Washington, DC

U.S. Office of Personnel Management
Compensation Claim Decision
Under section 3702 of title 31, United States Code

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Damon B. Ford
Compensation and Leave Claims
Program Manager
Agency Compliance and Evaluation
Merit System Accountability and Compliance


04/17/2019

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Date

The claimant is a Federal civilian employee of the Air Force Legal Operations Agency (AFLOA), Department of the Air Force (AF) at Andrews Air Force Base (AFB), Maryland.  She requests the U.S. Office of Personnel Management (OPM) restore her pay to a GS-15, step 00 with base pay commensurate to the rate earned when she occupied a National Security Personnel System (NSPS) covered position.  She also requests that she be granted back pay retroactive to February 21, 2016, the date she believes her retained pay was erroneously terminated.  We received the claim request on January 31, 2018, the agency administrative report (AAR) on April 26, 2018, and the claimant’s comments on the AAR on May 16, 2018.  For the reasons discussed herein, the claim is denied.  

The claimant previously occupied an NSPS-covered Supervisory Attorney (General), YC-0905-03, step 00, position with the AFLOA in San Antonio, Texas.  Her salary at that time was $154,353 per annum, which included $135,208 in basic pay and $19,145 in locality pay.  On October 28, 2009, the President signed into law the National Defense Authorization Act for Fiscal Year 2010, Public Law 111-84, which repealed the statutory authority for NSPS and required the Department of Defense to convert civilian employees and positions to non-NSPS personnel and pay systems before January 1, 2012.  Consequently, on July 4, 2010, the claimant’s position was converted from NSPS to a position in the General Schedule (GS) as a Supervisory Attorney Advisor, GS-0905-15, step 00, and she was placed on pay retention at $154,353, per annum.  The claimant subsequently applied for, accepted, and was reassigned to her current position of Supervisory Attorney Advisor, GS-0905-15, step 10, with the AFLOA at Andrews AFB in Maryland, effective February 21, 2016.  Her basic pay was set at $133,444, with a locality adjustment of $26,856, for a total salary of $160,300. 

The claimant acknowledges that upon reassignment to her current position the adjusted basic pay was increased from the basic pay of her former position in Texas.  Thus, she did not suffer a reduction in salary and accepted the position.  However, she challenges the differences in the rates of basic pay between the NSPS-covered position and her current one.  Specifically, she states:

 …at the time I came out of NSPS in 2010, my base pay was $135,208, and when I returned six years later to the NCR [National Capital Region] in 2016, having accepted a “promotion” my base pay was $133,444.  There was no mention in my offer that my bonuses earned during NSPS would be reduced if I accepted this promotion and returned to the NCR.  It was not obvious in the salary offer since locality pay bumped the overall amount higher than my salary in San Antonio, TX had been.  So, I did not question the salary and accepted. 

The agency explains its pay setting action in a memorandum dated April 24, 2018, as follows:

Typical procedures when re-determining pay retention due to change in official worksite is to follow 5 CFR 536.303(b).  But, performing the normal calculations according to 5 CFR 536.303(b) would cause the employee’s salary to exceed the salary of Executive Service level IV.  Therefore, the employee’s pay was set at GS-0905-15, step 10 with an increase to $160,300.00 PA.

The employee’s pay was set at the highest rate in the locality area for which she was moving and pay retention was terminated.  As indicated, the employee’s pay was set at the GS-15/10 and pay retention was terminated because the employee’s pay upon geographic conversion is subject to the EX-IV cap, which was $160,300.  This is in accordance with 5 CFR 536.306 (a) and (b).  The claimant disagrees with the agency’s application of 5 CFR 536.306(a) and (b) to set her pay at $160,300.  She believes her agency “ignored the requirements of Section 1113(c)(1) of the National Defense Authorization Act of FY2010 because this provision would have allowed [her] pay to be set at a rate of EX-IV plus 5 percent, a GS-15, Step 00, due to[her] time in NSPS.” 

Section 9901.372(c) of title 5, Code of Federal Regulations (CFR), dated January 1, 2011, Determining pay under new pay system, states that “when converting or moving an employee out of NSPS to another pay system, the pay-setting rules of the gaining system will apply.”  Therefore, after the claimant’s conversion out of the NSPS and into the GS system in 2010, pay setting determinations were made in accordance with the pay retention provisions of section 5363, of title 5, United States Code (U.S.C), implemented by the rules in 5 CFR part 536.  Specifically, under 5 CFR 536.303(b), a retained rate of pay is subject to geographic conversion when an employee’s official worksite is changed to a new location where different pay schedules apply.  Therefore, since the claimant’s official worksite changed in 2016, from Texas to Maryland where different pay schedules apply, 5 CFR 536.303(b) is applied to determine her retained rate of pay for the new worksite as follows:

(1)  Identify the maximum rate for the highest applicable rate range that applies to the employee’s former position of record based on the former official worksite.  In this instance, the claimant’s maximum rate for her former position of record, based on the Lackland-Kelly AFB in San Antonio worksite, is $152,593 (the GS-15, step 10 rate on the locality pay table for Rest of U.S.).

 (2)  Identify the maximum rate for the highest applicable rate range that would apply to the employee’s former position of record if the employee were stationed at the official worksite for the new position of record.  The claimant’s maximum rate applicable to her former position of record, had it been at Andrews AFB in Maryland as the official worksite for the new position of record, is $160,300 (the GS-15, step 10 rate on the locality pay table for Washington-Baltimore-Arlington, DC-MD-VA-WV-PA).

 (3)  Divide the maximum rate identified in step (2) by the maximum rate identified in step (1) and round the result to the fourth decimal place.  Dividing $160,300 by $152,593 rounding the result as described, yields 1.0505.

 (4)  Multiply the factor resulting from step (3) by the employee’s former retained rate and round to the nearest whole dollar for an annual rate to derive the employee’s converted retained rate at the new official worksite.  Multiplying 1.0505 by $156,722 (the claimant’s former retained rate),[1] rounding to the nearest whole dollar, yields $164,636 her converted retained rate at the new worksite.

As shown above, the claimant’s retained rate of pay for her new worksite after geographic conversion exceeds the 2016 rate payable for level IV of the Executive Schedule (i.e., $160,300).  Under 5 CFR 536.306(a), a retained rate may not at any time exceed the rate payable for level IV of the Executive Schedule.  Further, OPM’s Fact Sheet: Pay Retention for Former NSPS Employees, provides an understanding of transition-related personnel actions based on NSPS rules.  It describes geographic conversion rules applicable for employees on pay retention, whose retained rate is at or below level IV of the Executive Schedule (EX-IV).  It states, “[i]f a former NSPS employee has retained rate at or below EX-IV before geographic conversion, the rate resulting from geographic conversion is subject to the normal EX-IV cap.”  Thus, since the claimant’s retained rate prior to the geographic conversion was below the EX-IV cap, the rate resulting from the geographic conversion is subject to the normal EX-IV cap.  Here, we note that the claimant’s assertion that her pay should have been set at a rate of EX-IV plus 5 percent, at a GS-15, step 00 is misplaced.  By application of the rules in 5 CFR 536.303(b) and 536.306(a) and careful consideration of NSPS rules, we determined the agency used applicable basic pay rates and correctly adjusted the claimant’s pay to $160,300 (the EX-IV rate in 2016). 

Additionally, the claimant states that she was not provided “written notification that [her] ‘pay w[ould] be reduced, and entitlement of pay retention terminates’ by accepting the job back in the NCR.”  This she states is “required by 5 CFR 536.308, Loss of Eligibility for or Termination of Pay Retention.”  However, 5 CFR 536.308 does not require written notification for pay retention termination.  Rather, it describes conditions under which eligibility for pay retention ceases after an employee has received written notification of a reduction in pay, and conditions under which entitlement to pay retention terminates after the commencement of pay retention.  As the claimant was already receiving a retained rate, she falls into the latter category of employees.  The written notification provision applies to employees who are eligible for pay retention but not yet entitled to pay retention. 

It is well established that retroactive pay actions may only be granted where the erroneous action was contrary to statute, regulation, or a nondiscretionary agency policy.  See OPM file number S001798, July 28, 1998; 63 Comp. Gen. 417 (1984).  In this case, we find the claimant’s pay was properly set by the agency in accordance with law and regulation.  Thus, she is not entitled to have her pay restored at GS-15, step 00 and consequently her claim for back pay is denied. 

This settlement is final.  No further administrative review is available within the OPM.  Nothing in this settlement limits the claimant’s right to bring an action in an appropriate United States court.

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