02-03 16:57 H.B. 404
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Pay for Performance Management System Amendments
2025 GENERAL SESSION
STATE OF UTAH
Chief Sponsor: Stephanie Gricius
Senate Sponsor:
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LONG TITLE
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General Description:
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This bill amends provisions related to the pay for performance management system.
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Highlighted Provisions:
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This bill:
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▸ allows an independent entity to opt into participating in the pay for performance
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management system;
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▸ amends which employees of eligible agencies may participate in the pay for performance
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management system; and
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▸ makes technical and conforming changes.
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Money Appropriated in this Bill:
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None
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Other Special Clauses:
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None
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Utah Code Sections Affected:
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AMENDS:
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63A-17-106, as last amended by Laws of Utah 2024, Chapter 397
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63A-17-112, as last amended by Laws of Utah 2024, Chapter 397
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63A-17-301, as last amended by Laws of Utah 2024, Chapter 397
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Be it enacted by the Legislature of the state of Utah:
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Section 1. Section 63A-17-106 is amended to read:
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63A-17-106 . Responsibilities of the director.
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(1) As used in this section, "miscarriage" means the spontaneous or accidental loss of a
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fetus, regardless of gestational age or the duration of the pregnancy.
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(2) The director shall have full responsibility and accountability for the administration of
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the statewide human resource management system.
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(3) Except as provided in Section 63A-17-201, an agency may not perform human resource
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functions without the consent of the director.
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(4) Statewide human resource management rules made by the division in accordance with
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Title 63G, Chapter 3, Utah Administrative Rulemaking Act, shall take precedence if
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there is a conflict with agency rules, policies, or practices.
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(5) The division may operate as an internal service fund agency in accordance with Section
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63J-1-410 for the human resource functions the division provides.
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(6) The director shall:
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(a) develop, implement, and administer a statewide program of human resource
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management that will:
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(i) aid in the efficient execution of public policy;
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(ii) foster careers in public service for qualified employees; and
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(iii) render assistance to state agencies in performing their missions;
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(b) design and administer the state pay plan;
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(c) design and administer the state classification system and procedures for determining
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schedule assignments;
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(d) design and administer the state recruitment and selection system;
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(e) administer agency human resource practices and ensure compliance with federal law,
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state law, and state human resource rules, including equal employment opportunity;
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(f) consult with agencies on decisions concerning employee corrective action and
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discipline;
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(g) maintain central personnel records;
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(h) perform those functions necessary to implement this chapter unless otherwise
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assigned or prohibited;
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(i) perform duties assigned by the governor, executive director, or statute;
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(j) make rules for human resource management, in accordance with Title 63G, Chapter
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3, Utah Administrative Rulemaking Act;
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(k) establish and maintain a management information system that will furnish the
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governor, the Legislature, and agencies with current information on authorized
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positions, payroll, and related matters concerning state human resources;
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(l) conduct research and planning activities to:
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(i) determine and prepare for future state human resource needs;
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(ii) develop methods for improving public human resource management; and
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(iii) propose needed policy changes to the governor;
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(m) study the character, causes, and extent of discrimination in state employment and
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develop plans for its elimination through programs consistent with federal and state
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laws governing equal employment opportunity in employment;
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(n) establish compensation policies and procedures for early voluntary retirement;
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(o) confer with the heads of other agencies about human resource policies and
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procedures;
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(p) submit an annual report to the executive director, the governor, and the Legislature;
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and
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(q) assist with the development of a vacant position report required under Subsection
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63J-1-201(2)(b)(vi).
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(7)(a) After consultation with the executive director, the governor, and the heads of
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other agencies, the director shall establish and coordinate statewide training
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programs, including training described in Subsection (7)(e).
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(b) The programs developed under this Subsection (7) shall have application to more
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than one agency.
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(c) The division may not establish training programs that train employees to perform
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highly specialized or technical jobs and tasks.
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(d) The division shall ensure that any training program described in this Subsection (7)
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complies with Title 63G, Chapter 22, State Training and Certification Requirements.
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(e)(i) As used in this Subsection (7)(e):
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(A) "Employee" [ ]means [the same as that term is defined in Section 63A-17-112]
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an employee included in an agency's pay for performance policy adopted in
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accordance with Section 63A-17-112.
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(B) "Supervisor" means an individual in a position at an agency, as defined in
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Section 63A-17-112, that requires the regular supervision and performance
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evaluation of an employee.
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(ii) A supervisor shall attend the training:
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(A) within six months of being promoted or hired to the position of supervisor; and
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(B) at least annually.
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(iii) A supervisor's completion of training and effective use of training information
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and principles shall be considered in an evaluation of the supervisor's job
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performance.
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(iv) The training shall include:
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(A) effective employee management and evaluation methods based on the pay for
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performance management system described in Section 63A-17-112;
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(B) instruction to improve supervisor and employee communications;
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(C) best practices for recognizing and retaining high-performing employees;
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(D) best practices for addressing poor-performing employees; and
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(E) any other information and principles identified by the division to improve
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management or organizational effectiveness.
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(8)(a)(i) The division may collect fees for training as authorized by this Subsection (8).
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(ii) Training funded from General Fund appropriations shall be treated as a separate
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program within the department budget.
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(iii) All money received from fees under this section will be accounted for by the
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department as a separate user driven training program.
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(iv) The user training program includes the costs of developing, procuring, and
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presenting training and development programs, and other associated costs for
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these programs.
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(b)(i) Funds remaining at the end of the fiscal year in the user training program are
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nonlapsing.
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(ii) Each year, as part of the appropriations process, the Legislature shall review the
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amount of nonlapsing funds remaining at the end of the fiscal year and may, by
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statute, require the department to lapse a portion of the funds.
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(9) Rules described in Subsection (6)(j) shall provide for at least three work days of paid
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bereavement leave for an employee:
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(a) following the end of the employee's pregnancy by way of miscarriage or stillbirth; or
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(b) following the end of another individual's pregnancy by way of a miscarriage or
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stillbirth, if:
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(i) the employee is the individual's spouse or partner;
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(ii)(A) the employee is the individual's former spouse or partner; and
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(B) the employee would have been a biological parent of a child born as a result of
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the pregnancy;
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(iii) the employee provides documentation to show that the individual intended for
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the employee to be an adoptive parent, as that term is defined in Section
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78B-6-103, of a child born as a result of the pregnancy; or
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(iv) under a valid gestational agreement in accordance with Title 78B, Chapter 15,
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Part 8, Gestational Agreement, the employee would have been a parent of a child
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born as a result of the pregnancy.
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Section 2. Section 63A-17-112 is amended to read:
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63A-17-112 . Pay for performance management system -- Employees paid for
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performance.
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(1) As used in this section:
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(a)(i) "Agency" means, except as provided in Subsection [(1)(a)(ii)] (1)(a)(iii), the
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same as that term is defined in Section 63A-17-102.
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(ii) "Agency" includes an independent entity that has decided to participate in the pay
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for performance management system in accordance with Subsection (6)(a).
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[(ii)] (iii) "Agency" does not include:
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(A) [ ]the State Board of Education[,] ;
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(B) [ ]the Office of the State Treasurer[,] ;
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(C) [ ]Office of the State Auditor[,] ;
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(D) [ ]Office of the State Attorney General[,] ;
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(E) [ ]Utah System of Higher Education[,] ;
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(F) [ ]the Legislature[, ] ;
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(G) the judiciary[,] ; or[,]
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(H) [ as defined in Section 63E-1-102, ]an independent entity that chooses not to
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participate in the pay for performance management system under this section.
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(b)(i) "Employee" means an employee of an agency.
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(ii) "Employee" [does not include ] includes the following individuals only if the
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agency employing the individuals determines that the individuals may participate
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in the agency's pay for performance policy:
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[(A) an individual in a schedule AB position, as described in Section 63A-17-301;]
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[(B)] (A) an individual in a position that is not eligible to receive a retirement
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benefit under Title 49, Utah State Retirement and Insurance Benefit Act; or
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[(C)] (B) an individual that an agency hires for a time-limited position that will last
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fewer than 12 consecutive months.
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(c) "Independent entity" means the same as that term is defined in Section 63E-1-102.
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[(c)] (d) "Pay for performance" means a plan for incentivizing an employee to meet or
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exceed production or performance goals, in which the plan is well-defined before
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work begins, specific goals and targets for the employee are determined, and
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measurement procedures are in place.
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[(d)] (e) "Pay for performance management system" means the system described in
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Subsection (2).
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(2) The division shall [establish and] make rules, in accordance with Title 63G, Chapter 3,
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Utah Administrative Rulemaking Act, [make rules ]for the administration of a pay for
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performance management system.
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(3) The pay for performance management system shall include:
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(a) guidelines and criteria for an agency to adopt pay for performance policies and
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administer pay based on an employee's performance in furtherance of the agency's
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mission;
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(b) employee performance ratings;
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(c) requirements for written employee performance standards and expectations;
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(d) supervisor verbal and written feedback based on the standards of performance and
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behavior outlined in an employee's performance plan; and
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(e) quarterly written evaluation of an employee's performance.
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(4) In consultation with the division, [no later than July 1, 2023, ]each agency shall:
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(a) adopt and maintain pay for performance policies based on the performance
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management system; and
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(b) subject to available funds and as necessary, adjust an employee's wage to reflect:
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(i) subject to Subsection (5), [for a classified service employee, ]the salary range [of
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the position classified plan ]for the employee's position; and
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(ii) an increase, decrease, or no change in the employee's wage:
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(A) commensurate to an employee's performance as reflected by the employee's
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evaluation conducted in accordance with the pay for performance management
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system; and
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(B) in an amount that is in accordance with the guidelines and criteria established
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for a wage change in the pay for performance management system.
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(5) [In] The division shall make rules in accordance with Title 63G, Chapter 3, Utah
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Administrative Rulemaking Act, [the division shall make rules ]authorizing [a classified
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service] an employee to receive a wage that exceeds the salary range of the [classified
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service ]employee's position [classified plan ]if warranted based on the [classified ]
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employee's performance rating.
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(6)(a) An independent entity may participate in the pay for performance management
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system by providing written notice to the division that:
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(i) states the intent of the independent entity to participate in the system; and
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(ii) indicates that the independent entity agrees to comply with Subsection (6)(b).
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(b) An independent participating in the pay for performance management system shall
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comply with:
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(i) the provisions of this section; and
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(ii) the rules and policies of the division relating to participation in the pay for
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performance management system.
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Section 3. Section 63A-17-301 is amended to read:
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63A-17-301 . Career service -- Exempt positions -- Schedules for civil service
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positions -- Coverage of career service provisions.
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(1) Except as provided in Subsection (3)(d), the following positions are exempt from the
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career service provisions of this chapter and are designated under the following
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schedules:
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(a) schedule AA includes the governor, members of the Legislature, and all other elected
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state officers;
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(b) schedule AB includes appointed executives and board or commission executives
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enumerated in Section 67-22-2;
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(c) schedule AC includes all employees and officers in:
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(i) the office and at the residence of the governor;
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(ii) the Public Lands Policy Coordinating Office;
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(iii) the Office of the State Auditor; and
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(iv) the Office of the State Treasurer;
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(d) schedule AD includes employees who:
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(i) are in a confidential relationship to an agency head or commissioner; and
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(ii) report directly to, and are supervised by, a department head, commissioner, or
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deputy director of an agency or its equivalent;
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(e) schedule AE includes each employee of the State Board of Education that the State
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Board of Education designates as exempt from the career service provisions of this
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chapter;
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(f) schedule AG includes employees in the Office of the Attorney General who are under
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their own career service pay plan under Sections 67-5-7 through 67-5-13;
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(g) schedule AH includes:
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(i) teaching staff of all state institutions; and
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(ii) employees of the Utah Schools for the Deaf and the Blind who are:
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(A) educational interpreters as classified by the division; or
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(B) educators as defined by Section 53E-8-102;
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(h) schedule AN includes employees of the Legislature;
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(i) schedule AO includes employees of the judiciary;
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(j) schedule AP includes all judges in the judiciary;
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(k) schedule AQ includes:
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(i) members of state and local boards and councils appointed by the governor and
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governing bodies of agencies;
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(ii) a water commissioner appointed under Section 73-5-1;
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(iii) other local officials serving in an ex officio capacity; and
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(iv) officers, faculty, and other employees of state universities and other state
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institutions of higher education;
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(l) schedule AR includes employees in positions that involve responsibility:
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(i) for determining policy;
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(ii) for determining the way in which a policy is carried out; or
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(iii) of a type not appropriate for career service, as determined by the agency head
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with the concurrence of the director;
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(m) schedule AS includes any other employee:
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(i) whose appointment is required by statute to be career service exempt;
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(ii) whose agency is not subject to this chapter; or
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(iii) whose agency has authority to make rules regarding the performance,
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compensation, and bonuses for its employees;
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(n) schedule AT includes employees of the Division of Technology Services, designated
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as executive/professional positions by the director of the Division of Technology
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Services with the concurrence of the director of the division;
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(o) schedule AU includes patients and inmates employed in state institutions;
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(p) employees of the Department of Workforce Services, designated as schedule AW:
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(i) who are temporary employees that are federally funded and are required to work
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under federally qualified merit principles as certified by the director; or
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(ii) for whom substantially all of their work is repetitive, measurable, or transaction
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based, and who voluntarily apply for and are accepted by the Department of
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Workforce Services to work in a pay for performance program designed by the
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Department of Workforce Services with the concurrence of the director of the
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division;
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(q) subject to Subsection (6), schedule AX includes employees in positions that:
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(i) require the regular supervision and performance evaluation of one or more other
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employees; and
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(ii) are not designated exempt from career service under any other schedule described
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in this Subsection (1); and
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(r) for employees in positions that are temporary, seasonal, time limited, funding limited,
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or variable hour in nature, under schedule codes and parameters established by the
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division by administrative rule.
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(2) The civil service shall consist of two schedules as follows:
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(a)(i) Schedule A is the schedule consisting of positions under Subsection (1).
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(ii) Removal from any appointive position under schedule A, unless otherwise
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regulated by statute, is at the pleasure of the appointing officers without regard to
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tenure.
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(b) Schedule B is the competitive career service schedule, consisting of:
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(i) all positions filled through competitive selection procedures as defined by the
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director; or
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(ii) positions filled through a division approved on-the-job examination intended to
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appoint a qualified person with a disability, or a veteran in accordance with Title
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71A, Chapter 2, Veterans Preference.
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(3)(a) The director, after consultation with the heads of concerned executive branch
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departments and agencies and with the approval of the governor, shall allocate
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positions to the appropriate schedules under this section.
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(b) Agency heads shall make requests and obtain approval from the director before
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changing the schedule assignment and tenure rights of any position.
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(c) Unless the director's decision is reversed by the governor, when the director denies
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an agency's request, the director's decision is final.
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(d)(i) An agency may file a request with the division[.] :
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(A) to keep a position scheduled as a schedule B position as a schedule B position;
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or
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(B) to reschedule a position that is scheduled as a schedule A position as a
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schedule B position.
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(ii) The division shall review a request filed under Subsection (3)(d)(i) and approve
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the request only if the exception is necessary to conform to a requirement imposed
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as a condition precedent to receipt of federal funds or grant of a tax benefit under
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federal law.
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(4)(a) Compensation for employees of the Legislature shall be established by the
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directors of the legislative offices in accordance with Section 36-12-7.
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(b) Compensation for employees of the judiciary shall be established by the state court
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administrator in accordance with Section 78A-2-107.
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(c) Compensation for officers, faculty, and other employees of state universities and
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institutions of higher education shall be established as provided in Title 53B, Chapter
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1, Governance, Powers, Rights, and Responsibilities, and Title 53B, Chapter 2,
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Institutions of Higher Education.
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(d) Unless otherwise provided by law, compensation for all other schedule A employees
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shall be established by their appointing authorities, within ranges approved by, and
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after consultation with the director.
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(5) An employee who is in a position designated schedule AC and who holds career service
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status on June 30, 2010, shall retain the career service status if the employee:
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(a) remains in the position that the employee is in on June 30, 2010; and
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(b) does not elect to convert to career service exempt status in accordance with a rule
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made by the division.
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(6)(a) An employee who is hired for a schedule AX position on or after July 1, 2022, is
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exempt from career service status.
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(b) An employee who before July 1, 2022, is a career service employee employed in a
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schedule B position that is rescheduled to a schedule AX position on July 1, 2022,
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shall maintain the employee's career service status for the duration of the employee's
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employment in the same position unless the employee voluntarily converts to career
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service exempt status before July 1, 2023.
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(c)(i) Subject to Subsection (6)(c)(ii), an employee is exempt from career service
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status if:
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(A) before July 1, 2022, the employee was a probationary employee in a schedule
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B position and had not completed the probationary period; and
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(B) on July 1, 2022, the schedule B position in which the probationary employee
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is employed is rescheduled as a scheduled AX position.
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(ii) An employee described in Subsection (6)(c)(i):
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(A) is not a probationary employee on or after July 1, 2022; and
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(B) is exempt from career service status on and after July 1, 2022, unless the
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employee changes employment to a schedule B position.
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(d) The division shall disseminate to each employee described in Subsection (6)(b)
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information on financial and other incentives for voluntary conversion to
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career-service exempt status.
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(e) An agency[, as defined in Section 63A-17-112,] may adopt a policy, created in
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consultation with the division, for agency review of recommendations that schedule
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AX employees be suspended, demoted, or dismissed from employment.
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Section 4. Effective Date.
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This bill takes effect on May 7, 2025.
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