First Look

USDA to switch to ‘pass-fail’ performance management system, new awards policy this fall

The Agriculture Department is finalizing a new performance management system, which will move employees from a five-tier system to a "pass-fail" program. The ne...

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The Agriculture Department is planning to drop its five-tier performance management system in favor of a two-tiered, pass-fail program later this fall.

The goal, according to a recent memo and outline detailing USDA’s anticipated changes, will free up time and resources for agency managers and supervisors to recognize top performance, said Stephen Censky, USDA’s deputy secretary.

Awards will be based on specific employee accomplishments and will be dispersed throughout the year, rather than six-to-12 months after the fact, according to the memo, which Federal News Network obtained.

“This change will make the performance and awards process at USDA much simpler so that we can spend less time writing long, complicated performance plans and more time actually managing performance and rewarding employees,” Censky said. “In the coming months, we will be finalizing a new departmental regulation outlining these changes, and I wanted to start talking to you about it now, so you have plenty of time to understand and prepare for the new system.”

The approach is a departure from long-time procedures across much of government, where federal employees receive one of five performance ratings ranging from “unacceptable” and “minimally successful” at the bottom, to “fully successful,” “superior” and “outstanding” at the top.

But under the new performance management system, USDA employees will receive one of two ratings: either “fully successful” or “unacceptable.” Employees must be “fully successful” on all performance elements to receive a “fully successful” final rating, according to the memo. If they’re considered “unacceptable” on any one performance element, employees will receive an “unacceptable” rating.

USDA managers and supervisors are no longer required to submit detailed “accomplishment reports” or lengthy performance evaluations at the end of the year, according to the memo. Instead, USDA rating officials will have the discretion to require them.

The agency declined to answer specific questions about the new performance management policy, citing the draft nature of the documents.

“USDA’s workforce is our most valuable asset and we are working to update our performance and awards policy to ensure that employees are treated fairly and their many achievements are properly recognized,” an agency spokesman said in an email to Federal News Network.

Don Bice, a former USDA deputy assistant secretary for administration, worked on the new performance management policy before leaving USDA earlier this spring. He said the new policy should give supervisors more time to manage and employees more time to focus on the mission.

Some federal employees often took pains to argue for higher performance ratings, even if their supervisor had deemed them as reasonably successful individuals.

“For some people, it’s going to free up a lot of time to do the work that they’re getting paid to do,” he said. “Employees [often argue], ‘am I a five or a four?’ We spend a lot of time as supervisors trying to differentiate between the highest performers, and we sometimes don’t deal with the poor performers. We spend a lot of effort on the fives and fours, and we really should be paying more attention to the people who are ones and twos, making sure they get to be threes and fours.”

Because the new policy would no longer require supervisors to give formal, written performance evaluations, it’ll be up to USDA managers to ensure they’re still giving feedback to their workforce.

Managers will have to make a concerted effort to ensure they’re not giving too little feedback to their employees, and training for the entire USDA workforce on the new performance management system will be key, Bice said.

“Once the policy is finalized, USDA will ensure that our employees and supervisors have training and other tools available to them to understand any changes,” the agency spokesman said.

Bice said the department was exploring new tools that USDA supervisors could use to easily and quickly give daily or weekly feedback to employees. An app, for example, could help supervisors give quick, regular performance feedback.

USDA would hand out employee awards year-round

Cash and time-off awards, which are currently based on individual performance ratings and are often given at the end of the year, will also change under USDA’s new policy.

Rather than rewarding all employees who received an “outstanding” or “superior” performance rating at the end of the year, supervisors and managers would hand out awards and bonuses to employees for their specific accomplishments throughout the year.

For Bice, the changes will allow employees to see a direct, timely connection between hard work and agency recognition.

“The further away from a specific activity that you want to reward [and] that give you an award, the less the employee thinks it’s connected,” he said. “End-of-the-year awards really aren’t that much of an encouragement for people for specific behaviors. It’s gets people to think, ‘oh yeah, I’m valued,’ which is great. But if there are specific things you want people to be awarded for, the closer in time that you make an award the more impactful it is.”

Moving forward, USDA will no longer base cash bonuses and time-off awards on employee performance ratings, and will instead recognize “specific accomplishments that exceed normal job requirements,” the memo said.

Time-off awards today expire after about a year and can’t transfer with employees who move to another USDA subcomponent. But under the future policy, the department will allow employees to carry up to 80 hours over to the following leave year. Employees who move to another USDA subcomponent can take time-off awards with them, the department said.

USDA is also taking some measures to slow the movement of quality step increases.

As usual, USDA will reserve quality step increases for the top 2% of non-executives.

But in the future, employees will be eligible for a step increase every two years; today employees are eligible annually.

To earn a step increase in the future, employees must achieve a performance rating of “fully successful” over consecutive years while in the same grade and type of position for at least 18 months. Their work must significantly exceed “normal expectations,” USDA said.

Fear of ‘reform fatigue’

USDA’s planned policy changes follow messages from the Trump administration, which has instructed agencies to streamline their performance management systems and search for more ways to reward the best of the best.

In the president’s proposed 2021 budget, the administration urged agencies to prioritize greater spending on specific employee accomplishments over across-the-board pay bumps. Those proposals, however, have earned criticism from employee unions.

The performance management policy is still in draft form, the USDA spokesperson said, and the department is reviewing the proposed changes with its two national unions. Many union collective bargaining agreements, at a minimum, describe the five current performance ratings and the expectations employees have to meet them, so USDA will need to negotiate proposed changes with labor representatives.

But the more difficult endeavor may be in assuring employees and their unions that USDA isn’t denying them chances to succeed and advance through the promotional system.

The American Federation of Government Employees declined to comment on the department’s upcoming performance management changes. USDA union representatives plan to submit a demand to bargain over the new policy, AFGE said.

The potential performance management changes are all part of the department’s OneUSDA initiative, which Secretary Sonny Perdue formally launched in 2018 in an effort to find and achieve consistencies across the organization. Some employees have been critical of past OneUSDA initiatives, with the 2018 reductions to the department’s telework program as perhaps the most notable example.

Bice acknowledged the USDA workforce had witnessed its fair share of change over the past three years, with everything from new email addresses to the move of two research agencies to Kansas City, Missouri.

USDA leadership were worried, Bice said, about the potential for “reform fatigue” among employees.

“That’s one thing that you always have to have in the back of your mind: Is too much change going to get in the way of achieving the mission?” he said. “I know that the secretary was really cognizant of that. I’m sure that they’ve made the determination that this is a change that people can further absorb.”

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