5 C.F.R. Subpart D—Performance Management
Title 5 - Administrative Personnel
(a) This subpart provides for the establishment in DoD of a performance management system as authorized by 5 U.S.C. 9902. (b) The performance management system established under this subpart is designed to promote and sustain a high-performance culture by incorporating the following elements: (1) Adherence to merit principles set forth in 5 U.S.C. 2301; (2) A fair, credible, and transparent employee performance appraisal system; (3) A link between the performance management system and DoD's strategic plan; (4) A means for ensuring employee involvement in the design and implementation of the system; (5) Adequate training and retraining for supervisors, managers, and employees in the implementation and operation of the performance management system; (6) A process for ensuring ongoing performance feedback and dialogue among supervisors, managers, and employees throughout the appraisal period, and setting timetables for review; (7) Effective safeguards to ensure that the management of the system is fair and equitable and based on employee performance; (8) A means for ensuring that adequate agency resources are allocated for the design, implementation, and administration of the performance management system; and (9) A pay-for-performance evaluation system to better link individual pay to performance, and provide an equitable method for appraising and compensating employees. (a) This subpart applies to eligible DoD employees and positions in the categories listed in paragraph (b) of this section, subject to a determination by the Secretary under §9901.102(b)(2), except as provided in paragraph (c) of this section. (b) The following employees and positions in DoD organizational and functional units are eligible for coverage under this subpart: (1) Employees and positions who would otherwise be covered by 5 U.S.C. chapter 43; (2) Employees and positions who were excluded from chapter 43 by OPM under 5 CFR 430.202(d) prior to the date of coverage of this subpart; and (3) Such others designated by the Secretary as DoD may be authorized to include under 5 U.S.C. 9902. (c) This subpart does not apply to employees who have been, or are expected to be, employed in an NSPS position for less than a minimum period (as defined in §9901.404) during a single 12-month period. When a specified category or group of employees is covered by the performance management system(s) established under this subpart, the provisions of 5 U.S.C. chapter 43 are waived with respect to that category of employees. In this subpart— Appraisal means the review and evaluation of an employee's performance. Appraisal period means the period of time established under a performance management system for reviewing employee performance. Competencies has the meaning given that term in §9901.103. Contribution has the meaning given that term in §9901.103. Minimum period means the period of time established by the Secretary during which an employee will perform under applicable performance expectations before receiving a rating of record. Pay-for-performance evaluation system means the performance management system established under this subpart to link individual pay to performance and provide an equitable method for appraising and compensating employees. Performance has the meaning given that term in §9901.103. Performance expectations means the duties, responsibilities, and competencies required by, or objectives associated with, an employee's position and the contributions and demonstrated competencies management expects of an employee, as described in §9901.406(d). Performance management means applying the integrated processes of setting and communicating performance expectations, monitoring performance and providing feedback, developing performance and addressing poor performance, and rating and rewarding performance in support of the organization's goals and objectives. Performance management system means the policies and requirements established under this subpart, as supplemented by implementing issuances, for setting and communicating employee performance expectations, monitoring performance and providing feedback, developing performance and addressing poor performance, and rating and rewarding performance. It incorporates the elements set forth in §9901.401(b). Rating of record has the meaning given that term in §9901.103. Unacceptable performance has the meaning given that term in §9901.103. (a) The Secretary will issue implementing issuances that establish a performance management system for DoD employees, subject to the requirements set forth in this subpart. (b) The NSPS performance management system will— (1) Specify the employees covered by the system(s); (2) Provide for the appraisal of the performance of each employee at least annually; (3) Specify the minimum period during which an employee will perform before being eligible to receive a rating of record; (4) Hold supervisors and managers accountable for effectively managing the performance of employees under their supervision as set forth in paragraph (c) of this section; (5) Specify procedures for setting and communicating performance expectations, monitoring performance and providing feedback, and developing, rating, and rewarding performance; and (6) Specify the criteria and procedures to address the performance of employees who are detailed or transferred and for employees in other special circumstances. (c) In fulfilling the requirements of paragraph (b) of this section, supervisors and managers are responsible for— (1) Clearly communicating performance expectations and holding employees responsible for accomplishing them; (2) Making meaningful distinctions among employees based on performance and contribution; (3) Fostering and rewarding excellent performance; (4) Addressing poor performance; and (5) Assuring that employees are assigned a rating of record when required by implementing issuances. (a) Performance expectations will support and align with the DoD mission and its strategic goals, organizational program and policy objectives, annual performance plans, and other measures of performance. (b) Performance expectations will be communicated in writing, including those that may affect an employee's retention in the job. Performance expectations will be communicated to the employee prior to holding the employee accountable for them. However, notwithstanding this requirement, employees are always accountable for demonstrating professionalism and standards of appropriate conduct and behavior, such as civility and respect for others. (c) Performance expectations for supervisors and managers will include assessment and measurements of how well supervisors and managers plan, monitor, develop, correct, and assess subordinate employees' performance. (d) Performance expectations may include— (1) Goals or objectives that set general or specific performance targets at the individual, team, and/or organizational level; (2) Organizational, occupational, or other work requirements, such as standard operating procedures, operating instructions, manuals, internal rules and directives, and/or other instructions that are generally applicable and available to the employee; and (3) Competencies an employee is expected to demonstrate on the job, and/or the contributions an employee is expected to make. (e) Performance expectations may be amplified through particular work assignments or other instructions (which may specify the quality, quantity, accuracy, timeliness, or other expected characteristics of the completed assignment, or some combination of such characteristics). Such assignments and instructions need not be in writing. (f) Supervisors will involve employees, insofar as practicable, in the development of their performance expectations. However, final decisions regarding performance expectations are within the sole and exclusive discretion of management. In applying the requirements of the performance management system and its implementing issuances and policies, supervisors will— (a) Monitor the performance of their employees and their contribution to the organization; and (b) Provide ongoing (i.e., regular and timely) feedback to employees on their actual performance with respect to their performance expectations, including one or more interim performance reviews during each appraisal period. (a) Implementing issuances will prescribe procedures that supervisors will use to develop employee performance and to address poor performance. (b) If at any time during the appraisal period a supervisor determines that an employee's performance is unacceptable, the supervisor will— (1) Consider the range of options available to address the performance deficiency, which include, but are not limited to, remedial training, an improvement period, a reassignment, an oral warning, a letter of counseling, a written reprimand, or adverse action as defined in subpart G of this part, including a reduction in rate of basic pay or pay band; and (2) Take appropriate action to address the deficiency, taking into account the circumstances, including the nature and gravity of the unacceptable performance and its consequences. (c) As specified in subpart H of this part (or other appropriate appeal procedures, if not covered by subpart H of this part, such as procedures for National Guard Technicians under 32 U.S.C. 709(f)), employees may appeal adverse actions (e.g., suspensions of more than 14 days, reductions in pay and pay band, and removal) based on unacceptable performance and/or conduct. (a) The NSPS performance management system will establish a multi-level rating system as described in the implementing issuances. (b) An appropriate rating official will prepare and issue a rating of record after the completion of the appraisal period. In accordance with implementing issuances, an additional rating of record may be issued to reflect a substantial and sustained change in the employee's performance since the last rating of record. A rating of record will be used as a basis for— (1) A pay determination under any applicable pay rules; (2) Determining reduction in force retention standing; and (3) Such other action that the Secretary considers appropriate, as specified in implementing issuances. (c) A rating of record will assess an employee's performance with respect to his or her performance expectations, as amplified through work assignments or other instructions, and/or relative contributions and is considered final when issued to the employee with all appropriate reviews and signatures. (d) An appropriate rating official will communicate the rating of record and number of shares to the employee prior to payout. (e) A rating of record issued under this subpart is an official rating of record for the purpose of any provision of title 5, Code of Federal Regulations, for which an official rating of record is required. Ratings of record will be transferred between subordinate organizations and to other Federal departments or agencies in accordance with implementing issuances. (f) The Secretary may not lower the rating of record of an employee based on an approved absence from work, including the absence of a disabled veteran to seek medical treatment as provided in Executive Order 5396. (g) A rating of record may be challenged by a nonbargaining unit employee only through a reconsideration process as provided in implementing issuances. This process will be the sole and exclusive method for all nonbargaining unit employees to challenge a rating of record. A payout determination will not be subject to the reconsideration process. (h) A bargaining unit employee may choose a negotiated grievance procedure or the administrative reconsideration process established under paragraph (g) of this section, but not both, to challenge his or her rating of record. An employee who chooses the administrative reconsideration process may not revert to a negotiated grievance procedure. A payout determination will not be subject to the negotiated grievance procedure. Any individual or panel reviewing a rating of record under a negotiated grievance procedure may not conduct an independent evaluation of the employee's performance, determine the appropriate share payout, or otherwise substitute his or her judgment for that of the rating official. (i) A supervisor or other rating official may prepare an additional performance appraisal for the purposes specified in the applicable performance management system (e.g., transfers and details) at any time after the completion of the minimum period. Such an appraisal is not a rating of record. (j) Implementing issuances will establish policies and procedures for crediting performance in a reduction in force in accordance with subpart F of this part (or other appropriate workforce shaping procedures for those not covered by subpart F of this part, such as National Guard Technicians under 32 U.S.C. 709).
Title 5: Administrative Personnel
PART 9901—DEPARTMENT OF DEFENSE HUMAN RESOURCES MANAGEMENT AND LABOR RELATIONS SYSTEMS
Subpart D—Performance Management
§ 9901.401 Purpose.
§ 9901.402 Coverage.
§ 9901.403 Waivers.
§ 9901.404 Definitions.
§ 9901.405 Performance management system requirements.
§ 9901.406 Setting and communicating performance expectations.
§ 9901.407 Monitoring performance and providing feedback.
§ 9901.408 Developing performance and addressing poor performance.
§ 9901.409 Rating and rewarding performance.
