Agencies Have More Wiggle Room to Spend on 3Rs in 2016

Relocation incentives will be one of tools agencies will have more leeway to use. Relocation incentives will be one of tools agencies will have more leeway to use. Stokkete /

The government’s human resources shop is giving agencies greater wiggle room in 2016 to spend money on recruiting and retaining talented employees.

The White House is cautiously lifting its four-year freeze on how much agencies can spend on recruitment, relocation and retention incentives for certain jobs, according to new guidance from Office of Personnel Management acting Director Beth Cobert.

“Agencies can now approve exceptions to the calendar year 2010 spending limit on the 3Rs for certain employees based on critical agency need,” said Cobert in the Jan. 15 memorandum to federal chief human capital officers. CHCOs, and human resources staff, “should clearly document the critical agency need” for any exceptions and be prepared to show the evidence to OPM and the Office of Management and Budget, Cobert wrote.

The memo specifically mentioned cybersecurity employees as an example of an occupation that could meet the critical agency need exception.

“OPM recognizes the 3Rs are essential pay flexibilities for agencies facing serious staffing challenges,” Cobert wrote. “Agencies may need to resort to more expensive solutions or may have difficulties accomplishing their missions if the 3Rs are not available for use.”

Agencies, including the Veterans Affairs Department, have used recruitment, relocation and retention incentives in recent years for mission-critical workforce needs in nursing and other health care occupations.

A 2011 OPM report found that the federal government paid out more than $349 million in the 3Rs in 2009 – a 22 percent increase over 2008. VA and the Defense Department were the biggest users of the incentives. OPM called for a review of agencies’ use of the tools; then-OPM Director John Berry issued a 2011 memo telling agencies to keep total spending on the incentives at 2010 levels through 2012. That directive subsequently was extended through 2015.

While agencies might view the latest guidance as a loosening of restrictions on recruitment, relocation and retention incentives – the first in recent years – it’s clear OPM wants to maintain accountability over spending, and the buck stops with CHCOs.  

“OPM and agencies, through their CHCO and/or HR director, have specific approval, oversight, and accountability responsibilities in administering the 3Rs program,” the memo stated. “This includes the requirement for agencies to establish a plan prescribing payment approval criteria and requirements, document thoroughly the basis for paying each incentive, and review all retention incentives and group recruitment incentives at least annually to determine whether they should be revised or discontinued.”

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