This summary of transfer of function covers the following topics:
1. Learning About Transfer of Function
The transfer of function regulations require that under certain conditions nontemporary employees have the right to move with their work to another organization if the alternative is separation or downgrading by reduction in force.
This summary covers the procedures in the transfer of function regulations. With this summary, employees, managers, employee representatives, and others will have an overview of both the agency's and employees' rights in a transfer of function or similar situation involving the transfer of positions from one organization to another.
The appropriate human resources office can provide additional information on specific questions relating to transfer of function policies, options, and entitlements.
2. Legal Basis for Transfer of Function
The transfer of function regulations are derived from section 3503 of title 5, United States Code. The regulations published in subpart C, part 351 of title 5, Code of Federal Regulations, implement the statute.
3. Transfer of Function Because of Organizational Change
A transfer of function takes place when a function ceases in one competitive area, and moves to one or more other competitive areas that do not perform the function at the time of transfer.
"Competitive Area" is a reduction in force term. The agency establishes each of its competitive areas on the basis of organization and geography. The "Summary of OPM's Reduction in Force Regulations" includes additional information on competitive area.
OPM's transfer of function regulations apply only when, after transfer, the gaining competitive area uses Federal employees to perform the function. For example, a transfer of function does not take place when after transfer the gaining competitive area performs the work through contract employees, a reimbursable agreement with a different competitive area, or by members of the Armed Forces. The movement of work solely within a competitive area is a reorganization, and is not a transfer of function.
4. Transfer of Function Because the Competitive Area Relocates
A transfer of function also takes place when the entire competitive area moves to a different local commuting area without any additional organizational change.
For example, a claims office in Baltimore, Maryland, is a stand-alone competitive area. A transfer of function takes place when the Baltimore claims office moves to Wilmington, Delaware (a different local commuting area), where the office continues as a separate stand-alone competitive area.
The "Summary of OPM's Reduction in Force Regulations" includes additional information on "Local Commuting Area." A local commuting area usually includes one population center in which employees live and reasonably travel back and forth to work. OPM's regulations do not define a mileage standard for local commuting area.
5. Interagency Transfer of Function
A transfer of function may be intra- or interagency. The transfer of function regulations use the same procedures for both types of transfers.
An interagency transfer of a function and/or personnel requires specific statutory authorization. Without a specific legislative basis, an agency has no authority to permanently transfer a function and/or personnel to another agency.
An intra-agency transfer of function does not require statutory authority.
6. Modifying Transfer of Function Rights
Congress has the authority to exempt intra- and interagency transfers of function from the transfer of function provisions. Congress may also modify the rights of employees involved in intra- or interagency transfers of function.
7. Employee's Right to Transfer With a Function
An employee has no right to transfer with the function unless the alternative in the competitive area losing the function is separation or demotion by reduction in force.
An agency may always direct an employee's reassignment to another position (regardless of location) in lieu of transfer of function rights. The vacant position may be in the same or in a different classification series, line of work, and/or geographic location. The "Summary of Reassignment" includes additional information on reassignment.
8. A Transfer of Function May Result in a RIF Action
If the transfer of function results in a surplus of employees in the gaining competitive area, before separation or demotion, with one exception covered in the next paragraph all employees who transfer with the function compete under the reduction in force regulations on equal terms with other employees in the gaining competitive area for available positions.
An employee whose position is transferred to the gaining competitive area for liquidation with a function that will not continue for more than 60 days does not compete under the reduction in force regulations for other positions in the gaining competitive area.
9. Transfer of Function Canvass Letters
When a transfer of function will result in employees moving to a different local commuting area, the losing competitive area may use a "Transfer of Function Canvass Letter" to determine which employees wish to be considered for positions in a different local commuting area. A transfer of function canvass letter does not guarantee an employee a position at the new location, but simply asks the employee to state an interest in transferring with the function.
The losing competitive area may use the canvass letter as the basis to separate an employee who declines to transfer with the function to a different local commuting area.
An employee who chooses not to transfer with the function has no right to be in reduction in force competition for other positions in the losing competitive area. However, at its option the losing competitive area may include the employee in a concurrent reduction in force.
An employee who initially chooses to transfer with the function may later reconsider and decline to transfer to the new location. However, an employee who declines to transfer with the function may not later change the original declination to an acceptance of the offer to transfer with the function to the new location.
An employee is generally eligible for relocation expense allowances for a transfer of function that requires relocation to a different local commuting area. The General Services Administration (GSA) publishes its Federal Travel Regulation (FTR) in 41 CFR subpart F. The complete FTR and other relocation-related information are available on GSA's website at www.gsa.gov. See "Additional Information from the Agency" in section 17 below.
10. Adverse Action Separation for Declining a Geographic Transfer of Function
The losing competitive area must use adverse action procedures to separate an employee who chooses not to transfer with the function to a different geographic location unless the losing competitive area at its option includes the employee in a concurrent reduction in force. If the employee chooses not to transfer with the function, the losing competitive area may not separate the employee any sooner than it transfers employees who choose to transfer to the gaining competitive area.
After receiving a separation notice, the employee becomes eligible for most of the benefits available to an employee who receives a notice of reduction in force separation (e.g., potentially eligible for intra- and interagency hiring priority, severance pay, discontinued service retirement, etc.). See "Additional Information from the Agency" in section 17 below.
An employee does not have the option of declining transfer to a position in the employee's present local commuting area.
11. Identifying Employees for Transfer
The losing competitive area identifies employees and positions for transfer with a function on the basis of each employee's official position. The regulations provide agencies with two procedures to identify employees for transfer with a function:
"Identification Method One"; and
"Identification Method Two."
12. Identification Method One
Under Identification Method One, the losing competitive area identifies an employee with a transferring function if:
The employee performs the function during at least half of the employee's work time; or
Regardless of the amount of time that the employee performs the function, the function includes the duties controlling the employee's grade or rate of pay (i.e., the grade controlling duties transferring with the function fully support the employee's grade or rate of pay).
13. Identification Method Two
The losing competitive area uses Identification Method Two only to identify positions and employees not covered by Identification Method One.
Under Identification Method Two, the losing competitive area identifies for transfer the number of employees it needs to perform the function.
To determine which employees are identified for transfer under Identification Method Two, the losing competitive area uses "Retention Registers" that list employees working on the function in the order of their respective reduction in force retention standing. The "Summary of OPM's Reduction in Force Regulations" includes additional information on retention registers.
Identification Method Two provides that the losing competitive area identifies employees with the lowest retention standing for transfer with the function. However, if this procedure would result in the employees' separation or demotion by reduction in force in the losing competitive area of an employee with a higher retention standing, the losing competitive area instead identifies employees with the highest retention standing for transfer.
14. Volunteers for Transfer
At their option, the losing and the gaining competitive areas can agree that volunteers may transfer with the function, provided that no employee identified for transfer under Identification Methods One or Two is later separated or demoted solely because a volunteer transferred in place of a properly identified employee to the gaining competitive area.
15. Transfer of Function Appeals
An employee may not file an appeal to the Merit Systems Protection Board based solely on a transfer of function issue. However, an employee who is reached for separation or demotion because of a reduction in force or an adverse action after declining transfer may raise transfer of function as in issue in that appeal.
The released employee must file the appeal no later than 30 days after the effective date of the reduction in force or adverse action. In some situations, an employee may not have the right to file an appeal to the Board because the negotiated grievance procedures contained in relevant collective bargaining agreement are the exclusive procedures for resolving any action that could otherwise be appealed to the Board (with some exceptions covered in the Board's regulations). The collective bargaining provides the time period for filing a grievance under the negotiated grievance procedures.
16. Realignment Actions That Are Not a Transfer of Function
An employee has no right to transfer with a function if, at the time of transfer, the gaining competitive area performs the same type of work as the function that is transferring from the losing competitive area. Also, an employee has no right to transfer if the function does not cease in the losing competitive area at the time of transfer. In these situations, the employee has a right to compete in a reduction in force in the losing competitive area if the agency does not offer the employee another position at the same grade. The offered position may be in the same or in a different local commuting area. The agency must use adverse action procedures to separate an employee who declines relocation (e.g., by reassignment, change of duty station, realignment, etc.) to a different local commuting area.
17. Additional Information from the Agency
The agency's human resources office can provide both employees and managers with additional information on OPM's transfer of function regulations. The office can also provide information on potential benefits, such as eligibility for:
18. Additional Information from OPM
OPM provides additional restructuring information on the OPM website at www.opm.gov.