To be recognized as the best, we must recognize and reward the best in our employees. Pay for Performance & Performance Management System Veterans Health Administration February 26, 2008

Three Elements of Pay Base Pay Market Pay Performance Pay

What is performance pay? A component of compensation paid to recognize the achievement of specific goals and performance objectives Not an Incentive Award

Performance Pay The amount payable may not exceed the lower of  $15,000 or  The amount equal to 7.5% of the annual pay (base + market) on September 30 th of the fiscal year

Performance Pay Process  Objectives communicated 90 days of the beginning of the fiscal  Newly hired communicated within 30 days of entrance on duty  Physicians & Dentist hired after July 1 are not eligible within that fiscal year

Performance Pay Process  Physicians & Dentist that separate prior to September 30 are not eligible  Payments disbursed no later than March 31 of the following year

VHA Performance Management Established evidence-based performance measures based on overall strategic goals and hold accountable and reward line senior executives for achievement Developed and implemented the High Performance Development Model & workforce succession programs

Senior Executive Performance System ECF Performance System VA 5-level Performance System VHA Performance Management

ECF Performance System  ECF members – senior management, mid- management, first line management, senior staff positions

VHA Performance Management ECF Performance System  Cycle begins October 1 & ends September 30  Minimum appraisal period is 90 days under performance plan

VA Strategic Plan VHA Strategic Plan Goals & Performance Measures Chief Officer Performance Plans Subordinate Senior Exec. Performance Plans VHA Performance Management Align Performance

VHA Performance Management Plan Structure  Mission Critical Measures/Business Plan (critical)  Transformational Measures (non-critical)  High Performance Development Model (HPDM) Core Competencies (critical)  Additional HPDM Core Competencies (non- critical)

VHA Performance Management  Summary Ratings: Outstanding = All elements exceptional. Excellent = All critical elements exceptional; one other element fully successful. Fully Successful = All critical elements fully successful; other elements fully successful or higher.

VHA Performance Management  Summary Ratings Continued: Minimally Satisfactory = All critical elements fully successful. One or more non- critical elements less than fully successful. Unsatisfactory = One or more critical elements less than fully successful.

VHA Performance Management Funding  ECF bonus pool is based on the number of ECF members assigned to the organization  Funds are distributed based on ECF calculations in the Performance Database

VHA Performance Management Bonus Pool Range  Senior Executive pool determined by the Secretary  Senior Manager - $2,500 to $10,000  Mid-manager - $1,500 to $7,500  Front-line - $750 to $5,000 Note: Bonuses may not be awarded for a rating below the fully successful level

VHA Performance Management References:  Performance Pay – VA Handbook 5007/21, Part IX, section 12  Performance Management System – VA Handbook 5013  Other Sources: Employee Recognition & Awards – VA Handbook 5017

VHA Performance Management Contacts:  Pay for Performance: Anika Woods – George Neureither –  Performance Management System Elias Hernandez – Anika Woods –

VHA Performance Management QUESTIONS?