On March 30, 1994, President Bill Clinton signed the Federal Workforce Restructuring Act into law, aiming to reduce federal employment by approximately 273,000 positions by the end of fiscal year 1999. The legislation provided "buyout" incentives of up to $25,000 to encourage employees in unnecessary high-level positions to voluntarily leave, thereby maximizing savings and minimizing the need for disruptive layoffs.
In a statement upon signing the Act, President Clinton emphasized that the buyout authority would allow agencies to target employees in unnecessary high-level jobs, thereby maximizing savings.
The Act also modernized federal employee training laws, granting agencies greater flexibility in selecting cost-effective training methods and emphasizing retraining employees for new career fields where their skills were most needed.
By April 1995, the buyout program had facilitated the reduction of the federal workforce by 102,000 positions, with plans to achieve the total reduction of 272,900 positions through continued buyouts and natural attrition. The program was considered a success in achieving workforce reduction in a fiscally responsible and humane manner.
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