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Frequently Asked Questions Pay & Leave

Recruitment, Relocation and Retention Incentives

  • An agency may unilaterally terminate a recruitment or relocation incentive service agreement based solely on the management needs of the agency.  For example, an agency may terminate a service agreement when the employee’s position is affected by a reduction in force, when there are insufficient funds to continue the planned incentive payments, or when the agency assigns the employee to a different position (if the different position is not within the terms of the service agreement). In such cases, the employee is entitled to all incentive payments attributable to completed service and to retain any portion of an incentive payment already received that is attributable to uncompleted service. An agency must notify an employee in writing when it terminates a recruitment or relocation incentive service agreement. (See 5 CFR 575.111 and 575.211.)
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  • See the retention incentives fact sheet at – http://www.opm.gov/3rs/fact/RETALLFS.asp
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  • An agency may pay a recruitment or relocation incentive as an initial lump-sum payment at the beginning of the service period, in equal or variable installment payments throughout the service period, as a final lump-sum payment upon completion of the service period, or in a combination of these methods. (See 5 CFR 575.109(a) and 575.209(a).)
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  • Agencies may not pay a retention incentive to an employee in a position (1) to which the individual was appointed by the President; (2) in the Senior Executive Service as a non-career appointee; (3) which has been excepted from the competitive service by reason of its confidential, policy-determining, policy-making, or policy-advocating character; (4) designated as the head of an agency, including an agency headed by a collegial body composed of two or more individual members; or (5) in which the employee is expected to receive an appointment as the head of an agency. (See 5 CFR 575.304 and 575.315(b)(1).)
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  • For each determination to pay a retention incentive for an employee likely to leave the Federal service, an agency must document in writing-
    • The basis for determining that the unusually high or unique qualifications of the employee (or group of employees) or a special need of the agency for the employee’s (or group of employees') services makes it essential to retain the employee(s);
    • The basis for determining that the employee (or a significant number of employees in a group) would be likely to leave the Federal service in the absence of a retention incentive; and
    • The basis for establishing the amount and timing of the approved retention incentive payment and the length of the required service period.
    (See 5 CFR 575.308(b).)
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  • Yes. Agencies may pay a recruitment incentive to employees receiving a special rate or locality rate.
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  • For each determination to pay a recruitment or relocation incentive, an agency must document in writing—
    • The basis for determining that a position is likely to be difficult to fill;
    • The basis for authorizing an incentive; and
    • The basis for the amount and timing of the approved incentive payment and the length of the required service period.
    • Also, for a relocation incentive, that the worksite of the employees new position is not in the same geographic area as the worksite of the position held immediately before the move (or that a waiver was approved under 5 CFR 575.205(b)) and that the employee established a residence in the new geographic area.
    The authorized agency official must review and approve the recruitment or relocation incentive determination before the agency pays the incentive to the employee. (See 5 CFR 575.108(a) and 575.208(a).)
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  • Under OPM regulations (5 CFR 575.307(b)), an agency official who is at least one level higher than the employee’s (or group of employees‘) supervisor must review and approve each determination to pay a retention incentive to an individual or group of employees, unless there is no official at a higher level in the agency.  A higher level approval is not needed when approving coverage of individual employees under a previously approved group retention incentive authorization.  The authorized agency official must review and approve the retention incentive determination before the agency pays the incentive to the employee. We encourage agencies to delegate authority to approve retention incentives to the lowest level practicable to help respond more effectively to their staffing needs.
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  • No, agencies are not required to submit their recruitment and relocation incentive plans to OPM for review or approval.
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  • An authorized agency official who is at least one level higher than the employee’s supervisor must review and approve each determination to pay a recruitment or relocation incentive, unless there is no official at a higher level in the agency. See 5 CFR 575.107(b) and 575.207(b) for additional exceptions. We encourage agencies to delegate authority to approve incentives to the lowest level practicable to help respond more effectively to their staffing needs.
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