Agencies must cap performance bonuses for career Senior Executive Service and senior-level scientific and technical employees to no more than 5 percent of respective aggregate salaries, top Obama administration officials said in newly issued fiscal 2014 budget guidance. For non-SES staff, overall bonus amounts are limited to 1 percent of aggregate salaries, according to the memo, posted Friday on the Office of Management and Budget website by OMB Director Sylvia Burwell and then-acting OPM Director Elaine Kaplan.
If another sequester-related budget cut takes effect, agencies must reduce their bonus pools proportionately, the memo adds.
Because Congress has yet to set final 2014 budget levels, agencies should be “prudent in their awards spending,” the memo adds. Although the 5 percent threshold does not apply to group awards, referral bonuses or suggestion and invention awards, those all remain frozen at 2010 levels, except for travel savings and foreign language awards.
The instructions echo policies first set in place two years ago for fiscal 2011 and 2012. At the time, administration officials voiced concern that bonuses were “broadly and inconsistently allocated,” while some federal employees had come to expect them as part of their compensation. As the first sequester round was above to take effect this part March, OMB told agencies to issue bonuses only if legally reguired. By law, however, SES bonuses may not be less than 5 percent of an employee’s base pay, Mathews and Kaplan said a footnote to this month’s memo.