Department of War Awards Spending Guidance for Non-SES & Senior Professional Employees for Fiscal Years 2026-2027

The Department of Defense issued a memorandum indicating that the budget for performance awards would be at least 2.4 percent of the cost of employee salaries in fiscal year 2026 and at least 4 percent of that cost in fiscal year 2027. The memo also indicated that 5 percent of the awards budget would be reserved for supervisors who excel in the performance element titled "Holding Employees Accountable" or other supervisor-specific elements. The memorandum was initially issued in April 2026, but a revised version was issued in May 2026. The most significant change was that the April version provided that Defense Department component heads would have to approve any awards between $10,000 and $25,000, while the May version provided that component heads could delegate that authority. Both versions provided that awards greater than $25,000 would require presidential approval.