# Federal Agencies Set FY2026 Performance Awards

A discussion about FY2026 federal employee performance awards raises uncertainty over whether agency payouts will reach minimums recommended by the Office of Personnel Management (OPM). The discussion says agencies must fund awards from their own budgets and reports differing practices: the Department of the Interior (DOI) reportedly set awards at 5%, 3%, and 1% for ratings of 5, 4, and 3, while another commenter said only 30% of employees rated 3 would receive an award or time off. These are reported practices, not confirmed government-wide policy; commenters also questioned rating calibration and whether performance plans could be invalidated.

- Agencies’ budget-dependent award practices may affect workforce retention and continuity, including in acquisition and program teams, but the discussion does not establish a direct contracting opportunity or a confirmed impact on procurement budgets.
- Federal HR and acquisition leaders can use the reported variation as a reason to clarify their agency’s award criteria, funding approach, and treatment of performance plans with appropriate agency officials.
- Contractors supporting federal agencies may want to account for potential workforce uncertainty in staffing and continuity planning, without assuming that reported award rates apply government-wide.

**Jurisdictions:** federal
**Published:** October 30, 2026

### Government Entities
- U.S. Office of Personnel Management (OPM)
- U.S. Department of Veterans Affairs (VA)
- U.S. Department of the Interior (DOI)
- Internal Revenue Service (IRS)

### Sources
- [VA’s FY2026 performance awards appear lower than OPM’s recommended minimums. can HR clarify?](https://www.reddit.com/r/FedEmployees/comments/1xjsy2h/vas_fy2026_performance_awards_appear_lower_than) - reddit-fedemployees