NAFI Employees Moving to General Schedule Positions

Fact Sheet: NAFI Employees Moving to General Schedule (GS) Positions - Setting Pay

Description

When a Department of Defense (DOD) or Coast Guard NAFI employee (as described in 5 U.S.C. 2105(c)) moves to a GS position in DOD or the Coast Guard, respectively, without a break in service of more than 3 days, the employee's pay is set as described in this fact sheet based on whether the move was voluntary or involuntary.

Note: See section "Other Moves to GS Positions" below for the rules that apply when a DOD or Coast Guard NAFI employee moves to a GS position (1) with a break in service of more than 3 days, or (2) when the GS position is not in DOD (for movements from a DOD NAFI) or the Coast Guard (for movements from a Coast Guard NAFI).

Voluntary Move to a GS Position

When an employee moves voluntarily to a GS position in DOD or the Coast Guard from a NAFI position in DOD or the Coast Guard, respectively, without a break in service of more than 3 days, the agency must set the employee's initial payable rate of basic pay at the minimum rate of the highest applicable rate range for the employee's GS position. Alternatively, the agency, at its discretion, may choose one of the following methods to set the employee's rate of basic pay at a higher rate-

Based on the employee's NAFI highest previous rate (HPR) (as determined following the steps in "Determining an Employee's Rate Based on a NAFI HPR" below), or
Using the maximum payable rate (MPR) rule in 5 CFR 531.221 based on a non-NAFI rate of basic pay if that rule produces a higher rate than using the employee's NAFI HPR.

Such employees are not eligible to have their pay set under the superior qualifications and special needs pay-setting authority at 5 CFR 531.212.

Involuntary Move to a GS Position

When an employee is moved involuntarily from a NAFI position in DOD or the Coast Guard to a GS position in DOD or the Coast Guard, respectively, with substantially the same duties and without a break in service of more than 3 days, the employee is entitled to an initial payable rate of basic pay (including any locality pay or special rate supplement) at the lowest step rate of the GS grade that is equal to or greater than the employee's rate of basic pay in the NAFI position immediately before the move. The agency must compare the employee's former NAFI rate to the highest applicable rate range for the employee's GS position of record and official worksite in effect immediately prior to the move.

Example:

In 2016, an NF-3 DOD NAFI employee in Boston ($42,005) is involuntarily moved without a break in service to a GS-6 DOD position in Boston with substantially the same duties. The GS-6 position is not covered by a special rate. The employee's rate of basic pay entitlement is determined as follows:

Step A: Compare the former NAFI rate to the highest applicable rate range for the employee's GS position of record and official worksite. The highest applicable rate range is the GS-6 range on the Boston locality rate schedule.

Step B: Find the lowest step on the GS-6 Boston locality rate range that equals or exceeds $42,005 (i.e., GS-6, step 3, or $42,069).

Step C: The employee is entitled to the GS-6, step 3, Boston locality rate of $42,069.

At its discretion, an agency may choose one of the following methods to set the initial payable rate of basic pay of an employee who is moved involuntarily at a higher rate of pay -

Using the employee's NAFI HPR (as determined following the steps in "Determining an Employee's Rate Based on a NAFI HPR" below);
Using the GS MPR rule in 5 CFR 531.221 based on a non-NAFI rate of basic pay; or
Using the authority to grant pay retention in 5 CFR 536.302(a).

Determining an Employee's Rate Based on a NAFI HPR

The following provisions apply when determining an employee's rate based on the employee's NAFI highest previous rate (HPR):

Same official worksite: If the official worksite for the employee's GS position of record is located at the same official worksite where the employee was stationed while earning the NAFI HPR, the agency may set the employee's initial payable rate of basic pay at the lowest step in the highest applicable rate range currently in effect for the employee's GS position of record and official worksite that equals or exceeds the employee's NAFI HPR. This rate is the maximum payable rate (MPR) the agency may pay the employee using the NAFI HPR or the agency may set the employee's rate of basic pay at any step rate that does not exceed the MPR.

Different highest applicable rate range: If the highest applicable rate range would be different if the official worksite for the employee's GS position of record were located at the place where the employee was stationed while earning the NAFI HPR, the agency must determine the MPR as follows:

Step A: Compare the NAFI HPR to the highest applicable rate range currently in effect at the place where the NAFI HPR was earned. The highest applicable rate range is determined based on the pay schedules that would be applicable to the employee's current GS position of record if the employee were stationed in that location.

Step B: Identify the lowest step in the highest applicable rate range that was equal to or exceeded the employee's NAFI HPR. If the NAFI HPR is less than the range minimum, identify the step 1 rate. If the NAFI HPR exceeds the maximum rate, identify the step 10 rate.

Step C: Convert the step rate identified in step B to a corresponding rate (same step) on the highest applicable rate range for the employee's current official worksite and GS position of record. This rate is the MPR the agency may pay the employee using the NAFI HPR, or the agency may set the employee's rate of basic pay at any step rate that does not exceed the MPR.

Step D: After setting the employee's rate of basic pay in the current highest applicable rate range (not to exceed the MPR identified in step C), determine any underlying rate of basic pay to which the employee is entitled at the determined step rate.

Example:

In 2016, an NF-3, DOD employee in San Diego ($38,328) is appointed to a DOD GS-5 position in Washington, DC, and voluntarily moves to the position without a break in service. The GS-5 position is not covered by a special rate. The employee's only entitlement is to step 1. However, the agency decides to use the employee's NAFI HPR to set the employee's pay. The agency follows the rules for an employee whose HPR is based on a NAFI rate.

Step A: Compare the NAFI HPR to the highest applicable rate range in effect at the place where the NAFI HPR was earned. The highest applicable rate range is the GS-5 range on the San Diego locality rate schedule.

Step B: Identify the lowest step in the highest applicable rate range that was equal to or exceeded the employee's NAFI HPR. In this example, since the NAFI HPR falls between steps 3 and 4 of the GS-5 rate range, identify GS-5, step 4 ($38,776).

Step C: Convert the step rate identified in step B to a corresponding rate (same step) on the highest applicable rate range for the employee's current official worksite and GS position of record. The highest applicable rate range for the current GS-5 position is the GS-5 rate range on the DC locality rate schedule. In 2016, the GS-5, step 4, DC locality rate is $38,792. This is the MPR based on the employee's NAFI HPR.

Other Moves to GS Positions

The provisions above do not apply when a DOD or Coast Guard NAFI employee moves to a GS position-

With a break in service of more than 3 days, or
When the GS position is not in DOD or the Coast Guard, respectively. (In other words, a DOD NAFI employee must move to a GS position within DOD, and a Coast Guard NAFI employee must move to a GS position within the Coast Guard for the provisions above to apply.)

In such situations, the agency must set the employee's payable rate of basic pay at the minimum rate of the highest applicable rate range for the employee's GS position of record, unless -

The employee is eligible for a higher payable rate under the GS MPR rule in 5 CFR 531.221 based on a rate earned in a previous non-NAFI position and the agency chooses to apply that rule; or
The agency chooses to apply the superior qualifications and special needs pay-setting authority at 5 CFR 531.212.

Key Terms

"Highest applicable rate range" means the rate range applicable to a GS employee, based on a given position of record and official worksite that provides the highest rates of basic pay, excluding any retained rates. (For example, a rate range of special rates may exceed an applicable locality rate range. In certain circumstances, the highest applicable rate range may consist of two types of pay rates from different pay schedules--e.g., a range where special rates (based on a fixed dollar supplement) are higher in the lower portion of the range and locality rates are higher in the higher portion of the range.)

"Moved involuntarily" means the movement of the incumbent of a NAFI position in the DOD or the Coast Guard with the position when it is moved to the civil service employment system of the DOD or the Coast Guard, respectively.

"NAFI highest previous rate (HPR)" means the highest rate of basic pay received by an employee during service in a NAFI position, as described in 5 U.S.C. 2105(c).

References

5 U.S.C. 5334(f), as amended by section 1114 of the National Defense Authorization Act for Fiscal Year 2008 (Public Law 110-181, January 28, 2008) (See also CPM 2008-04).
5 CFR 531.216 setting pay when an employee moves from Department of Defense or Coast Guard nonappropriated fund instrumentality.
5 CFR 531.221 and the GS MPR rule fact sheet.
5 CFR 531.212 and the superior qualifications and special needs pay-setting authority fact sheet.