The purpose of this Internal Revenue Manual (IRM) is to establish general principles, concepts, and policies that govern human resources management (HRM) activities and practices within the Internal Revenue Service (IRS). These requirements constitute the framework for managing employees in an efficient and effective manner while ensuring adherence to Federal Human Resources (HR) laws, rules, and regulations.

HRM involves all of the activities that relate to attracting, developing, sustaining, managing, and retaining a high-quality and diverse workforce. Strategic HRM is the creative, mission-oriented, results-driven approach to HRM. It provides IRS managers with the HR tools necessary to properly plan, develop, organize, and accomplish core programs and operations. This requires:

A fundamental concept of HRM within the IRS is to provide high-quality, cost-effective policies, programs, and services that demonstrate positive contributions to achieving the mission of the agency. In the IRS, the primary responsibility for managing human resources is placed on the Service's managers who have accountability for overall mission performance.

The effectiveness of human resources management will be judged on two bases: legal/regulatory compliance and mission-related outcome and results. This balanced approach requires IRS managers to comply with legal and regulatory requirements while maximizing the mission effectiveness of their HR decisions and practices.

HRM policies, procedures, and practices within the IRS will be consistent with and support the Merit System Principles outlined in 5 U.S.C. 2301(b). In upholding these Merit System Principles, Service managers will avoid or prevent the occurrence of any of the Prohibited Personnel Practices identified in 5 U.S.C. 2302(b).

IRS supervisors and managers will not discriminate when carrying out HRM policies, procedures, and practices because of race, sex, martial status, age, color, religion, national origin, sexual orientation, lawful political affiliation, labor organization membership, or handicapping condition.

IRS employees will be placed in jobs for which they are qualified, and will be given equal opportunities for advancement. Selection to fill positions shall be made impartially on the basis of merit and fitness.

IRS employees’ work performance will be evaluated fairly and objectively on a scheduled basis, and the results of such evaluations will be discussed with employees. Training and development required to improve present job performance and meet future skill needs will be provided.

IRS employees have the right, without interference, coercion, restraint, or reprisal, to join or refrain from joining any lawful labor organization or employee association. When employees are represented by a recognized labor organization, management officials and supervisors will endeavor to build a relationship with the organization based upon mutual respect and trust.

IRS employees with a grievance or complaint will be accorded a fair and prompt discussion with their immediate supervisor; and, failing prompt and satisfactory adjustment, have the right to pursue the matter under an applicable grievance or complaint system. When employees present a grievance or complaint, supervisors and managers will assure that employees are free from interference, restraint, or reprisal, and that they understand that they may be accompanied and assisted by a representative.

IRS supervisors and managers will treat employees with full regard for their dignity as individuals, and will encourage them to express themselves concerning improvement of work methods and working conditions. Employees and their recognized labor organizations will be informed in advance, insofar as possible, of plans and policies affecting them and their employment.

IRS employees have the right to discuss their problems with their supervisor, HR office specialist, equal employment opportunity officer or counselor, labor organization representative, a person designated to provide guidance, or a supervisory or management official of higher grade or organizational level than the immediate supervisor (provided such higher-level official agrees to consult with the employee).

IRS supervisors will represent management in the administration of HR policy and labor-management agreements. They will provide progressive and constructive leadership, and ensure that all employees understand what is expected of them, to whom they are responsible, and the expected work relationships with fellow workers.

HRM authorities will be delegated to the lowest practical level based upon local circumstances. The decentralization of HRM authorities supports the Service's concept that these authorities are key elements of the overall responsibility of individual IRS supervisors and managers, and directly relate to their ability to achieve timely, effective, and efficient mission results.

HRM policies, procedures, and programs will be developed in accordance with existing legal requirements, applicable regulations of the Office of Personnel Management (OPM), decisions of the Comptroller General (CG), and directives issued by the Department of the Treasury.

Servicewide HRM policies, procedures, and programs will be developed in conjunction with the Human Resources Policy Council (HRPC). The Council serves as the principal corporate HR policy-making body and strategic HR advisor to the Commissioner and senior staff.

HRM policies, procedures, and programs in the IRS, whether established at the national level or business-unit level, will be issued only when necessary to interpret or supplement a statute or federal policy or rule, or to meet the unique requirements of the IRS or an individual business unit.

In the case of employees covered by negotiated collective bargaining agreements, those agreements can supersede or modify Servicewide policies, procedures, and programs where the Service has discretionary authority. IRS bargaining agreements cannot, however, modify statutory or governmentwide regulatory policies or rules.

All matters or issues affecting Servicewide or governmentwide policy or requests for additional authorities, flexibilities, or variances (Treasury, OPM, and GAO) must be referred to the SHR organization for consideration.

The SHR organization will establish and maintain a vigorous and aggressive program for evaluating HRM policies, procedures, programs, and other activities as a basis for ensuring legal and regulatory compliance, and for making improvements that facilitate IRS mission accomplishments and strategic goals. HR management issues that will be addressed include the HR tools, processes, and systems used to support HRM programs and goals.

HRM policies, procedures, and programs in the IRS will be designed to achieve organizational excellence through a flexible, stable workforce with the competence to do the job well, and to realize a cost and mission-effective return on HR-related investments. The effective use of IRS employees is a responsibility shared by IRS managers and their HR staffs. Generally, IRS managers are primarily accountable for the program impact of HRM decisions, while the HR staffs are primarily accountable for the regulatory compliance of the action. However, IRS managers and HR staffs are expected to work in partnership with emphasis on shared accountability for mission-effective and legally compliant workforce management policies and practices.

Commissioner of Internal Revenue. The Commissioner of Internal Revenue has overall responsibility in all matters pertaining to the employment, direction, and general administration of the IRS workforce. These authorities are redelegated to subordinate officials that best support the efficient and effective use of the Service's human resources. The following are the applicable statutory and departmental authorities:

Human Resources Policy Council (HRPC). The HRPC is responsible for providing strategic HR advice to the Commissioner and senior staff on Servicewide HR policy issues and direction including oversight of their implementation by the business units and the National Headquarters. The HRPC also performs the key function of coordinating Servicewide HR issues, policies, and strategies to ensure that cross-division linkages are established and operate effectively. The responsibilities, membership, and operations of the HRPC are described in Exhibit 6.250.1-1.

Chief Human Resource Officer (CHRO). The CHRO is responsible for providing leadership and direction of the SHR organization in the planning, development, execution, and evaluation of HRM policies, procedures, programs, and requirements necessary to support IRS managers, supervisors, and employees. This includes the development of legislation, policies, or authorities that support innovative and flexible HRM that best meets mission requirements. The CHRO's authority is established in IRM 1.1.14.5.

Human Resources Directors for the Business Units and the National Headquarters. These officials are responsible for implementing or customizing policies, procedures, programs, and requirements established by the CHRO. This includes providing positive and expert HRM assistance and services to their managers, supervisors, and employees that take into consideration their unique business requirements. The most significant authorities delegated by the Commissioner are set forth in the following HR-related delegation orders:

Agency-Wide Shared Services (AWSS). The AWSS is a central support organization responsible for providing Servicewide administrative services to the IRS business units and the National Headquarters (NHQ). The Personnel Services component of AWSS provides standardized HR operational processes and services that are organizationally aligned with the business units to insure dedicated attention to specific customer needs. The HR support services provided include payroll and personnel transaction processing for the entire IRS workforce.

Supervisors and Managers. These officials are responsible for providing effective leadership and management for the IRS workforce, which includes shared accountability with their HR staffs for effective, legally compliant HRM practices and actions. In discharging these responsibilities, supervisors and managers are expected to establish a work environment that creates positive employee motivation and high organizational performance. Supervisors and managers have been delegated specific authorities by the Commissioner to take final action on the HRM matters set forth in the Delegation Orders referenced in 6.250.1.4.4, and applicable SHR IRMs.

The CHRO, through the SHR organization, designs Servicewide HR policies, programs, and procedures in collaboration with the HRPC. The CHRO's and the HRPC's focus is on the IRS as a whole, with emphasis on integrating and aligning the HRM function with the overall IRS mission and strategic planning goals. The role of the embedded HR offices in the business units is to formulate and customize Servicewide HR policies, procedures, and practices in response to their organization's unique business needs. The role of the AWSS Personnel Services organization is to deliver the products and services required to make HR policies work as intended across the IRS, and to ensure consistent application of HR policies throughout the business unit. The chart in Exhibit 6.250.1-2 graphically depicts the delineation of key responsibilities among the SHR, embedded HR, and AWSS organizations.

The SHR organization, which is part of the NHQ, is comprised of eight major divisions.

As a result of the IRS Restructuring and Reform Act of 1998, the role of the CHRO at NHQ has been redefined to focus on setting broad HRM policy, reviewing HR plans and goals of business units and the NHQ, and developing major HR strategies and programs that integrate and align HRM activities with the attainment of the Service's mission and strategic goals. An essential component of this process is to define specific and measurable goals and priorities, in collaboration with the business units and the NHQ, that ensure HR policies and practices contribute to the long-term viability and success of the Service.

The Strategic HRM process reinforces the Service's conviction that its employees are its greatest resource and are the key to bringing long-term value to the organization. The IRS will invest in, develop, and manage employees in a strategic manner to produce a workforce committed to achieving results and to meeting customer needs. A corollary commitment will also be made to provide IRS employees with quality leadership.

The Strategic HRM goals and priorities, identified in partnership with the business units and the NHQ, will be documented in a Strategic Plan. The creation of an effective partnership between HR professionals and Service managers is a fundamental goal of Strategic HRM. Its purpose is to strengthen the connection between the Service's short-term and long-term operational goals and mission and SHR's policies, programs and systems.

The Strategic HRM process relies on workforce planning to drive the integration of the HRM function into the Service's overall planning and decisionmaking process. (See 6.250.1.7.1 below.)

The SHR function organizes its HRM strategy, structure, and systems around a Strategic HRM life-cycle framework with initiatives and outcome measures devoted to each of the major life-cycle employment phases. Exhibit 6.250.1-4 depicts the phases.

The Strategic HRM life-cycle framework approach reinforces the core belief that IRS employees are the Service's most important asset and the IRS needs to focus its HRM strategy on how best to attract, develop, utilize, and retain them. This concept views employees as Human Capital — not a cost to be minimized, but a valuable asset to be invested in and carefully managed.

The basis of the Strategic HRM life-cycle framework is the recognition that an integrated, decentralized HRM structure is vital to the successful achievement of the mission of the IRS. This approach places less emphasis on the transactional aspects of HR administration, and more on the strategic contributions of the HRM function — particularly on the importance of workforce planning. The goal is for HRM strategy, structure, and systems to be aligned with and fully integrated into the Service's overall mission. A strong reengineering and technology-intervention program will be used to ensure an effective and efficient HRM program that remains relevant to the Service's overall mission and strategic priorities.

The six Strategic HRM life-cycle employment phases are:

The Council is chaired by the CHRO but serves to address the needs of all members.

The staff support for the Council comes from the CHRO with assistance, as needed, by other HR offices.

The Council may also invite to its deliberations temporary external members such as subject-matter experts in business as well as support functions.

Similar networks or councils may be established, as needed, for specific HR functional areas such as Labor Relations, Education, and Recruiting.