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RIF Avoidance Strategies When Downsizing and Restructuring

February 1, 1998
Related Topics: Downsizing, Managing Change, Featured Article
For an agency to efficiently and effectively restructure and/or downsize, it is critical that three management tools be in place to allow for proper planning and personnel utilization. These tools are:

  • Workforce forecasting
  • Position management
  • Skills analysis

Listed below is a glossary of options public agencies may consider when trying to downsize or restructure their workforce. While not all options will work for all situations, it is in the agency's interest to exercise all feasible alternatives whenever possible before resorting to reduction in force procedures. When evaluating the options, agencies should focus on the objective(s) for the change because this will determine which options are most likely to yield the desired results:

Certification of expected separation:
This is an early warning signal to employees that they stand a strong likelihood of being separated from their job within the next six months. Receiving this certification allows employees to register in the Interagency Placement Program (which may result in outplacement to another agency) and the Reemployment Priority List (which may result in outplacement to another part of the agency in the local commuting area). Issuance of this certification also allows participation in the Job Training Partnership Act, administered by the Department of Labor, which provides a wide range of outplacement and retraining services.

Contracting out:
Non-critical or non-full time functions or services can be contracted out on an as needed basis. This would eliminate or reduce the need for additional full time permanent employees.

Discontinued Service Retirement:
This retirement authority applies to employees whose jobs are abolished and who face involuntary separation. These employees may be given an immediate annuity if they meet early retirement eligibility (i.e. 25 years of service at any age or 20 years of service and at least 50 years of age).

Freeze hiring:
Freeze hiring from external sources or freeze movement into impacted area. This allows vacancies to be 'stockpiled' which can be used to place employees before or during a RIF, thereby avoiding or at least decreasing the number of employees affected by a RIF.

Freeze promotions:
Freeze career ladder promotions and merit promotion actions. This normally is combined with a hiring freeze of impacted positions.

Involuntary lay-offs without pay. The process used to furlough the workforce depends upon the length of the furlough. Furloughs if over 22 non-consecutive days or over 30 consecutive days require RIF procedures. Furloughs of less time fall under adverse action procedures (part 752). Furloughs are most appropriately used to meet a temporary fiscal shortfall rather than a permanent fiscal reduction.

Internal 'stopper' list:
A list of surplus employees who must be considered for positions within the organization before recruitment from other sources can occur. A qualified employee on this lisy may 'stop' management from filling this position from any other source.

Involuntary reduction of hours worked:
Management initiated reduction in the number of hours part-time and intermittent employees work. (note: this may require adverse action procedures if it was not part of the employment agreement.)

Job redesign:
Restructure the position to include new duties. Caution must be exercised if this restructuring results in grade level change. Job redesign may result in a need for retraining.

Job sharing:
Allows two or more employees to convert from full time to part-time and share the work of one or more positions. While the agency is responsible for the benefits package of each employee, the annual salary will be reduced by one position.

Management directed reassignment:
Reassignment initiated by management to a vacant position in another part of the organization or agency. This reassignment may be made to a position in the same or different commuting area and is not subject to RIF regulations as long as the employee is not reduced in grade. An employee who refuses this directed reassignment is subject to part 752 separation under adverse action procedures.

Non-permanent personnel actions and work schedule changes:
Avoid hiring additional permanent full time employees by using temporary and term appointments (whenever appropriate), details, temporary reassignments/promotions, or by increasing the number of hours part-time and intermittent employees work.

Optional retirement:
Encourage eligible employees to consider optional retirement although management must exercise caution between encouraging and coercing. Agencies may want to consider offering a decision making class on whether retirement is right for them at this time. Supplement the class with transition assistance services for those who opt to retire.

A good outplacement program can contribute significantly to reduce staff levels. This program may be limited to employees occupying impacted positions or may include the entire workforce which may provide additional placement opportunities for those who want to remain at the agency. Outplacement programs may be directed to other parts of an agency, other Federal agencies, or to the public and private sector.

Overtime instead of hiring new employees:
A viable option when the work is not of a continuing nature.

Reduce overtime expenditures:
Allow compensatory time off in lieu of overtime payment or place severe restraints on the use of overtime.

Reimbursable details:
Detail employees outside of the organization to perform reimbursable work. Reimbursement may include not only the employee’s salary but also the cost of benefits and overhead.

Retained grade/retained pay:
Agencies have the authority to grant retained pay whenever the employee’s pay is decreased as a result of a management action (i.e. reassignment from a special rate to a non-special rate position). Agencies may grant grade retention to employees who are or might be reduced in grade as a result of reorganization or reclassification. This may be offered to the employee on a ‘voluntary’ basis when it is in the interest of management. The employee may decline the offer and later compete under reduction in force procedures if they are invoked.

Training employees for skills in non-impacted positions (i.e. for another part of the agency or another agency). Retraining generally refers to updating skills which have become obsolete or training designed to equip individuals with the necessary skills to enter another occupation. Retraining generally focuses on competencies needed in a new or redesigned job.

Separate temporary employees and re-employed annuitants:
Both groups of employees may be separated at the will of the appointing official.

Temporary help services:
Used to meet manpower needs during periods of peak workload.

Temporary hires instead of permanent employees:
Allows maximum placement opportunities for impacted permanent employees in the event of a RIF because temporary appointments may be easily terminated.

Training programs:
Formalized training programs (i.e. intern, apprentice, or upward mobility) develop the skills of an agency’s workforce to meet future staffing needs. These programs provide avenues for employees with surplus or obsolete skills to make positive career transitions.

Voluntary change to lower grade:
Initiated on the part of the employee. This may allow the employee to remain in the same line of work (or change the line of work if that is the employee’s preference) or at the same work location when the current position is subject to abolishment or relocation.

Voluntary early retirement:
This retirement authority must be requested through the agency’s chain of command and approved by OPM. This allows individuals to retire with reduced age and/or service requirements (and under CSRS with an annuity reduction as well). Again, agencies can encourage attrition through this authority by offering a decision making class and transition support. Voluntary early retirement coupled with a voluntary separation incentive payment may enhance the number of separations considerably.

Voluntary leave without pay:
A request initiated by the employee for time off from work without pay.

Voluntary reassignment:
Reassignment out of the impacted area to another part of the organization or agency. This may be done through one-on-one negotiations or through the use of an internal placement program (i.e. surplus list or ‘stopper’).

Voluntary reduction in hours of work:
Voluntary changes on behalf of the employee from full time to part-time or intermittent. Voluntary request by a part-time employee to change to intermittent or to reduce the number of part-time hours worked.

Voluntary Separation Incentives:
Cash payments made to employees who voluntarily leave the Federal government. Agencies must have Congressional authority to offer this incentive. Presently there is a blanket authority for all agencies through March of 1995 (some agencies, such as the Department of Defense have individual buyout authorities which go beyond the March 1995 deadline). At present, the incentive is limited to severance pay entitlement of $25,000 whichever is less.

Waivers or modification of qualifications requirements:
Agencies have the authority to waive or modify (other than positive education requirements) qualification requirements for in-service placement to vacant positions.

SOURCE: U.S. Office of Personnel Management

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