As federal agencies wrap up the first performance cycle under a governmentwide limit on top ratings, the Internal Revenue Service (IRS) has told employees it still needs high performers, even if not all of them receive the rating their work might otherwise earn. The message, sent by an IRS internal consulting office, has drawn sharp reactions from employees, a union and a former IRS human capital chief, and it offers an early look at how the new system is landing with the workforce and the managers who administer it.

An email sent on Friday, October 23, by IRS Chief of Internal Consulting Joseph Ziegler and his deputy, Elizabeth Vonhof, acknowledged that the changes to performance ratings have generated concern, frustration and, for some employees, disappointment. According to reporting by Government Executive, which obtained the message, the officials addressed a question they said had surfaced in employee feedback: if an Outstanding rating may be out of reach, why keep performing at that level?

The email's answer was that a rating label should not determine the quality of work employees choose to do. It said the IRS needs talented people who care about doing their jobs well, stated that a "fully successful" score does not mean mediocre, and cautioned against "deliberately choosing mediocrity" because a particular rating is not guaranteed.

The message also said supervisors must continue to evaluate employees objectively against their established performance standards and document accomplishments accurately. The standardized distribution, it said, does not remove the duty to assess fairly, but it does call for greater differentiation in deciding which accomplishments represent the highest level of performance, which can mean difficult conversations on teams with many strong performers. The email added that the share of employees eligible for top scores could change in future years based on OPM and governmentwide guidance, and that the office was awaiting final ratings decisions from the IRS CEO's office, IRS human resources and the Treasury Department.

The IRS message follows a series of changes by the Office of Personnel Management (OPM) regarding the return of forced distributions, as FMA has regularly noted in the Washington Report:

• July 2026 final rule: OPM removed the long-standing ban on forced distribution of performance ratings for non-SES employees, a practice it now calls standardized distribution. The rule applies to the top two rating levels, consolidates the five-level scale by eliminating level 2, and ends negotiated-grievance challenges to ratings. Separately, a July OPM rule emphasizes recent performance ratings over tenure in reductions in force, which raises the stakes of a rating.

• September 2026 guidance. For this appraisal cycle, OPM directed agencies to limit the top two scores, Outstanding (5) and Exceeds Fully Successful (4), to no more than 40 percent of General Schedule (GS) employees. Top ratings can make employees eligible for cash and time-off awards.

Under the rule, supervisors still rate each employee against individual performance standards. Agencies then apply the standardized distribution at an appropriate aggregate level, consistent with OPM guidance. OPM says agencies should continue to honor collective bargaining agreements that bar forced distribution or grievances over ratings until those agreements expire.

OPM has argued the changes respond to rating inflation, saying the existing distribution suggests top ratings are overused and that weaker performers are not being identified or held accountable. It has said a forced distribution promotes more consistent ratings across agencies, requires more meaningful distinctions among levels, and allows cash awards to be distributed more fairly. It has also cited research indicating that forced distribution can counter leniency bias when overseen appropriately.

Critics have raised several objections, and the IRS email drew a notable share of them. NTEU National President Doreen Greenwald said an arbitrary cap on the highest ratings undermines morale and makes it harder to retain the experienced employees taxpayers rely on. Traci DiMartini, the IRS's former chief human capital officer, called the email's tone insulting and noted that the federal government has long tied bonuses to ratings, which she said explains why employees are upset about what she described as efforts to downgrade performance. And agencies previously warned OPM that forced distribution conflicts with merit system principles can reduce collaboration among employees. Researchers have also found that imposing a forced curve can produce a short-term performance bump followed by a drop.

Federal managers and supervisors are the people asked to hold both messages at once: rate each employee honestly against written standards, and then explain to strong performers why recognition may fall short of what the work merits. The IRS email acknowledges this tension directly. For managers, the practical questions now include how calibration decisions are made and documented, how clearly the process can be explained to employees, and how to keep high performers engaged when top ratings are scarce.

FMA will continue to follow how the new rating system is implemented and how it affects the managers and employees who carry out the federal government's mission.