Washington, DC
U.S. Office of Personnel Management
Compensation Claim Decision
Under section 3702 of title 31, United States Code
Department of Justice
San Antonio, Texas
Kimberly A. Steide, DPA
Deputy Associate Director
Agency Compliance and Evaluation
Merit System Accountability and Compliance
03/14/2025
Date
The claimant occupies a Criminal Investigator, GS-1811-13, position with the U.S. Marshals Service (USMS), Department of Justice (DOJ), in San Antonio, Texas. He requests the U.S. Office of Personnel Management (OPM) direct his employing agency to correct the setting of pay from step 7 to step 9 upon his change to [the] lower grade (CLG) position. We received the claim on January 10, 2023. For reasons discussed herein, the claim is denied.
The claimant previously occupied a Supervisory Criminal Investigator, GS-1811-14, step 3, position with USMS in Laredo, Texas. At that time, his adjusted basic pay was $122,692, which was based on the locality pay area for Laredo. Effective February 13, 2022, he was reassigned to his current GS-13, position with a duty station of San Antonio. The Standard Form 50 for the CLG identifies section 335.102 of title 5, Code of Federal Regulations (CFR) as the legal authority, and includes the remark, “THIS ACTION IS A RESULT FROM A MEDICAL HARDSHIP REQUEST AT THE EMPLOYEE’S REQUEST.” The agency set the claimant’s pay at GS-13, step 7, with an adjusted basic pay of $114,406, which was based on the locality pay area for San Antonio. He seeks to file a claim “based on an unfair reduction of pay practice stemming from a voluntary medical hardship reassignment,” specifically requesting setting of pay for his GS-13 position from step 7 to step 9.
First, we must establish the lowest payable rate of basic pay to which the claimant is entitled upon demotion, defined by 5 CFR 531.203 as a change of an employee, while continuously employed, from one GS grade to a lower GS grade, with or without a reduction in pay. Because the record shows he moved from a GS-14 to a GS-13 position while continuously employed, setting pay upon the claimant’s demotion in the GS is governed by 5 CFR 531.215, which states in relevant part:
(a) General. Except as otherwise provided in this section, an employee who is demoted is entitled to the minimum payable rate of basic pay for the lower grade unless the agency sets the employee’s pay at a higher rate under-
(1) The grade and pay retention rules in 5 CFR part 536, as applicable; or
(2) The maximum payable rate [(MPR)] rule in 531.221, as applicable.
In accordance with 5 CFR 531.215(a), the claimant is entitled to the GS-13, step 1 rate upon his CLG (i.e., the minimum payable rate of basic pay for the lower grade).
As provided for by 5 CFR 531.221(a), the MPR rule allows an agency to set pay for a GS employee above the rate that would be established using normal rules, based on a higher rate of pay the employee previously received, i.e., his or her highest previous rate (HPR). The pay set under the MPR rule may not exceed the rate for step 10 of the GS grade of the position in which the employee is being placed or be less than the rate to which the employee would be entitled under normal pay-setting rules. In a December 20, 2022, memorandum (“Subject: Pay Claim Determination”), the Office of Compensation, Benefits, and Processing Chief of USMS’s Human Resources (HR) Division explains the agency’s pay setting determination based on the claimant’s HPR. The agency determined his pay was set correctly at the GS-13, step 7 rate based on 5 CFR 531.215 in conjunction with the agency’s pay-setting policies, i.e., HR Order – DOJ 1200.1: Part 2 Compensation: Chapter 2-2, [HPR] and USMS Policy Directives 3.2 Highest Previous Pay. The memorandum explains:
In 2022, [claimant] held a GS-14 step 3 position at $102,371 (base); $122,692 (Laredo, TX (LR) locality). [Claimant] accepted a voluntary CLG and his personnel action was processed at the GS-13 step 7 and pay was set at $97,458 (base); $114,406 (San Antonio (ST) locality) effective Feb 13, 2022…[Claimant’s] entitlement upon the CLG is at the step 1 of the lower grade (see 5 CFR 531.215). [Claimant] is not entitled to grade or pay retention. HPR is not an entitlement and should not be used to set [claimant’s] pay upon a voluntary CLG/demotion. The windfall rule was properly applied to set [claimant’s] pay at the GS13 step 7 based on current DOJ policy.
It further explains:
[The agency] applied the windfall rule to [claimant’s] pay setting and by doing so, USMS corrects potential problems when using the HPR to set pay on voluntary CLG: in some situations, it could result in more pay than the employee would have gotten if they stayed in the higher grade. Using HPR could result in employees requesting downgrades to get more pay. Therefore, the CFR, DOJ Order, and USMS Directive prevents rapid pay advancements through voluntary CLG and subsequent promotions.
Second, we must establish the highest payable rate of basic pay the agency could have offered the claimant upon his CLG based on the MPR rule provided for by 5 CFR 531.221(a). In 2022, he was in a GS-14, step 3, position in Laredo ($122,692) and voluntarily accepted a demotion to a GS-13 position in the San Antonio locality pay area. Because his was a voluntary demotion, grade and pay retention do not apply. As provided by 5 CFR 531.215(b), the employee’s official worksite after demotion is in a different geographic location where different pay schedules apply. We must therefore initially convert the claimant to the applicable pay schedules and rates of basic pay in the new geographic area based on his position of record before processing the demotion. The pay schedules applicable to him in San Antonio are the (1) GS base and (2) San Antonio locality rate schedule. The GS-14, step 3, GS rate is $102,371, and the GS-14, step 3, San Antonio locality rate is $120,173. The claimant’s HPR is the GS-14, step 3, rate on the GS (as provided by 5 CFR 531.222(b), we must use his underlying GS rate as the HPR in applying the MPR rule in 5 CFR 531.221(b)). Comparing the claimant’s HPR ($102,371) to the GS-13 rate range on the 2022 GS, the step 9 rate ($102,872) equals or exceeds his HPR; his MPR is the GS-13, step 9, rate. Therefore, the maximum rate of pay the claimant could have been offered by USMS based on his HPR is GS-13, step 9, on the San Antonio locality rate ($120,761).
As provided by 5 CFR 531.221(a)(2), an agency may at its discretion set an employee’s rate of basic pay at the maximum rate based on an employee’s HPR or at a lower rate. An agency is under no obligation to set an employee’s pay at the MPR. Furthermore, each agency is permitted to formulate its own policy regarding application of the MPR rule. B-186554, December 28, 1976.
Relevant to the claimant’s situation, HR Order – DOJ 1200.1: Part 2 Compensation: Chapter 2-2, [HPR] states:
Change to Lower Grade at Employee’s Request. When an employee is demoted or changed to a lower grade at his or her own request for his or her own personal benefit or convenience (e.g., to acquire competitive status or a desired duty station), with the probability of promotion as soon as possible under merit promotion rules, any windfall that could occur when the employee is promoted must be taken into consideration when setting the employee’s pay at a rate in the lower grade. [italics added]
Similarly, USMS Policy Directives 3.2 Highest Previous Pay instructs:
When an individual accepts a change to a lower grade with the probability of being re-promoted to (a) the former grade, (b) an intervening grade as soon as possible under the merit promotion plan or (c) a career-ladder position, the individual’s pay shall be set at a rate in the lower grade, which, upon re-promotion, will place the person in a rate in the higher grade which they would have attained had he or she remained in the higher grade, except as provided for in 5 C.F.R. § 536.104. [italics added]
We note the mandatory terms “must” and “shall,” as opposed to the permissive term “may,” adopted by the agency’s pay-setting policies. We conclude the policies are mandatory and the agency is without discretionary authority with regard to application of HPR in CLG situations like the claimant’s; i.e., it is required to fix pay at a rate in the lower grade so that if he is re-promoted to a higher-graded position, the resulting pay would be set at a rate in the higher grade which he would have attained if he remained in the GS-14 position. In accordance with agency policies, he is not entitled to have his pay upon CLG set at the GS-13, step 9 rate. The agency instead adjusted the claimant’s rate of pay according to established pay-setting policies, resulting in his pay upon CLG set at the GS-13, step 7 rate.
Under 5 CFR 178.105, the burden is upon the claimant to establish the liability of the United States and the claimant’s right to payment. As previously discussed, the claimant has failed to do so. Since an agency decision made in accordance with established regulations as is evident in the present case cannot be considered arbitrary, capricious, or unreasonable, there is no basis upon which to reverse the decision. Consequently, his claim is denied.
The claimant does not provide a rationale for his claim, other than stating that the salary he expected was based on information provided by a human resources specialist. It is well settled by the courts that a claim may not be granted based on a misinterpretation of information provided by agency officials. Payments of money from the Federal Treasury are limited to those authorized by statute, and erroneous advice provided by a government employee cannot bar the Government from denying benefits not otherwise permitted by law. See OPM v. Richmond, 496 U.S. 414, rehearing denied, 497 U.S. 1046, 111 S. Ct. 5 (1990); Falso v. OPM, 116 F.3d 459 (Fed. Cir. 1997); and 60 Comp. Gen. 417 (1981).
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.