Attachment to Compensation Memorandum 2001-4

New Pay System for Administrative Appeals Judges

Section 5372b of title 5, United States Code, authorizes the heads of Executive agencies to fix the rates of basic pay for administrative appeals judge (AAJ) positions. The new AAJ pay system becomes effective for service performed by an administrative appeals judge on the first day of the first applicable pay period beginning on or after April 20, 2001. For most agencies, the effective date will be April 22, 2001.

Rate of Basic Pay

Under 5 U.S.C. 5372b, the head of an Executive agency may set the rate of basic pay for employees in AAJ positions at a rate not less than the minimum rate of basic pay for level AL-3 ($82,100 in 2001) and not more than the maximum rate of basic pay for level AL-3 ($113,600 in 2001) of the administrative law judge (ALJ) pay system established under 5 U.S.C. 5372. The structure of the AAJ pay system should link directly to the structure of level AL-3 of the ALJ pay system. Since employees in AAJ positions review the decisions made by ALJs, linking to the ALJ basic pay structure will ensure that employees in both pay systems are paid equitably.

Pay Adjustment Action

Agencies must process a pay adjustment action for each employee converted from the General Schedule pay system to the new AAJ pay system. The pay plan code for the AAJ pay system is "AA". Agencies must document the pay plan conversion using nature of action code 894, Pay Adjustment. Agencies must use legal authority code ZLM and "5 U.S.C. 5372b" as the legal authority. Additional information can be found in "The Guide to Processing Personnel Actions" on OPM’s web site at http://www.opm.gov/feddata/gppa/gppa.htm.

Locality Payments

The President’s Pay Agent (the Secretary of Labor and the Directors of the Office of Management and Budget and the Office of Personnel Management) has extended locality-based comparability payments to employees covered by the AAJ pay system under the authority of 5 U.S.C. 5304(h), effective on the first day of the first pay period beginning on or after April 20, 2001. Locality payments must be paid to employees in AAJ positions in accordance with 5 U.S.C. 5304 and 5 CFR part 531, subpart F. The locality rate of pay for employees in AAJ positions may not exceed the rate for level III of the Executive Schedule ($133,700 in 2001).

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Last Modified: 2:39:19 PM on Wednesday, August 20, 2003