intended 
to implement the program for scientific and engineering positions that 
are classified above GS-15 after the proposed Professional Scientific 
and Technical Corps (PSTC) is approved and DoD guidance issued.
3. Classification
    a. Comment: One commenter recommended a change to section II.B.3.a. 
on the Simplified Classification Process. Recommended changing ``those 
descriptions may be further tailored'' to: Descriptions will be 
tailored to address levels of difficulty, responsibility, and 
supervisory relationships sufficient to identify complexity and scope 
of the position. Also add: ``In all cases, the description of the 
actual duties of the position will be sufficiently described for use in 
announcing positions to potential applicants so that they will be able 
to tell what the specific duties the selectee will be expected to 
perform.''
    Response: Concur with the need for the ability to provide 
supplemental information to the generic descriptors to support various 
human resources processes. We do intend to provide a description of 
specific duties of the position when announcing positions to potential 
applicants. The FRN language has been modified accordingly.
    b. Comment: One commenter recommended an addition to the wording in 
section II.B.3.b, which addresses delegation of classification 
authority. The commenter recommended changing ``The Systems Centers' 
Technical Directors/Commanding Officers may delegate classification 
authority for all positions except those in Supervisor/Manager pay band 
6.'' To ``The Systems Centers' Technical Directors/Commanding Officers 
may delegate classification authority only to the designated management 
authority within their immediate organizational supervisory chain for 
all positions except those in Supervisor/Manager pay band 6.''
    Response: Concur with commenter. The recommended change has been 
made in the document.
    c. Comment: One commenter recommended changing section II.B.3.c. on 
classification appeals by adding the word ``further'' within the 
sentence which currently reads: ``An employee may not (further) appeal 
the demonstration project classification criteria, the accuracy of the 
pay band descriptor, or the pay setting criteria; the assignment of 
occupational series to a career path; the title of a position; the 
propriety of a base pay schedule; or matters grievable under an 
administrative or an alternative dispute resolution procedure.''
    Response: This suggested wording change is not adopted. Adding the 
word ``further'' seems to imply that an employee could initially appeal 
the STRL classification structural or pay issues cited. In fact, the 
contrary is so. The intent is clearly stated that such structural or 
pay issues are not appealable.
4. Pay Setting Outside the Contribution Assessment and Recognition 
System (CARS)
    a. Comment: One commenter noted changes to the Special Salary Rates 
(SSRs) which may impact the Systems Centers' decision to not initially 
utilize SSRs upon conversion to the demonstration project as specified 
in section II.B.4.f. In fact, new SSRs have been established for series 
in locations which would directly impact Systems Center employees.
    Response: Concur with commenter. We have reworded this section to 
allow for the potential use of SSRs in the form of staffing supplements 
as Systems Center management determines is applicable.
    b. Comment: Two comments were directed at section II.B.4.h.(2), 
Distinguished Contribution Allowance (DCA). One commenter noted a 
change to the OPM Guide to Processing Personnel Actions which changes 
the pay cap computations. A second commenter recommended an addition to 
the section which stipulates a 10-year maximum limit for DCA awards 
over the career of an employee.
    Response: Concur with both comments and the language in this 
section has been adjusted to address the updated pay cap computation 
(``SSC Atlantic and SSC Pacific will implement a Distinguished 
Contribution Allowance, a temporary monetary allowance up to 25 percent 
of base pay, which, when added to an employee's

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rate of locality-adjusted pay, may not exceed the rate of base pay for 
Executive Level I.'') and the maximum DCA award language.
    c. Comment: One commenter recommended addition to section II.B.4.1, 
Pay Differential for Supervisory Functions. Recommended changing ``It 
is paid on a pay period basis and is not included as part of the 
employee's base rate of pay.'' To: ``It is paid on a pay period basis 
as documented via time and attendance, and is not included as part of 
the employee's base rate of pay.''
    Response: Concur with commenter and added this language to the 
appropriate section.
    d. Comment: One commenter suggested that the wording of section 
II.B.4.m, Awards, should be reviewed in conjunction with 5 U.S.C. 
451.103(c)(2).
    Response: The reference was reviewed and documenting the 
justification will be done when these awards are granted.
    e. Comment: One commenter noted that section II.B.4.n. appears to 
be redundant with section II.B.4.g.(3) and asked for clarification.
    Response: Concur that the two sections are redundant. We have 
removed section II.B.4.n. accordingly.
5. Contribution Assessment and Recognition System (CARS)
    a. Comment: One commenter recommended a rewording of section 
II.B.6. to establish and standardize terminology relative to the 
demonstration project. The sentence which reads: ``A sample chart 
showing detailed language for the Technical Contribution Element in the 
Scientific and Engineering career path (ND) is provided in Appendix 
E.'' should be changed to: ``A sample chart showing detailed benchmark 
standards for the Technical Contribution Element in the Scientific and 
Engineering career path (ND) is provided in Appendix E.'' in order to 
establish ``benchmark standards'' as demonstration project terminology.
    Response: Concur with commenter and the recommended change has been 
made.
    b. Comment: One commenter questioned section II.B.6.b.(4)., 
Contribution Bonus Awards, which states in part that unexpended bonus 
dollars may be used to augment the category of base pay increases 
budget authority, and further questioned the legality of this statement 
relative to standing DoD policy.
    Response: While both Systems Centers had initially requested this 
specific capability, we have since decided that the potential benefits 
are outweighed by the associated complications relative to long-term 
costs. Concur with the basic intent of the commenter and have removed 
the language in question.
    c. Comment: One commenter suggested that section II.B.6.a.(3) needs 
to be reworded to address changes in the timeline associated with SSC 
STRL transition. The section currently outlines a transition cycle that 
stipulates a 15-month appraisal cycle as the first official cycle of 
the demonstration project. In actuality, recent changes in SSC 
Atlantic's and Pacific's strategy point to a different initial 
appraisal cycle and require some readdressing.
    Response: Concur with commenter. Due to afore-mentioned changes in 
strategy, SSC Atlantic and Pacific intend to conclude the initial 
transitional appraisal cycle on 30 June 2010. As such, this section has 
been reworded to account for changes and provide an accurate summary of 
intent.
    d. Comment: One commenter noted that section II.B.6.a.(6), Normal 
Pay Range, contains confusing language.
    Response: Concur and the paragraph has been reworded to clarify the 
definition of ``Normal Pay Range.''
    e. Comment: One commenter addressed Section II.B.6.a.(2) on 
contribution-based pay pools, asking if SSC STRL pay pools would have 
Center attorney's as required participants, and if not, what was going 
to be the mechanism to ensure compliance relative to state 
requirements. The commenter further suggested language utilized by 
other STRL organizations which addresses this concern by adding the 
following: ``To avoid conflict with state bar rules, the pay pool panel 
may not alter the contribution element scores or the overall 
contribution score that SPAWAR counsel assigns to an attorney; however, 
the pay pool panel may make independent judgments, such as pay 
adjustments after considering that score. A reconsideration from a 
SPAWAR attorney will be handled in accordance with the Office of 
General Counsel's grievance procedures after SPAWAR counsel and the pay 
pool panel recommend a resolution.''
    Response: Concur with commenter and the recommended language has 
been added to the applicable section.
6. Conversion from NSPS into the Demonstration Project
    a. Comment: One commenter points out that section II.B.8. indicates 
that upon conversion from NSPS, employees will retain the adjusted base 
salary from their permanent NSPS position. It is pointed out that 
additional clarification may be needed with regard to how an employee's 
pay is treated when he/she is temporarily assigned to an NSPS position 
prior to that position converting to the demonstration project if the 
employee is returned to that temporary position immediately after 
conversion. In these cases as the commenter notes, section 1113(c)(1) 
of NDAA for FY 2010 would also apply to the temporary position, i.e., 
there will be no loss or decrease in pay as a result of the conversion 
of positions and employees from NSPS.
    Response: Concur with commenter's point and have amended the 
applicable section to further clarify this issue.
7. Required Waivers to Law and Regulation
    a. Comment: One commenter noted that there is inconsistency in the 
application of title 5 CFR part 430, in that the demonstration project 
waives part 430 subpart B in its entirety, yet references that the 
project's appraisal process complies with title 5 CFR part 430, subpart 
B except where waivers have been approved. Earlier in the document it 
is stated that ``employees under the demonstration project will not be 
subject to the requirement of this part.'' Commenter suggested a review 
of document and clarification of title 5 CFR part 430, subpart B waiver 
requests.
    Response: Our determination is that the language waiving title 5 
CFR part 430 subpart B is necessary, and is consistent with the intent 
of SSC STRL. However, the waiver language has been modified to address 
the commenter's concerns.
    b. Comment: One commenter noted that the demonstration cites a 
waiver to title 5 U.S.C. chapter 45, section 4502, which limits awards 
to $10K, that the actual title of this section is 5 U.S.C. 4502, and 
that this waiver waives the authority which provides that ``the 
Secretary of Defense may grant a cash award under subsection (b) of 
this section without regard to the requirements for certification and 
approval provided in that subsection.'' Commenter further recommends a 
review of 5 U.S.C. 451.103(c)(2).
    Response: The language associated with this waiver has been 
clarified. Paragraph (a), 5 U.S.C. 4502, indicates limitation of cash 
awards to $10K. This section is waived to the limited extent that it 
will allow Technical Director/Commanding Officer to award up to $25K 
with the same level of authority as the Secretary of Defense to grant 
cash awards. The requirement for certification and approval of the cash 
awards by OPM is not required. All other provisions of section 4502 
apply.

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8. Appendices
    a. Comment: One commenter noted that Appendices A and B were 
missing series 1371, Cartographer Technician, which is a series 
occupied at both Centers, and recommended adding this series to 
applicable appendices.
    Response: Concur with commenter and have corrected this oversight 
in Appendices A and B.
    b. Comment: One commenter noted that Appendix H, Intervention 
Model, 2b referenced ``Alignment of organizational and individual 
objectives and results,'' yet the demonstration project documentation 
references ``establishing contribution goals and expectations,'' not 
objectives.
    Response: Agree with the commenter. SSC STRL is a contribution-
based evaluation and compensation system, and as such, the language 
needs to be consistent throughout, including the Intervention Model. 
The language in Appendix H has been corrected to reflect contribution 
rather than objective-based methodology.
9. Demonstration Project Notice Changes
    The following is a summary of substantive changes and 
clarifications which have been made to the project proposal:
    a. Corrected SSC Atlantic contact information for new SSC Atlantic 
STRL Transition Team Lead in the Introduction Contact Information.
    b. Numerous corrections made to Table of Contents to address 
inconsistencies in titling and subtitling of sections and subsections. 
Applicable sections throughout document were then corrected to ensure 
consistency in numbering and subtitling throughout.
    c. Corrected and standardized use of ``i.e.,'' and ``e.g.,'' 
throughout document.
    d. Addressed lack of funding shown in Section V., Figure 3.1. for 
project evaluation in FY 2011.
    e. In Section II.B.1.a, refined definition of ``similar'' as used 
relative to positions under Expanded Detail Authority.
    f. In Section II.B.1.b, further clarified language associated with 
non-citizen hiring in accordance with Department of Navy Human 
Resources Service Center South West recommendation.
    g. In Section II.B.1.g.(1), addressed issues regarding Delegated 
Examining Authority and its ability to be further delegated to service 
component Human Resources.
    h. In Section II.B.1.g.(2), addressed compliance with OPM Hiring 
Reform initiatives regarding the elimination of the rule of three.
    i. In Section II.B.1.f.(3), clarified language relative to veteran 
hiring.
    j. In Section II.B.1.f.(2).a, clarified that relative to S&E 
positions, both the positions and acceptability from accredited 
colleges and universities must be as defined by the Office of Personnel 
Management (OPM).
    k. In Section II.B.2.a, clarified section on Career Path and Pay 
Band structure by re-ordering the sentence. Also, corrected designation 
of ND-6 pay band to NM-6 pay band in accordance with Above GS-15 
position requirements.
    l. In Section II.B.2.c, addressed comments regarding PSTC positions 
by re-inserting language for PSTC governance into FRN.
    m. In Section II.B.3.a, added recommended language to Simplified 
Position Description section to provide additional positional 
definition and granularity.
    n. In Section II.B.3.b, clarified delegation of classification 
authority by stipulating that such authority can only be delegated 
within the applicable Technical Director's chain of command.
    o. In Section II.B.4.f, re-worded section on staffing supplement 
usage upon entering the demonstration project to allow for their use 
immediately upon transition.
    p. In Section II.B.4.h.(2), edited section on Distinguished 
Contribution Allowance (DCA) to account for GPPA changes and 
corresponding changes to pay cap computations (to Executive Level I). 
Also, specified 10-year cumulative maximum limit for receipt of DCA 
awards over the career of an employee.
    q. In Section II.B.4.1, amended section on Pay Differential for 
Supervisory Functions by stipulating that such pay is provided in 
strict accordance with all applicable guidelines.
    r. Section II.B.4.g.(3). Removed this section on retention 
incentives because it was redundant (as covered in Section 
II.B.4.g.(3)).
    s. In Section II.B.6, Contribution Assessment and Recognition 
System. Standardized language associated with contribution element 
scoring as ``benchmark standards'' for each element in each pay band 
was established.
    t. In Section II.B.6.b.(4), Contribution Bonus Awards. Eliminated a 
sentence which suggested that unused bonus amounts could be used to 
fund the continuing portion of the pay pool.
    u. In Section II.B.6.a.(3), Modified the paragraph which discusses 
the initial appraisal cycle of the SSC STRL system, clarifying that the 
initial (partial) cycle will end on June 30 2011, vice June 30, 2012 as 
originally stated.
    v. Section II.B.6.a.(6), Normal Pay Range. Language in this section 
modified to clarify meaning and definition of Normal Pay Range.
    w. Section II.B.6.a.(2), Contribution-Based Pay Pools. Language 
added regarding attorney evaluation and reconsideration, and addressed 
associated State bar requirements.
    x. Section II.B.8, Conversion from NSPS. Clarifying language added 
that standards associated with the retention of base salary upon 
conversion to SSC STRL apply to both permanent and temporary positions 
held under NSPS prior to conversion.
    y. 5 CFR part 430, subpart B. Clarified waiver language.
    z. 5 CFR. Added waiver to part 536, subpart B, waived in its 
entirety. Sections 536.305, Adjusting an employee's retained rate when 
a pay schedule is adjusted, and 536.306, Limitation on retained rates, 
waived only to the extent that under-contributing employees receiving a 
retained rate will not be entitled to the full amount of any increase 
in the maximum rate of the employee's pay band.
    aa. Amended title 5 U.S.C. chapter 53, section 5363 waiver. 
Clarified waiver requirements to (1) enable reduction in GPI for under-
contributing employees receiving a retained rate and (2) to provide pay 
retention based on a discontinued or reduced staffing supplement as 
under the GS system.
    ab. Appendices A and B. Corrected appendices to include missing 
series (1371--Cartographer Technician).
    ac. Appendix H, Intervention Model. Language in subsection 2b that 
referred to employee objectives, rather than to contribution elements 
was corrected.

3. Access to Flexibilities of Other STRLs

    Flexibilities published in this Federal Register shall be available 
for use by the STRLs previously enumerated in section 9902(c)(2) of 
title 5, United States Code, which are now designated in section 1105 
of the NDAA for FY 2010, Public Law 111-84, 123 Stat. 2486, October 28, 
2009, if they wish to adopt them in accordance with DoD Instruction 
(DoDI) 1400.37; pages 73248 to 73252 of volume 73, Federal Register; 
and after the fulfilling of any collective bargaining obligations.

    Dated: January 4, 2011.
Morgan F. Park,
Alternate OSD Federal Register Liaison Office, Department of Defense.

Table of Contents

I. Introduction
    A. Purpose
    B. Expected Benefits

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    C. Participating Organizations, Employees, and Union 
Representation
    D. Project Overview
    Figure 1-1. Employee Distribution by Geographic Location
II. Methodology
    A. Project Design
    B. Personnel System Changes
    1. Hiring and Appointment Authorities
    a. Expanded Detail Authority
    b. Non-citizen Hiring
    c. Extended Probationary/Trial Period
    d. Expanded Term Appointments
    e. Voluntary Emeritus Program
    f. Direct Hire Authority for Candidates with Advanced Degrees 
for Scientific and Engineering Positions
    g. Delegated Examining
    h. Distinguished Scholastic Achievement Appointments
    2. Career Path Pay Band Structure
    Figure 2-1. SSC STRL Career Path and Pay Band Structure
    a. Career Paths
    b. Career Path Pay Bands and Levels of Responsibility
    c. Above GS-15
    d. Seamless Movement to a Higher Pay Band Level
    3. Classification
    a. Simplified Classification Process
    b. Delegation of Classification Authority
    c. Classification Appeals
    d. Simplified Assignment Process
    4. Pay Setting Outside the Contribution Assessment and 
Recognition System (CARS)
    a. Advanced In-Hire Rate
    b. Promotion
    c. Reassignment
    d. Change to Lower Pay Band
    e. Locality Pay.
    f. Staffing Supplements
    g. Other Provisions
    h. Distinguished Contribution Allowance (DCA)
    i. Pay Differential for Supervisory Functions
    j. Accelerated Compensation for Developmental Positions
    k. Educational Base Pay Adjustment
    l. Expanded Development Opportunity
    m. Awards
    5. Performance/Contribution Management Principles
    a. Performance Development Assistance
    b. Two-Level Performance Rating System
    c. Establishing Contribution Expectations
    d. On-going Contribution Dialogue
    e. Feedback from Multiple Sources
    f. Performance Improvement Plan (PIP)
    6. Contribution Assessment and Recognition System (CARS)
    a. Rating and Contribution Assessment Process
    (1) Eligibility
    (2) Contribution-Based Pay Pool
    (3) Contribution Assessment and Recognition System (CARS)
    (4) Contribution Expectations and Element Weighting
    (5) Assessment
    (6) Normal Pay Range (NPR)--Base Pay Versus Contribution
    b. Compensation Decision Process
    (1) Employee Compensation
    (2) General Pay Increases
    (3) Base Pay Increases
    (4) Contribution Bonus Awards
    c. Reconsideration of Rating and Scoring Decisions
    7. Reduction-in-Force (RIF)
    8. Conversion from NSPS into the Demonstration Project
    a. Placement into Demonstration project Pay Plans and Pay Bands 
from NSPS
    (1) Determine the Appropriate Demonstration Project Pay Plan
    (2) Determine the Appropriate Pay Band
    b. Pay Upon Conversion
    (1) Fair Labor Standards Act (FLSA) Status
    (2) Transition Equity
    c. Pay Band Retention
    d. Converting Employees on NSPS Term and Temporary Appointments
    e. Probationary Periods
    (1) Initial Probationary Period
    (2) Supervisory Probationary Period
    9. Conversion from Other Personnel Systems
    10. Movement Out of the SSC STRL Demonstration Project
    a. Termination of Coverage under the SSC STRL Demonstration 
Project Pay Plans
    b. Determining a GS-Equivalent Grade and GS-Equivalent Rate of 
Pay for Pay Setting Purposes when an SSC Employee's Coverage by a 
Demonstration Project Pay Plan Terminates or the Employee 
Voluntarily Exits the SSC STRL Demonstration Project
    (1) Equivalent GS-Grade-Setting Provisions
    (2) Equivalent GS-Rate-of-Pay-Setting Provisions
    (3) Employees with Pay Retention
III. SSC STRL Demonstration Project Duration
IV. SSC STRL Demonstration Project Evaluation Plan
    A. Overview
    B. Evaluation Model
    C. Evaluation
    D. Method of Data Collection
V. Demonstration Project Costs
VI. Automation Support
    A. General
    B. Defense Civilian Personnel Data System (DCPDS)
VII. Project Oversight and Management
    A. Oversight and Management
    B. Personnel Administration
    C. Modifications
VIII. Required Waivers to Law and Regulation
    A. Waivers to title 5, U.S.C.
    B. Waivers to title 5, CFR
IX. Appendices
    Appendix A: STRL Demonstration Project Series
    Appendix B: SSC STRL Demonstration Project Series Distribution
    Appendix C. Baseline Performance Standards (Career Path-
Independent)
    Appendix D. Core Contribution Elements
    Appendix E. Element Detail Benchmark Example (Technical) for 
Science and Engineering Career Path (ND)
    Appendix F: Sample Pay Range/Contribution Chart (for ND-4 Pay 
Band)
    Appendix G: Basic Compensation Matrix
    Appendix H: Intervention Model

I. Introduction

A. Purpose

    The goal of this personnel demonstration project is to implement a 
personnel management system incorporating the practices from existing 
STRL and other personnel management systems best suited to the specific 
needs of SSC Atlantic and SSC Pacific. As the Navy's leader in Command, 
Control, Communications, Computers, Intelligence, Surveillance, and 
Reconnaissance (C4ISR), SSC Atlantic and SSC Pacific must be able to 
attract, hire, and retain the best scientists, engineers, business, and 
support personnel in the labor market. The organization's human 
resources management authorities, policies, and practices must have the 
flexibility needed to respond quickly to changes in mission, 
organizational constraints, workload, and market conditions. Unless 
specifically stated otherwise, the Technical Directors/Commanding 
Officers of SSC Atlantic and SSC Pacific may delegate their authority 
to effectively implement the provisions of this notice. Any such 
delegations, including details of implementation, will be documented by 
local business rules and/or implementing instructions.
    Many aspects of a demonstration project are experimental. 
Modifications may be made from time to time as experience is gained, 
results are analyzed, and conclusions are reached on how the system is 
working. The provisions of this project plan will not be modified, or 
extended to individuals or groups of employees not included in the 
project plan without the approval of the DUSD(CPP). The provisions of 
DoDI 1400.37 are to be followed for any modifications, adoptions, or 
changes to this demonstration project plan.

B. Expected Benefits

    In order to remain the DON leader in C4ISR, SSC Atlantic and SSC 
Pacific must be able to compete with the private sector for the most 
talented, technically proficient candidates, and must have in place a 
system that fosters their development, enhances their performance and 
experience, and provides a strong retention incentive.
    The SSC STRL demonstration project must enable and enhance:
    1. The ability to attract highly qualified scientific, technical, 
business, and support employees in today's competitive environment;
    2. The ability to select personnel and make job offers in a timely 
and efficient manner, with the attendant compensation that attracts 
high-quality, in-demand employees;

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    3. Improved employee satisfaction with pay setting and adjustment, 
recognition, and career advancement opportunities;
    4. Human Resource (HR) flexibilities needed to staff, shape, and 
adjust to evolving requirements associated with sustaining a quality 
workforce for the future;
    5. Increased retention of high-level contributors; and
    6. Simpler and more cost effective HR management processes.
    To effectively meet the above expectations, the SSC STRL 
demonstration project has identified and established in this notice 
those features and flexibilities that provide the mechanisms to achieve 
its objectives. Those features and flexibilities alone, however, will 
not ensure success.
    The nature of the SSC STRL and its ambitious workforce goals will 
require human resources support at an enhanced level. A traditional 
process-oriented and reactive construct will serve neither the mission 
nor the management needs of the two organizations. A primary emphasis 
of the SSC demonstration project is its streamlined hiring, 
sophisticated contribution-based compensation system, talent 
acquisition/retention, and professional human capital planning and 
execution. Accordingly, successful execution of that vision includes a 
human resources service delivery model that is highly proactive, 
expertly skilled in analytical tools, and fully capable of engaging as 
a strategic partner and trusted agent of a modern multi-faceted defense 
laboratory.

C. Participating Organizations, Employees, and Union Representation

    Both SSC Atlantic and SSC Pacific will participate in the project. 
The primary sites of SSC Atlantic and SSC Pacific are in two major 
geographic locations, Charleston, South Carolina, and San Diego, 
California, respectively, but the organizations employ personnel at 
more than two dozen locations worldwide. Locations are diverse in 
employment profiles and size, ranging from several thousand personnel, 
to a single embedded employee. Both major SSC sites are engaged in the 
full spectrum of research, development, test and evaluation, 
engineering, and fleet support.
    Both SSC Atlantic and SSC Pacific are predominantly Navy Working 
Capital Fund organizations. Instead of receiving congressionally 
appropriated funds, operations are funded by dollars received from 
other government agencies on a fee-for-service/break-even basis. In 
order to fully meet naval requirements and successfully assist in the 
execution of the Navy's mission, SSC Atlantic and SSC Pacific must 
maximize management effectiveness and efficiency in order to control 
expenditures, which support a cost competitive position as compared 
with other government agencies.
    SSC Atlantic's and SSC Pacific's STRL personnel management 
demonstration project is intended to govern all SSC Atlantic and SSC 
Pacific employees with the following exceptions: Bargaining Unit 
employees (as stipulated in the paragraph below), Federal Wage System 
employees, Senior Executive Service (SES), Senior Level (SL), and 
Scientific and Professional (ST) personnel.
    SSC Atlantic's and SSC Pacific's human capital complement includes 
a small number of employees (under 150 total) that are represented by 
exclusive bargaining units. Prior to including any employees in 
bargaining units in the STRL demonstration project, SSC Atlantic and 
SSC Pacific will fulfill their obligation to consult and/or negotiate 
with these labor organizations in accordance with 5 U.S.C. 4703(f) and 
7117, as appropriate. Figure 1 identifies SSC Atlantic and SSC Pacific 
employees by major geographic location.

D. Project Overview

    In response to the authority granted by Congress to develop a 
personnel management demonstration project, SSC Atlantic and SSC 
Pacific chartered a Transition Team tasked with the design and 
implementation of the new demonstration project plan. The joint team is 
responsible for developing all associated deliverables, proposals, and 
implementation details. The Transition Team developed its initial 
concept as a result of information-seeking and assistance visits at the 
NRL, Office of Naval Research, and Naval Sea Systems Command, Surface 
Warfare Center, Dahlgren Division, as well as from consultative 
sessions with numerous other STRL laboratory representatives across the 
DoD. The Transition Team continues to solicit and receive information 
and advice from the DUSD(CPP), DoD Civilian Personnel Management 
Service, and a number of organizations with on-going demonstration 
projects. Information and suggestions have been solicited from SSC 
Atlantic and SSC Pacific employees through an ongoing series of 
interviews, briefings, and small-group meetings.
BILLING CODE 5001-06-P

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[GRAPHIC] [TIFF OMITTED] TN11JA11.188

BILLING CODE 5001-06-C

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II. Methodology

A. Project Design

    The four fundamental elements of the SSC STRL personnel management 
system are: (1) Hiring and staffing flexibilities, (2) simplified 
classification, (3) pay banding, and (4) contribution-based 
compensation and assessment. The hiring and staffing flexibilities are 
being implemented in order to better recruit, hire, and retain the most 
capable, qualified, and competent workforce in the job market today. 
Simplified classification is being implemented to streamline the job 
classification process, simplify the effects of administrative 
processes on personnel, and allow for more flexibility in making job 
reassignments. The pay banding structure will create five career paths 
with multiple pay bands within each career path representing the phases 
of career progression that are typical for the respective careers. This 
banding structure will enable managers to more appropriately reward and 
retain a diverse workforce using principles of pay equity and career 
progression. The contribution-based compensation system is 
characterized by an assessment of an employee's contribution to the 
organization and an appropriate pay allocation predicated on the 
assessed level of contribution. The contribution-based compensation and 
assessment is being implemented to more appropriately recognize and 
reward the employees' overall efforts and results.
    While much of the demonstration project will be applied uniformly 
across both Systems Centers, there are decisions that will be delegated 
to the respective Systems Centers so that the needs and cultures of 
those organizations may be taken into account. Decisions at the local 
level will be made through established governance boards set up by the 
appropriate Center Technical Director or Commanding Officer.

B. Personnel System Changes

1. Hiring and Appointment Authorities
a. Expanded Detail Authority
    SSC Atlantic and SSC Pacific will have an Expanded Detail Authority 
providing the ability to: (1) Effect details up to one year to 
specified positions at the same or similar level (positions in a pay 
band with the same maximum salary) without the current 120-day renewal 
requirement specified at 5 U.S.C. 3341; and (2) effect details to a 
position in a pay band with a higher maximum salary up to one year 
within a 24-month period without competition. Details to higher level 
positions beyond one year in a 24-month period require approval of the 
Technical Director/Commanding Officer and are subject to competitive 
procedures. The specifics of these authorities will be stipulated by 
local business rules, policies, or procedures as organizational 
experience dictates.
b. Non-citizen Hiring
    Where Executive Orders or other regulations limit hiring non-
citizens to the excepted service, both SSC Atlantic and SSC Pacific 
will have the authority to approve the hiring of non-citizens into 
competitive service positions when there are no qualified U.S. 
citizens, and the candidate meets all applicable immigration and 
security requirements. In order to make a determination that there are 
no qualified candidates, the position will be advertised extensively 
using paid advertisements in venues such as major newspapers, 
scientific journals, and electronic media as well as through ``normal'' 
recruiting methods. If a non-citizen candidate is the only qualified 
candidate for the position, the candidate may be appointed. The 
selection is subject to approval by the SSC Atlantic and SSC Pacific 
Technical Director/Commanding Officer. This authority will not be 
delegated further.
c. Extended Probationary/Trial Period
    (1) Initial Probationary Period. Candidates hired under the 
demonstration project into positions classified to the Science and 
Engineering and Administrative Specialist/Professional occupational 
families (the nature of whose work requires the manager to have more 
than one year to assess the employee's job performance) will serve a 
three-year probationary/trial period. Personnel assigned to positions 
classified to the Science and Engineering Technical/Technician and 
General Support occupational families will serve a one-year 
probationary/trial period.
    (2) Supervisory Probationary Period. Personnel assigned for the 
first time to supervisory/managerial positions which have a career path 
pay plan indicator of NM will serve a one-year supervisor probationary 
period. The one-year supervisory/managerial probationary period may run 
concurrently with the required initial probationary period for the 
occupational family to which an employee's position is classified.
    (3) Transitional Probationary Periods. Any personnel entering the 
demonstration project from another Federal government personnel 
management system, who have served an initial or supervisory 
probationary period under that system, will be deemed to have met the 
SSC STRL probationary period requirements. Personnel transitioning into 
the SSC STRL demonstration project who have begun, but have not yet 
completed an initial or supervisory probationary period under another 
Federal government system, will have met the probationary requirements 
of SSC STRL when they have completed the terms of the initial and/or 
supervisory probationary periods under which they were hired or placed.
    (4) Termination of Initial Probationary Period Employees. Initial 
probationary employees may be terminated when they fail to demonstrate 
proper conduct, technical competency, and/or acceptable performance for 
continued employment, and for conditions arising before employment. 
When a supervisor decides to terminate an employee during the initial 
probationary period because his/her work performance or conduct is 
unacceptable, the supervisor shall terminate the employee's services by 
written notification stating the reasons for termination and the 
effective date of the action. The information in the notice shall, at a 
minimum, consist of the supervisor's conclusions as to the inadequacies 
of the employee's performance or conduct, or those conditions arising 
before employment that support the termination.
    (5) Termination of a Supervisory Probationary Period. The 
supervisory probationary period may be terminated when supervisors fail 
to demonstrate proper conduct, technical competency, and/or acceptable 
performance for continued assignment as a supervisor, and for 
conditions arising before supervisory assignment. When a supervisory 
probationary period is terminated by the supervisor (the manager) of 
the supervisor in question, the manager shall terminate the supervisory 
assignment by written notification stating the reasons for supervisory 
assignment termination and the effective date of the action. The 
information in the notice shall, at a minimum, consist of the manager's 
conclusions as to the inadequacies of the supervisor's performance or 
conduct, or those conditions arising before supervisory assignment that 
support the termination of the assignment.
    (6) All initial and supervisory probationary period requirements 
will be outlined in local business rules, policies, or procedures. 
Preference eligibles will maintain their rights under applicable law 
and regulation in both the competitive and excepted service.

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d. Expanded Term Appointments
    The Systems Centers perform engineering and scientific work that 
often has project durations of three to six years. The current four-
year limitation on term appointments, as described in 5 CFR part 316, 
imposes a burden on the Centers by forcing the termination of some term 
employees prior to completion of projects they were hired to support. 
This disrupts the engineering and acquisition process and reduces the 
Centers' ability to serve their customers. Under the demonstration 
project, SSC Atlantic and SSC Pacific have the authority to appoint 
individuals under modified term appointments for a period of more than 
one year but not more than five years when the need for an employee's 
services is not predicted to be permanent. These appointments may be 
extended one additional year for a total of six years. Employees hired 
under the modified term appointment authority may be eligible for 
conversion to career or career-conditional appointments in the 
competitive service. To be converted, the employee must have: (1) been 
selected for the term position under competitive procedures, with the 
announcement specifically stating that the individual(s) selected for 
the term position(s) may be eligible for conversion to a career or 
career-conditional appointment at a later date; (2) served a minimum of 
two years of continuous service in the term position; and (3) have a 
current contribution score consistent with acceptable contribution/
performance criteria as established by each Systems Center. Applicable 
probationary periods apply to both temporary and permanent positions.
    Employees serving under term appointments at the time of conversion 
to the SSC STRL demonstration project may be converted to modified term 
appointments provided they were hired for their current positions under 
competitive procedures. These employees may be eligible for conversion 
to career-conditional or career appointments provided they have 
completed at least two years of continuous service, and are performing 
at a satisfactory level. Should this criterion not be met, legacy term 
employees will remain on existing appointments until the not-to-exceed 
date or until some other terminating event occurs. These appointments 
may be extended in accordance with the requirements of 5 CFR part 316. 
The positions under this feature will be defined by local business 
rules, policies, or procedures.
e. Voluntary Emeritus Program
    SSC Atlantic and SSC Pacific will establish a Voluntary Emeritus 
Program. Under the demonstration project, the Systems Centers' 
Technical Directors/Commanding Officers have the authority to offer 
retired or separated employees in Science and Engineering (S&E) or 
Administrative/Professional occupational families (see Appendix B) 
voluntary assignments (non-paid) in the Centers. This authority may not 
be further delegated. The Voluntary Emeritus Program ensures continued 
quality research, mentoring, support, and program management while 
reducing the overall base pay by allowing higher paid employees to 
retire with the opportunity to retain a presence in the Center's 
workplace. The program is beneficial during manpower reductions as 
senior personnel accept retirement and return to provide valuable on-
the-job training or mentoring to less experienced employees. This 
authority includes employees who have retired or separated from Federal 
service. Voluntary Emeritus Program assignments are not considered 
employment by the Federal government, except for purposes of on-the-job 
injury compensation. Thus, such assignments do not affect an employee's 
entitlement to retain buyouts or severance payments based on an earlier 
separation from Federal service.
    To be accepted into the Voluntary Emeritus Program, a volunteer 
must be recommended by a manager within the Centers. Everyone who 
applies is not automatically entitled to a voluntary assignment. The 
process must be clearly documented and records retained at the command 
level in accordance with established business rules, procedures, or 
processes.
    To encourage participation, the volunteer's Federal civilian or 
military retirement pay will not be affected while serving in a 
voluntary capacity.
    Volunteers are not permitted to monitor contracts on behalf of the 
government or to participate on any contracts or solicitations where a 
conflict of interest exists.
    An agreement is established between the volunteer and the 
respective Center and is reviewed by the local legal counsel 
representative. The agreement must be finalized in advance and shall 
include as a minimum:
    (1) A statement that the voluntary assignment does not constitute 
an appointment in the Civil Service and is without pay or any other 
form of compensation;
    (2) The volunteer waives any and all claims against the Government 
because of the voluntary assignment except for purposes of on-the-job 
injury compensation as provided in 5 U.S.C. 8101(1)(B);
    (3) Volunteer's work schedule as needed or requested;
    (4) Length of agreement (defined by length of project or time 
defined by weeks, months, or years);
    (5) Support provided by the Center (travel, administrative, office 
space, supplies);
    (6) A provision that states no additional time will be added to a 
volunteer's service credit for such purposes as retirement, severance 
pay, and leave as a result of being a member of the Voluntary Emeritus 
Program;
    (7) A provision allowing either party to void the agreement with 
written notice to the other (volunteers have no appeal or grievance 
rights); and
    (8) The level of security access required--any security clearance 
required by the assignment is managed by the appropriate Systems Center 
while the volunteer is a member of the Voluntary Emeritus Program.
f. Direct Hire Authority for Candidates with Advanced Degrees for 
Scientific and Engineering Positions
    (1) Background.
    The Systems Centers have an urgent need for direct hire authority 
to appoint qualified candidates possessing an advanced degree to 
scientific and engineering positions in competitive and excepted 
service. The market is extremely competitive with industry and academia 
for the small supply of highly-qualified and security clearable 
candidates with a master's degree or PhD in science or engineering. Out 
of approximately 35,000 scientists and engineers employed in the DoD 
laboratories; 27% hold master's degrees, while 10% are in possession of 
a PhD. The Systems Centers employ around 3,308 S&Es; 29% holding 
master's degrees, while 4% are in possession of a PhD. Over the next 
five years, the Systems Centers plans to hire approximately 400 of the 
country's best and brightest S&Es just to keep pace with attrition. 
This number does not reflect the impact of other actions affecting the 
demand of S&Es in the Systems Centers (e.g., Base Realignment and 
Closure, in-sourcing, and other initiatives which add to the increased 
demand for scientific and engineering expertise). Additionally, 
statistics indicate that the available pool of advanced degree, 
clearable candidates is substantially diminished by the number of non-
U.S. citizens granted degrees by

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U.S. institutions. For instance, in 2006, 20% of master's degrees in 
science and over 35% of PhDs in science were awarded to temporary 
residents.
    It is expected that this hiring authority, together with 
streamlined recruitment processes, will be very effective in 
accelerating the hiring process for candidates possessing a PhD. For 
instance, under a similar authority in the National Defense 
Authorization Act for Fiscal Year 2009, section 1108 (Pub. L. 110-417), 
October 28, 2009, one STRL had fifteen PhD. selectees in 2009 for the 
sixteen vacancies for which they were using this hiring authority. 
Another STRL, using this expedited hiring authority in calendar year 
2009, made thirty firm hiring offers in an average of thirteen days 
from receipt of paper work in the Human Resources Office. Of these 
thirty selectees, twenty-three possessed PhDs.
    (2) Definitions.
    (a) Scientific and engineering positions are defined in accordance 
with OPM guidance as all professional positions in scientific and 
engineering occupations (with a positive education requirement) 
utilized by the Centers.
    (b) An advanced degree is a Master's or higher degree from an 
accredited college or university as defined by OPM, in a field of 
scientific or engineering study directly related to the duties of the 
position to be filled.
    (c) Qualified candidates are defined as candidates who:
    i. Meet the minimum standards for the position as published in 
OPM's operating manual, ``Qualification Standards for General Schedule 
Positions,'' or the laboratory's demonstration project qualification 
standards specific to the position to be filled;
    ii. Possess an