The Central Personnel System Act, codified as North Dakota Century Code chapter 54-44.3, was passed in 1975. The Act created the Central Personnel Division and the State Personnel Board. The Division is to establish and maintain classification and compensation plans, as well as general policies and rules relating to a unified system of personnel administration for the employees in the classified service of the State.
From its beginning, the Central Personnel Division developed general personnel policies in response to requirements in state and federal law, various court decisions, and requests from the State Personnel Board and from agencies or other officials in the executive branch. If the State Personnel Board approved a particular policy, the Division would then include it in the North Dakota personnel policies manual.
The policies included in the North Dakota personnel policies manual were to be followed by all agencies with classified employees. Merit system agencies (grant-aided agencies that receive federal funds) were to strictly follow the policies, but non merit system agencies were advised that the policies formed a "base" for the development of each agency's policies and procedures. (In other words, the policies of the Central Personnel Division were not mandated to all state agencies, and the Central Personnel system was really not a central system at all.)
In 1981, Governor Allen Olson issued executive order 1981-10. This executive order portrayed the North Dakota personnel policies manual as providing the assurance that classified employees would be treated fairly and uniformly if the policies were followed. The executive order identified the State Personnel Board as the agency that would hold public meetings to receive comments and approve revisions to the policies. Governor Olson also ordered that agencies headed by a gubernatorial appointee adhere to and follow the policies, including the statewide appeal mechanism.
By late 1986, that manner of personnel policy implementation and its "legality" and effect on various agencies had been challenged before the North Dakota Supreme Court. By 1990, in order for the Division to carry out its statutory purpose of establishing a unified system of personnel administration for the classified service of the state, it was apparent that certain policies had to be adopted as rules in accordance with North Dakota Century Code section 28-32-02. The Central Personnel Division has the authority to adopt policies, rules, and procedures regarding:
- Classification and compensation plans.
- Salary administration.
- Personnel administration actions.
- Compliance to state or federal law or rule as pertains to merit personnel system.
In 1995, the administration of the merit system was decentralized to those agencies required to have a merit system of personnel administration. Central Personnel Division maintains the auditing function and continues to assist agencies with the recruitment and selection of applicants, but merit system agencies are accountable for their own merit system.
In August 2003, the name of the Central Personnel Division was changed to North Dakota Human Resource Management Services as a result of legislative action.