Federal Employment Management Reform Act of 2001

Federal Employee Management Reform Act of 2001 - Sets forth provisions governing voluntary separation incentive payments. Requires each agency to develop a plan setting forth the positions and functions affected, the timing and amounts of payments, and how the agency will subsequently operate. Reduces the number of employee positions by the number accepting such payments, except as specified. Continues existing voluntary separation incentives authority.

Revises eligibility criteria for voluntary early retirement.

Revises Federal employee recruitment, relocation, and retention bonus provisions, increasing the amount which may be paid for critical need employees.

Revises and expands criteria for providing employees academic degree training, to include accomplishment of an agency's strategic plan. Authorizes an agency to pay for employee credentials.

Revises provisions governing special pay authority, including by placing such authority with the Office of Personnel Management and by providing for pay conversion upon geographic movement.

Revises annuity computation for part-time service.

Permits all Federal employees, including members of the armed services, to keep their frequent travel program benefits resulting from U.S. paid travel.

Makes certain student volunteers eligible under agency programs to encourage commuting by means other than single-occupancy motor vehicles.

Establishes a separate annual pay cap applicable to certain senior-level and senior executive positions (not to exceed the total annual compensation of the Vice President).

Repeals the senior executive recertification requirement. Authorizes an annual leave credit for certain senior level and senior executive employees.

Revises provisions concerning personnel management demonstration projects, permitting their modification and/or conversion to an alternative personnel system.

Authorizes an agency to implement and modify an alternative personnel system according to an approved plan which includes how such system is consistent with merit system principles and relates to carrying out the strategic plan.

Authorizes agencies to appoint certain critical employees outside the competitive service. Authorizes the use of a quality category rather than a numerical ratings selection system.