AGENCY:

Office of Personnel Management.

ACTION:

Proposed rule with request for comments.

SUMMARY:

The Office of Personnel Management (OPM) is issuing proposed regulations governing the appointment and employment of administrative law judges (ALJs). The proposed rule will implement Executive Order (E.O.) 13843 titled “Excepting Administrative Law Judges from the Competitive Service.” These proposed revisions update the rules for ALJ hiring in light of the new Schedule E of the excepted service for ALJs and update the existing ALJ employment regulations to reflect other recent changes in the law.

DATES:

Comments must be received on or before November 20, 2020.

ADDRESSES:

You may submit comments, identified by document number and/or Regulation Identification Number (RIN) “3206-AN72” and title using any of the following methods:

Federal Rulemaking Portal: http://www.regulations.gov. Follow the instructions for submitting comments. All submissions received through the Portal must include the agency name and docket number or RIN for this rulemaking.

Instructions: All submissions received must include the agency name and docket number or Regulatory Information Number (RIN) for this rulemaking. All comments received will be posted without change to regulations.gov, including any personal information provided.

Docket: For access to the docket to read background documents or comments received, go to regulations.gov.

FOR FURTHER INFORMATION CONTACT:

Roseanna Ciarlante by telephone at (267) 392-8640 or Katika Floyd by telephone at (202) 606-0960; by email at employ@opm.gov; by fax at (202) 606-4430; or by TTY at (202) 418-3134.

SUPPLEMENTARY INFORMATION:

Background and Authority for this Rulemaking

ALJs serve as independent impartial triers of fact in formal proceedings requiring a decision on the record after the opportunity for a hearing. In general, ALJs prepare for and preside at formal proceedings required by statute to be held under or in accordance with provisions of the Administrative Procedure Act (APA), codified, in relevant part, in sections 553 through 559 of title 5, United States Code (U.S.C.). ALJs rule on preliminary motions, conduct pre-hearing conferences, issue subpoenas, conduct hearings (which may include written and/or oral testimony and cross-examination), review briefs, and prepare and issue decisions, along with written findings of fact and conclusions of law.

The Federal Government employs ALJs in a number of agencies throughout the United States. Previously, appointments to the position of ALJ have been made through competitive examination and competitive service selection procedures.^[1] As recognized by the Supreme Court in Lucia v. Securities and Exchange Commission, 138 S. Ct. 2044 (2018) at least some ALJs are “inferior Officers” of the United States and thus subject to the Constitution's Appointments Clause, which governs who may appoint such officials. In accordance with the Constitution, in such instances, Congress has vested the appointment of ALJs in the heads of departments or agencies. Although such department or agency head may rely on agency human resource officials or other staff to assess applications, conduct interviews, and the like, the final appointment must be made or approved by the department or agency head; this authority cannot be delegated. On July 10, 2018, the President signed Executive Order (E.O.) 13843 titled, “Excepting Administrative Law Judges from the Competitive Service” (83 FR 32755). E.O. 13843 states “that conditions of good administration make necessary an exception to the competitive hiring rules and examinations for the position of ALJ. These conditions include the need to provide agency heads with additional flexibility to assess prospective appointees without the limitations imposed by competitive examination and competitive service selection procedures.” Section 2 of the Executive Order specifies that all appointments of administrative law judges made on or after July 10, 2018 must be made under Schedule E of the excepted service.^[2] Section 3(a) of the Executive Order amended Civil Service Rule VI to shift new hiring of ALJs from the competitive to the excepted service.

Section 3(b) of the Executive Order directed OPM to issue transitional guidance, and OPM issued explanatory guidance on the E.O. on July 10, 2018. See OPM Memorandum to Heads of Departments and Agencies, Executive Order—Excepting Administrative Law Judges from the Competitive Service, available at https://chcoc.gov/​transmittals. OPM later issued more specific guidance to agencies on the ALJ loan program (August 1, 2018), on promotions and reassignments of ALJs (August 27, 2018), and on the termination of the ALJ register and discontinuance of the ALJ examination (Sept. 20, 2018). OPM published a Fact Sheet: Administrative Law Judge (ALJ) Positions on August 19, 2019, available at https://www.opm.gov/​services-for-agencies/​administrative-law-judges/​fact-sheet-administrative-law-judge-alj-positions-posted.pdf.

Section 3(b) of the Executive Order also directed OPM to “adopt such regulations as the Director determines may be necessary to implement this order, including, as appropriate, amendments to or rescissions of regulations that are inconsistent with, or that would impede the implementation of, this order, giving particular attention to 5 CFR part 212, subpart D; 5 CFR part 213, subparts A and C; 5 CFR 302.101; and 5 CFR part 930, subpart B.” OPM is proposing rules for the newly created Schedule E hiring of ALJs. The proposed regulations make several significant changes to the recruitment, appointment, and movement of ALJs based on E.O. 13843 and formalize OPM's prior explanatory guidance. As described in detail below, OPM is also proposing other changes to comply with other recent changes in the law.

OPM is proposing these regulations pursuant to this instruction, the Civil Service Rules, and OPM's own statutory authority to regulate the ALJ program, which includes, inter alia, sections 1103(a)(5)(A), 1305, 3323(b)(2), and 5372(c) of title 5, U.S.C.

Summary of the Proposed Changes

Removal of References to the Competitive Examination

In light of the Executive Order, OPM terminated the ALJ competitive service register, its centralized list of eligible ALJ applicants, as the Executive Order ended the need for competitive examination, rating and ranking, and selection from competitive certificates of eligibles issued by OPM. Therefore, OPM proposes to remove references to the ALJ competitive examination throughout subpart B of 5 CFR part 930.

In particular, the text of the current regulations recites that ALJs are appointed in the competitive service and that OPM is responsible for examining ALJ candidates and producing registers of qualified ALJ applicants from which agencies make selections in accordance with the provisions of subpart B of 5 CFR part 930. The proposed rule aligns the text of OPM's regulations to the changes the President effected through E.O. 13843. The proposed rule changes reflect that OPM will no longer conduct recruitment and competitive examinations of ALJ candidates for employment in Federal agencies, and that agencies will no longer select ALJ candidates from competitive certificates of eligibles issued by OPM.

Excepted Appointments of ALJs

As noted above, the proposed rule removes references to appointments in the competitive service. Instead, the proposed rule, conforming to E.O. 13843, recites that any ALJ selected (with the application of veterans' preference as far as administratively feasible) on or after July 10, 2018, must be appointed by the head of the hiring agency ^[3] and placed in an ALJ position in the excepted service. Consistent with Civil Service Rule VI, as amended by section 3(a) of the E.O., the proposed rule creates a new Schedule E in the excepted service specific to ALJs, except that an individual encumbering an ALJ position in the competitive service on July 10, 2018, shall remain in the competitive service while he or she remains in the position (and will continue to be subject to the same conditions pertaining to appointment in the competitive service).

Recruitment

OPM's current regulations do not address requirements for job opportunity announcements for ALJs, because the requirements for job opportunity announcements for competitive service positions generally are set forth in 5 U.S.C. 3330 and in 5 CFR part 330, subpart A. OPM's August 17, 2019 transitional guidance explains that although the excepted service has no requirement to post a USAJOBS announcement or to follow the job posting requirements for competitive service positions, the merit system principles (5 U.S.C. 2301) apply to excepted service recruiting. Accordingly, agencies should tell potential applicants about ALJ vacancies, recruit in a manner to attract a sufficient pool of qualified applicants, and recruit in a manner that allows all qualified and eligible employees to apply for higher-level positions.

OPM proposes to codify this guidance in the regulations. We note that this is consistent with E.O. 11478 of August 8, 1969, as amended, Equal Opportunity in the Federal Government, 42 U.S.C. 2000e note and similar to Administrative Conference Recommendation 2019-2, Agency Recruitment and Selection of Administrative Law Judges (para. 1), 84 FR 38927, 38930-31 (Aug. 8, 2019).

Movement Between Agencies or Appointment After a Period of Separation

OPM is proposing through this rule that an ALJ serving in the competitive service who accepts a new ALJ appointment at another agency on or after July 10, 2018, moves from the competitive service to an ALJ position under Schedule E of the excepted service, instead of transferring to another competitive service position. Likewise, a former ALJ who held a position in the competitive service prior to separation cannot be reinstated to an ALJ position in the competitive service, and must be given a new excepted appointment. The proposed rule recognizes that transfer and reinstatement are no longer available for ALJ appointments because these actions are exclusively competitive service appointment methods and accordingly, are no longer available for ALJ appointments.

Qualifications of ALJs in the Excepted Service

Section 1 of the E.O. states that excepting the position of ALJ from the competitive service “will give agencies greater discretion to assess critical qualities in ALJ candidates, such as work ethic, judgment, and ability to meet the particular needs of the agency,” and to conduct assessments “without proceeding through complicated and elaborate examination processes and rating procedures that do not necessarily reflect the agency's particular needs.”

Under the proposed rule, the heads of agencies, not OPM, are authorized to assess prospective appointees for ALJ positions in their respective agencies without consideration of the competitive hiring rules and examination process. This provides agency heads with greater flexibility to assess critical qualities in ALJ applicants and determine whether an ALJ applicant meets the particular needs of the hiring agency. Appointments of ALJs are made pursuant to Schedule E of the excepted service, but are not subject to the provisions of OPM's regulations in 5 CFR part 302 governing appointments in the excepted service, including examination and rating requirements. However, an agency head must apply the principle of veterans' preference “as far as administratively feasible” when filling ALJ positions.

Civil Service Rule VI, as amended by section 3(a) of the E.O., adopts, as a “minimum standard of appointment to the position of administrative law judge,” the bar licensure requirement that OPM previously prescribed through regulation in 5 CFR 930.204(b), and permits “additional agency requirements” for qualifications “where appropriate.” This means the minimum qualification and licensure requirement for an ALJ position is the possession of a professional license to practice law and being authorized to practice law under the laws of a State, the District of Columbia, the Commonwealth of Puerto Rico, or any territorial court established under the United States Constitution at the time of selection and any new appointment (other than of an incumbent ALJ to another ALJ position). Judicial status is acceptable in lieu of “active” status in States that prohibit sitting judges from maintaining “active” status to practice law, and being in “good standing” also is acceptable in lieu of “active” status in States where the licensing authority considers “good standing” as having a current license to practice law.

The proposed rule therefore continues only the existing bar licensure requirement as the minimum standard for appointment and explains that agency heads may prescribe additional requirements as appropriate.

Effect of a Promotion or Reassignment

E.O. 13843 provides that “[a]ppointments of ALJs shall be made under Schedule E of the excepted service,” but that “[i]ncumbents of this position who are, on July 10, 2018, in the competitive service shall remain in the competitive service as long as they remain in their current positions.” Thus, as long as an ALJ in the competitive service on July 10, 2018, remains in the position of ALJ, and does not require a new appointment, he or she remains in the competitive service. Under generally-applicable regulations, the internal reassignment or promotion of an officer or employee by his or her agency involves only a position change, and does not involve a new appointment under civil service law. 5 CFR 210.102; see als o 5 CFR 335.101. This rule also applies to ALJs as well as employees in other pay systems. See 70 FR 75745, 75746 (Dec. 21, 2005). Therefore, under the proposed rule, and consistent with OPM's transitional guidance, an ALJ reassigned or promoted within his or her agency remains in the competitive service, as long as he or she remains an ALJ. In this circumstance, an agency must process and record the personnel action as a reassignment or promotion in the competitive service, not as an appointment in the excepted service.

However, because some ALJs were deemed to have constitutional status as inferior officers of the United States under the Supreme Court's decision in Lucia v. Securities and Exchange Commission, OPM's transitional guidance instructed agencies that where a promotion or reassignment would involve a significant position change, such as a promotion to a position classified at a higher level (AL-1 or AL-2), a reassignment to a different bureau within the same department, or a reassignment to perform a significantly different kind of work (e.g., a change from presiding over ex parte cases to presiding over trials, or from adjudicating benefits cases to adjudicating regulatory enforcement cases), the agency's request for OPM to approve the action must document that the head of the requesting agency approved the promotion or reassignment. OPM's transitional guidance further instructed that this documentation is not necessary for routine geographic reassignments, or for the advancement of an ALJ's rate within pay level AL-3. This documentation requirement also does not require a change in the ALJ's status from the competitive service to the excepted service. The proposed rule formalizes these instructions.

Pay and Position Classification

ALJ pay administration and position classification are governed by 5 U.S.C. 5372, which assigns responsibility to OPM and makes no distinction between competitive service and excepted service ALJs. The proposed rule, therefore, makes no distinction between competitive and excepted service ALJs with respect to OPM's pay administration and position classification responsibility.

Adverse Actions and Personnel Vetting Requirements

Adverse actions against ALJs are governed by 5 U.S.C. 7521, subject to regulations issued by the Merit Systems Protection Board (MSPB) under 5 U.S.C. 1305. These provisions likewise make no distinction between competitive service and excepted service ALJs. Therefore, under the proposed rule, the MSPB procedures prescribed in 5 U.S.C. 7521 and 5 CFR part 1201 will apply to an agency action to remove, suspend, reduce in level, reduce pay, or furlough for 30 days or less an ALJ in the competitive or excepted service (i.e., adverse action).

The current regulations provide that appointment as an ALJ is subject to the competitive service suitability requirements in 5 CFR part 731. OPM is amending these requirements due to changes in the law since the provisions were last amended in 2007. First, E.O. 13764 of January 23, 2017 amended Civil Service Rules II and V, authorizing OPM to prescribe minimum standards of fitness of character and conduct for excepted service appointments, and to require such appointments to be subject to a risk-based position designation and a corresponding background investigation under OPM-prescribed standards. E.O. 13764 also amended Civil Service Rule VI to make excepted service appointments “subject to the suitability and fitness requirements of the applicable Civil Service Rules and Regulations,” namely, Civil Service Rules II and V. (E.O. 13843 subsequently acknowledged that this requirement applies to “the position of administrative law judge.”) Finally, E.O. 13764 amended an earlier executive order, E.O. 13467 of June 30, 2008, to give the Director of National Intelligence, as the Security Executive Agent, the authority to prescribe investigative, adjudicative, and continuous vetting requirements for eligibility for access to classified information and for employment in a sensitive position; and to give the Director of OPM, as the Suitability and Credentialing Executive Agent, the authority to do the same for suitability, fitness, and eligibility for an identity credential. The Executive Order assigns this responsibility to ODNI and OPM for both competitive and excepted service positions, including, inter alia, ALJ positions. The proposed rule incorporates these changes.

OPM's current regulations state that a removal or other action against an ALJ on grounds of suitability under part 731 is not subject to the statutory removal procedure in 5 U.S.C. 7521. OPM is eliminating this provision. In Archuleta v. Hopper, 786 F.3d 1340 (Fed. Cir. 2015), the Court of Appeals for the Federal Circuit ruled that, where an employee is covered by the statutory removal procedure in 5 U.S.C. chapter 75, subchapter II, that procedure governs his or her removal even if it is on grounds of suitability under the Civil Service Rules and OPM's regulations in 5 CFR part 731, because (at the time of the court's decision) the definition of an “adverse action” in 5 U.S.C. 7512 did not explicitly exclude a suitability action. Subsequently, in section 1086 of Public Law 114-92, the National Defense Authorization Act for FY 2016, Congress amended 5 U.S.C. 7512 to explicitly exclude an OPM suitability action from the definition of an adverse action in 5 U.S.C. 7512. Accordingly, suitability-based removals of employees who are covered by subchapter II are not subject to the statutory adverse action procedures. However, Congress did not make a corresponding amendment to 5 U.S.C. 7521, defining an “adverse action” for purposes of 5 U.S.C. chapter 75, subchapter III, which covers ALJs. Thus, while an ALJ may be subject to an unfavorable suitability determination, the removal action should follow the statutory procedure. The proposed rule retains references to other exceptions to 5 U.S.C. 7521 that have been prescribed by statute.

OPM's current regulation describes the use of administrative leave when an adverse action is pending. The Administrative Leave Act of 2016, section 1138 of Public Law 114-328, established new types of paid non-duty status in 5 U.S.C. 6389a and 6389b, namely, notice leave and investigative leave. OPM proposes to update the regulation to reflect this change. OPM has proposed separate rulemaking to implement the Administrative Leave Act, at 82 FR 32263 (July 13, 2017).

Performance Ratings, Awards, and Incentives

The regulations in 5 CFR 930.206 currently provide that an agency may not rate the job performance of an ALJ and may not grant any monetary or honorary award or incentive under 5 U.S.C. 4502, 4503, 4504, or any other authority, to an ALJ. Sections 1305 and 4305 of title 5, U.S.C. give OPM the responsibility to regulate the statutory prohibition on appraising the performance of ALJs—found in 5 U.S.C. 4301(2)(D)—without regard to whether ALJs are in the competitive service or the excepted service. Accordingly, under the proposed rule, the prohibition against rating the job performance of an ALJ remains in effect for ALJs in the competitive and excepted service.

OPM proposes revisions to this section, however, to clarify the incentives and similar payments for which an ALJ, whether in the competitive or excepted service, is ineligible. Specifically, the proposed rule clarifies that an ALJ is not eligible for recruitment, relocation, or retention incentives under 5 U.S.C. 5753 and 5754 because the regulations in 5 CFR part 575, subparts A, B, and C, require an eligible employee to have or maintain a rating of record of at least “Fully Successful” or equivalent to receive an incentive. Similarly, the proposed rule further establishes that ALJs are not eligible for the student loan repayment program because, under 5 U.S.C. 5379(d)(2) and 5 CFR 537.108(a)(2), an employee must maintain an acceptable level of performance to receive student loan repayment benefits. An ALJ cannot meet the requirements for these incentives and payments because an agency may not rate the job performance of an ALJ in either the competitive or excepted service.

ALJ Loan Program

In accordance with 5 U.S.C. 3344, OPM administers an Administrative Law Judge Loan Program that coordinates the loan/detail of an administrative law judge from one agency to another. Section 3344 makes no distinction between competitive service and excepted service ALJs. The proposed rule, like OPM's transitional guidance, makes clear OPM continues its responsibilities under this Program whether ALJs are in the competitive or excepted service. However, because some ALJs were deemed to have constitutional status as inferior officers of the United States under the Supreme Court's decision in Lucia, OPM's transitional guidance instructed agencies that, upon accepting the services of a loaned ALJ, the receiving agency must provide to OPM, as soon as practicable, documentation that the head of that agency made, approved, or ratified the loan of the ALJ. Likewise, the agency lending the ALJ must provide OPM with documentation that the ALJ's appointment was originally made or approved, or later ratified, by the head of that agency. This documentation requirement does not require a change in the ALJ's status from the competitive service to the excepted service. The proposed rule formalizes these instructions.

Senior ALJ Program

The Senior ALJ Program allows retired ALJs to be reemployed on a temporary or irregular basis to complete hearings of one or more specified case(s). Upon appointment, and while reemployed, the retired ALJ is referred to as a Senior ALJ. The proposed rule clarifies that an agency that temporarily reemploys a retired ALJ must use the newly created Schedule E excepted service appointment. It also clarifies that Senior ALJs appointed prior to July 10, 2018 remain in the competitive service for the duration of their appointment, including any extension periods authorized by OPM. OPM approval procedures have not otherwise changed with respect to reemploying retired ALJs, since the statute governing the Senior ALJ Program, 5 U.S.C. 3323(b)(2), assigns program responsibility to OPM and makes no distinction between competitive service and excepted service senior ALJs after they have been appointed.

Reduction in Force.

The proposed rule amends the ALJ reduction in force (RIF) regulations currently described at 5 CFR 930.210. When implementing a reduction in force, the provisions in this section are a supplement to the RIF provisions in 5 CFR part 351 that have separate provisions for the treatment of competitive service and excepted service positions. The existing rule, which references part 351, makes clear that competitive service ALJs are subject to the provisions of 5 CFR part 351 that apply to competitive service employees and that excepted service ALJs are subject to the provisions of 5 CFR part 351 that apply to excepted service employees.

The proposed amendment establishes procedures for placement assistance for ALJs reached in an agency's reduction in force for those in both the competitive and excepted service. Under the proposed changes, an agency is required to establish an administrative law judge priority reemployment list and provide consideration to ALJs on its administrative law judge priority reemployment list before it may consider candidates on its regular employment lists, with certain exceptions.

Summary of Proposed Changes by Section

Changes Proposed for 5 CFR Part 212

We propose to amend the authority citation to add a reference to E.O. 13843. OPM is retaining the existing reference to E.O. 10577, but adding a corresponding reference to 5 CFR part 6. From 1954 until the early 1980s, the organic Civil Service Rules were set forth in E.O. 10577 and amended from time to time by the President. However, in recent decades, the practice has been for the President to amend the Civil Service Rules and, at the same time, directly amend a corresponding part in chapter I, subchapter A of title 5, Code of Federal Regulations without also further amending E.O. 10577. Since the Civil Service Rules are the product of both of these methods of presidential rulemaking, both E.O. 10577 and the corresponding part in 5 CFR chapter I, subchapter A should be cited as authority for OPM's regulation.

Proposed § 212.401(b) adds the newly established Schedule E in the excepted service to the list of Schedules already in the rule. This provides that an employee in the competitive service at the time his or her position is first listed in schedule A, B, C, or E remains in the competitive service while occupying the position.

Changes Proposed for 5 CFR Part 213

The authority citation is revised to include E.O. 13843 and 5 CFR part 6, and to correct the citation to E.O. 13562.

Subpart A of 5 CFR part 213 General provisions is revised to include the Schedule E authority in § 213.102, and to clarify that appointments to Schedule E must be made on a permanent basis in accordance with part 930.

Subpart C of 5 CFR part 213 Excepted schedules is revised by establishing Schedule E as a new schedule in part 213. Proposed § 213.3501 is labeled “Positions of administrative law judge appointed under 5 U.S.C. 3105.” This proposed section explains the reasoning and basis for appointments under Schedule E and requires that all appointments of ALJs on or after July 10, 2018 must be made under this excepted service authority in accordance with the provisions in subpart B of 5 CFR part 930.

Changes Proposed for 5 CFR Part 302

The authority citation is revised to include references to 5 U.S.C. 3317, 3318, and 3320 (in accordance with recent case law arising in a different context, see 81 FR 86290, 86291 (Nov. 30, 2016)), and to E.O. 13843 and 5 CFR part 6.

We propose to add ALJs to the list of positions in § 302.101(c) that are exempt from the appointment procedures of 5 CFR part 302, and for which agencies shall apply the principle of veterans' preference as far as administratively feasible.

Changes Proposed for 5 CFR Part 930

The proposed rule makes extensive changes to 5 CFR part 930.

The proposed rule revises the authority citation for subpart B of part 930 by adding references to E.O. 13843 and 5 CFR parts 2, 5, and 6, as well as to 5 U.S.C. 1103(a)(5)(A) (OPM's general substantive rulemaking authority) and 5 U.S.C. 4305 (which, together with 5 U.S.C. 1305, authorizes OPM to regulate the exception from performance appraisals for ALJs).

The proposed rule deletes, from the authority citation, references to 5 U.S.C. 1104(a) (pertaining to the ALJ examination) and 1302(a) (pertaining to competitive examinations).

Proposed § 930.201 is revised throughout to add references to the excepted service. Paragraph (b) is revised to make clear that, as of July 10, 2018, appointments of ALJs must be made under Schedule E of the excepted service in § 213.3501. Paragraph (c) makes clear that ALJs appointed prior to July 10, 2018, remain in the competitive service as long as they remain in their positions, including when they are subject to actions within their agencies that do not result in a new appointment (including details, assignments, reassignments, pay adjustments, and promotions). The proposed rule also states that no new appointments of ALJs may be made to the competitive service after July 9, 2018. Paragraph (e) establishes OPM's authority with respect to the ALJ program. This paragraph is revised to delete references to OPM's authority to recruit and examine ALJ applicants, to approve transfers and reinstatements to competitive service positions, and to maintain a central priority reemployment list, and to clarify that OPM's authority to classify positions under 5 U.S.C. 5372 includes the authority to approve classifications.

We propose to change the text in paragraphs (e) and (f), stating that OPM has “the authority to . . . [e]nsure the independence of the administrative law judge” and that the employing agency has “[t]he responsibility to ensure the independence of the administrative law judge.” The revised text states that OPM has the authority, and the agency has the responsibility, to “[e]nsure the qualified independence of the administrative law judge, and to faithfully administer the structural protections designed to ensure the impartiality of the administrative law judge.” This is a clarifying change because the current reference to “ensuring the independence of the administrative law judge” encompasses two concepts: qualified decisional independence, and the statutory, structural protections designed to ensure judges' impartiality by limiting agency control in matters of position classification, pay, performance management, case assignment, and tenure. See, e.g., Ramspeck v. Fed. Trial Examiners Conf., 345 U.S. 128 (1953).

We propose removing and reserving § 930.203 Cost of competitive examination, since OPM no longer conducts the examination. Under the current regulation each agency is charged a pro rata share of the examination cost, based on the actual number of administrative law judges the agency employs; and under OPM's Revolving Fund statute each agency is also charged a corresponding share for program administration costs (e.g., for administering the ALJ Loan and Senior ALJ programs, review of position descriptions and job opportunity announcements, approval of noncompetitive actions, and FOIA/Privacy Act activity). While this funding method for program administration must continue for the time being as a matter of appropriations law, the end of the examination has prompted OPM to rethink its funding method for the program. OPM is considering requesting the use of appropriated funds, instead of agency payments under the Revolving Fund, to fund its program costs. OPM seeks comment on the appropriate funding method and plans to amend this section after careful consideration of the feasibility of a new funding method and consideration of public comments.

In § 930.204 Appointments and conditions of employment, paragraph (a) is revised to make clear that ALJs are appointed on a permanent full-time basis, with the exception of appointments to the Senior ALJ Program, and to address requirements for excepted service appointments. Paragraph (a)(1) includes information on ALJ appointments under Schedule E, and paragraph (a)(2) clarifies that ALJs appointed prior to July 10, 2018, remain in the competitive service under the conditions described in § 930.201(c). Information about hiring from competitive certificates is removed.

Section 930.204(b), Licensure, continues the existing licensure requirement for competitive service ALJ appointments, which E.O. 13843 has now extended to excepted service as the minimum standard for ALJ appointments. New § 930.204(c) sets forth the qualification requirements for competitive service and excepted service ALJs. Paragraph (c)(1) addresses the qualifications for competitive service ALJs. OPM is retaining this information, even though E.O. 13843 does not permit new competitive service appointments, because it may be relevant to reconstructing past selections. Paragraph (c)(2) addresses the agency-specific requirements permitted by E.O. 13843 for excepted appointments. Existing provisions are renumbered accordingly.

Current § 930.204(g), Reinstatement, is proposed to be redesignated and recaptioned as § 930.204(j) Appointment of a former administrative law judge. The proposed revisions to paragraph (j) make clear that any reappointments of ALJs must be made under Schedule E of part 213 in the excepted service. Current § 930.204(h)—Transfer, is proposed to be redesignated as § 930.204(k) and recaptioned as Movement between agencies. The proposed revisions to paragraph (k) make clear that any movements of ALJs between agencies must be made to positions under Schedule E of part 213 in the excepted service in the gaining agency. The proposed revisions to this paragraph also require that the hiring agency inform an ALJ that such a move will place him or her in the excepted service, and requires the gaining agency to obtain a written statement from the ALJ that the ALJ understands he or she will be leaving the competitive service for an appointment in the excepted service.

Proposed § 930.204(g), Promotion to a higher level, is currently § 930.204(e). The text is amended to address promotions of excepted-service ALJs, including application of agency policies and the need to document agency head approval in a request to OPM; and to ensure that incumbent ALJs have an opportunity to be considered for promotion to higher-level positions when the agency considers external applicants.

Reclassification of ALJs is addressed in proposed § 930.204(h).

Reassignment of ALJs, currently addressed in § 930.204(f), is addressed in proposed § 930.204(j). The text is amended to explain the circumstances when an agency's request to OPM for approval of the reassignment must document that the head of the requesting agency approved it.

Paragraph (l) is added to § 930.204 to address recruitment and vacancy announcements.

The proposed rule amends § 930.205, Administrative law judge pay system, by including a statement that makes clear this section applies to ALJ positions in both the competitive and excepted services. The proposed rule modifies paragraph (b) by removing the reference to ALJ positions “filled through a competitive examination,” and replacing it with the words “at the entry level.” The proposed rule amends paragraph (f)(2)(i) by removing the words “who is within reach for appointment from an administrative law judge certificate of eligibles” and replacing them with “who meets the minimum qualification and licensure requirement in paragraph (b) and any agency-specific requirements established under paragraph (c)(2).” The proposed rule amends paragraph (f)(2)(ii) by removing the words “who is eligible for reinstatement” and replacing them with “who is eligible for appointment under Schedule E and meets the minimum qualification and licensure requirement in paragraph (b) and any agency-specific requirements established under paragraph (c)(2).”

The proposed rule modifies § 930.206, Performance rating and awards, by inserting the words “in the competitive or excepted service.” Paragraph (b) is proposed to be modified by adding 5 U.S.C. 4505, 4505a, 5379, 5753, and 5754 to the list of provisions under which ALJs may not be granted “any monetary or honorary award, incentive, or similar payment.”

The proposed rule modifies § 930.207, Details and assignments to other duties within the same agency, to clarify that details that will last more than 120 days, and details exceeding more than a total of 120 days in a 12-month period, require OPM approval regardless of whether the ALJs are in the competitive or excepted service.

The proposed rule modifies § 930.208, Administrative law judge loan program-detail to other agencies, to make clear that OPM administers the ALJ loan program for loans/details of an ALJ in both the competitive and excepted services. The proposed rule also adds two new paragraphs to § 930.208. New paragraph (e) requires the loaning agency to furnish OPM with documentation stating that the loaned ALJ's appointment was originally made, approved, or later ratified by the head of the agency. New paragraph (f) similarly requires the receiving agency of a loaned ALJ to provide documentation to OPM, as soon as practicable, stating that the head of the agency made, approved, or ratified the loan of the ALJ.

The proposed rule modifies several provisions in § 930.209, Senior Administrative Law Judge Program. The proposed rule modifies paragraph (b)(2) by removing the current language and replacing it with a reference to the licensure, qualification, and vetting requirements prescribed under § 930.204(b) through (g). The proposed rule amends paragraph (c) by adding the phrase “under Schedule E of § 213.3501 of this chapter” to make clear that reemployed ALJ annuitants are appointed to positions in the excepted service. The proposed rule amends paragraph (d) to specify that an agency's request to OPM for a senior ALJ must document that the appointment will be made or approved by the head of the requesting agency.

OPM is proposing to amend § 930.210, Reduction in force. ALJs serving in Schedule E appointments in the excepted service will be subject to the provisions of 5 CFR part 351 specific to excepted service employees. ALJs in the competitive service remain subject to the provisions of 5 CFR part 351 specific to competitive service employees. Thus, the existing rule makes clear that for RIF purposes agencies use competitive service procedures for ALJs in the competitive service and excepted service procedures for ALJs in the excepted service to determine who will remain in their current positions. In either case, the rule makes clear that an agency may not use performance as a factor for purposes of retention standing in subpart E of 5 CFR part 351.

The proposed rule also requires agencies to establish procedures for placement assistance for ALJs reached in an agency's RIF. Agencies are required to establish a priority reemployment list and provide consideration to ALJs on its priority reemployment list before it may consider candidates on its regular employment lists, with certain exceptions. This will replace the current procedure under which OPM maintains a central, government-wide priority referral list. The agency-specific approach we are proposing is more in keeping with the excepted hiring model established by E.O. 13843. There are currently no names on the OPM list, so no individuals will be adversely affected by this change.

These new placement procedures will apply to ALJs in positions in both the competitive and the excepted service. However, the proposed rule also clarifies that displaced competitive service ALJs also will be eligible for consideration for non-ALJ competitive service positions pursuant to 5 CFR part 330, subpart B.

Lastly, OPM proposes to amend § 930.211, Actions against administrative law judges. The proposed rule amends paragraph (b)(4) to reference the use of notice leave, investigative leave, or administrative leave under the Administrative Leave Act of 2016, and amends paragraph (c) to remove a reference to actions taken under 5 CFR part 731.

Regulatory Flexibility Act

I certify that this regulation will not have a significant impact on a substantial number of small entities because it applies only to Federal agencies and employees.

E.O. 13563 and E.O. 12866, Regulatory Review

Executive Orders 13563 and 12866 direct agencies to assess all costs and benefits of available regulatory alternatives and, if regulation is necessary, to select regulatory approaches that maximize net benefits (including potential economic, environmental, public health and safety effects, distributive impacts, and equity). Executive Order 13563 emphasizes the importance of quantifying both costs and benefits, of reducing costs, of harmonizing rules, and of promoting flexibility. This rule has been designated a “significant regulatory action,” under Executive Order 12866 and has been reviewed by OMB.

Executive Order 13771, Reducing Regulation and Controlling Regulatory Costs

This proposed rule is not expected to be subject to the requirements of E.O. 13771 (82 FR 9339, February 3, 2017) because it is expected to impose no more than de minimis costs.

Unfunded Mandates Reform Act of 1995

This rule will not result in the expenditure by state, local, and tribal governments, in the aggregate, or by the private sector, of $100 million or more in any year and it will not significantly or uniquely affect small governments. Therefore, no actions were deemed necessary under the provisions of the Unfunded Mandates Reform Act of 1995.

E.O. 13132, Federalism

This regulation will not have substantial direct effects on the States, on the relationship between the National Government and the States, or on distribution of power and responsibilities among the various levels of government. Therefore, in accordance with Executive Order 13132, it is determined that this rule does not have sufficient federalism implications to warrant preparation of a Federalism Assessment.

E.O. 12988, Civil Justice Reform

This regulation meets the applicable standard set forth in section 3(a) and (b)(2) of Executive Order 12988.

Congressional Review Act

This action pertains to agency management, personnel, and organization and does not substantially affect the rights or obligations of nonagency parties and, accordingly, is not a “rule” as that term is used by the Congressional Review Act (Subtitle E of the Small Business Regulatory Enforcement Fairness Act of 1996 (SBREFA)). Therefore, the reporting requirement of 5 U.S.C. 801 does not apply.

Paperwork Reduction Act

This rule does not impose any new reporting or record-keeping requirements subject to the Paperwork Reduction Act.

List of Subjects in 5 CFR Part 212, 213, 302, and 930

• Government employees

Accordingly, the Office of Personnel Management proposes to amend title 5, Code of Federal Regulations parts 212, 213, 302, and 930 as follows:

PART 212—COMPETITIVE SERVICE AND COMPETITIVE STATUS

1. Revise the authority citation for part 212 to read as follows:

Authority: 5 U.S.C. 1302, 3301, 3302; E.O. 10577, 3 CFR, 1954-1958 Comp., p. 218; E.O. 13843, 83 FR 32755; 5 CFR part 6.

Subpart D—Effect of Competitive Status on Position

2. Amend § 212.401 by revising paragraph (b) to read as follows:

PART 213—EXCEPTED SERVICE

3. Revise the authority citation for part 213 to read as follows:

Authority: 5 U.S.C. 3161, 3301 and 3302; E.O. 10577, 3 CFR 1954-1958 Comp., p. 218; E.O. 13562, 3 CFR, 2010 Comp., p. 291; E.O. 13843, 83 FR 32755; 5 CFR part 6; Sec. 213.101 also issued under 5 U.S.C. 2103. Sec. 213.3102 also issued under 5 U.S.C. 3301, 3302, 3307, 8337(h), and 8456; E.O. 13318, 3 CFR 1982 Comp., p. 185; 38 U.S.C. 4301 et seq.; Pub. L. 105-339, 112 Stat 3182-83; E.O. 13162; E.O. 12125, 3 CFR 1979 Comp., p. 16879; and E.O. 13124, 3 CFR 1999 Comp., p. 31103; and Presidential Memorandum—Improving the Federal Recruitment and Hiring Process (May 11, 2010).

Subpart A—General Provisions

4. Amend § 213.102 by revising the heading and paragraph (b)(3)(i) to read as follows:

5. Amend § 213.103 by revising the heading and paragraph (a) to read as follows:

Subpart C—Excepted Schedules

6. At the end of subpart C, add undesignated heading and § 213.3501 to read as follows:

Schedule E

PART 302—EMPLOYMENT IN THE EXCEPTED SERVICE

7. Revise the authority citation for part 302 to read as follows:

Authority: 5 U.S.C. 1302, 3301, 3302, 3317, 3318, 3320, 8151, E.O. 10577 (3 CFR 1954-1958 Comp., p. 218); E.O. 13843, 83 FR 32755; 5 CFR part 6; § 302.105 also issued under 5 U.S.C. 1104, Pub. L. 95-454, sec. 3(5); § 302.501 also issued under 5 U.S.C. 7701 et seq.

Subpart A—General Provisions

8. Amend § 302.101 by adding paragraph (c)(12) to read as follows:

PART 930—PROGRAMS FOR SPECIFIC POSITIONS AND EXAMINATIONS (MISCELLANEOUS)

Subpart B—Administrative Law Judge Program

9. Revise the authority citation for part 930, subpart B to read as follows:

Authority: 5 U.S.C. 1103(a)(5)(A), 1305, 3105, 3301, 3304, 3323(b), 3344, 3502, 4301(2)(D), 4305, 5372, 7521; E.O. 10577, 3 CFR, 1954-1958 Comp., p. 219; E.O. 13843, 83 FR 32755; 5 CFR parts 2, 5, 6.

10. Revise § 930.201 to read as follows:

11. Remove and reserve § 930.203:

12. Revise § 930.204 to read as follows:

13. Amend § 930.205 by adding a sentence to the beginning of paragraph (a), and by revising paragraphs (b) and (f)(2) to read as follows:

14. Revise § 930.206 to read as follows:

15. In § 930.207, revise paragraph (a) to read as follows:

16. In § 930.208, revise paragraph (a) and add paragraphs (e) and (f) to read as follows:

17. Amend § 930.209 by revising paragraphs (b)(2), (c), (d)(3) and (4), and adding paragraphs (d)(5) and (h) to read as follows:

18. Amend § 930.210 by revising paragraphs (a) and (c) to read as follows:

19. Amend § 930.211 by revising paragraphs (b)(4) and (c) as follows:

Footnotes