Defense Department set to issue new civilian employee awards by end of the month

By the end of the month, the Defense Department’s top civilian employees will likely get a sizable one-time bump in their paychecks.

In an effort to recognize and retain its top civilian employees, Defense Secretary Pete Hegseth directed the DOD’s component agency heads and principal staff assistants to designate monetary awards for the top 15 percent of performers in each of their agencies. 

The awards, outlined in a Dec. 15 memo and expected to be issued by Jan. 30, would be 15% to 25% of an employee’s basic pay, up to $25,000. The awards’ funding would come from each component agency’s budget under their respective awards authorities for their employee pay systems, such as the Senior Executive Service, Senior Professional, General Schedule, Federal Wage System and alternative personnel systems.

Hegseth said in the memo that the awards are meant to both recognize the DOD civilian workforce’s resilience during the new administration’s transition and the “severe strain” it had been put under during last year’s 43-day government shutdown. 

“I am enormously grateful for the incredible contributions of our entire civilian workforce, and I am proud to work with everyone in the Department, military and civilian, in defending our Nation,” he said in the memo. 

Who gets the awards and how much will be allotted will be determined by each component agency’s leader, in coordination with their financial management and comptroller groups for budget planning. 

Hegseth also said that if components want issue awards beyond the 15% threshold, they can reallocate internal budget resources to do so. 

The memo follows other recent high-performer retention incentives outlined by the DOD last year, coupled with a 5% to 8% reduction of its civilian workforce, or roughly 61,000 employees as part of a broader reorganization of the department.

Because the awards are considered personnel actions, recipients likely won’t be made public.