---
kind: "section"
citation: "5 U.S.C. § 5404"
title: "5"
title_heading: "Government Organization and Employees"
number: "5404"
heading: "Human capital performance payments"
release: "119-102"
date: "2026-07-12"
url: "https://uscodex.org/usc/5/5404"
units:
  - "Part III — Employees"
  - "Subpart D — Pay and Allowances"
  - "Chapter 54 — Human Capital Performance Fund"
---

# §5404. Human capital performance payments

- (a)
  - (1) Notwithstanding any other provision of law, the [Office](/usc/5/5402.md?p=3) may authorize an [agency](/usc/5/3132.md?p=a-1) to provide human capital performance payments to individual [employees](/usc/5/4701.md?p=a-2) based on exceptional performance contributing to the achievement of the [agency](/usc/5/3132.md?p=a-1) mission.
  - (2) The number of [employees](/usc/5/4701.md?p=a-2) in an [agency](/usc/5/3132.md?p=a-1) receiving payments from the [Fund](/usc/5/8401.md?p=6), in any year, shall not be more than the number equal to 15 percent of the [agency](/usc/5/3132.md?p=a-1)’s average total civilian full- and part-time permanent employment for the previous fiscal year.
- (b)
  - (1) A human capital performance payment provided to an individual [employee](/usc/5/4701.md?p=a-2) from the [Fund](/usc/5/8401.md?p=6), in any year, shall not exceed 10 percent of the [employee](/usc/5/4701.md?p=a-2)’s rate of [basic pay](/usc/5/8401.md?p=4).
  - (2) The aggregate of an [employee](/usc/5/4701.md?p=a-2)’s rate of [basic pay](/usc/5/8401.md?p=4), adjusted by any locality-based comparability payments, and human capital performance [pay](/usc/5/7511.md?p=a-4), as defined by regulation, may not exceed the rate of [basic pay](/usc/5/8401.md?p=4) for Executive Level IV in any year.
  - (3) Any human capital performance payment provided to an [employee](/usc/5/4701.md?p=a-2) from the [Fund](/usc/5/8401.md?p=6) is in addition to any annual [pay](/usc/5/7511.md?p=a-4) adjustment (under [section 5303](/usc/5/5303.md) or any similar provision of law) and any locality-based comparability payment that may apply.
- (c) No monies from the Human Capital Performance [Fund](/usc/5/8401.md?p=6) may be used to [pay](/usc/5/7511.md?p=a-4) for a new [position](/usc/5/5102.md?p=a-3), for other performance-related payments, or for recruitment or retention incentives paid under sections [5753](/usc/5/5753.md) and 5754.
- (d)
  - (1) An [agency](/usc/5/3132.md?p=a-1) may finance initial human capital performance payments using monies from the Human Capital Performance [Fund](/usc/5/8401.md?p=6), as available.
  - (2) In subsequent years, continuation of previously awarded human capital performance payments shall be financed from other [agency](/usc/5/3132.md?p=a-1) [funds](/usc/5/8401.md?p=6) available for salaries and expenses.

## Source credit

(Added Pub. L. 108–136, div. A, title XI, § 1129(a), Nov. 24, 2003, 117 Stat. 1643.)

## Notes

### Editorial Notes

### References in Text

Executive Level IV, referred to in subsec. (b)(2), is set out in section 5315 of this title.

### Prior Provisions

A prior section 5404, added Pub. L. 95–454, title V, § 501, Oct. 13, 1978, 92 Stat. 1183; amended Pub. L. 98–615, title II, § 201(a), Nov. 8, 1984, 98 Stat. 3210; Pub. L. 101–103, § 3(a), Sept. 30, 1989, 103 Stat. 670, related to merit increases, prior to repeal by Pub. L. 103–89, § 3(a)(1), (c), Sept. 30, 1993, 107 Stat. 981, 983, eff. Nov. 1, 1993.