Title
Merit-Based Step Increments for Govt Employees
Law
Csc Memorandum Circular No. 40
Decision Date
Nov 6, 1991
The Joint CSC-DBM Circular No. 1, 1990, mandates the implementation of merit-based step increments for government officials and employees, rewarding those with Outstanding and Very Satisfactory performance over two consecutive rating periods, while capping recipients at 10% of total personnel.

Questions (CSC MEMORANDUM CIRCULAR NO. 40)

It provides for the implementation of step increments based on merit pursuant to Joint CSC-DBM Circular No. 1, s. 1990, specifying the qualifications, rates (one or two steps), timing, and allocation limits.

Very Satisfactory performance for two (2) consecutive rating periods based on an agency-approved performance appraisal system.

Outstanding performance for two (2) consecutive rating periods based on an approved agency performance appraisal system.

It takes effect the day following the end of the second rating period.

It takes effect the day following the end of the second rating period.

Not more than ten percent (10%) of the total number of personnel actually employed in the department or agency.

Yes. Recipients of two (2) step increments shall not exceed three percent (3%) of the total number of personnel actually employed.

The head of the Department or Agency must develop a forced ranking system to determine which employees will comprise the 10% limit.

Performance for 1990 under an approved Agency Performance Appraisal System (PES) shall be the basis of the grant.

The performance must be based on the agency-approved performance appraisal system; agencies with approved PES are enjoined to implement the grant according to the Joint Circular.

An employee must obtain the required rating (Very Satisfactory or Outstanding) consistently for two successive rating periods, as determined under the agency’s approved PES.

Heads of agencies are required to monitor strict compliance with the Joint Circular.

It is necessary when the number of qualified recipients exceeds the maximum allowable 10% (and subject to the 3% cap for two-step increments).

No. The Circular specifies that the ratings must be based on an agency-approved performance appraisal system.

One (1) step increment based on merit.

Two (2) steps increment based on merit.

Up to 10% of 1,000, or a maximum of 100 recipients (subject also to the separate 3% cap for two-step recipients).

Up to 3% of 1,000, or a maximum of 30 recipients.


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