Federal Employee Performance and Accountability Act of 2025
- Bill Number
- S. 359
- Origin Chamber
- Senate
- Congress
- 119th Congress, Session 1
- Policy Area
- Government Operations and Politics
- Status
- Introduced
- Latest Action
- 2025-02-03: Read twice and referred to the Committee on Homeland Security and Governmental Affairs.
- Last Updated
- 2025-12-05T22:49:11Z
AI-Generated Summary
Purpose
The Federal Employee Performance and Accountability Act of 2025 (S. 359) establishes a 5-year pilot program to create a performance-based pay system for select federal employees. The goal is to boost productivity, increase accountability, and improve job satisfaction in public service roles by linking pay adjustments directly to measurable performance outcomes.
Key Provisions
- Eligibility and Scope:
- Applies to "eligible employees" in executive agencies (as defined in U.S. law), specifically those at General Schedule (GS) levels 11 through 15 or senior-level positions above GS-15.
- Eligible roles must have clear, measurable performance criteria, such as project management, policy analysis, IT/finance/procurement specialists, leadership/supervisory positions, customer service, or claims processing.
- Each executive agency must enroll 1% to 10% of its eligible employees, unless the agency head opts out due to national security or public safety risks (with a written justification required).
- The program runs for 5 years, starting 180 days after enactment, overseen by the Director of the Office of Management and Budget (OMB).
- Performance Measurement:
- Agencies set annual "performance metrics" tailored to their operations, focusing on productivity (e.g., output like completed projects), quality (e.g., accuracy and customer satisfaction), and timeliness (e.g., meeting deadlines).
- A standardized evaluation system includes regular reviews; agencies must provide training, resources, and quarterly feedback to help employees meet standards.
- Incentive Pay Structure:
- Tiered system based on annual evaluations, starting from the second year:
- Tier 1 (Exceeds Expectations): 15% pay increase; optional bonuses, flexible scheduling, telework, or other perks (e.g., better equipment or parking).
- Tier 2 (Meets Expectations): No pay change.
- Tier 3 (Below Expectations): 15% pay reduction, plus required training or development to improve.
- Participants are ineligible for standard federal pay raises, step increases, or bonuses under Title 5 of the U.S. Code (which governs most federal employee compensation) during the program.
- Reporting and Oversight:
- Agencies submit annual reports to OMB on productivity gains, cost savings, efficiency, public service improvements, and employee satisfaction.
- OMB conducts yearly assessments and reports to Congress on program outcomes, including budget effects.
- After the program ends, the Government Accountability Office (GAO) and OMB will evaluate its overall success and report to Congress.
- Funding: No new money is authorized; all costs come from existing agency budgets.
Significant Changes to Existing Law
- Introduces a direct link between individual performance and pay adjustments, replacing or suspending routine annual pay raises, within-grade step increases, and certain bonuses under Title 5, U.S. Code, for participants only.
- Allows for pay reductions (up to 15%) for underperformance, which is not standard in current federal pay systems that typically focus on increases or protections against cuts.
- Creates a temporary pilot framework with opt-out provisions and mandatory reporting, differing from permanent, uniform pay structures across the federal workforce.
Potential Impacts
- On Government Agencies: Could lead to higher efficiency and cost savings through better performance, but may increase administrative workload for developing metrics, conducting evaluations, and providing training. Opt-outs protect sensitive areas like security, minimizing risks there.
- On Citizens: Potential for improved public services, such as faster processing of claims or better customer support, due to incentivized productivity and quality.
- On Federal Employees: May motivate high performers with raises and perks, enhancing satisfaction, but risks demotivating others through pay cuts or exclusion from standard benefits; training support aims to mitigate this.
- No direct impacts on international relations are outlined.
Main Stakeholders
- Federal Employees: Particularly mid-to-senior level workers in measurable roles (participating employees), who face both opportunities for advancement and risks of pay reduction.
- Executive Agencies: Agency heads must implement the program (or justify opting out), manage evaluations, and report outcomes.
- Office of Management and Budget (OMB): Oversees the program, sets evaluation standards, reviews reports, and advises Congress.
- Congress: Receives annual and final assessments to decide on future expansions or changes.
- Government Accountability Office (GAO): Conducts the post-program review.
- Unions and Employee Groups: Indirectly affected, as the program alters pay rules without mention of collective bargaining involvement.
Notable Legal, Constitutional, or Political Implications
- Legal: The pilot temporarily modifies Title 5 pay rules, creating a carve-out for participants that could face challenges if seen as inconsistent with broader federal compensation laws; opt-outs ensure flexibility but require transparency to avoid arbitrary decisions.
- Constitutional: Pay reductions for underperformance might raise due process concerns (under the Fifth Amendment) if evaluations are not fair or appealable, though the bill's standardized system and training provisions aim to address this.
- Political: As a pilot, it allows testing of merit-based reforms without permanent overhaul, potentially appealing to advocates of government efficiency but controversial among those worried about employee morale or politicization of performance metrics; bipartisan sponsors (e.g., Sens. Blackburn, Tillis, Ricketts) suggest cross-aisle interest in accountability.
This summary was generated by AI and may contain inaccuracies. Refer to the official source document for the authoritative text.
Sponsor
Cosponsors (2)
Sen. Tillis, Thomas [R-NC], Sen. Ricketts, Pete [R-NE]
Recent Actions
- 2025-02-03: Read twice and referred to the Committee on Homeland Security and Governmental Affairs.
- 2025-02-03: Introduced in Senate
Bill Versions
- Federal Employee Performance and Accountability Act of 2025 — issued 2025-02-03 — PDF (10 pages)