How to Recruit and Retain the Best Talent with the 3Rs

For Federal HR professionals and managers planning their staffing, there is good news to help you ensure that highly-qualified employees fill key government positions. As of this month, the 2011 spending cap that the Office of Personnel Management (OPM) and the Office of Management and Budget (OMB) placed on the 3Rs—recruitment, relocation, and retention incentives—has been lifted. Previously, agencies were required to ensure that any 3R spending did not exceed calendar year 2010 levels. This guidance expired at the end of 2015.

An announcement came out on January 15, when acting OPM Director Beth Cobert issued a memo on the use of the 3Rs during the 2016 calendar year. OPM will now allow exceptions for certain employees to receive incentives based on “a critical agency need.” This is a good sign, since agencies facing serious staffing challenges would otherwise have to turn to more expensive solutions, such as use of contractors, or else deal with the consequences of losing or lacking qualified staff who play key roles in helping the agency achieve its mission.

Use of the 3Rs in Federal Hiring

For a better understanding of the role of the 3Rs in Federal hiring, let’s take a quick look back at how the incentives have been used by various agencies in the past. Consider whether any of these situations apply to your staffing concerns today.

This data is available because in February 2010, OPM issued a memorandum to Chief Human Capital Officers (CHCOs) requesting that agencies submit their 2009 calendar year reports describing how each of the 3Rs was used and how this improved recruitment and retention.

The subsequent report to Congress, in which 96 agencies provided data on their use of the 3Rs, highlighted the main reasons agencies used these incentives:

• Target jobs that were hard to fill due to competing jobs in the private sector. Agencies found that Federal government positions in IT, economics, engineering, and cybersecurity cannot always compete with the private sector, where starting salaries for these fields in recent years have exceeded the GS-12 range and even several steps in the GS-13 range.
• Resolve hiring and retention problems in regions with a high cost of living, overseas, or remote regions. The Department of Energy used relocation incentives to motivate senior managers to change positions and to entice well-qualified technical and scientific employees to accept positions in locations that were isolated, had an expensive cost of living, or had economic barriers.
• Ease the difficulty of securing specialized talent in crucial professions. The emphasis on strengthening government cybersecurity, which is not possible without a very particular skillset, has led some agencies to leverage use of the 3Rs to hire specialized talent.
• Ensure agencies have the right workforce necessary to accomplish agency missions. The 3Rs are often used for employees in healthcare occupations who treat our nation’s military members and veterans.
• Retain key personnel who plan to retire from the Federal service. The Department of Justice used retention incentives for succession planning so that highly knowledgeable employees could engage in knowledge transfer through developing and positioning less experienced staff to move into leadership roles. Retention incentives for employees likely to leave for a different Federal position were on the rise, increasing from one incentive (for $1,602) in 2008 to 30 incentives (worth $127,244) in 2009.

Don’t Forget about Oversight and Accountability

No one in today’s world can expect Federal incentives to be offered without oversight and accountability measures. According to the OPM memo announcing the 2016 exceptions to the 3Rs spending limit, agencies, through their CHCO or Human Resources Director, are now required to:

1. Document the critical agency need justifying each 3R exception. Agencies must be prepared to provide information to OPM or OMB on approved exceptions upon request.
2. Establish a plan outlining payment approval criteria and requirements. They must thoroughly document the basis for paying each incentive, and review all retention and recruitment incentives at least annually to determine whether they should be revised or discontinued. The CHCO and/or HR Director—at a minimum—must approve the plan.

Three Tips for Leveraging the 3Rs

Here are three tips to help you leverage the 3Rs for growing human capital in your agency:

• Use the spending lift as an opportunity to learn more about your agency’s workforce planning. Learn more about your agency’s talent strategies. Revisit your agency’s organizational vision, mission, and purpose.
• Be proactive in recruitment and retention efforts. Reach out to your HR department (or to others within your HR group) to advocate for hiring or retaining crucial personnel. Become a part of the recruitment process. Build your talent pipeline.
• Be aware of crucial positions you need filled, and select wisely. You may be asked to perform a job analysis and/or assess candidates to contribute more to the recruitment and selection process

The three incentives of recruitment, retention, and relocation are essential tools in the Federal managers’ and HR professionals’ toolkit. Consider using the 2016 lift on the spending cap as an opportunity to support your agency’s strategic hiring and retention initiatives.