Sponsors
The bill creates a time‑limited, centrally overseen pilot that can reward higher-performing mid‑level federal employees and increase transparency and efficiency, but it also creates real pay‑loss risks, measurement and fairness challenges, and administrative burdens likely absorbed within existing agency budgets.
GS‑11 through GS‑15 and SL federal employees can join a 5‑year pilot that ties pay to measured performance, enabling higher performers to earn pay increases (up to 10%), discretionary bonuses, and receive regular training and quarterly feedback to improve job performance.
Agencies, OMB, and GAO can test a time‑limited, centrally overseen performance‑pay model with annual reporting and a final evaluation, increasing transparency and allowing Congress and taxpayers to judge whether performance pay improves productivity and accountability before any permanent adoption.
OMB recommendations and a centralized evaluation framework can promote more consistent performance metrics and operational improvements across agencies, which could raise efficiency and service quality for the public.
Participating employees face meaningful downside risk: failing to meet metrics can reduce an employee's basic pay by up to 10% and participants forfeit eligibility for standard Title 5 pay adjustments, step increases, bonuses, and awards while in the program, creating direct income loss and reduced long‑term pay progression.
Reliance on quantitative or standardized metrics (and public reporting) can incentivize throughput over complex or equitable work, encourage gaming or selective reporting, and produce inconsistent or unfair standards across agencies, harming job quality and service fairness.
Designing, implementing, monitoring, and reporting on agency‑specific metrics — plus OMB and GAO assessments — will require staff time and administrative resources that could be diverted from program delivery; because the law provides no new appropriations, agencies may shift funds from other services or delay other work to absorb these costs.
Based on analysis of 7 sections of legislative text.
Introduced January 3, 2025 by Claudia Tenney · Last progress January 3, 2025
Creates a five-year pilot that lets the Office of Management and Budget run a performance-based pay program for a small share (1–10%) of eligible GS-11 through GS-15 and senior federal employees. Participating agencies must use standardized productivity/quality/timeliness metrics, provide training and feedback, implement a three-tier pay adjustment system (raises up to 10%, no change, or a 10% pay cut), and report annual results to OMB and Congress using existing agency funds.