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Most civilian positions in the federal government of the United States are part of the competitive service, where applicants must compete with other applicants in open competition under the merit system administered by the Office of Personnel Management. However, some agencies (and some positions within other agencies) are excluded from these provisions. Although they primarily operate on a merit basis also, they have their own hiring systems and evaluation criteria. These agencies are called excepted service agencies and such positions are part of the excepted civil service.
The primary common denominator of many of these agencies and positions is that they have national security and/or intelligence functions, such as the Central Intelligence Agency, the Department of State, the Defense Intelligence Agency, the National Security Agency, the Federal Bureau of Investigation, U.S. Secret Service, and the NCIS. Attorney positions, Presidential Management Fellows, Presidential Innovation Fellows, and Foreign Service positions are examples of positions excepted across-the-board in all Federal agencies. Not all excepted service members serve in sensitive areas—for example, teachers and administrators at DOD schools, both in the U.S. and overseas, are also excepted, as are all patent examiners. In addition, most employees in the legislative branch of the federal government are excepted service employees.
One key factor concerning the excepted service is that employees have fewer appeal rights (compared to positions in the competitive service) in the event of disciplinary actions or job termination. For example, non-veteran employees in the excepted service are generally barred from appealing adverse agency personnel decisions to the United States Merit Systems Protection Board (MSPB) or to the Federal courts for their first two years of employment, whereas employees in the competitive service have a one-year probationary period. Excepted service agencies have consistently claimed that they need the speed and flexibility afforded by being in the excepted service in order to perform their missions and maintain good order and discipline.
From 5 U.S.C. § 2103:
(a) For the purpose of this title, the excepted service consists of those civil service positions which are not in the competitive service or the Senior Executive Service.
(b) As used in other Acts of the United States Congress, “unclassified civil service” or “unclassified service” means the “excepted service”.