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



05/14/2019

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Date

The claimant is a Federal civilian employee of the Department of the Navy (Navy), in Yokosuka, Japan.  She requests pay retention at the GS-13, step 7 rate of basic pay and “back payment of base pay differential wages, plus interest” in connection with a change to a lower-graded position.  The U.S. Office of Personnel Management (OPM) received the claim request on March 8, 2018, and the agency administrative report (AAR) on August 20, 2018.  For the reasons discussed herein, the claim is denied.

In May 2017, while employed as a Supervisory Contract Specialist, GS-1102-13, step 6 with Navy in Bahrain, Manama, the claimant applied for her current Federal civilian position, Contracting Officer Representative, GS-1101-12 in Yokosuka, Japan.  She received tentative and formal job offers on August 10, 2017, and September 22, 2017, respectively.  On September 30, 2017, the claimant accepted the formal job offer with pay set at the GS-12, step 10 rate of basic pay, and was appointed to her position effective October 29, 2017.  In her claim to OPM she included the vacancy announcement for the position and a Foreign Overseas Recruitment Information page, dated August 17, 2016, which states “Pay retention will be granted to selectee recruited outside the area who accepts a downgrade when there was no step in the lower grade that equals or exceeds his/her current rate of basic pay.”  Therefore, she believes she is entitled to pay retention at the GS-13, step 7 rate of basic pay because “neither the vacancy announcement nor DoDIs [Department of Defense Instructions] conveyed that eligibility for pay retention would be determined by the selectee’s recruitment location, CONUS vice OCONUS.” [1]  In her claim to OPM she states:

HRO failed to communicate, via the vacancy announcement, emails and tentative job offer that the benefit of pay retention was not applicable to those applicants applying and selected from OCONUS locations.  The exclusion of this information willfully prevents applicants OCONUS from making “informed decisions about whether assignment to the foreign area is appropriate for them and any family member who may accompany them” as stated in DoDI 1400.25, Volume 1230 Enclosure 2 number 1.

The claimant also disagrees with the agency’s decision to deny her pay retention based on her understanding of DoDI 1400.25 V536 paragraph 3c(10), which states in part that pay retention will be extended when “An employee applies through a formal recruitment program and is selected for a position at an overseas location.”  She states the “excerpt neither states nor implies that pay retention is only eligible for applicants recruited from CONUS locations.”

The agency takes the position that pay retention, in this instance, was not mandatory but discretionary.  In its AAR, the agency states:

…. [The claimant] accepted the job in Japan and moved with the DON’s clear position that no pay retention would be offered.  The DON concluded that it was not necessary to offer a pay rate exceeding the full step of the properly classified position (GS-12) as there were adequate candidates to fill the job.  The position of the DOD and DON is that pay retention in this instance is not mandatory but discretionary.  Ms. Parker had ample opportunity to remain in Bahrain at her GS-13, step 6 position before personnel actions were initiated.  There is no law or regulation mandating pay retention in this situation.

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….All departments which reviewed this case determined that the pay setting at the GS-12 step 10 was appropriate when applying maximum payable rate (MPR).  The fact that the move was from an overseas position to another overseas position did not meet the intent of DoDI 1400.25 V536 paragraph 3c(10).  Pay retention is used as a recruitment tool to seek candidates for overseas posts which are not necessarily as attractive as postings in the continental U.S.  Once an employee is overseas the need for similar incentives is not mandatory.  Ms. Parker was recruited from an overseas post.

Part 536 of title 5, Code of Federal Regulations (CFR) implements the pay retention provisions of section 5363 of title 5, United States Code (U.S.C.).  Under 5 CFR part 536, an employee whose rate of basic pay otherwise would be reduced as a result of a management action is entitled to retain his or her rate of basic pay.  One of the pay retention coverage requirements is that the reduction in grade or pay not be “at the employee’s request” (5 CFR 536.102(b)(1)).  If the move to the position is initiated by the employee for his or her benefit, convenience, or personal advantage, it would be considered to be at the employee’s request, thus excluding the employee from coverage under title 5 pay retention provisions.  However, if the move to the position was directly caused or influenced by a management action (not based on personal cause), then even though the move in position appeared to be voluntary, it would not be “at the employee’s request.” (See definition of Reduced in grade or pay at the employee’s request in 5 CFR 536.103). 

An employee may be eligible under 5 CFR 536.301, Mandatory pay retention, or 5 CFR 536.302, Optional pay retention.  Thus, the claimant would need to meet the requirements for mandatory or optional pay retention under 5 CFR 536.301 or 5 CFR 536.302, respectively, to be eligible for pay retention upon her move to the lower-graded position. 

The claimant’s move to the lower-graded position does not meet any of the pay retention requirements in 5 CFR 536.301, thus she is not entitled to mandatory pay retention under 5 CFR 536.301. 

Under 5 CFR 536.302, an authorized agency official may provide optional pay retention to an employee not entitled to mandatory pay retention under 5 CFR 536.301, whose payable rate of basic pay otherwise would be reduced as a result of a management action.  Here, both the claimant and the agency reference DoDI 1400.25 V536 paragraph 3c(10) with their submissions.  This is an internal agency instruction that provides the agency will apply optional pay retention as a result of a management action (in this case the one listed in paragraph 3c(10)).  Thus, we consider the agency’s reliance on its instructions as supporting the definition in 5 CFR 536.103 of management action which means, in relevant part, “an action (not for personal cause) by an agency official not initiated or requested by an employee which may adversely affect the employee’s grade or rate of basic pay.” 

DoDI 1400.25 V536 paragraph 3c(10), states that pay retention will be extended when “an employee applies through a formal recruitment program and is selected for a position at an overseas location.”  The agency indicates that the claimant did not apply for the position through such a program, therefore this provision does not apply to permit optional pay retention.  Further, the agency indicates that this provision was not intended to apply to the claimant’s situation (i.e., moves from one overseas position to another overseas position), and that the provision is used as a recruitment tool to incent a candidate to leave a post in CONUS to take an overseas post.  Such an incentive was not needed for this position as there were adequate candidates to fill the position.  In addition, the claimant accepted the offer to take the job knowing that she would be filling the position at a lower grade and that pay retention would not be offered.  Since optional pay retention is a discretionary authority given to agency officials, OPM gives deference to the agency’s interpretation on the application of DODI 1400.25 V536 paragraph 3c(10) and will not address this matter further.  Accordingly, the claim for pay retention and back pay is denied.    

The claimant also requests “transparency in future announcements of DoD’s intent to not provide pay retention to OCONUS applicants that apply to OCONUS vacancy announcements.”  She believes that the “exclusion of this information willfully prevents applicants from OCONUS from making informed decisions…”  However, the claims jurisdiction authority of OPM under 31 U.S.C. 3702(a)(2) is limited to consideration of legal and regulatory liability in determining if monies are owed for the stated compensation or leave claim.  Therefore, this authority does not extend to reviewing language in an agency’s vacancy announcements.  Furthermore, even if they have no actual knowledge, Federal employees are charged with constructive knowledge of statutory requirements pertaining to them and of the implementing regulations authorized to be issued by statute.  See B-173927, October 27, 1971; B-187104, April 1, 1977; and B-192510, April 6, 1979.

Under 5 CFR 178.105, the burden of proof is on the claimant to establish the liability of the United States and the claimant's right to payment.  OPM does not conduct adversary hearings, but settles claims on the basis of the evidence submitted by the claimant and the written record submitted by the government agency involved in the claim.  See 5 CFR 178.105; Matter of John B. Tucker, B-215346, March 29, 1985.  Where the agency's factual determination is reasonable, we will not substitute our judgment for that of the agency.  See, e.g., Jimmie D. Brewer, B-205452, Mar. 15, 1982. 

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

 

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