[Federal Register Volume 73, Number 217 (Friday, November 7, 2008)]
[Rules and Regulations]
[Pages 66143-66157]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E8-26562]
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Rules and Regulations
Federal Register
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Federal Register / Vol. 73, No. 217 / Friday, November 7, 2008 /
Rules and Regulations
[[Page 66143]]
OFFICE OF PERSONNEL MANAGEMENT
5 CFR Parts 294, 359, 362, 451, 530, 531, 532, 534, 536, 550, 591,
630, 831, and 842
RIN 3206-AK88
Changes in Pay Administration Rules for General Schedule
Employees
AGENCY: U.S. Office of Personnel Management.
ACTION: Final rule.
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SUMMARY: The U.S. Office of Personnel Management is issuing final
regulations on pay setting rules for General Schedule employees. The
final regulations revise the interim regulations by making a number of
technical modifications, corrections, and clarifications.
DATES: The regulations are effective on December 8, 2008.
FOR FURTHER INFORMATION CONTACT: Carey Johnston by telephone at (202)
606-2858; by fax at (202) 606-0824; or by e-mail at pay-performance-
policy@opm.gov.
SUPPLEMENTARY INFORMATION: On May 31, 2005, the U.S. Office of
Personnel Management (OPM) published interim regulations (70 FR 31278)
to implement section 301 of the Federal Workforce Flexibility Act of
2004 (Pub. L. 108-411, October 30, 2004), hereafter referred to as
``the Act.'' On December 19, 2005, OPM corrected minor errors in the
interim regulations (70 FR 74995). Section 301 of the Act amended
provisions in 5 U.S.C. chapter 53 relating to the administration of
special rates, locality rates, and retained rates. The statutory and
regulatory changes were designed to correct a variety of pay
administration anomalies that resulted in unfair pay reductions or
unwarranted pay increases, to allow locality rates and special rates to
be treated in similar ways, and to improve the operation of the special
rates program.
The 60-day comment period ended on August 1, 2005. We received
comments from eight agencies, one union, and several individuals. This
Federal Register notice addresses the comments we received on the
interim regulations and makes a number of technical revisions and
clarifications, which are summarized below. In addition, we issued
guidance, including examples, to address many of the questions we
received about the interim regulations. We encourage agencies and
employees to review these materials on OPM's Web site at http://
www.opm.gov/oca/pay/HTML/factindx.asp. We will continue to provide
additional guidance on pay administration, as necessary.
Comment Applicable to the Effective Date
One commenter objected to the effective date of the interim
regulations. The commenter stated he was a manager who had to redo
personnel actions because of the retroactive implementation of the
rules. The commenter stated OPM should have published the rules before
they became effective.
Section 301(d) of the Act provided that section 301 would take
effect the first day of the first pay period beginning on or after the
180th day of enactment of the Act. The 180th day after enactment was
April 28, 2005, and the first day of the first pay period following
that date was May 1, 2005. On November 1, 2004, OPM issued a memorandum
to agencies notifying them of changes resulting from the Federal
Workforce Flexibility Act of 2004. (See http://www.opm.gov/oca/
compmemo/2004/2004-22.asp.) On April 25, 2005, OPM issued an additional
memorandum to agencies notifying them of changes to special rate
schedules and special rate entitlements resulting from the Act. (See
http://www.opm.gov/oca/compmemo/2005/2005-06.asp.) While OPM did not
publish interim regulations until May 31, 2005, the regulations became
effective on May 1, 2005, in order to implement the statutory changes
mandated by the Act. The regulations must be applied prospectively from
that date. OPM has no authority to waive or change this statutory
effective date.
Comments Applicable to Senior Executive Service Saved Rates
An agency recommended that OPM revise Sec. 359.705, which provides
the rules on establishing, adjusting, and terminating saved rates for
former members of the Senior Executive Service (SES) who are guaranteed
placement in a position covered by another pay system. The agency
suggested that OPM clarify that an employee who is placed under 5 CFR
part 359, subpart G, in a General Schedule (GS) position is not subject
to the limitation on GS basic pay in 5 U.S.C. 5303(f) of the rate for
level V of the Executive Schedule (EX). This statement was included in
former Sec. 359.705(c) as in effect prior to May 1, 2005. In addition,
a commenter requested that OPM clarify what pay limitations apply to
SES saved rates.
Under Sec. 359.705(a), an appointee placed under subpart G in a
position outside the SES is entitled to receive basic pay at the
highest of (1) the rate of basic pay in effect for the position in
which the appointee is being placed; (2) the rate of basic pay
currently in effect for the position the appointee held immediately
before being appointed to the SES; or (3) the rate of basic pay in
effect for the appointee immediately before removal from the SES. Under
5 U.S.C. 5382, the maximum SES rate for an agency with a certified
performance appraisal system is the rate for EX-II, and the maximum SES
rate for an agency without a certified performance appraisal system is
the rate for EX-III. Consistent with the purpose of the SES saved pay
provision, we are revising Sec. 359.705(c) to clarify that an employee
placed under subpart G in a position outside of the SES pay system is
subject to the limitation on SES pay in 5 U.S.C. 5382 of the rate for
level II of the Executive Schedule.
Comments Applicable to General Schedule Basic Pay Setting
Definitions of Demotion and Promotion (Sec. 531.203)
A commenter recommended that OPM revise the definitions of
promotion and demotion in Sec. 531.203 to cover situations involving
movements between pay systems. Specifically, the commenter would like
the definitions to be the same as or similar to the definitions of
promotion and change to
[[Page 66144]]
lower grade in the Guide to Processing Personnel Actions (GPPA).
We are not adopting this recommendation. The same or similar terms
may be used and defined in different ways in the GPPA and the CFR,
depending on the purpose of the term and statutory requirements. In the
GPPA, a promotion is an employee's movement to a position at a higher
grade level within the same job classification system and pay schedule,
or to a position with a higher rate of basic pay in a different job
classification system and pay schedule. In Sec. 531.203, a promotion
is a GS employee's movement from one GS grade to a higher GS grade
while continuously employed. It is necessary for the definition of
promotion in Sec. 531.203 to be more narrow than the definition of
promotion in the GPPA because the two-step promotion rule in 5 U.S.C.
5334(b) and 5 CFR 531.214 applies only to GS employees who are promoted
to a higher grade under the General Schedule without a break in
service. Similarly, the demotion rules in Sec. 531.215 apply only to
employees who move from one GS grade to a lower GS grade while
continuously employed. As a result, we cannot revise the definitions of
promotion and demotion in Sec. 531.203 to be consistent with the GPPA
definitions. Agencies need to be aware of these different definitions.
For example, an employee who moves from a non-GS pay system to the GS
pay system may receive an increase in basic pay, and the nature of
action may be documented as a promotion as that term is defined in the
GPPA. However, for GS pay-setting purposes, the movement would be
considered a transfer or reassignment as those terms are defined in
Sec. 531.203, depending on whether the movement occurs within the same
agency or between agencies.
Superior Qualifications and Special Needs Pay-Setting Authority (Sec.
531.212)
An agency recommended that OPM clarify what constitutes a
candidate's existing salary in Sec. 531.212(c)(2). Section 531.212(c)
provides the factors an agency may consider, as applicable in the case
at hand, to determine the step at which to set an employee's rate of
basic pay using the superior qualifications and special needs pay-
setting authority. The agency stated it would be helpful to clarify
whether bonuses or overtime premium pay should or could be a factor in
the candidate's existing salary.
We are not adopting this recommendation. Bonuses or overtime pay
could be a factor in determining the step at which to set an employee's
payable rate of basic pay, since those payments could be considered
``other relevant factors'' under Sec. 531.212(c)(10). However, this is
a matter that must be decided at the agency level.
Setting Pay Upon Promotion (Sec. 531.214)
A commenter requested clarification on why the locality pay
associated with his previous worksite was not considered in setting his
pay upon promotion at his new worksite. He stated that the interim
regulations provide that locality rates are considered basic pay in
applying GS pay administration provisions (e.g., GS promotion
provisions).
When an employee's official worksite is changed to a new location
where different pay schedules apply, the agency must convert the
employee to the applicable pay schedule(s) and rate(s) of basic pay for
the new official worksite based on the employee's position of record
before the promotion, as provided in Sec. 531.205, before processing a
simultaneous promotion action. See Sec. 531.214(b) and 5 U.S.C.
5334(g). Therefore, the geographic conversion rule must be applied
before the use of any applicable locality rates in applying the GS pay-
setting rules. A major objective of the geographic conversion rule is
to provide the same pay result that would have occurred if the employee
in question had moved laterally without a change in position (such as
grade) to the new geographic location and then underwent a position
change.
An agency recommended OPM revise Sec. 531.214(b) to state that the
rate resulting from the geographic conversion rule must be used as the
existing rate in processing a promotion. While the converted rate is
used as the existing rate, we are not adopting the recommendation
because the geographic conversion rule is adequately stated in
Sec. Sec. 531.205, 531.206, and 531.214(d)(1). We also note that the
definition of existing rate in Sec. 531.203, which is a term used in
Sec. 531.214, includes ``For example, the existing rate immediately
before a promotion action must reflect any geographic conversion under
Sec. 531.205 and any simultaneous within-grade increase or quality
step increase.''
Three commenters, who were apparently entitled to special rates
prior to May 1, 2005, expressed concerns that their basic pay had
decreased upon promotion. In the past, special rates were viewed as a
rate of basic pay replacing the corresponding GS base rates of pay.
Under current law and regulations, a special rate is viewed as
consisting of a base rate (GS rate or law enforcement officer special
base rate) and a special rate supplement--similar to the base-plus-
supplement concept we have long used for locality rates. In other
words, special rate employees have the same base rates as non-special
rate employees, but have a different supplement. Changing the way
special rates are documented is not a reduction in basic pay. Special
rates are still considered basic pay for the purposes specified in
Sec. 530.308, including retirement contributions and benefits.
It appears the commenters were promoted either from or to positions
where special rates had recently been terminated. Section 301 of the
Act amended 5 U.S.C. 5305(h) so that an employee is not entitled to a
special rate if he or she is entitled to a higher rate of basic pay
under another authority (e.g., a locality rate or a retained rate). The
termination of these special rates did not result in a loss in pay for
any covered employees, since all affected employees continued to
receive the higher locality rate to which they were otherwise entitled.
Furthermore, by law, OPM was required to issue regulations
governing the extent to which special rates and locality rates would be
used in applying the GS promotion rule. (See 5 U.S.C. 5334(b), as
amended by section 301(a)(3) of the Act.) Under the law and regulations
in effect before May 1, 2005, a special rate employee promoted to a
grade with underlying special rates (where locality rates were higher
at all steps of the grade) would have received a higher pay increase
than the normal GS promotion increase. Section 301 of the Act was
designed to correct this anomaly and restore fairness by ensuring that
locality rates would be considered in applying the promotion rule. This
intent was documented in the legislative history of the Act:
Section 301(a)(3)(A) would amend Sec. 5334(b), which covers
employee entitlement to basic pay rates upon promotion * * *. OPM
would prescribe regulations on the circumstances under which and the
extent to which special rates or locality-adjusted rates would be
considered to be basic pay in applying this subsection. This
amendment would authorize OPM to determine how special rates and
locality rates should be used in applying the two-step promotion
rule (upon promotion to a higher General Schedule grade, an employee
is generally eligible for a pay increase at least equal to two steps
in the grade from which he or she is promoted) in order to remedy
existing pay administration problems arising in situations involving
promotions, special rates, and retained pay when locality pay is not
considered to be basic pay. This amendment would also allow OPM to
prescribe regulations to avoid current windfalls resulting from
employees receiving a two-step promotion (based on the higher
special
[[Page 66145]]
rate schedule) and then receiving locality pay on top of the
adjusted rate.
H.R. Rep. No. 108-733 (2004), 2005 U.S.C.C.A.N. 2289, 2298-2299.
The promotion rules in Sec. 531.214 meet the statutory requirements
and the Congressional intent of the Act and further changes are
unnecessary.
One of the commenters requested to be ``grandfathered in,'' stating
that changes should apply to new personnel entering the workforce. OPM
is not able to accommodate any requests to be grandfathered in because
the Act contained no special grandfathering provisions. Pay actions
must be processed using the law and regulations that are in effect at
the time of the pay action.
Using a Highest Previous Rate Under the Maximum Payable Rate Rule
(Sec. 531.221-223)
An individual objected to the revised rule in Sec. 531.221 of the
interim regulations for determining an employee's maximum payable rate
when the employee's highest previous rate is a rate under the Federal
Wage System (FWS). The individual stated that the revised rule is
neither consistent with the President's intention for locality pay nor
legal. The individual also stated that even though he received an
increase in total pay (i.e., basic pay and locality pay), his basic pay
was reduced.
We do not agree that the current maximum payable rate rule is
inconsistent with Presidential or Congressional intent. In applying the
former maximum payable rate rule in cases where an employee was moving
from an FWS position to a GS position, a highest previous rate based on
an FWS rate of pay was compared to the underlying GS base rate range
for the employee's grade, excluding locality pay. The maximum payable
rate was set at the lowest step rate in the underlying GS base rate
range that equaled or exceeded the highest previous rate, not to exceed
the rate for step 10 of the GS grade. This process of comparing a
locality-based FWS rate to a GS rate range that did not include a
locality adjustment resulted in substantial pay increases for affected
employees--an anomalous result not intended by the maximum payable rate
rule. At the same time, in cases where an employee was moving from a GS
position to an FWS position, the employee's highest previous rate was
based on the GS base rate, excluding locality pay, and was compared to
the locality-based FWS rate range. This process resulted in an FWS rate
that was significantly lower than the employee's former GS locality
rate, which also was an anomalous result not intended by the FWS
highest previous rate rule. Both types of anomalies have been corrected
under the current OPM regulations, which require that GS locality rates
be considered in applying these pay-setting rules.
Under the current GS maximum payable rate rule, when an employee
moves from an FWS position to a GS position, his or her highest
previous rate is compared to the GS rate range for the employee's
grade, including locality pay. The maximum payable rate is set at the
lowest rate in the locality rate range that equals or exceeds the
highest previous rate. The current rule more logically compares a
locality-based FWS rate of pay to a GS locality rate range to determine
the employee's maximum payable rate and avoids substantial pay
increases not intended by the maximum payable rate rule.
A commenter requested clarification regarding how the maximum
payable rate rule applies to employees in the GM pay plan. (A GM
employee is a GS employee who was formerly covered by the Performance
Management and Recognition System under 5 U.S.C chapter 54 on October
1, 1993, and became covered on November 1, 1993, by section 4 of Public
Law 103-89, the Performance Management and Recognition System
Termination Act of 1993.) As noted in Sec. 531.221(a)(1), special
rules for GM employees are provided in Sec. 531.247.
In the Supplementary Information for the interim regulations
published May 31, 2005, we invited comments on a proposal to establish
a regulatory time limit on the period of time from which an employee's
highest previous rate may be drawn. The purpose of the proposed time
limit was to reduce the administrative burden associated with
identifying an employee's highest previous rate over an entire career
and comparing the highest previous rate with pay schedules in effect
many years ago.
We received mixed reactions regarding establishing a regulatory
time limit. Two agencies supported this proposal and three agencies did
not support the proposal. Two agencies stated it would be better if the
time limit was discretionary. One agency did not think a time limit was
necessary, but stated, if a time limit is established, OPM should
mandate a time limit rather than allowing each agency to establish its
own policy. The agencies also expressed different views regarding the
length of the time limit.
We have decided not to establish a regulatory time limit. We note
that each agency continues to have discretion to set an employee's pay
at any rate equal to or less than the maximum payable rate; thus, an
agency could take into account the recentness of an employee's highest
previous rate in exercising that discretion.
An agency suggested that OPM specify that a rate of pay earned
during military service may not be used as an employee's highest
previous rate. We agree. While Sec. 531.222(a)(1)(i) already provides
that a highest previous rate must be a ``rate of basic pay previously
received * * * while employed in a civilian position * * * '', we have
added a new paragraph Sec. 531.223(i) to expressly exclude a rate of
pay received as a member of the uniformed services from rates of pay
that may be used as the highest previous rate. ``Uniformed services''
is defined in 5 U.S.C. 2101.
A commenter requested clarification on determining an employee's
maximum payable rate when the employee has a retained rate under part
536. We have added a new paragraph Sec. 531.223(j) excluding retained
rates from rates of pay that may be used as the highest previous rate.
Under part 536 of the interim regulations, a retained rate is based on
an employee's highest applicable rate, including any applicable
locality rate after any geographic conversion. This clarification is
consistent with the policy in effect before May 1, 2005, that a
locality-adjusted retained rate could not be used as a highest previous
rate. The agency may use the rate of pay the employee received
immediately before his or her entitlement to pay retention as the
employee's highest previous rate.
Comment Applicable to Removal of Special Pay Adjustments for Law
Enforcement Officers
The interim regulations removed subpart C of part 531, which dealt
with special geographic adjustments for law enforcement officers (LEOs)
under section 404 of the Federal Employees Pay Comparability Act of
1990, because all of the special geographic adjustments for LEOs have
been surpassed by regular locality payments under 5 U.S.C. 5304. One
commenter asked hypothetically whether an employee would become
entitled to special geographic adjustments for LEOs if locality
payments were to decrease and fall below the LEO special geographic
adjustments. Although such a scenario seems unlikely under current
circumstances, OPM would address such a situation by regulation if it
were to occur.
[[Page 66146]]
Comment Applicable to General Schedule Within-Grade Increases
One agency asked if an increase in pay an employee receives when
moving from a non-GS pay system to the GS pay system would be an
equivalent increase, as determined under the rules in Sec. 531.407.
Section 531.407 provides a list of personnel actions that are
considered equivalent increases for the purpose of determining when GS
employees are entitled to their next within-grade increase. The within-
grade increase rules take into account personnel actions that occur
within the GS pay system and within a non-GS pay system (for the
purpose of determining when an employee is eligible to receive a
within-grade increase after movement from a non-GS to a GS position).
Personnel actions that occur within the GS pay system are listed in
Sec. 531.407(a). Personnel actions that occur within a non-GS system
are listed in Sec. 531.407(b).
We have revised Sec. 531.407(b) to clarify that the personnel
actions listed in paragraph (b) must have occurred in the non-GS pay
system. If an employee receives an increase in pay as a result of
moving between non-GS pay systems, from a non-GS to the GS pay system,
or from the GS pay system to a non-GS pay system, such personnel
actions are not considered equivalent increases.
However, when certain personnel actions occur simultaneously with a
pay system change under authority of the non-GS pay system and those
personnel actions are within-level or within-range increases that
result in forward movement in the rate range that applies to the
employee's new position, such actions are considered equivalent
increases. This would include, for example, a pay increase that is paid
simultaneously with a pay system change to account for the value of
accrued within-grade increases under the former system or to provide a
promotion-equivalent increase. We have revised Sec. 531.407(b)(2) to
clarify that such a simultaneous personnel action is considered an
equivalent increase. We also have revised Sec. 531.407(b)(2)(ii) to
clarify that placement under a new basic pay schedule within the same
pay system is not an equivalent increase when such placement results in
a nondiscretionary basic pay increase to account for occupational pay
differences.
Comments Applicable to Locality Rates
Determining an Employee's Official Worksite (Sec. 531.605)
In the Supplementary Information for the interim regulations
published on May 31, 2005, we invited comments on a proposal to revise
the regulations so that, in cases involving a temporary promotion or
reassignment, the official worksite for the employee's permanent
position of record would be considered to be the official worksite of
the temporary position of record for pay-setting purposes (unless the
employee receives relocation benefits under 5 U.S.C. 5737).
One agency supported the proposal. Another agency suggested
revising the proposal to provide agencies with the flexibility to
determine whether or not the official worksite should be changed,
depending on which location would provide the employee with the
greatest pay entitlement. Revising the proposal as suggested would not
be equitable to an employee who is permanently reassigned or promoted
to a different location and cannot receive the same benefit due to the
geographic conversion rule in Sec. 531.205. A third agency summarized
conflicting comments it received from its subcomponents on this issue.
We will consider these comments further as we review the need for
changes in OPM requirements related to documentation of personnel
actions. Accordingly, we have not included the proposed changes in
these final regulations.
The interim regulations implemented changes in determining an
employee's official worksite that OPM proposed on January 5, 2005, as
part of a larger notice of proposed rulemaking (70 FR 1068). Under
Sec. 531.605(a), the official worksite generally is the place where
the employee regularly performs his or her duties. We are making
clarifying revisions in Sec. 531.605(a) to provide that, when an
employee's work involves recurring travel or the work location varies
on a recurring basis, the official worksite is the location where the
work activities for his or her position of record are based, as
determined by the employing agency, subject to the requirement that the
official worksite must be in a locality pay area in which the employee
regularly performs work.
Under Sec. 531.605(d) (as issued in the May 2005 interim
regulations), a teleworker must report to the regular worksite at least
once a week on a regular and recurring basis in order for the regular
worksite to be the employee's official worksite. One agency recommended
removing this portion of the regulations because of the ``potentially
adverse impact that the interim regulations will have on employees who
are currently teleworking from outside their locality pay area.''
We do not agree. It is not consistent with the law (5 U.S.C. 5304)
to pay locality payments based on an employee's regular worksite if the
employee generally does not perform his or her duties in that locality
pay area. We do not see any reason to remove the requirements in Sec.
531.605(d). The public had an opportunity to comment on the proposed
regulations issued in January 2005, and we addressed the comments we
received on those proposed regulations in the Supplementary Information
accompanying the interim regulations issued in May 2005.
Another agency suggested that OPM delete ``at least once a week''
from the regulation and allow the agency to determine what constitutes
having an employee report to the official worksite on a regular and
recurring basis. We do not agree that the determination of an
employee's official worksite should be made by individual agencies
without criteria or parameters. Providing certain specific criteria in
regulations is essential to ensure that agencies pay employees fairly
and consistently, especially in situations such as telework
arrangements. However, we have revised Sec. 531.605 to replace the
once-a-week standard with a twice-a-pay-period standard. Revised Sec.
531.605 allows an agency to treat the regular worksite for a telework
employee's position of record as the employee's official worksite if
the employee works at the regular worksite for the employee's position
of record at least twice each biweekly pay period on a regular and
recurring basis. We are identifying additional examples of temporary
situations in which an agency may make an exception to the twice-a-pay-
period standard: (1) An extended period of approved absence from work,
(2) a period during which the employee is in temporary duty travel
status away from the official worksite, or (3) a period during which an
employee is temporarily detailed to work at a location other than a
location covered by a telework agreement. These changes will provide
agencies some additional flexibility in determining official worksites
for teleworkers while continuing to ensure such determinations are made
consistently and meet the intent of the locality pay law.
Relationship of Locality Rates to Other Pay Rates (Sec. 531.608)
A union and an agency requested that OPM waive Sec. 531.608 for
certain Department of Defense civilian engineers until implementation
of the National Security Personnel System
[[Page 66147]]
(NSPS) in October 2006. The agency noted that an employee's entitlement
to a special rate is terminated when an employee's locality rate
exceeds a corresponding special rate; the agency was concerned how this
loss of entitlement to the special rate would affect the employee's
promotion entitlement. The agency also expressed concerns about
possible recruitment and retention problems.
OPM has no authority to delay the effective date of this regulation
until implementation of NSPS. The provisions regulated under Sec.
531.608(b) are required by law at 5 U.S.C. 5305(c). See the discussion
in the ``Comment Applicable to the Effective Date'' section within this
Supplementary Information. Also see the discussion of promotions
involving special rates under ``Comments Applicable to General Schedule
Basic Pay Setting'' within this Supplementary Information. To address
any existing or likely staffing problems, an agency may request that
OPM establish or increase special rates under Sec. 530.305 or use
other tools such as recruitment and retention incentives under 5 CFR
part 575.
Treatment of Locality Rates as Basic Pay (Sec. 531.610)
In the Supplementary Information for the interim regulations
published May 31, 2005, we invited comments on whether the final
regulations should make a change in the treatment of locality rates in
computing danger pay allowances and post differentials. Since August
2004, OPM regulations have provided that locality rates are considered
basic pay in computing danger pay allowances and post differentials in
foreign areas for which the State Department has authorized danger pay
allowances, as long as the employee's official worksite is located in a
locality pay area (i.e., within the 48 contiguous States or the
District of Columbia). (See 69 FR 47353, August 5, 2004.) Employees
receiving locality rates are eligible for post differentials only when
they are temporarily detailed (including a work assignment while in
temporary duty travel status) to a post differential area for at least
42 consecutive days.
OPM received comments on the August 2004 interim regulations from
three agencies that a locality rate should be considered basic pay for
the purpose of computing danger pay and post differentials for all
employees on temporary duty assignments at overseas posts designated
for post differentials as well as for those posts designed for danger
pay.
OPM solicited comments in the May 2005 interim regulations on
whether it is appropriate to continue the current rules and consider
special rates as basic pay in computing post differentials where danger
pay allowances do not apply, while locality rates are not considered
rates of basic pay in this same situation. Two agencies responded that
the difference in treatment is not appropriate because it is not
consistent with the intent of the new pay administration regulations,
which is to treat both locality rates and special rates as supplements
to the General Schedule. OPM also solicited comments on whether we
should maintain the existing policy of using detailed employees'
locality rates in computing danger pay allowances and post
differentials only in danger pay areas or establish a new policy
requiring the use of detailed employees' locality rates to compute post
differentials authorized in any area (regardless of whether danger pay
applies). Three agencies clearly supported extending the policy to
other post differential areas. No commenters opposed the proposals.
We agree with the commenters. We are revising Sec. 531.610(f) to
treat locality pay as basic pay for the purpose of computing danger pay
under 5 U.S.C. 5928, post differentials for foreign areas under 5
U.S.C. 5925(a), and post differentials for nonforeign areas under 5
U.S.C. 5941 when an employee's official worksite is in a locality pay
area.
Miscellaneous Provisions (Sec. 531.611)
Section 531.611(a) of the interim regulations provides that a
locality rate may be paid only for those hours for which an employee is
in a pay status. An agency requested that OPM clarify the situations
where an employee is in a pay status.
An employee is in a pay status during the hours for which an
employee receives pay, such as when the employee works or uses paid
time off. This provision was in the former Sec. 531.606(d). Under 5
U.S.C. 5304(c)(2)(B), a locality-based comparability payment must ``be
paid in the same manner and at the same time as the basic pay payable
to such employee pursuant to any provision of law outside of this
section.''
Comments Applicable to Grade and Pay Retention
Definitions of Management Action, Position of Record, and Temporary
Reassignment (Sec. 536.103)
An agency requested that OPM clarify an employee's entitlement to
grade or pay retention in situations in which an employee is reduced in
grade or pay for inability to perform the duties of his or her position
because of a medical or physical condition beyond the employee's
control. The agency noted that the definition of reduced in grade or
pay for personal cause states that such a reduction is not considered
to be for personal cause. However, the agency requested that OPM
clarify whether such a reduction is caused or influenced by a
management action or if the employee is reduced in grade or pay at the
employee's request. The agency recommended that OPM revise the
regulations to provide that a determination to grant or not to grant
grade or pay retention in demotions based on physical or mental
inability to perform should be based on the individual circumstances of
each case and should be left to the discretion of the agency.
We do not believe it is necessary to revise the regulations. An
employee who is reduced in grade or pay for inability to perform the
duties of his or her position because of a medical or physical
condition beyond the employee's control would not be entitled to
mandatory or optional grade retention because that is not a basis for
grade retention. However, such an employee normally will be eligible
for optional pay retention under Sec. 536.302 if the reduction in
grade or pay is the result of a management action, unless the
employee's reduction satisfies one of the conditions for mandatory pay
retention in Sec. 536.301.
Another agency requested clarification regarding the definition of
position of record in Sec. 536.103. The definition in the interim
regulations stated that it excludes ``any position to which an employee
is temporarily detailed.'' The agency asked OPM to clarify whether the
exclusion of any position to which an employee is temporarily detailed
includes any temporary action (including temporary promotion). The
exclusion refers only to situations when the employee is temporarily
detailed. We are revising the definition of position of record in
Sec. Sec. 530.302, 531.203, 531.602, and 536.103 to clarify that a
position to which an employee is temporarily detailed is not documented
as a position of record. An employee who is on detail is considered for
pay and strength count purposes to be permanently occupying his or her
regular position. Unless the agency chooses to use a Standard Form 50
(Notification of Personnel Action), a detail is generally documented
with a Standard Form 52 (Request for Personnel Action).
[[Page 66148]]
The same agency also asked whether there is a Nature of Action Code
for a temporary reassignment. The agency stated that previously
temporary reassignments have not been processed by the GPPA.
Section 536.102(c) provides that a temporary reassignment is not a
basis for grade or pay retention. A reassignment is defined in Sec.
210.102(b)(12) as a change of an employee, while serving continuously
within the same agency, from one position to another without promotion
or demotion. An agency may intend to reassign an employee to another
position for a specified period of time, but the agency would still use
the Nature of Action (NOA) Code 721 for reassignments. OPM staffing
regulations make no distinction between permanent and temporary
reassignments. However, certain OPM regulations recognize this
distinction. For example, application of the pay retention regulation
requires that the time-limited nature of a reassignment be documented
in some way beyond a NOA code.
Mandatory Grade Retention or Optional Grade Retention (Sec. Sec.
536.201 and 536.202)
An agency requested that OPM clarify whether a reclassification
process, as that term is used in Sec. 536.201(a)(2), includes the
correction of an erroneous classification. It does. See 5 CFR part 511,
subpart G.
Another agency requested that OPM clarify whether mandatory or
optional grade retention applies when an employee moves without a break
in service of more than 3 days from a position in a Department of
Defense or Coast Guard nonappropriated fund instrumentality (NAFI) to a
position under a covered pay system in the same agency. The agency
stated that Sec. 536.201(e) and Sec. 536.202(d) of the interim
regulations appeared to have the same wording.
We have determined that the regulations in effect prior to May 1,
2005, did not provide grade retention to a NAFI employee who moved to a
position in a covered pay schedule. A NAFI employee would not have a
reduction-in-force right to a competitive or excepted service position
under OPM's 5 CFR part 351 regulations. In addition, OPM has previously
determined that the movement from NAFI to another pay system would not
be as a result of a reclassification process. (See discussion in 57 FR
182, September 18, 1992.) Therefore, neither mandatory nor optional
grade retention applies when an employee moves without a break in
service of more than 3 days from a position in a Department of Defense
or Coast Guard NAFI to a position under a covered pay system in the
same agency. Adding the NAFI-related provisions in Sec. Sec.
536.201(e) and 536.202(d) in the interim regulations was an error.
Accordingly, we are removing Sec. Sec. 536.201(e) and 536.202(d).
These changes bring the grade retention regulations in conformity with
Sec. 536.102(b)(8) and (d). If an agency provided grade retention to
an employee moving from a NAFI position to a position under a covered
pay system based on the erroneous provision in the interim regulations,
that action should be corrected.
Loss of Eligibility for Grade Retention and Termination of Grade
Retention (Sec. Sec. 536.207 and 536.208)
An agency recommended that OPM clarify whether an employee who is
eligible for optional grade retention would be ineligible for optional
pay retention if he or she waives optional grade retention. The agency
recognized that, under Sec. Sec. 536.207(c) and 536.208(d) of the
interim regulations, an employee is not eligible for pay retention if
the employee elects to terminate mandatory eligibility for grade
retention. The agency believed it was not clear that an employee is
also ineligible to receive pay retention if he or she waives optional
grade retention.
We agree that clarification is needed. Both Sec. 536.207(a) and
Sec. 536.208(d) cross reference Sec. 536.207(a)(5), which deals with
loss of eligibility for mandatory grade retention. While the provision
dealing with loss of eligibility for optional grade retention in Sec.
536.207(b) refers to the conditions in Sec. 536.207(a), we agree that
the effect on optional grade retention is not clear. Accordingly, we
have revised Sec. Sec. 536.207(c) and 536.208(d) to clarify that an
employee is not eligible for pay retention if the employee elects to
terminate mandatory or optional eligibility for grade retention. This
is consistent with the provision in Sec. 536.207(b)(1) concerning loss
of eligibility for optional grade retention.
Mandatory Pay Retention (Sec. 536.301)
A commenter requested clarification about whether an employee whose
payable rate of basic pay otherwise would be reduced as a result of a
management action that places the employee in a formal employee
development program generally used Governmentwide is entitled to pay
retention under Sec. 536.301(a)(5) when the employee is moving from a
non-covered pay system to a covered pay system. The commenter believed
the employee would be entitled to pay retention.
We agree that mandatory pay retention under Sec. 536.301(a)(5) can
apply to an employee who is moving from a non-covered pay system to a
covered pay system, but only if this movement is within the same agency
so that it qualifies as a ``placement,'' as required by Sec.
536.301(a)(5). If such a movement involves a ``transfer'' to a
different agency, the gaining agency may provide optional pay retention
as long as the employee is otherwise eligible. We have revised Sec.
536.301(a) to clarify that, subject to the requirements in Sec.
536.102 and Sec. 536.301, an agency must provide pay retention to an
employee who moves between positions under a covered pay system, or
from a position not under a covered pay system to a position under a
covered pay system, and whose payable rate of basic pay otherwise would
be reduced (after application of any applicable geographic conversion
under Sec. 536.303(a)) as a result of one of the actions listed in
paragraph (a). The actions listed in paragraph (a) include placement in
a position under a formal employee development program generally used
Governmentwide.
Another commenter suggested revising Sec. 536.301(a)(6) to be
consistent with the promotion rules in Sec. 531.214. The commenter
noted that, under Sec. 536.301(a)(6), an agency must provide pay
retention to an employee in a position under a covered pay system whose
payable rate of basic pay otherwise would be reduced as a result of the
application of the promotion rule for GS employees under 5 U.S.C.
5334(b) and 5 CFR 531.214 when the employee's payable rate of basic pay
after promotion exceeds the maximum rate of the highest applicable rate
range. The commenter requested clarification because step D of the
promotion rules in Sec. 531.214(d)(3)(i) and (4)(i) provides that, if
the rate identified in step C exceeds the maximum of the rate range
identified in step D, the employee's payable rate is (1) that maximum
rate, or (2) if the employee's existing rate is higher than that
maximum rate, a retained rate under 5 CFR part 536 equal to that
existing rate. The commenter also requested that OPM clarify a similar
provision under Sec. 536.301(a)(7), which states that an agency must
provide pay retention to an employee in a position under a covered pay
system whose payable rate of basic pay otherwise would be reduced as a
result of the application of the promotion rule for prevailing rate
employees under 5 CFR 532.407 when the employee's payable rate of basic
pay after
[[Page 66149]]
promotion exceeds the maximum scheduled rate of the grade, as described
in 5 CFR 532.407(b).
We agree that a revision to Sec. 536.301 is needed to clarify how
a retained rate is created when application of a promotion increase
rule for GS or prevailing rate employees results in a rate of basic pay
that exceeds the maximum rate of the highest applicable rate range for
the employee's new position. We are deleting former paragraphs (a)(6)
and (a)(7) and inserting a new paragraph (b) in Sec. 536.301 to
address retained rates resulting from application of a promotion rule.
We are adding a reference to the GS and prevailing rate promotion
increase rules and noting that, under those rules, a retained rate is
created only when an employee's existing rate before promotion exceeds
the maximum rate of the grade to which promoted, and such retained rate
is set to equal that existing rate. Retained rates created under the GS
or prevailing rate system promotion rule are not created based on a
finding that pay would otherwise be reduced, because the promotion
rules themselves prevent such a reduction. These promotion-rule
retained rates should be rare, since they should occur only when an
employee is being promoted from the high steps of a high special rate
range to a non-special rate range. Employees with an existing retained
rate under 5 CFR part 536 who are promoted are excluded from this
provision because they are covered by the rules in Sec. 536.304(c)(3)-
(5).
Determining an Employee's Pay Retention Entitlement (Sec. 536.304)
Two commenters requested that OPM allow their agencies to continue
paying locality payments on top of retained rates.
OPM is not able to accommodate the commenters' request. Section
301(a)(1) of the Act amended the definition of ``scheduled rates of
basic pay'' in 5 U.S.C. 5302 so that a retained rate was no longer
considered a scheduled rate of basic pay. Locality pay under 5 U.S.C.
5304 is paid on top of a scheduled rate of basic pay (see 5 U.S.C.
5304(c)(1)(B)). Thus, locality pay ceased to be payable on top of a
retained rate effective May 1, 2005. Instead, Sec. 536.304 provides
that an eligible employee is entitled to a retained rate if his or her
rate of basic pay (including any locality payment or special rate, but
after geographic conversion under Sec. 536.303(a)) exceeds the maximum
rate of the highest applicable rate range for the new position or
geographic area. The retained rate will equal the employee's former
rate of basic pay (including any locality payment or special rate
supplement).
Comment Requesting Definition of ``One Year''
One agency recommended that OPM define what constitutes ``one
year'' as provided in Sec. Sec. 531.223(b), 531.407(a)(5), and
536.203(b). We did not change the use of the term ``one year'' in the
interim regulations, and the clarification is not directly related to
changes made by the Federal Workforce Flexibility Act of 2004. We will
review the need to clarify ``one year'' in future regulations, and, if
warranted, we will invite comments on the use of the term.
Additional Miscellaneous Changes
The final regulations also include additional miscellaneous changes
to correct technical errors or omissions and to improve clarity. For
example, in various places in parts 530, 531, and 536, we are
clarifying that references to a ``rate'' being used in lieu of a
``step'' refer to the relative position in range of a GM employee's
off-step rate. We also are revising the definition of special rate
supplement in Sec. Sec. 530.302, 531.203, and 531.602 to clarify that,
when a special rate schedule covers both law enforcement officer
positions and other positions, the value of the special rate supplement
will be less for law enforcement officers because they have a higher
base rate. Additional miscellaneous changes are described below.
In subpart G of part 359 (dealing with SES saved rates), we are
making the following changes:
Adding a parenthetical explanation in Sec. 359.705(a)(1)
to clarify that the rate of basic pay in effect for the position in
which the appointee is being placed refers to a rate of basic pay
within the normal rate range of that position, consistent with the
rules of the pay system covering such position.
Correcting an omission by adding a paragraph (c)(3) to
Sec. 359.705 to provide that an SES saved rate is considered to be an
employee's rate of basic pay for the same purposes that apply to a
retained rate under part 536. This is consistent with OPM's stated
purpose for making changes to Sec. 359.705, which was explained in the
Supplementary Information for the interim regulations-namely, to ``make
changes that are consistent with * * * the changes made in the pay
retention provisions in part 536 * * * .'' (See 70 FR 31286.)
In subpart C of part 530 (dealing with special rates), we are
making the following changes:
Removing the words ``under 5 CFR 359.705 or 5 CFR part
536'' from the definition of rate of basic pay in Sec. 530.302 because
these references are included in the definition of retained rate in the
same section.
Revising the last sentence of Sec. 530.304(a) to make the
language regarding the limitation on special rates more consistent with
the language in 5 U.S.C. 5305(a)(1).
Revising Sec. 530.309(d) to add a cross reference to
Sec. 530.308 and to update a reference to an action under Sec.
930.214. OPM revised the administrative law judge program regulations
in 5 CFR part 930, subpart B, in March 2007, which included renumbering
Sec. 930.214 as Sec. 930.211.
In subpart B of part 531 (dealing with GS basic pay setting), we
are making the following changes:
Revising the definition of rate of basic pay in Sec.
531.203 to clarify that, for the purpose of applying the maximum
payable rate rule using a rate under a non-GS pay system as an
employee's highest previous rate, the non-GS rate may not be a type of
rate that is generally excluded under Sec. 531.223. We are also adding
references to 5 CFR 530.308, 531.610, and 536.307. Those regulations
address the purposes for which a special rate is considered a rate of
basic pay, a locality rate is considered a rate of basic pay, and a
retained rate is considered a rate of basic pay, respectively.
In Sec. 531.205, replacing ``(or rate)'' with ``(or a GM
employee's GS rate)'' in the second sentence.
Revising Sec. 531.212(a)(3) to clarify a ``non-permanent
appointment'' excludes a Schedule C appointment under 5 CFR part 213.
An agency may not use the superior qualifications and special needs
pay-setting authority when an employee moves from a Schedule C
appointment to a non-Schedule C appointment, unless the employee has a
90-day break in service. We are also listing non-permanent appointments
and time-limited appointments separately to increase clarity.
Adding employment under the Student Career Experience
Program under 5 CFR 213.3202(b) as a new paragraph (3)(v) in Sec.
531.212(a). A similar provision was included in the former superior
qualifications and special needs pay-setting regulations, but it was
inadvertently left out of the interim regulations.
Revising Sec. 531.215 to clarify an agency is not limited
in pursuing action for misconduct or other problems and setting pay in
accordance with such action when an employee is in a supervisory
probationary period, consistent with 5 U.S.C. 3321(b)(2). Such an
action, however, would have to
[[Page 66150]]
be taken in accordance with applicable laws and regulations.
Revising Sec. 531.221(a)(1) to clarify that the maximum
payable rate rule may be used when an employee moves from a non-GS pay
system to the GS pay system without a change in position. We are also
clarifying that an agency may use the maximum payable rate rule upon
termination of grade or pay retention.
In Sec. 531.244, replacing ``rate of basic pay'' in each
place it appears with ``GS rate'' and replacing ``GM rate'' in
paragraph (a)(2) with ``GS rate''.
Replacing ``rate of basic pay'' in Sec. 531.246 with ``GS
rate''.
Replacing steps 1-6 with steps A-F in Sec. 531.247 to be
consistent with other tables in the regulations.
In subpart D of part 531 (dealing with GS within-grade increases),
we are making the following changes:
Deleting the last sentence of Sec. 531.406(b)(2). The
sentence is not necessary because Sec. 531.406(b)(3) sufficiently
states that time in a nonpay status that is in excess of the allowable
amount extends a waiting period for a within-grade increase by the
excess amount, except as provided in Sec. 531.406(c).
Revising Sec. 531.407(a)(2) to improve clarity.
In subpart F of part 531 (dealing with locality-based comparability
payments), we are updating a reference in Sec. 531.611(d) to the
administrative law judge program regulations. OPM revised 5 CFR 930,
subpart B, in March 2007, which included renumbering Sec. 930.214 as
Sec. 930.211.
In 5 CFR part 536 (dealing with grade and pay retention), we are
making the following changes:
Replacing the term representative rate with comparison
rate throughout part 536, including the definition of representative
rate in Sec. 536.103. OPM's regulations in 5 CFR 351.203 define the
term representative rate for reduction-in-force purposes. Separate
terms will help reduce any confusion since the terms are defined
differently.
Correcting an omission by clarifying in Sec. 536.208 that
termination of grade retention benefits takes effect at the end of the
day before separation from service if termination is the result of a
break in service. We are also adding in Sec. 536.208 a necessary
exception to the rule that the termination of grade retention benefits
takes effect at the end of the last day of the pay period in which the
employee elects to terminate grade retention benefits. The exception is
that, if an employee's election specifically provides that the
termination will take effect at the end of a later pay period, the
election is considered to be made effective on the last day of that
later pay period.
Revising Sec. 536.304(c)(3) and (c)(4) to add references
to the terminating conditions in Sec. 536.308.
Adding, in Sec. 536.307, an explicit reference to adverse
action provisions in 5 CFR part 752 as a purpose for which a retained
rate is considered a rate of basic pay, consistent with longstanding
policies and OPM's interpretation of the interim regulations. We also
are removing ``OPM'' from Sec. 536.307(a)(11) to clarify that a
retained rate is considered a rate of basic pay for the purpose of
computing and applying other provisions as specified in regulations of
OPM or other agencies.
Revising the language in Sec. 536.308(a)(2) to clarify
that entitlement to an equal or higher rate of basic pay during a
temporary promotion or temporary reassignment does not terminate an
employee's preexisting entitlement to pay retention, but that the pay
retention entitlement is held in abeyance.
Correcting an omission in Sec. 536.308 by clarifying that
termination of pay retention benefits takes effect at the end of the
day before separation from service if termination is the result of a
break in service.
Correcting an omission in Sec. 536.308 by clarifying that
termination of pay retention benefits takes effect at the end of the
day before the employee becomes entitled to an equal or greater rate as
described in Sec. 536.308(a)(2).
In 5 CFR part 550 (dealing with miscellaneous pay administration
matters), we are making the following changes:
In Sec. Sec. 550.202 and 550.703, adding the word
``supplement'' after ``special rate'' in paragraph (1) of the
definition of rate of basic pay.
Deleting a reference to a temporary appointment pending
establishment of a register (TAPER) in the definition of nonqualifying
appointment in Sec. 550.703 because the TAPER authority is no longer
used.
We are replacing the term representative rate with comparison rate
in Sec. Sec. 550.703, 831.503, and 842.206 and clarifying those
definitions. Under 5 CFR 536.102(b)(6), an agency may not provide grade
or pay retention under part 536 to an employee who moves between
positions not under a covered pay system or from a position under a
covered pay system to a position not under a covered pay system.
However, the severance pay (Sec. 550.703) and discontinued service
retirement provisions (Sec. Sec. 831.503 and 842.206) do not have this
same exclusion. Therefore, although paragraph (2) in the definition of
new term comparison rate in Sec. 536.103 of the grade and pay
retention regulations refers to comparing grades or levels of work in
making reasonable offer determinations when one of the grades or levels
of work is not under a covered pay system, this comparison for making
reasonable offer determinations for severance pay or discontinued
service retirement purposes is not limited to whether the offered
position is under a covered pay system.
Title 38 Market Pay
Since publication of the interim regulations in May 2005, OPM has
used its authority under 5 U.S.C. 5371 to delegate to certain agencies
authority to provide market pay to physicians and dentists under 38
U.S.C. 7431(c), consistent with the authority of the Department of
Veterans Affairs. Under this OPM delegation, title 38 market pay may be
paid on top of General Schedule base rates in lieu of locality payments
under 5 U.S.C. 5304, special rate supplements under 5 U.S.C. 5305, or
grade and pay retention under 5 U.S.C. 5361-5365. We decided it would
not be necessary to amend the regulations related to locality payments,
special rate supplements, and grade and pay retention to address the
exclusion of physicians and dentists receiving title 38 market pay.
Those exclusions are not effected under the authorities related to
those payments, but are based on OPM's administrative authority under 5
U.S.C. 5371. Title 38 market pay is generally not considered basic pay
for GS pay administration purposes; however, it may be used in
establishing an employee's highest previous rate. (See revised
definitions of rate of basic pay and special rate in Sec. 531.203 and
new paragraph (a)(5) in Sec. 531.221.)
Pay Setting for NAFI Employees Who Move to GS Positions
This notice finalizes the rules in 5 CFR 531.216, as published in
the May 2005 interim regulations, concerning pay setting for
nonappropriated fund instrumentality (NAFI) employees who move to GS
positions. However, section 1114 of the National Defense Authorization
Act for Fiscal Year 2008 (Pub. L. 110-181, January 28, 2008) amended 5
U.S.C. 5334(f) to provide that a NAFI employee in the Department of
Defense (DOD) or the United States Coast Guard (USCG) (as described in
5 U.S.C. 2105(c)) who moves voluntarily to a GS position in DOD or
USCG, respectively, without a break in service of more than 3 days may
(at the employing agency's discretion) have the GS rate of basic pay
set at the lowest
[[Page 66151]]
step rate of the applicable GS grade that equals or exceeds the former
NAFI rate. This amendment became effective on January 28, 2008. Under
previous law, the employee's GS rate of basic pay could not exceed the
formerly applicable NAFI rate in such voluntary movements; thus,
setting the rate at a GS step for these former NAFI employees generally
resulted in a reduction in pay. The amendment permits DOD and USCG to
set pay at the next higher step rate, avoiding a pay reduction. OPM has
issued proposed regulations to conform with this statutory change. (See
73 FR 50575, August 27, 2008.)
E.O. 12866, Regulatory Review
This rule has been reviewed by the Office of Management and Budget
in accordance with E.O. 12866.
Regulatory Flexibility Act
I certify that these regulations will not have a significant
economic impact on a substantial number of small entities because they
will apply only to Federal agencies and employees.
List of Subjects in 5 CFR 294, 359, 362, 451, 530, 531, 532, 534,
536, 550, 591, 630, 831, and 842
Administrative practice and procedure; Air traffic controllers;
Alimony; Claims; Decorations, medals, awards; Disability benefits;
Firefighters; Freedom of information; Government employees; Hospitals;
Income taxes; Intergovernmental relations; Law enforcement officers;
Pensions; Reporting and recordkeeping requirements; Research;
Retirement; Students; Transportation and travel expenses; Wages.
Office of Personnel Management.
Michael W. Hager,
Acting Director.
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The interim rule published May 31, 2005, at 70 FR 31278 and amended at
70 FR 74995 (December 19, 2005) is adopted as final with the changes
set forth below, and OPM further amends 5 CFR chapter I as follows:
PART 359--REMOVAL FROM THE SENIOR EXECUTIVE SERVICE; GUARANTEED
PLACEMENT IN OTHER PERSONNEL SYSTEMS
0
1. The authority citation for part 359 is revised to read as follows:
Authority: 5 U.S.C. 1302, 3302, and 3596, unless otherwise
noted.
Subpart G--Guaranteed Placement
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2. In Sec. 359.705, revise paragraphs (a)(1) and (c) to read as
follows:
Sec. 359.705 Pay.
(a) * * *
(1) The rate of basic pay in effect for the position in which the
appointee is being placed (i.e., a rate of basic pay within the normal
rate range of the position in which placed, consistent with the rules
of the pay system covering such position);
* * * * *
(c)(1) For an employee placed in a General Schedule position, a
saved rate established under this section may not be supplemented by a
locality payment under 5 U.S.C. 5304, a special rate supplement under 5
U.S.C. 5305, or a similar payment under other legal authority.
(2) A saved rate established under this section is subject to the
limitation on Senior Executive Service pay in 5 U.S.C. 5382 of the rate
for level II of the Executive Schedule.
(3) A saved rate established under this section is considered an
employee's rate of basic pay for the same purposes as a retained rate
under 5 CFR part 536, as described in 5 CFR 536.307.
* * * * *
PART 530--PAY RATES AND SYSTEMS (GENERAL)
0
3. The authority citation for part 530 continues to read as follows:
Authority: 5 U.S.C. 5305 and 5307; subpart C also issued under 5
U.S.C. 5338 and sec. 4 of the Performance Management and Recognition
System Termination Act of 1993, Pub. L. 103-89), 107 Stat. 981.
Subpart C--Special Rate Schedules for Recruitment and Retention
0
4. In Sec. 530.302--
0
a. Revise the definition of position of record;
0
b. Amend the definition of rate of basic pay by removing the words
``under 5 CFR 359.705 or 5 CFR part 536''; and
0
c. Revise the definition of special rate supplement.
The revisions read as follows:
Sec. 530.302 Definitions.
* * * * *
Position of record means an employee's official position (defined
by grade, occupational series, employing agency, LEO status, and any
other condition that determines coverage under a pay schedule (other
than official worksite)), as documented on the employee's most recent
Notification of Personnel Action (Standard Form 50 or equivalent) and
current position description. A position to which an employee is
temporarily detailed is not documented as a position of record. For an
employee whose change in official position is followed within 3
workdays by a reduction in force resulting in the employee's separation
before he or she is required to report for duty in the new position,
the position of record in effect immediately before the position change
is deemed to remain the position of record through the date of
separation.
* * * * *
Special rate supplement means the portion of a special rate paid
above an employee's GS rate. However, for a law enforcement officer
receiving an LEO special base rate who is also entitled to a special
rate, the special rate supplement equals the portion of the special
rate paid above the officer's LEO special base rate. When a special
rate schedule covers both LEO positions and other positions, the value
of the special rate supplement will be less for law enforcement
officers receiving an LEO special base rate (since that rate is higher
than the corresponding GS rate). The payable amount of a special rate
supplement is subject to the Executive Schedule level IV limitation on
special rates, as provided in Sec. 530.304(a).
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5. In Sec. 530.304, revise the last sentence of paragraph (a) to read
as follows:
Sec. 530.304 Establishing or increasing special rates.
(a) * * * A special rate may not exceed the rate for level IV of
the Executive Schedule.
* * * * *
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6. In Sec. 530.309, revise paragraph (d) to read as follows:
Sec. 530.309 Miscellaneous provisions.
* * * * *
(d) Consistent with Sec. 530.308, the reduction or termination of
an employee's special rate supplement in accordance with the
requirements of this subpart is not an adverse action under 5 CFR part
752, subpart D, or an action under 5 CFR 930.211.
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7. In Sec. 530.322, revise the first sentence of paragraph (a) to read
as follows:
Sec. 530.322 Setting pay when a special rate schedule is newly
established or increased.
(a) General rule. When an employee holds a position that becomes
covered by a newly established special rate schedule (including a
schedule for which coverage is expanded) or increased special rate
schedule (including an increased special rate range within a schedule),
the agency must set the employee's special rate at the step (or
relative position in range for
[[Page 66152]]
a GM employee) of the grade on the new special rate schedule that
corresponds to the employee's existing numerical step (or relative
position in range for a GM employee) as in effect immediately before
the new special rate schedule takes effect, except as otherwise
provided in this section. * * *
* * * * *
Sec. 530.323 [Amended]
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8. In Sec. 530.323, remove the parenthetical clause ``(or rate)'' in
both places in paragraph (c) and add ``(or relative position in range
for a GM employee)'' in each place.
PART 531--PAY UNDER THE GENERAL SCHEDULE
0
9. The authority citation for part 531 continues to read as follows:
Authority: 5 U.S.C. 5115, 5307, and 5338; sec. 4 of Pub. L. 103-
89, 107 Stat. 981; and E.O. 12748, 56 FR 4521, 3 CFR, 1991 Comp., p.
316; Subpart B also issued under 5 U.S.C. 5303(g), 5305, 5333,
5334(a) and (b), and 7701(b)(2); Subpart D also issued under 5
U.S.C. 5335(g) and 7701(b)(2); Subpart E also issued under 5 U.S.C.
5336; Subpart F also issued under 5 U.S.C. 5304, 5305, and 5338; and
E.O. 12883, 58 FR 63281, 3 CFR, 1993 Comp., p. 682 and E.O. 13106,
63 FR 68151, 3 CFR, 1998 Comp., p. 224.
Subpart B--Determining Rate of Basic Pay
0
10. In Sec. 531.203, revise the definitions of position of record,
rate of basic pay and special rate supplement to read as follows:
Sec. 531.203 Definitions.
* * * * *
Position of record means an employee's official position (defined
by grade, occupational series, employing agency, LEO status, and any
other condition that determines coverage under a pay schedule (other
than official worksite)), as documented on the employee's most recent
Notification of Personnel Action (Standard Form 50 or equivalent) and
current position description. A position to which an employee is
temporarily detailed is not documented as a position of record. For an
employee whose change in official position is followed within 3
workdays by a reduction in force resulting in the employee's separation
before he or she is required to report for duty in the new position,
the position of record in effect immediately before the position change
is deemed to remain the position of record through the date of
separation.
* * * * *
Rate of basic pay means the rate of pay fixed by law or
administrative action for the position held by a GS employee before any
deductions, including a GS rate, an LEO special base rate, a special
rate, a locality rate, and a retained rate, but exclusive of additional
pay of any other kind. For the purpose of applying the maximum payable
rate rules in Sec. Sec. 531.216 and 531.221 using a rate under a non-
GS pay system as an employee's highest previous rate, rate of basic pay
means a rate of pay under other legal authority which is equivalent to
a rate of basic pay for GS employees, as described in this definition,
excluding a rate under Sec. 531.223. (See also 5 CFR 530.308, 531.610,
and 536.307.)
* * * * *
Special rate means a rate of pay within a special rate schedule
established under 5 CFR part 530, subpart C, or a similar rate for GS
employees established under other legal authority (e.g., 38 U.S.C.
7455). The term special rate does not include an LEO special base rate
or an adjusted rate including market pay under 38 U.S.C. 7431(c).
* * * * *
Special rate supplement means the portion of a special rate paid
above an employee's GS rate. However, for a law enforcement officer
receiving an LEO special base rate who is also entitled to a special
rate, the special rate supplement equals the portion of the special
rate paid above the officer's LEO special base rate. When a special
rate schedule covers both LEO positions and other positions, the value
of the special rate supplement will be less for law enforcement
officers receiving an LEO special base rate (since that rate is higher
than the corresponding GS rate). The payable amount of a special rate
supplement is subject to the Executive Schedule level IV limitation on
special rates, as provided in 5 CFR 530.304(a).
* * * * *
Sec. 531.204 [Amended]
0
11. In Sec. 531.204, amend paragraph (c) by removing the parenthetical
clause ``(or relative position)'' and adding in its place ``(or
relative position in range for a GM employee)''.
0
12. In Sec. 531.205, revise the second sentence to read as follows:
Sec. 531.205 Converting pay upon change in location of employee's
official worksite.
* * * The agency must first set the employee's rate(s) of basic pay
in the applicable pay schedule(s) in the new location based on his or
her position of record (including grade) and step (or a GM employee's
GS rate) immediately before the change in the employee's official
worksite. * * *
0
13. In Sec. 531.212--
0
a. Revise paragraph (a)(3)(i);
0
b. Remove ``or'' at the end of paragraph (a)(3)(ii);
0
c. Remove the period at the end of paragraph (a)(3)(iii) and insert a
semicolon; and
0
d. Add paragraphs (a)(3)(iv) and (a)(3)(v).
The revision and additions read as follows:
Sec. 531.212 Superior qualifications and special needs pay-setting
authority.
(a) * * *
(3) * * *
(i) Employment under a time-limited appointment in the competitive
or excepted service;
* * * * *
(iv) Employment under a non-permanent appointment (excluding a
Schedule C appointment under 5 CFR part 213) in the competitive or
excepted service; or
(v) Employment under the Student Career Experience Program under 5
CFR 213.3202(b).
* * * * *
0
14. In Sec. 531.213, remove the parenthetical clause ``(or rate)'' and
add in its place ``(or relative position in range for a GM employee)''.
0
15. In Sec. 531.215, revise the last sentence in paragraph (d) to read
as follows:
Sec. 531.215 Setting pay upon demotion.
* * * * *
(d) * * * However, nothing in this paragraph prohibits an agency
from taking action against an employee serving under a probationary
period under 5 U.S.C. 3321(a)(2) for cause unrelated to supervisory or
managerial performance and setting pay in accordance with such action.
* * * * *
0
16. In Sec. 531.221--
0
a. Revise the first sentence in paragraph (a)(1);
0
b. Revise paragraph (a)(4); and
0
c. Add a new paragraph (a)(5).
The revisions and addition read as follows:
Sec. 531.221 Maximum payable rate rule.
(a) General. (1) An agency may apply the maximum payable rate rule
as described in this section to determine an employee's payable rate of
basic pay under the GS pay system at a rate higher than the otherwise
applicable rate upon reemployment, transfer, reassignment, promotion,
demotion, change in type of
[[Page 66153]]
appointment, termination of a critical position pay authority under 5
CFR part 535, movement from a non-GS pay system, or termination of
grade or pay retention under 5 CFR part 536. * * *
* * * * *
(4) In applying this section, an agency must treat a critical
position pay rate under 5 CFR part 535 as if it were a rate under a
non-GS pay system, as described in paragraph (d) of this section.
(5) In applying this section, an agency must treat an adjusted GS
rate that includes market pay under 38 U.S.C. 7431(c) as if it were a
rate under a non-GS pay system, as described in paragraph (d) of this
section.
* * * * *
0
17. In Sec. 531.223--
0
a. Remove ``or'' at the end of paragraph (g);
0
b. Remove the period at the end of paragraph (h) and insert a
semicolon; and
0
c. Add new paragraphs (i) and (j) to read as follows:
Sec. 531.223 Rates of basic pay that may not be used as the highest
previous rate.
* * * * *
(i) A rate received as a member of the uniformed services; or
(j) A retained rate under 5 U.S.C. 5363 or a similar rate under
another legal authority.
Sec. 531.244 [Amended]
0
18. In Sec. 531.244, remove ``rate of basic pay'' in each place it
appears and add ``GS rate'' in each place, and remove ``GM rate'' in
paragraph (a)(2) and add ``GS rate'' in its place.
0
19. Revise Sec. 531.246 to read as follows:
Sec. 531.246 Within-grade increases for GM employees.
GM employees are entitled to within-grade increases as provided
under subpart D of this part. A within-grade increase may not cause a
GM employee's GS rate to exceed the maximum GS rate of his or her
grade. GM employees may receive quality step increases as provided in
subpart E of this part.
0
20. In Sec. 531.247, revise the table in paragraph (c)(2) as follows:
Sec. 531.247 Maximum payable rate rule for GM employees.
* * * * *
(c) * * *
(2) * * *
Step A.................. Find the difference between the employee's
highest previous rate and the minimum rate
for the GS rate range (for the employee's
current grade) in effect at the time the
highest previous rate was earned.
Step B.................. Find the difference between the maximum rate
and the minimum GS rate for the rate range
identified in step A. (If the GS maximum
rate was not payable because of the EX level
V pay limitation, use the uncapped maximum
rate.)
Step C.................. Divide the result from step A by the result
from step B. Carry this result to the
seventh decimal place and truncate, rather
than round, the result. This decimal factor
represents the employee's relative position
in the rate range.
Step D.................. Using the current GS rate range (for the
employee's current grade), find the
difference between the maximum rate and the
minimum rate. (If the maximum GS rate was
not payable because of the EX level V pay
limitation, use the uncapped maximum GS
rate.)
Step E.................. Multiply the result from step D by the
factor derived under step C.
Step F.................. Add the result from step E to the minimum
rate for the employee's current GS rate
range and round to the next higher whole
dollar. This rate is the maximum payable GS
rate the agency may pay the employee
(subject to the EX level V pay limitation).
* * * * *
Subpart D--Within-Grade Increases
Sec. 531.406 [Amended]
0
21. In Sec. 531.406, remove the last sentence of paragraph (b)(2).
0
22. In Sec. 531.407, revise paragraphs (a)(2)(i) and (ii) and
paragraph (b) to read as follows:
Sec. 531.407 Equivalent increase determinations.
(a) * * *
(2) * * *
(i) A temporary promotion if, at the end of the that temporary
promotion, the employee is returned to the grade from which promoted;
or
(ii) A promotion to a higher-graded supervisory or managerial
position when the employee does not satisfactorily complete a
probationary period established under 5 U.S.C. 3321(a)(2) and is
returned to a position at the lower grade held before promotion;
* * * * *
(b) Non-GS employees who move to the GS pay system. When an
employee performs service under a non-GS pay system for Federal
employees and that service is potentially creditable towards a GS
within-grade increase waiting period, an equivalent increase is
considered to occur at the time of any of the following personnel
actions in the non-GS pay system:
(1) A promotion to a higher grade or work level within the non-GS
pay system (unless the promotion is cancelled and the employee's rate
of basic pay is redetermined as if the promotion had not occurred); or
(2) An opportunity to receive a within-level or within-range
increase that results in forward movement in the applicable range of
rates of basic pay (including an increase granted immediately upon
movement to the non-GS pay system from another pay system--e.g., to
account for the value of accrued within-grade increases under the
former pay system or to provide a promotion-equivalent increase), where
``forward movement in the applicable range'' means any kind of increase
in the employee's rate of basic pay other than an increase that is
directly and exclusively linked to--
(i) A general structural increase in the employee's basic pay
schedule or rate range (including the adjustment of a range minimum or
maximum); or
(ii) The employee's placement under a new basic pay schedule within
the same pay system, when such placement results in a nondiscretionary
basic pay increase to account for occupational pay differences.
* * * * *
Subpart F--Locality-Based Comparability Payments
0
23. In Sec. 531.602, revise the definitions of position of record and
special rate supplement to read as follows:
Sec. 531.602 Definitions.
* * * * *
Position of record means an employee's official position (defined
by grade, occupational series, employing agency, LEO status, and any
other condition that determines coverage under a pay schedule (other
than official worksite)), as documented on the employee's most recent
Notification of Personnel Action (Standard Form 50 or equivalent) and
current position description. A position to which an employee is
temporarily detailed is not documented as a position of record. For an
employee whose change in official position is followed within 3
workdays by a reduction in force resulting in the
[[Page 66154]]
employee's separation before he or she is required to report for duty
in the new position, the position of record in effect immediately
before the position change is deemed to remain the position of record
through the date of separation.
* * * * *
Special rate supplement means the portion of a special rate paid
above an employee's scheduled annual rate of pay. However, for a law
enforcement officer receiving an LEO special base rate who is also
entitled to a special rate, the special rate supplement equals the
portion of the special rate paid above the officer's LEO special base
rate. When a special rate schedule covers both LEO positions and other
positions, the value of the special rate supplement will be less for
law enforcement officers receiving an LEO special base rate (since that
rate is higher than the corresponding GS rate). The payable amount of a
special rate supplement is subject to the Executive Schedule level IV
limitation on special rates, as provided in 5 CFR 530.304(a).
* * * * *
0
24. Revise Sec. 531.605 to read as follows:
Sec. 531.605 Determining an employee's official worksite.
(a)(1) Except as otherwise provided in this section, the official
worksite is the location of an employee's position of record where the
employee regularly performs his or her duties.
(2) If the employee's work involves recurring travel or the
employee's work location varies on a recurring basis, the official
worksite is the location where the work activities of the employee's
position of record are based, as determined by the employing agency,
subject to the requirement that the official worksite must be in a
locality pay area in which the employee regularly performs work.
(3) An agency must document an employee's official worksite on an
employee's Notification of Personnel Action (Standard Form 50 or
equivalent).
(b) For an employee who is relocated and authorized to receive
relocation expenses under 5 U.S.C. chapter 57, subchapter II (or
similar authority), the official worksite is the established worksite
for the position in the area to which the employee has been relocated.
For an employee authorized to receive relocation expenses under 5
U.S.C. 5737 in connection with an extended assignment resulting in a
temporary change of station, the worksite associated with the extended
assignment is the official worksite. (See 41 CFR 302-1.1.)
(c) For an employee whose assignment to a new worksite is followed
within 3 workdays by a reduction in force resulting in the employee's
separation before he or she is required to report for duty at the new
location, the official worksite in effect immediately before the
assignment remains the official worksite through the date of
separation.
(d) For an employee covered by a telework agreement, the following
rules apply:
(1) If the employee is scheduled to work at least twice each
biweekly pay period on a regular and recurring basis at the regular
worksite for the employee's position of record, the regular worksite
(where the employee's work activities are based) is the employee's
official worksite. However, in the case of such an employee whose work
location varies on a recurring basis, the employee need not work at
least twice each biweekly pay period at the regular official worksite
(where the employee's work activities are based) as long as the
employee is regularly performing work within the locality pay area for
that worksite.
(2) An authorized agency official may make an exception to the
twice-in-a-pay-period standard in paragraph (d)(1) of this section in
appropriate situations of a temporary nature, such as the following:
(i) An employee is recovering from an injury or medical condition;
(ii) An employee is affected by an emergency situation, which
temporarily prevents the employee from commuting to his or her regular
official worksite;
(iii) An employee has an extended approved absence from work (e.g.,
paid leave);
(iv) An employee is in temporary duty travel status away from the
official worksite; or
(v) An employee is temporarily detailed to work at a location other
than a location covered by a telework agreement.
(3) If an employee covered by a telework agreement does not meet
the requirements of paragraphs (d)(1) or (d)(2) of this section, the
employee's official worksite is the location of the employee's telework
site.
(4) An agency must determine a telework employee's official
worksite on a case-by-case basis. A determination made under this
paragraph (d) is within the sole and exclusive discretion of the
authorized agency official, subject only to OPM review and oversight.
(e) In applying paragraph (d) of this section for the purpose of
other location-based pay entitlements under other regulations that
refer to this section, the reference to a locality pay area is deemed
to be a reference to the applicable geographic area associated with the
given pay entitlement. For example, for the purpose of special rates
under 5 CFR part 530, subpart C, the reference to a locality pay area
is deemed to be a reference to the geographic area covered by a special
rate schedule.
0
25. In Sec. 531.610--
0
a. Revise the introductory text;
0
b. Revise paragraph (f);
0
c. Redesignate paragraphs (g) through (n) as (h) through (o),
respectively; and
0
d. Add a new paragraph (g).
The revisions and addition read as follows:
Sec. 531.610 Treatment of locality rate as basic pay.
A locality rate is considered to be an employee's rate of basic pay
only for the purpose of computing or applying--
* * * * *
(f) Post differentials under 5 U.S.C. 5925(a) and danger pay
allowances under 5 U.S.C. 5928 for an employee temporarily working in a
foreign area when the employee's official worksite is located in a
locality pay area;
(g) Post differentials under 5 U.S.C. 5941 and 5 CFR part 591,
subpart B, for an employee temporarily working in a nonforeign area
when the employee's official worksite is located in a locality pay
area;
* * * * *
0
26. In Sec. 531.611, revise paragraph (d) to read as follows:
Sec. 531.611 Miscellaneous provisions.
* * * * *
(d) Consistent with Sec. 531.610, a reduction or termination of a
locality rate under Sec. 531.609 is not an adverse action for the
purpose of 5 CFR part 752, subpart D, or an action under 5 CFR 930.211.
PART 536--GRADE AND PAY RETENTION
0
27. The authority citation for part 536 is revised to read as follows:
Authority: 5 U.S.C. 5361-5366; sec. 4 of the Performance
Management and Recognition System Termination Act of 1993 (Pub. L.
103-89), 107 Stat. 981; Sec. 536.301(b) also issued under 5 U.S.C.
5334(b); Sec. 536.308 also issued under section 301(d)(2) of the
Federal Workforce Flexibility Act of 2004 (Pub. L. 108-411), 118
Stat. 2305; Sec. 536.405 also issued under 5 U.S.C. 552, Freedom of
Information Act, Public Law 92-502.
Subpart A--General Provisions
0
28. In Sec. 536.103--
[[Page 66155]]
0
a. Revise the definition of position of record;
0
b. Amend the definition of representative rate by removing
``representative rate'' in each place it appears and adding in its
place ``comparison rate''; and
0
c. Revise the definition of reduced in grade or pay for personal cause.
The revisions read as follows:
Sec. 536.103 Definitions.
* * * * *
Position of record means an employee's official position (defined
by grade, occupational series, employing agency, LEO status, and any
other condition that determines coverage under a pay schedule (other
than official worksite)), as documented on the employee's most recent
Notification of Personnel Action (Standard Form 50 or equivalent) and
current position description. A position to which an employee is
temporarily detailed is not documented as a position of record. For an
employee whose change in official position is followed within 3
workdays by a reduction in force resulting in the employee's separation
before he or she is required to report for duty in the new position,
the position of record in effect immediately before the position change
is deemed to remain the position of record through the date of
separation.
* * * * *
Reduced in grade or pay for personal cause means a reduction in
grade or rate of basic pay based on the conduct, character, or
unacceptable performance of an employee. In situations in which an
employee is reduced in grade or pay for inability to perform the duties
of his or her position because of a medical or physical condition
beyond the employee's control, the reduction in grade or pay is not
considered to be for personal cause.
* * * * *
Sec. 536.105 [Amended]
0
29. In Sec. 536.105, amend paragraph (a) by removing ``representative
rates'' and inserting ``comparison rates''; and amend paragraph (b) by
removing ``representative rate'' and inserting ``comparison rate''.
Subpart B--Grade Retention
Sec. 536.201 [Amended]
0
30. In Sec. 536.201, remove paragraph (e).
Sec. 536.202 [Amended]
0
31. In Sec. 536.202, remove paragraph (d).
Sec. 536.206 [Amended]
0
32. In Sec. 536.206, amend paragraph (b) by removing ``(or rate)'' and
adding in its place ``(or relative position in range for a GM
employee)''.
0
33. In Sec. 536.207, revise paragraph (a)(2) by removing
``representative rates'' and inserting ``comparison rates''; and amend
paragraph (c) by revising the second sentence to read as follows:
Sec. 536.207 Loss of eligibility for grade retention.
* * * * *
(c) * * * An employee is not eligible for pay retention under
subpart C of this part based on an action that provided eligibility for
grade retention if the employee elects to terminate eligibility for
grade retention under paragraph (a)(5) or (b) of this section.
0
34. In Sec. 536.208, revise paragraphs (c) and (d) to read as follows:
Sec. 536.208 Termination of grade retention.
* * * * *
(c) Termination of grade retention benefits takes effect--
(1) At the end of the day before separation from service if
termination is the result of a break in service;
(2) At the end of the day before placement if the termination is
the result of the employee's placement in another position; or
(3) At the end of the last day of the pay period in which the
employee--
(i) Declines a reasonable offer;
(ii) Elects to terminate grade retention benefits (except that, if
an employee's election specifically provides that the termination will
take effect at the end of a later pay period, the election is
considered to be made effective on the last day of that later pay
period for the purpose of applying this paragraph); or
(iii) Fails to enroll in, or comply with reasonable written
requirements established to assure full consideration under, a program
providing priority consideration for placement.
(d) If an employee's entitlement to grade retention terminates
under this section, the employee's rate of basic pay must be set in
accordance with the pay-setting rules and pay rates applicable to the
employee's position of record (e.g., 5 CFR part 531, subpart B, for GS
positions). An employee is not entitled to pay retention under subpart
C of this part based on a reduction in basic pay resulting from waiver
of the employee's grade retention entitlement under paragraph (a)(5) or
(b) of Sec. 536.207.
Subpart C--Pay Retention
0
35. In Sec. 536.301--
0
a. Revise the introductory text of paragraph (a);
0
b. Add ``or'' at the end of paragraph (a)(5);
0
c. Remove paragraphs (a)(6) and (a)(7);
0
d. Redesignate paragraph (a)(8) as paragraph (a)(6);
0
e. Redesignate paragraphs (b) through (d) as paragraphs (c) through
(e), respectively; and
0
f. Add a new paragraph (b).
The revision and addition read as follows:
Sec. 536.301 Mandatory pay retention.
(a) Subject to the requirements in Sec. 536.102 and this section,
an agency must provide pay retention to an employee who moves between
positions under a covered pay system or from a position not under a
covered pay system to a position under a covered pay system and whose
payable rate of basic pay otherwise would be reduced (after application
of any applicable geographic conversion under Sec. 536.303(a)) as a
result of--
* * * * *
(b) An agency must establish a retained rate when application of a
promotion increase rule for General Schedule or prevailing rate
employees results in a payable rate of basic pay that exceeds the
maximum rate of the highest applicable rate range for the employee's
new position. (See the promotion increase rules in 5 U.S.C. 5334(b) and
5 CFR 531.214 for GS employees and in 5 CFR 532.407 for prevailing rate
employees--in particular, the special provisions in these promotion
increase rules on establishing a retained rate equal to an employee's
existing rate when that existing rate exceeds the applicable range
maximum.) Once established, such a retained rate is governed by the
provisions of this subpart.
* * * * *
0
36. In Sec. 536.303, revise the second sentence after the heading of
paragraph (a) as follows:
Sec. 536.303 Geographic conversion.
(a) Geographic conversion at the time of action that may provide
initial entitlement to pay retention. * * * The agency must identify
the highest applicable rate range that would apply to the employee's
position of record before the pay action as if that position were
stationed at the new official worksite and determine the employee's
converted payable rate of basic pay based on the step (or relative
position in range for a GM employee) in that range that corresponds to
the employee's step (or relative position in range for a GM employee)
before the pay action. * * *
* * * * *
[[Page 66156]]
0
37. In Sec. 536.304, revise paragraphs (c)(3) and (c)(4) to read as
follows:
Sec. 536.304 Determining an employee's pay retention entitlement.
* * * * *
(c) * * *
(3) If the employee's pay system is not changing but the employee
is being promoted to a higher-graded position, the agency must apply
the applicable promotion rules to determine the employee's payable rate
of basic pay (e.g., the rules in 5 CFR 531.214(d)(5) for GS positions
and 5 CFR 532.407 for Federal Wage System positions). If the promotion
action results in a terminating condition as described in Sec. 536.308
(e.g., the resulting rate is equal to or greater than the existing
retained rate), pay retention ceases to apply. Otherwise, the
employee's existing retained rate continues.
(4) If the employee is moving to a position under a different
covered pay system whose grade has a higher comparison rate, the agency
must apply the applicable pay administration rules to determine the
employee's payable rate of basic pay (e.g., part 531, subpart B, for GS
positions and part 532 for Federal Wage System provisions). If the
promotion action results in a terminating condition as described in
Sec. 536.308 (e.g., the resulting rate is equal to or greater than the
existing retained rate), pay retention ceases to apply. Otherwise, the
employee's existing retained rate continues.
* * * * *
0
38. In Sec. 536.307--
0
a. Redesignate paragraphs (a)(10) and (a)(11) as paragraphs (a)(11) and
(a)(12), respectively;
0
b. Amend paragraph (a)(11), as redesignated, by removing ``OPM''; and
0
c. Add a new paragraph (a)(10).
The addition reads as follows:
Sec. 536.307 Treatment of a retained rate as basic pay for other
purposes.
(a) * * *
(10) Adverse action provisions in 5 CFR part 752;
* * * * *
0
39. In Sec. 536.308--
0
a. Amend paragraph (a)(4) by removing ``representative rates'' and
adding in its place ``comparison rates''; and
0
b. Revise paragraphs (a)(2) and (c).
The revisions read as follows:
Sec. 536.308 Loss of eligibility for or termination of pay retention.
(a) * * *
(2) The employee is entitled to a rate of basic pay under a covered
pay system which is equal to or greater than the employee's retained
rate (after applying any applicable geographic conversion under
paragraph (b) of this section), except that entitlement to a retained
rate will not be terminated based on entitlement to an equal or higher
rate of basic pay during a temporary promotion or temporary
reassignment but will be held in abeyance during that temporary period.
* * * * *
(c) Termination of pay retention benefits takes effect--
(1) At the end of the day before separation from service if
termination is the result of a break in service;
(2) At the end of the day before the employee becomes entitled to
an equal or greater rate as described in paragraph (a)(2) of this
section;
(3) At the end of the day before placement or movement if the
termination is the result of the employee's placement in or movement to
another position; or
(4) At the end of the last day of the pay period in which the
employee declines a reasonable offer.
* * * * *
PART 550--PAY ADMINISTRATION (GENERAL)
Subpart B--Advances in Pay
0
40. The authority citation for subpart B of part 550 continues to read
as follows:
Authority: 5 U.S.C. 5524a, 5545a(h)(2)(B); E.O. 12748, 3 CFR,
1992 Comp., p. 316.
0
41. In Sec. 550.202, amend the definition of rate of basic pay by
adding the word ``supplement'' after ``special rate'' in paragraph (1)
of the definition.
Subpart G--Severance Pay
0
42. The authority citation for subpart G of part 550 continues to read
as follows:
Authority: 5 U.S.C. 5595; E.O. 11257, 3 CFR, 1964-1965 Comp., p.
357.
0
43. In Sec. 550.703--
0
A. Add a definition of comparison rate in alphabetical order;
0
B. Amend the definition of nonqualifying appointment by removing
paragraph (f)(2) and redesignating paragraphs (f)(3) through (f)(6) as
paragraphs (f)(2) through (f)(5), respectively;
0
C. Amend the definition of rate of basic pay by adding the word
``supplement'' after ``special rate'' in paragraph (1) of the
definition;
0
D. Amend the definition of reasonable offer by removing
``representative rate'' in both places in paragraph (c)(4) and by
adding in its place ``comparison rate''; and
0
E. Remove the definition of representative rate.
The addition reads as follows:
Sec. 550.703 Definitions.
* * * * *
Comparison rate has the meaning given that term in Sec. 536.103 of
this chapter, except paragraph (2) of that definition should be used
for the purpose of comparing grades or levels of work for all
situations not covered by paragraph (1) of that definition.
* * * * *
PART 831--RETIREMENT
0
44. The authority citation for part 831 continues to read as follows:
Authority: 5 U.S.C. 8347; Sec. 831.102 also issued under 5
U.S.C. 8334; Sec. 831.106 also issued under 5 U.S.C. 552a; Sec.
831.108 also issued under 5 U.S.C. 8336(d)(2); Sec. 831.114 also
issued under 5 U.S.C. 8336(d)(2), and section 1313(b)(5) of Pub. L.
107-296, 116 Stat. 2135; Sec. 831.201(b)(1) also issued under 5
U.S.C. 8347(g); Sec. 831.201(b)(6) also issued under 5 U.S.C.
7701(b)(2); Sec. 831.201(g) also issued under sections 11202(f),
11232(e), and 11246(b) of Pub. L. 105-33, 111 Stat. 251; Sec.
831.201(g) also issued under section 7(b) and (e) of Pub. L. 105-
274, 112 Stat. 2419; Sec. 831.201(i) also issued under sections 3
and 7(c) of Pub. L. 105-274, 112 Stat. 2419; Sec. 831.204 also
issued under section 102(e) of Pub. L. 104-8, 109 Stat. 102, as
amended by section 153 of Pub. L. 104-134, 110 Stat. 1321; Sec.
831.205 also issued under section 2207 of Pub. L. 106-265, 114 Stat.
784; Sec. 831.301 also issued under section 2203 of Pub. L. 106-265,
114 Stat. 780; Sec. 831.303 also issued under 5 U.S.C. 8334(d)(2)
and section 2203 of Pub. L. 106-235, 114 Stat. 780; Sec. 831.502
also issued under 5 U.S.C. 8337; Sec. 831.502 also issued under
section 1(3), E.O. 11228, 3 CFR 1964-1965 Comp. p. 317; Sec. 831.663
also issued under sections 8339(j) and (k)(2); Secs. 831.663 and
831.664 also issued under section 11004(c)(2) of Pub. L. 103-66, 107
Stat. 412; Sec. 831.682 also issued under section 201(d) of Pub. L.
99-251, 100 Stat. 23; Sec. 831.912 also issued under section 636 of
Appendix C to Pub. L. 106-554, 114 Stat. 2763A-164; subpart V also
issued under 5 U.S.C. 8343a and section 6001 of Pub. L. 100-203, 101
Stat. 1330-275; Sec. 831.2203 also issued under section 7001(a)(4)
of Pub. L. 101-508, 104 Stat. 1388-328.
Subpart E--Eligibility for Retirement
0
45. In Sec. 831.503, revise paragraph (b)(3)(iv) to read as follows:
Sec. 831.503 Involuntary retirement.
* * * * *
(b) * * *
(3) * * *
(iv) Not lower than the equivalent of two grades or pay levels
below the
[[Page 66157]]
employee's current grade or pay level, without consideration of the
employee's eligibility to retain his or her current grade or pay under
part 536 of this chapter or other authority. In movements between pay
schedules or pay systems, the comparison rate of the grade or pay level
that is two grades below that of the current position will be compared
with the comparison rate of the grade or pay level of the offered
position. For this purpose, ``comparison rate'' has the meaning given
that term in Sec. 536.103 of this chapter, except paragraph (2) of
that definition should be used for the purpose of comparing grade or
levels of work in making reasonable offer determinations in all
situations not covered by paragraph (1) of that definition.
PART 842--FEDERAL EMPLOYEES RETIREMENT SYSTEM--BASIC ANNUITY
0
46. The authority citation for part 842 continues to read as follows:
Authority: 5 U.S.C. 8461(g); Secs. 842.104 and 842.106 also
issued under 5 U.S.C. 8461(n); Sec. 842.104 also issued under
sections 3 and 7(c) of Pub. L. 105-274, 112 Stat. 2419; Sec. 842.105
also issued under 5 U.S.C. 8402(c)(1) and 7701(b)(2); Sec. 842.106
also issued under section 102(e) of Pub. L. 104-8, 109 Stat. 102, as
amended by section 153 of Pub. L. 104-134, 110 Stat. 1321-102; Sec.
842.107 also issued under sections 11202(f), 11232(e), and 11246(b)
of Pub. L. 105-33, 111 Stat. 251, and section 7(b) of Pub. L. 105-
274, 112 Stat. 2419; Sec. 842.108 also issued under section 7(e) of
Pub. L. 105-274, 112 Stat. 2419; Sec. 842.213 also issued under 5
U.S.C. 8414(b)(1)(B) and section 1313(b)(5) of Pub. L. 107-296, 116
Stat. 2135; Secs. 842.304 and 842.305 also issued under section
321(f) of Pub. L. 107-228, 116 Stat. 1383, Secs. 842.604 and 842.611
also issued under 5 U.S.C. 8417; Sec. 842.607 also issued under 5
U.S.C. 8416 and 8417; Sec. 842.614 also issued under 5 U.S.C. 8419;
Sec. 842.615 also issued under 5 U.S.C. 8418; Sec. 842.703 also
issued under section 7001(a)(4) of Pub. L. 101-508, 104 Stat. 1388;
Sec. 842.707 also issued under section 6001 of Pub. L. 100-203, 101
Stat. 1300; Sec. 842.708 also issued under section 4005 of Pub. L.
101-239, 103 Stat. 2106 and section 7001 of Pub. L. 101-508, 104
Stat. 1388; subpart H also issued under 5 U.S.C. 1104; Sec. 842.810
also issued under section 636 of Appendix C to Pub. L. 106-554 at
114 Stat. 2763A-164; Sec. 842.811 also issued under section
226(c)(2) of Public Law 108-176, 117 Stat. 2529.
Subpart B--Eligibility
0
47. In Sec. 842.206, revise paragraph (c)(3)(iv) to read as follows:
Sec. 842.206 Involuntary retirement.
* * * * *
(c) * * *
(3) * * *
(iv) Not lower than the equivalent of two grades or pay levels
below the employee's current grade or pay level, without consideration
of the employee's eligibility to retain his or her current grade or pay
under part 536 of this chapter or other authority. In movements between
pay schedules or pay systems, the comparison rate of the grade or pay
level that is two grades below that of the current position will be
compared with the comparison rate of the grade or pay level of the
offered position. For this purpose, ``comparison rate'' has the meaning
given that term in Sec. 536.103 of this chapter, except paragraph (2)
of that definition should be used for the purpose of comparing grades
or levels of work in making reasonable offer determinations in all
situations not covered by paragraph (1) of that definition.
* * * * *
[FR Doc. E8-26562 Filed 11-6-08; 8:45 am]
BILLING CODE 6325-39-P