Part 6. Human Resources Management

Chapter 500. Pay and Allowances

Section 1. Pay Administration (Cont. 1)

6.500.1  Pay Administration (Cont. 1)

6.500.1.9  (07-01-2003)
Reemployment of Civilian Retirees

  1. The conditions and procedures for requesting approval for re-employing a civilian retiree without offset to his or her annuity are at 5 CFR part 553.

6.500.1.10  (07-01-2003)
Travel to First Post of Duty

  1. A Division Commissioner or Functional Chief may determine which positions qualify for the payment of a new appointee's travel expenses to the first post of duty. Payment will be in accordance with 41 CFR chapters 301 through 304 (Federal Travel Regulations).

6.500.1.10.1  (07-01-2003)
Travel for Pre-Employment Interview

  1. A Division Commissioner or Functional Chief may determine which interviewees are eligible for the payment of pre-employment travel expenses. Payment will be in accordance with 41 CFR chapters 301 through 304 (Federal Travel Regulations).

6.500.1.10.2  (07-01-2003)
Organizational Discretion

  1. A decision to pay expenses for moving to first duty station or for a pre-employment interview made in connection with one specific position or vacancy does not require a like decision in connection with a future vacancy. When determining to make such a payment the organization should consider such factors as availability of funds as well as the desirability of conducting interviews for a particular job or offering a recruiting incentive to a particular candidate.

6.500.1.11  (07-01-2003)
Payment of Recruitment Bonuses

  1. Section 5753 of title 5, United States Code and 5 CFR part 575 subpart A authorize and implement the grant of a recruitment bonus of up to 25 percent of basic pay to a newly appointed employee, when, in the absence of such a bonus, there would be difficulty filling a position with a qualified candidate. The Secretary of the Treasury has delegated approval authority to bureau heads with approval for further redelegation. (See Treasury HRDM 575.1.) In addition, 5 U.S.C. 9504 enables the IRS to provide for variations from 5 U.S.C. 5753 governing payment of recruitment incentives with the approval of the Office of Personnel Management and of the Secretary of the Treasury. This additional provision is effective through July 2008. Payment of a recruitment bonus is contingent upon the execution of an agreement to remain an IRS employee for a period commensurate with the amount of the bonus.

  2. This plan defines responsibilities and provides criteria for granting a recruitment bonus to an eligible prospective employee of the IRS. The plan must be followed in conjunction with the laws, regulations, and policies at 5 U.S.C. 5753 and 9504, 5 CFR part 575 subpart A, and Treasury Personnel Manual, HRDM 575.1.

6.500.1.11.1  (07-01-2003)
Policy

  1. It is the policy of the IRS to authorize a recruitment bonus for a newly-appointed employee, within the meaning defined at 5 CFR 575.103, when, but for payment of the bonus, the IRS would have difficulty filling the position. The determination to pay a recruitment bonus is made on a case-by-case basis. When making a timely offer is important, a designated official or recruiter may make such an offer based upon pre-approved criteria, however, the determination that the prospective employee meets the set criteria still must be justified on a case-by-case basis.

    1. The Commissioner may approve a recruitment bonus for a highly qualified, current employee of an IRS division or of another Federal agency to accept a hard-to-fill position in the IRS.

    2. In highly unusual circumstances and on a case-by-case basis only, the Commissioner may approve a recruitment bonus of more than 25 percent when extreme modernization/transition related circumstances warrant an exception to the 25 percent ceiling. (See 6.500.1.15.9(2).)

    3. The determination to offer a recruitment bonus must be made and the conditions of the payment accepted before the employee enters on duty.

    4. Payment of a recruitment bonus is contingent upon the employee's execution of an agreement to remain an employee of the IRS for at least 6 months.

6.500.1.11.2  (07-01-2003)
Scope

  1. This plan applies to all eligible employees of the IRS. (See 6.500.1.15, above.)

6.500.1.11.3  (07-01-2003)
Approval

  1. The authority to approve a recruitment bonus is retained by the Commissioner or Deputy Commissioner who is responsible for:

    1. Approving a recruitment bonus for any eligible prospective employee of the IRS, on a case-by-case basis;

    2. Waiving the requirement to repay a recruitment bonus when a recipient fails to fulfill a service agreement if he or she determines that recovery would be against equity and good conscience or against the public interest; (See Waivers at 6.500.1.15.10(4), below.)

    3. Approving appropriate criteria and amounts to enable a recruiter or other official to make timely offers of recruitment bonuses without further review or approval, on a case-by-case basis;

  2. The Commissioner, only, is authorized to approve the payment of a recruitment bonus of more than 25 percent, on a case-by-case basis, when extreme modernization/ transition related circumstances warrant an exception to the 25 percent ceiling.

  3. The Commissioner, only, is responsible for approving the payment of a recruitment bonus to an employee who does not meet the definition of "newly appointed," as it is defined at 5 CFR 575.103, on a case-by-case basis, in order to fill a hard-to-fill position with a well-qualified candidate.

    1. Such a bonus may be paid to a current Federal employee of another Federal agency only if the employee is moving to a difficult -to-fill position in a different career field.

    2. The above condition does not apply in the case of a current IRS employee recruited from another IRS division.

6.500.1.11.4  (07-01-2003)
Responsibilities

  1. A Division Commissioner or Functional Chief (or their Deputies) is responsible for recommending payment of a recruitment bonus for an eligible employee on a case-by-case basis.

  2. A functional manager recommends the recruitment bonus to include justifying the need for the bonus, identifying the individual employee to receive the bonus, and recommending and justifying a percentage of salary appropriate for the bonus.

  3. The Personnel Policy and Programs Division, Strategic Human Resources, is responsible for providing program guidance concerning the payment of recruitment bonuses, and for compiling, evaluating, and reporting on the payment of recruitment bonuses to the Commissioner on an annual basis.

  4. The supporting AWSS Transactional Processing Center ensures the documentation is complete, processes the pay action, files a copy of the documentation in the employee's Official Personnel Folder/Pay Folder, and sends the original documentation with a copy of the pay action to the Personnel Policy and Programs Division, Strategic Human Resources.

  5. The AWSS Transactional Processing Center will generate a report on the number of recruitment bonuses, by organization, paid during that fiscal year, including title, series, and grade of the employees, and total dollar amounts paid, as required or requested.

6.500.1.11.5  (07-01-2003)
Coverage

  1. A recruitment bonus may be paid to an eligible employee who is newly appointed to a position in the IRS.

6.500.1.11.6  (07-01-2003)
Basis for Determining to Pay a Recruitment Bonus

  1. The decision to pay a recruitment bonus must be made on a case-by-case basis. An official offering a bonus without further review or approval must document and justify the decision based upon pre-approved criteria, on a case-by-case basis.

6.500.1.11.7  (07-01-2003)
Criteria

  1. Each recruitment bonus will be based on a written determination that in the absence of such a bonus the IRS would have difficulty filling a position.

    1. The approving official must make the determination to pay a recruitment bonus before the employee actually enters on duty.

    2. The IRS may target groups of positions that have been difficult to fill in the past or that may be difficult to fill in the future and define criteria and parameters under which an appropriate official may offer recruitment bonuses to candidates for a hard-to-fill positions or categories of positions, e.g., Revenue Agents.

  2. In addition, the documentation shall address the following factors:

    1. The success of recent recruitment efforts to fill similar positions, including offer acceptance rates, the proportion of positions filled, and the length of time required to fill similar positions;

    2. Recent turnover in similar positions;

    3. Labor market factors affecting the IRS' recruitment efforts for similar positions, currently or in the future; and

    4. Other special qualifications for the specific position, especially as they are essential to the IRS transition; and

    5. The practicality of using the superior qualifications authority alone or in combination with a recruitment bonus (as applicable).

  3. The recommending, reviewing, and approving officials shall consider the following factors to determine the amount of the bonus:

    1. The criticality of the position to meeting the mission of the IRS,

    2. The cost effectiveness of granting a recruitment bonus to a specific candidate relative to the cost of further recruitment (additional lost productivity, increased attrition rate, and other applicable alternatives and considerations),

    3. Transition timetables, and

    4. The availability of funds within the operating division or functional unit.

6.500.1.11.8  (07-01-2003)
Eligibility

  1. To receive a recruitment bonus an employee must meet the definition of "newly appointed" as it is defined at 5 CFR 575.103.

  2. In addition, under the conditions provided in 6.500.1.15.1 (1)(a), above, an onboard employee may receive a recruitment bonus.

6.500.1.11.9  (07-01-2003)
Payment

  1. A recruitment bonus (not to exceed 25 percent of the employee's rate of basic pay, exclusive of additional pay of any kind including a locality-based comparability payment under 5 U.S.C. 5304) will be calculated as a percentage of the employee's annual rate of basic pay and paid in a lump sum.

  2. Rarely, but in situations specifically approved by the Commissioner of the IRS, the percentage of a recruitment bonus may exceed 25 percent of the employee's rate of basic pay when the employee's recruitment is necessary for the IRS modernization/ transition.

    1. The higher percentage will be based on the uniqueness of the employee's qualifications, the difficulty filling similar positions, and the criticality of IRS' need for the employee's services.

    2. The bonus may not exceed 25 percent of the employee's annual basic rate of pay at the beginning of the service period multiplied by the number of years (or fraction thereof) in the service period, not to exceed 4 years. That is, under the special circumstances described above, an employee may receive a recruitment bonus of 75 percent only if the employee signs an agreement to remain in the IRS for 3 years.

  3. When an alternative payment method is deemed more effective, a recruitment bonus may be paid on an other-than-lump-sum basis, e.g., a monthly or quarterly basis. The bonus will be calculated on the employee's annual rate of basic pay at the time it was approved and paid in increments deemed to be the most effective.

    1. Such alternative payments may be in installments or as a final lump sum paid up upon completion of an agreed upon service period.

    2. A bonus so paid may not exceed 25 percent of the employee's annual rate of basic pay at the beginning of the service agreement.

  4. A recruitment bonus will not be considered part the employee's rate of basic pay for any purpose.

  5. A recruitment bonus may be paid before the employee enters on duty, but the employee must first execute a service agreement as described at (7), below.

  6. A recruitment bonus may be paid at some date after the employee enters on duty, for example at the end the successful completion of training, or after 6 months, but the terms of such delayed payment must be clarified in the service agreement.

  7. Service Agreement. Payment of a recruitment bonus is contingent upon the employee's execution of a service agreement that he or she will remain an employee of the IRS for at least 6 months. A longer period of service may be required based on the factors described in 6.500.1.15.7, above, on the amount of the bonus, difficulty of filling the position, and other pertinent factors that affect recruitment and retention.

  8. A recruitment bonus may not be paid to an employee if, or to the extent, that the bonus, when added to the employees' rate of basic pay plus all other cash payments to which the employee is entitled, would cause the employee's annual aggregate compensation to exceed the rate for Level I of the Executive Schedule during a calendar year. Any portion of a recruitment bonus not payable because of the action of this limitation will become payable at the beginning of the next calendar year.

  9. A recruitment bonus may be paid in combination with superior qualifications appointments, special salary rates, etc., to the extent that the employee's aggregate compensation does not exceed the limitation indicated at (8), above.

  10. An employee fulfilling a service agreement for a recruitment bonus may be granted a relocation bonus if all other statutory and regulatory provisions are met and receipt of the bonus does not cause the employee's aggregate compensation to exceed the limitation indicated at (8), above.

6.500.1.11.10  (07-01-2003)
Documentation

  1. The functional manager recommending payment of a recruitment bonus must provide the Recruitment Bonus Justification Information and Certification. (See Exhibit 6.500.1-9.) The justification must include:

    1. A written determination describing how the individual and the situation meet the factors in 6.500.1.15.7, above.

    2. The proposed recruitment bonus percentage and a justification for that amount, including a statement addressing the factors in 6.500.1.15.7(3), above. (Substantial justification will be required for a percentage greater than 25 percent.)

    3. The duration of the period of employment required by the service agreement.

  2. When it is deemed appropriate to provide payment of the bonus in an other than lump-sum payment, the reason for the variation must be documented and explained including the reasons why the alternative payment method will provide a more effective incentive for the affected employee(s).

6.500.1.11.11  (07-01-2003)
Repayment of a Recruitment Bonus

  1. An employee who fails to complete the period of employment established under the service agreement described at 6.500.1.15.9(7), above, shall be indebted to the Federal government and shall repay the recruitment bonus on a pro rata basis. Failure to complete the period of employment established under the service agreement occurs when the employee's service with the IRS terminates before the employee completes the period of employment specified in the service agreement.

  2. Amounts owed by an employee for repayment of a recruitment bonus shall be recovered from the employee under the Department's regulation for debt collection by offset under 5 U.S.C. 5514 and 5 CFR part 550, subpart K.

  3. Repayment of a recruitment bonus is not required when an employee fails to complete the terms of the service agreement because the employee is involuntarily separated (as defined at 5 CFR 575.103) from the IRS.

  4. Waivers. A right of recovery of an employee's debt under 5 U.S.C. 5514 may be waived in whole or in part if the Commissioner determines that recovery would be against equity and good conscience or against the public interest.

6.500.1.11.12  (07-01-2003)
Records and Reports

  1. All documentation, certification, and service agreement used for the payment of a recruitment bonus will be maintained in the employee's Official Personnel Folder.

  2. At the end of each fiscal year, the AWSS Transactional Processing Center will generate a report on the number of recruitment bonuses, by organization, paid during the fiscal year, including title, series and grade of the employees, and total dollar amounts paid. This information will be analyzed from a Servicewide recruitment and retention perspective to determine trends, problem areas, and future needs.

  3. Other reports concerning recruitment bonuses will be generated as required or requested.

6.500.1.12  (07-01-2003)
Payment of Relocation Bonuses

  1. 5 U.S.C. 5753 and 5 CFR part 575 subpart B authorize the grant of a relocation bonus of up to 25 percent of basic pay to an employee as an incentive to relocate outside the employee's current commuting area to accept a position in the new area either permanently or temporarily. In addition, 5 U.S.C. 9504 enables the IRS to provide for variations from section 5753 governing payment of relocation incentives with the approval of the Office of Personnel Management and of the Secretary of the Treasury. This additional provision is effective through July 2008. Payment of a relocation bonus is contingent upon the execution of an agreement to remain an IRS employee for a reasonable period considering the conditions of the move and the amount of the bonus.

  2. This plan defines responsibilities and provides criteria for granting a relocation bonus to an eligible employee of the Internal Revenue Service (IRS). The plan must be followed in conjunction with the laws, regulations, and policies at 5 U.S.C. 5753 and 9504, 5 CFR part 575 subpart B, and Treasury Personnel Manual, HRDM 575.2

6.500.1.12.1  (07-01-2003)
Policy

  1. It is the policy of the IRS to authorize a relocation bonus for an employee who must move outside of the area where he or she resides and establish a new residence in a different commuting area, as defined in 5 CFR 575.203, to accept a position, when the IRS otherwise would have difficulty filling the position. A bonus may be authorized for either a permanent or temporary relocation. The determination to pay a relocation bonus generally is made on a case-by-case basis.

    1. The requirement to make a case-by-case determination to pay a relocation bonus may be waived, under the conditions described at 5 CFR 575.204(d) and 6.500.1.16.11(4), below, when the requirements of the IRS mission make it necessary or advantageous to relocate specific groups of employees outside the commuting area.

    2. In highly unusual circumstances on a case-by-case basis only, the Commissioner may approve a relocation bonus of more than 25 percent when extreme modernization/transition related circumstances warrant an exception to the 25 percent ceiling.

    3. A relocation bonus may not be paid until the employee actually establishes a residence in the new commuting area.

    4. Payment of a relocation bonus is contingent upon the employee's execution of an agreement to remain an employee of the IRS at the new duty station for at least 6 months.

6.500.1.12.2  (07-01-2003)
Scope

  1. This plan applies to all eligible employees of the IRS. (See 6.500.1.16.1, above.)

6.500.1.12.3  (07-01-2003)
Approval

  1. The authority to approve a relocation bonus is retained by the Commissioner or Deputy Commissioner, who is responsible for:

    1. Approving a relocation bonus for any eligible employee of the IRS, on a case-by-case basis. The Commissioner is authorized to approve a relocation bonus of more than 25 percent, on a case-by-case basis, when extreme modernization/transition related circumstances warrant an exception to the 25 percent ceiling; and

    2. Waiving the requirement to repay a relocation bonus when a recipient fails to fulfill a service agreement if the Commissioner or Deputy Commissioner determines that recovery would be against equity and good conscience or against the public interest. (See 6.500.1.16.11(4), below.)

6.500.1.12.4  (07-01-2003)
Responsibilities

  1. The Deputy Commissioner, Division Commissioners or Functional Chiefs are responsible for recommending payment of a relocation bonus for an eligible employee on a case-by-case basis. A functional manager recommends the relocation bonus to include justifying the need for the bonus, identifying the individual employee to receive the bonus, and recommending and justifying a percentage of salary appropriate for the bonus.

  2. The Personnel Policy and Programs Division, Strategic Human Resources, is responsible for providing program guidance concerning the payment of relocation bonuses, and for compiling, evaluating, and reporting on the payment of relocation bonuses to the Commissioner on an annual basis.

  3. The supporting AWSS Transactional Processing Center ensures the documentation is complete, processes the pay action, files a copy of the documentation in the employee's Official Personnel Folder/Pay Folder, and sends the original documentation with a copy of the pay action to the Personnel Policy and Programs Division, Strategic Human Resources.

  4. The AWSS Transactional Processing Center will generate a report on the number of relocation bonuses, by organization, paid during that fiscal year, including title, series, and grade of the employees, and total dollar amounts paid, as required or requested.

6.500.1.12.5  (07-01-2003)
Coverage

  1. A relocation bonus may be paid to an eligible employee who must relocate to accept a position in the IRS.

6.500.1.12.6  (07-01-2003)
Bases for Determining to Pay a Relocation Bonus

  1. Case-by-case determination. A relocation bonus generally is established on a case-by-case basis for an individual employee who must move outside the commuting area to accept a position based on the determination that, in the absence of such bonus, the IRS would have difficulty filling the position with a qualified candidate.

  2. Group determinations. The Commissioner or Deputy Commissioner may waive the requirement to make case-by-case determinations to authorize a relocation bonus of up to 25 percent of basic pay to a group or category of employees when:

    1. The employee is within a specific group of employees covered by a mobility agreement, and the approving official determines that relocation bonuses are necessary to ensure the IRS' ability to retain employees in that specific group and subject to such an agreement; or

    2. A major organizational unit is relocating to a different commuting area, and the approving official determines that relocation bonuses are necessary as an incentive for specific groups of employees to move to the new commuting area to ensure continued operation of the unit without undue disruption of an essential function or of service to the public.

    3. To receive a relocation bonus under this subsection, an employee in a covered group must have a "Met" rating or its equivalent, as required by 5 CFR 575.204(d).

6.500.1.12.7  (07-01-2003)
Criteria

  1. Each relocation bonus will be based on a written determination that in the absence of such a bonus the IRS would have difficulty filling a position.

    1. The approving official must make the determination to pay a relocation bonus before the employee actually enters on duty in the new area.

    2. The IRS may target groups of positions that have been difficult to fill in the past or that may be difficult to fill in the future. The decision to pay a bonus to an employee in a targeted group must be made on a case-by-case basis unless the conditions requiring the bonus meet those described at 6.500.1.16.6(2), above, for group determinations.

  2. In addition, the IRS shall consider the following factors:

    1. The success of recent recruitment efforts to fill similar positions in similar geographic areas, including offer acceptance rates, the proportion of positions filled, and the length of time required to fill similar positions;

    2. Recent turnover in similar positions or similar geographic areas;

    3. Labor market factors affecting the IRS' recruitment efforts for similar positions in similar areas, currently or in the future; and

    4. Other special qualifications for the specific position, especially as they are essential to the IRS transition.

  3. The IRS shall consider the following factors to determine the amount of the bonus:

    1. The criticality of the position(s) to meeting the mission of the IRS,

    2. The cost effectiveness of granting a relocation bonus relative to the cost of recruitment (training, lost productivity, attrition rate, and other applicable alternatives and considerations),

    3. Transition timetables, and

    4. The availability of funds within the operating division or functional unit.

6.500.1.12.8  (07-01-2003)
Eligibility

  1. To receive a relocation bonus an employee must:

    1. Have completed 6 months of continuous service with the IRS--in critical situations, this requirement may be waived by the approving officials;

    2. Have a fully successful or higher performance rating on the most recent annual performance appraisal; and

    3. Not be fulfilling a service agreement for receipt of a recruitment bonus. (With the approval of Division Commissioner or Functional Chief, the approving official may waive this requirement when it is essential to fill the position and the candidate for the bonus has specific qualifications that make payment of the bonus advantageous to the IRS.)

    4. A relocation bonus may be paid only to a current employee and may not be paid to a newly appointed employee as defined at 5 CFR 575.103.

6.500.1.12.9  (07-01-2003)
Payment

  1. A relocation bonus (not to exceed 25 percent of the employee's rate of basic pay, exclusive of additional pay of any kind including a locality based comparability payment, under 5 U.S.C. 5304), will be calculated as a percentage of the employee's annual rate of basic pay and paid in a lump sum.

  2. Rarely, but in situations specifically approved by the Commissioner of the IRS, the percentage of a relocation bonus may exceed 25 percent of the employee's rate of basic pay when the employee's relocation is necessary for the IRS modernization/transition.

    1. The higher percentage will be determined by the of the uniqueness of the employee's qualifications, the difficulty filling similar positions in the geographic area, and the criticality of the IRS' need for the employee's services in the new location.

    2. The bonus may not exceed 25 percent of the employee's annual basic rate of pay at the beginning of the service period multiplied by the number of years (or fraction thereof) in the service period, not to exceed 4 years.

  3. In situations, when an alternative payment method is deemed more effective, a relocation bonus may be paid on an-other-than-lump-sum basis, e.g., a monthly or quarterly basis. The bonus will be calculated on the employee's annual rate of basic pay at the time it was approved and paid in increments deemed to be the most effective.

    1. Such alternative payments may be in installments or as a final lump sum paid upon completion of an agreed upon service period.

    2. A bonus so paid may not exceed 25 percent of the employee's annual rate of basic pay at the beginning of the service agreement.

  4. A relocation bonus will not be considered part the employee's rate of basic pay for any purpose.

  5. A relocation bonus may not be paid until the employee enters on duty and actually establishes a residence in the new area.

  6. Service Agreement. Payment of a relocation bonus is contingent upon the employee's execution of a service agreement that he or she will remain employed by the IRS in the new area for a reasonable period based on factors described in 6.500.1.16.7, above, and on the amount of the bonus. In general, the period of service must be for at least 6 months; however, a Division Commissioner or Functional Chief may approve a lesser period when such period may be advantageous to the Service, as in the case of a relocation undertaken to effect a temporary assignment for which the recipient is exceptionally well qualified.

  7. A relocation bonus may not be paid to an employee if, or to the extent, that the bonus, when added to the employee's rate of basic pay plus all other cash payments to which the employee is entitled, would cause the employee's aggregate compensation to exceed the rate for Level I of the Executive Schedule during a calendar year. Any portion of a relocation bonus not payable because of the action of this limitation will become payable at the beginning of the next calendar year.

  8. A relocation bonus may be paid in combination with dual compensation restriction waivers, superior qualifications appointments, special salary rates, etc., to the extent that the employee's aggregate compensation does not exceed the limitation indicated at (7), above.

  9. An employee, in receipt of a retention allowance, may continue to receive the allowance and be granted a relocation bonus if all other statutory and regulatory provisions are met. However, the payment of the bonus in additional the retention allowance may not cause the employee's aggregate compensation to exceed the limitation indicated at (7), above.

  10. As provided in 6.500.16.8(1)(c), above, an employee fulfilling a service agreement for a recruitment bonus may be granted a relocation bonus if all other statutory and regulatory provisions are met and receipt of the bonus does not cause the employee's aggregate compensation to exceed the limitation indicated at (7), above.

6.500.1.12.10  (07-01-2003)
Documentation

  1. The functional manager recommending payment of a relocation bonus to an individual employee must provide the "Relocation Bonus Justification Information and Certification." (See Exhibit 6.500.1-8 .) The justification must include:

    1. A written determination describing how the employee and situation meet the factors in 6.500.1.16.7, above.

    2. The proposed relocation bonus percentage and a justification for that amount, including a statement addressing the 6.500.1.16.9(3), above. (Substantial justification will be required for payment of a percentage greater than 25 percent.)

    3. The duration of the period of employment in the new area required by the relocation service agreement.

  2. When it is deemed appropriate to provide payment of the bonus in an other than lump-sum payment, the reason for the variation must be documented and explained including the reasons why the alternative payment method will be a more effective incentive for affected employee(s)

6.500.1.12.11  (07-01-2003)
Repayment of a Relocation Bonus

  1. An employee who fails to complete the period of employment established under the service agreement described at 6.500.1.16.9(6), above, shall be indebted to the Federal government and shall repay the relocation bonus on a pro rata basis. Failure to complete the period of employment established under the service agreement occurs when the employee's service with the IRS at the new duty station terminates before the employee completes the period of employment specified in the service agreement.

  2. Amounts owed by an employee for repayment of a relocation bonus shall be recovered from the employee under the Department's regulation for debt collection by offset under 5 U.S.C. 5514 and 5 CFR part 550, subpart K.

  3. A relocation bonus is not subject to repayment when an employee fails to complete the terms of the service agreement because:

    1. The employee is involuntarily separated (as defined at 5 CFR 575.203) from the IRS; or

    2. The approving official makes a written determination that it is necessary to relocate the employee to a position in yet another commuting area.

  4. Waivers. A right of recovery of an employee's debt under 5 U.S.C. 5514 may be waived in whole or in part if the Commissioner determines that recovery would be against equity and good conscience or against the public interest.

6.500.1.12.12  (07-01-2003)
Records and Reports

  1. All documentation, certification, and service agreement used for the payment of a relocation bonus will be maintained in the employee's Official Personnel Folder.

  2. At the end of each fiscal year, the AWSS Transactional Processing Center will generate a report on the number of relocation bonuses, by organization, paid during the that fiscal year, including title, series and grade of the employees, and total dollar amounts paid. This information will be analyzed from a Servicewide recruitment and retention perspective to determine trends, problem areas, and future needs.

  3. Other reports concerning relocation bonuses will be generated as required or requested.

6.500.1.13  (07-01-2003)
Payment of Retention Allowances

  1. 5 U.S.C. 5754 and 5 CFR part 575 subpart C authorize and implement the grant of a retention allowance of up to 25 percent of basic pay to a current employee. In addition, 5 U.S.C. 9504 enables the IRS to provide for variations from section 5754 governing payment of retention incentives with the approval of the OPM and of the Secretary of the Treasury. This additional provision is effective through July 2008.

  2. The purpose of this plan is to define responsibilities and provide criteria for granting a retention allowance to an eligible employee of the IRS. The information herein should be followed in conjunction with the laws, regulations, and policies at. 5 U.S.C. 5754 and 9504, 5 CFR part 575 subpart C, and Treasury Personnel Manual, HRDM 575.3

6.500.1.13.1  (07-01-2003)
Policy

  1. It is the policy of the IRS to authorize a retention allowance for an employee who has unusually high or unique qualifications or skills for which the Service has special need, when, but for payment of the allowance, the employee would leave the Federal service. An allowance also may be authorized to retain such an employee when the Commissioner determines that the employee's continued service in the IRS is critical and the employee is likely to leave his or her current position for another IRS position or for other Federal employment. The determination to pay a retention allowance generally is made on a case-by-case basis.

  2. The requirement to make a case-by-case determination to pay a retention allowance may be waived when it is necessary to retain groups of similarly skilled employees, employees with specific qualifications, licensure, or certification, or employees in work groups requiring specific and unique skill matches. (See 6.500.1.17.6(2), below.)

  3. In highly unusual circumstances on a case-by-case only, the Commissioner may approve a retention allowance of more than 25 percent when extreme modernization/ transition circumstances warrant an exception to the 25 percent ceiling.

6.500.1.13.2  (07-01-2003)
Scope

  1. This plan applies to all eligible employees of the IRS. (See 6.500.1.17.5, below.)

6.500.1.13.3  (07-01-2003)
Approval

  1. The authority to approve a retention allowance is retained by the Commissioner or Deputy Commissioner who is also responsible for:

    1. Approving a retention allowance for any eligible employee of the IRS, on a case-by-case basis. The Commissioner is also responsible for approving a retention allowance on a case-by-case basis, for an employee who would otherwise leave his or her current position for another IRS position at the same grade level or for other Federal employment; (See 6.500.1.17.5(1), below.)

    2. The Commissioner or Deputy Commissioner is responsible for approving waiver of the requirement for case-by-case determinations to pay retention allowances up to 10 percent to appropriate groups of eligible employees as defined at 5 CFR 575.305(d).

    3. The Commissioner, only, is responsible for approving, with the concurrence of the Office of Personnel Management (OPM), a retention allowance of up to 50 percent, on a case-by-case basis, when extreme modernization/transition circumstances warrant an exception to the 25 percent ceiling.

6.500.1.13.4  (07-01-2003)
Responsibilities

  1. A Division Commissioner or Functional Chief (or their Deputies) is responsible for recommending payment of a retention allowance for an eligible employee on a case-by-case basis. A functional manager recommends the retention allowance to include justifying the need for the allowance, identifying the individual employee to receive the allowance, and recommending and justifying a percentage of salary appropriate for the allowance.

  2. The Personnel Policy and Programs Division, Strategic Human Resources, is responsible for providing program guidance concerning the payment of retention allowances, and for compiling, evaluating, and reporting on the payment of retention allowances to the Commissioner on an annual basis.

  3. The supporting AWSS Transactional Processing Center ensures the documentation is complete, processes the pay action, files a copy of the documentation in the employee's Official Personnel Folder, and sends the original documentation with a copy of the pay action to the Personnel Policy and Programs Division, Strategic Human Resources.

  4. The AWSS Personnel Payroll Processing Office will generate a report on the number of retention allowances, by organization, paid during that fiscal year, including title, series, and grade of the employees, and total dollar amounts paid, as required or requested.

6.500.1.13.5  (07-01-2003)
Coverage

  1. A retention allowance may be paid to an employee to remain in a position in the Federal service, when but for the allowance, the employee would leave Federal service; or

  2. The Commissioner determines that the employee's continued service in the IRS is critical to the success of the IRS modernization and transition and the employee is likely to leave the Service for other Federal employment.

6.500.1.13.6  (07-01-2003)
Bases for Determining to Pay a Retention Allowance

  1. Case-by-case determination. A retention allowance generally is established on a case-by-case basis for an individual employee based on a determination that:

    1. The employee's unusually high or unique qualifications or the agency's special need for the employee's services make it essential to retain the employee, and

    2. The employee would be likely to leave the Federal service in the absence of a retention allowance, or

    3. In situations critical to the IRS, the Commissioner determines that the employee would be likely to leave the IRS for other Federal service or for another position in the IRS in the absence of a retention allowance when the other position is under a different pay system. This authority may not be used to pay a retention allowance to an employee likely to leave for a GS, prevailing rate (wage), SL/ST, SES, ALJ, EX, or CBA position when his or her current position is also under any of these pay systems. For the purposes of this subsection, an employee in a pay banded position is not considered to be covered by the GS pay system; and it is essential to retain the employee before an office closure or relocation, or the completion of a project critical to the mission of the organization. For employees working on a critical project, such a retention allowance may be paid for no longer than 1 year. (An extension to this period may be requested from OPM on a case-by-case basis).

  2. Group determinations.

    1. The Commissioner or Deputy Commissioner may waive the requirement to make case-by-case determinations to authorize retention allowances of up to 10 percent to a group or category of employees. The skills or unique qualifications of the group are determined to be essential to the mission of the Service and there is a high risk that a significant number of employees in the group or category otherwise would be likely to leave their current position.

    2. The Commissioner retains the authority to waive the requirement to make case-by-case determinations to authorize payment of retention allowances to a group or category when the proposed payment exceeds 10 percent with the approval of the OPM. Retention allowances for a group or category of employees will not exceed 25 percent.

6.500.1.13.7  (07-01-2003)
Criteria

  1. Each retention allowance will be based on a written determination that the employee's unusually high or unique qualifications, or the IRS' special need for the employee's services make it essential to retain the employee; and that, in the absence of such an allowance, the employee would be likely to leave:

    1. The Federal service, or

    2. The IRS, when retention of a specific employee is critical to the IRS modernization/transition.

  2. In addition, the IRS shall consider the following factors:

    1. The extent to which the employee's departure would affect the IRS' ability to carry out an activity or perform a function that is essential to its mission;

    2. The success of recent efforts to recruit candidates and retain employees with qualifications similar to those possessed by the employee(s);

    3. The availability in the labor market of candidates for employment, who with minimal training or disruption of service to the taxpayer, could perform the full range of duties and responsibilities assigned to the position(s) held by the employee(s) for whom a retention allowance is being considered; and,

    4. Other special or unique needs for the services of such employee(s), especially as they are essential to the IRS modernization/transition.

  3. The IRS shall consider the following factors to determine the amount of the allowance:

    1. The criticality of the special mission or skills requiring the continued service of a specific employee or group of employees;

    2. The cost effectiveness of granting a retention allowance relative to the cost of recruitment (training, lost productivity, attrition rate, and other applicable alternatives and considerations);

    3. Transition timetables; and

    4. The availability of funds within the operating division or functional unit.

6.500.1.13.8  (07-01-2003)
Eligibility

  1. To receive a retention allowance an employee must:

    1. Have completed 6 months of continuous service with the IRS; in critical situations, this requirement may be waived by the approving officials;

    2. Have a fully successful or higher performance rating on the most recent annual performance appraisal; and

    3. Not be fulfilling a service agreement for receipt of a previously authorized recruitment or a relocation allowance.

6.500.1.13.9  (07-01-2003)
Payment

  1. In most situations, a retention allowance (not to exceed 25 percent of the employee's rate of basic pay, exclusive of additional pay of any kind including a locality based comparability payment under 5 U.S.C. 5304), will be calculated and paid in the same manner and at the same time as basic pay. That is, the retention allowance will be calculated on an hourly basis and paid for every hour that the employee is in a non-overtime pay status.

  2. Rarely, but in situations specifically approved by the Commissioner, the percentage of a retention allowance may exceed 25 percent of the employee's rate of basic pay when the employee's continued services are necessary for the IRS modernization and transition. The higher percentage will be determined by the criticality of the employee's qualifications and the IRS' need for his or her continuing services.

  3. When an alternative payment method is deemed more effective, a retention allowance may be paid on an other-than biweekly basis, e.g., a quarterly basis. The allowance will continue to be calculated at an hourly rate and paid in increments deemed to be the most effective under the following conditions:

    1. The employee must enter into a written service agreement to complete a period of employment with the IRS before payment of a retention allowance. The agreement must specify the length of the required service period, the amount of the allowance, the method of payment, the conditions under which the Service may terminate the agreement before the employee completes the service period, the effect of the termination, and other terms and conditions under which the allowance is payable.

    2. The IRS may pay a retention allowance to an employee in installments after completion of specified periods of service, in a single lump sum at the end of the full period of service required by the agreement, or in a combination of these forms of payment.

    3. The retention allowance must be stated as a percentage of the employee's basic pay for the service period associated with the allowance.

    4. An installment payment may not exceed the amount derived by multiplying the basic pay earned during the installment period by the percentage rate established for the employee.

  4. A retention allowance will not be considered part the employee's rate of basic pay for any purpose.

  5. A retention allowance may not be authorized for an employee if, or to the extent that, the allowance when added to the employee's estimated aggregate compensation during the calendar, would cause the actual aggregate compensation received by the employee during that year to exceed the rate for Level I of the Executive Schedule at the end of the same year. The amount of the authorized retention allowance must be reduced or terminated to the extent necessary to ensure that the employee's estimated aggregate compensation does not exceed the rate for Level I of the Executive Schedule at the end of the calendar year.

  6. A retention allowance may be paid in combination with dual compensation restriction waivers, superior qualifications appointments, special salary rates, etc., to the extent that the employee's aggregate compensation does not exceed the limitation indicated at (5), above.

  7. An employee, in receipt of a retention allowance, may continue to receive the allowance and be granted a relocation bonus if all other statutory and regulatory provisions are met and payment of the bonus does not cause the employee's aggregate compensation to exceed the limitation indicated at (5), above.

  8. A retention allowance will not be included in the calculation of a lump-sum payment for annual leave.

6.500.1.13.10  (07-01-2003)
Documentation

  1. The functional manager recommending payment of a retention allowance to an individual employee or to a category of employees must provide the "Retention Allowance justification Information and Certification/Recertification. " (See Exhibit 6.500.1-10.) The justification information include:

    1. A written determination describing how the employee meets the factors in 6.500.1.17.7(1), above.

    2. The proposed retention allowance percentage and a justification for that amount, including a statement addressing the factors in 6.500.1.17.7(2), above. (Substantial justification will be required for a percentage greater than 25 percent.)

    3. The expected duration of the retention allowance payments.

  2. When it is deemed appropriate to provide payment of the allowance on an other than biweekly basis, the reason for the variation must be documented and explained including the reasons why the alternative payment method will be more effective in retaining the affected employee(s).

  3. Recertification: A retention allowance may continue as long as the IRS determines that the employee is critical to the mission. However, at least annually, the IRS manager recommending the allowance, or his or her successor, must review and recertify, in writing, the continuing criticality of the employee to the mission. The approving official then must determine whether continued payment is justified. The documentation referenced in (1), above, is to be used for recertification.

6.500.1.13.11  (07-01-2003)
Reduction or Termination of a Retention Allowance

  1. A retention allowance may be reduced or terminated at any time if a determination is made that payment of the allowance is no longer warranted or payment at a lower percentage is sufficient to retain the employee or group of employees.

  2. Functional managers must monitor the continuing need for payment of a retention allowance to ensure its efficient use.

  3. When a decision is made to reduce or terminate an allowance, the functional manager must notify the affected employee as least one full pay period before the reduction or termination is effective.

  4. Factors, such as the following, provide a basis for reducing or terminating a retention allowance:

    1. Changes in labor market conditions that facilitate the hiring of candidates with the needed qualifications,

    2. The continuing criticality of the employee's services, or

    3. Budgetary considerations that may make continued payment of the allowance inappropriate.

  5. The recipient of a retention allowance is not eligible to continue to receive the allowance when he or she meets any of the following circumstances (NOTE: In these instances, the employee's manager must notify the Business Unit Personnel Office or the AWSS Transactional Processing Center immediately to terminate the retention allowance.):

    1. No longer performs the duties of the position necessitating the unique skill,

    2. Has been reassigned to a new position, or

    3. Has left the IRS.

  6. A reduction in, or termination of, a retention allowance is not an adverse action.

6.500.1.13.12  (07-01-2003)
Records and Reports

  1. The Certification/Recertification Form used for the payment of a retention allowance will be maintained in the employee's Official Personnel Folder.

  2. At the end of each quarter of the fiscal year, AWSS Personnel Transaction Processing Center will generate a TIMIS report of employees currently receiving a retention allowance. This report will be provided to appropriate functional managers (certifying officials) for their information and use.

  3. At the end of each fiscal year, AWSS Personnel Transactional Processing Center, will release a report to the Commissioner on the number of retention allowances, by organization, paid during the fiscal year, including title, series and grade of the employees, and total dollar amounts paid.

  4. The Retention Allowance Certification/Recertification Worksheet will be filed in the office of the certifying official for 3 years after termination of the retention allowance.

6.500.1.14  (07-01-2003)
Waiver of Repayment of Voluntary Separation Incentive Payments

  1. Part 576 of Title 5, Code of Federal Regulations, provides guidance for requesting a waiver to the requirement to repay a voluntary separation incentive payment paid under 5 U.S.C. 5597 when an employee returns to Federal service within 5 years of receiving such a payment. The IRS, however, has its own voluntary separation incentive payment authority under, section 1202 of the IRS Restructuring and Reform Act of 1998, which does not have a similar waiver provision. Therefore, General Legal Services has advised that IRS does not have authority to request a waiver of repayment of a voluntary separation incentive payment.

6.500.1.15  (07-01-2003)
Processing Garnishment Orders for Child Support and/or Alimony

  1. 5 CFR part 581 provides the regulations, guidance and direction for processing garnishment orders for child support and/or alimony under 42 U.S.C. 659, 15 U.S.C. 1673; Executive Order 12105, and 3 CFR part 262.

6.500.1.16  (07-01-2003)
Commercial Garnishment of Federal Employees Pay

  1. 5 CFR part 582 provides the regulations, guidance and direction for processing commercial garnishment of Federal employees' pay under 5 U.S.C. 5520a.

6.500.1.17  (07-01-2003)
Allowances and Differentials

  1. Cost-of-living allowances and post differential, non-foreign areas: General Schedule employees, employees in senior-level scientific and professional positions paid under 5 U.S.C. 5376, and members of the Senior Executive Service whose official duty stations are in areas for which an allowance or differential has been established, under 5 U.S.C. 5941 and 5 CFR 591.204, shall receive such payments as provided by 5 CFR 591 subpart B.

6.500.1.18  (07-01-2003)
Overseas Allowances and Differentials

  1. The authority to authorize allowances and differentials to IRS employees, including employees on Tax Administration Advisory Services (TAAS) assignments, who are stationed in foreign areas is delegated to:

    1. Deputy Division Commissioners; Deputy Division Chief; Deputy Commissioner for Modernization/Chief Information Officer; Deputy National Taxpayer Advocate for employees under their supervision and control; and

    2. National Headquarters Directors and Chiefs (and their Deputies) who report directly to the Commissioner, Deputy Commissioner, or Assistant Deputy Commissioner for employees under their supervision and control.

    3. The authority may not be redelegated.

Exhibit 6.500.1-1  (07-01-2003)
Suggested Notice of Intent to Deny Within-Grade Increase (Bargaining Unit Employees)

This image is too large to be displayed in the current screen. Please click the link to view the image.
This image is too large to be displayed in the current screen. Please click the link to view the image.

Exhibit 6.500.1-2  (07-01-2003)
Suggested Notice That Within-Grade is Granted After Notice of Intent to Deny WGI Was Given (for Bargaining Unit Employees)

This image is too large to be displayed in the current screen. Please click the link to view the image.

Exhibit 6.500.1-3  (07-01-2003)
Suggested Notice of Denial of Within-Grade Increase

This image is too large to be displayed in the current screen. Please click the link to view the image.
This image is too large to be displayed in the current screen. Please click the link to view the image.

Exhibit 6.500.1-4  (07-01-2003)
Suggested Notice That Within-Grade Increase is Granted After Reconsideration

This image is too large to be displayed in the current screen. Please click the link to view the image.

Exhibit 6.500.1-5  (07-01-2003)
Suggested Notice that Reconsideration Sustains Original Determination (For Bargaining Unit Employees)

This image is too large to be displayed in the current screen. Please click the link to view the image.

Exhibit 6.500.1-6  (07-01-2003)
Suggested Notice that Reconsideration Sustains Original Determination (For Non-Bargaining Unit Employees)

This image is too large to be displayed in the current screen. Please click the link to view the image.

Exhibit 6.500.1-7  (07-01-2003)
Suggested Language for Representatives Request for Access to Tax Information and for Employee Request for Material Relied On

This image is too large to be displayed in the current screen. Please click the link to view the image.

Exhibit 6.500.1-8  (07-01-2003)
Conversion Rules for Employees Previously Covered by IRS Paybands

This image is too large to be displayed in the current screen. Please click the link to view the image.

Exhibit 6.500.1-9  (07-01-2003)
Recruitment Bonus Justification Information

This image is too large to be displayed in the current screen. Please click the link to view the image.
This image is too large to be displayed in the current screen. Please click the link to view the image.
This image is too large to be displayed in the current screen. Please click the link to view the image.
This image is too large to be displayed in the current screen. Please click the link to view the image.

Exhibit 6.500.1-10  (07-01-2003)
Relocation Bonus Justification Information

This image is too large to be displayed in the current screen. Please click the link to view the image.
This image is too large to be displayed in the current screen. Please click the link to view the image.
This image is too large to be displayed in the current screen. Please click the link to view the image.
This image is too large to be displayed in the current screen. Please click the link to view the image.

Exhibit 6.500.1-11  (07-01-2003)
Retention Allowance Justification Information

This image is too large to be displayed in the current screen. Please click the link to view the image.
This image is too large to be displayed in the current screen. Please click the link to view the image.
This image is too large to be displayed in the current screen. Please click the link to view the image.

Prev

More Internal Revenue Manual