Statute: 5 U.S.C. 3594

Regulations: 5 CFR Part 359, Subpart G

General Information

Guaranteed placement (“fallback”) to a position outside the SES applies for a career appointee (other than a reemployed annuitant) who is removed from the SES under the following circumstances:

• during the SES probationary period for other than disciplinary reasons, if at the time of appointment to the SES the individual held a career or career-conditional appointment, or an appointment of equivalent tenure as defined in 5 CFR 359.701(a) [See Chapter 8, Removals and Suspensions, for information on removal during probation.];
• after the SES probationary period as the result of less than Fully Successful performance [See Chapter 8 for information on removal for performance.]; or
• after the SES probationary period as the result of a reduction in force. [See Chapter 9, Reduction in Force, RIF Placement, and Furlough, for information on RIF removal of post-probationers.] 

Conditions of Offer

The placement offer must meet the following conditions:

• the offer must be to a continuing position (to be considered “continuing” a position must last at least three months);
• the position must be one at GS-15 or above, or equivalent, even if the individual entered the SES from a position below the GS-15 level;
• the individual must meet the qualifications requirements for the position;
• the tenure of the appointment must be equivalent to the tenure of the appointment held by the individual at the time of entry into the SES, if it was a career or career-conditional appointment (or an appointment of equivalent tenure). This provision does not apply if the agency does not have a position with an appointment of equivalent tenure or if the appointee is willing to accept a position having a different tenure; and

If a post-probationer does not have reinstatement eligibility in the competitive service and if there is no regular excepted appointment authority the agency can use, the agency may use the Schedule B authority under 5 CFR 213.3202(m).

The placement may not cause the separation or reduction in grade of any other employee.

Equivalent Tenure

Appointment in the excepted service that is of “equivalent tenure” [defined at 5 CFR 359.701(a)] to that of a career or career-conditional appointment in the competitive service means an appointment other than—

• an appointment to a Schedule C position established under 5 CFR part 213;
• an appointment to a position that meets the same criteria as a Schedule C position (i.e., is policy determining or involves a close and confidential working relationship with the head of an agency or other key appointed official), but which is filled under a different appointment authority; or
• an appointment to a position where the incumbent traditionally changes when Presidential administrations change.

Agency Responsibility for Placement

It is the agency’s responsibility to place the employee in an appropriate position within the agency, without causing the separation or reduction in grade of any other employee, or for arranging a transfer to an appropriate position in another agency (5 CFR 359.703). Except when a transfer of function is involved, the transfer must be mutually acceptable to both the employee and the gaining agency.

Reductions in Force (RIF) situations. A RIF will often affect both SES and non-SES positions and personnel. It may be difficult to find a position outside the SES in which to place an SES member. Even so, the agency is obligated by law (5 U.S.C. 3594(c)(1)(A)) to place the individual in a continuing position at GS-15 or above unless the action would violate the Anti-Deficiency Act or other applicable statute.

If it appears that the position in which the individual is placed outside the SES will be abolished sometime after the 3-month period, the agency should continue its effort to find an appropriate position for the individual, either internally or in another agency.

Any future RIF action affecting an individual after placement outside the SES would be taken under 5 CFR part 351. Although the agency could issue a part 351 RIF notice during the three-month period, the action may not be made effective until the period is over.

Abolished agencies. If an agency is being abolished (without a transfer of functions) and an employee is being removed from the SES within three months of the effective date of the abolishment, the employee is not entitled to placement in a position outside the SES in the agency since there is no continuing position.

[Note: If an individual has placement rights outside the SES following removal, the agency is subject only to the notice requirements governing the removal and not to the notice requirements governing SES reassignments. For example, if the non-SES position is in a different geographic area, the agency does not have to provide a 60-day advance notice to the individual, but the agency would be subject to any advance notice requirements applicable outside the SES to geographic moves. If the individual fails to report to the new position, the individual may be removed from the civil service under adverse action procedures that are applicable for employees outside the SES, i.e., 5 CFR part 752, Subpart D.]

Effect of Career Transition Requirements. SES members exercise placement rights without regard to priority selection requirements for certain RIFed employees provided under the career transition regulations in 5 CFR part 330, Subparts F and G.

Saved Pay

Under 5 U.S.C. 3594(c)(1)(B), an employee placed in a non-SES position under the guaranteed placement provisions at 5 U.S.C. 3594 is entitled to be paid at the highest of:

• the rate of basic pay for the non-SES position to which assigned;
• the current rate of basic pay for the civil service position which the employee held immediately before entry into the SES; or
• the rate of basic pay held under the SES immediately before removal.

The “basic rate of pay” for the first two alternatives includes any applicable locality payment under 5 U.S.C. 5304, special rate supplement under 5 U.S.C. 5305, or similar payment under other legal authority (see 5 CFR 359.705(b)). However, for an employee placed in a General Schedule position, once the saved pay rate has been established, it is not to be supplemented by a locality payment, a special rate supplement, or a similar payment under other legal authority (see 5 CFR 359.705(c)(1)).

If placement is in a position in another agency, the employee is still entitled to saved pay. The saved pay of an employee receiving saved pay under 5 U.S.C. 3594(c) based on the rate of basic pay held in the SES immediately before removal is subject to the limitation on SES pay under 5 U.S.C. 5382 (EX-II) if the individual is placed in a General Schedule position. [5 CFR 359.705(c)(2)]

Effect of rate increase. An employee receiving saved pay will have his/her basic pay rate increased by 50 percent of the dollar amount of each increase in the maximum rate of basic pay for the grade in which placed (including any applicable locality payment, a special rate supplement, or a similar payment under other legal authority), until the pay rate is equal to the rate in effect for the position in which placed [5 U.S.C. 3594(c)(2)].

Example: In 2019 an employee was placed in a GS-15 position in the DC area with SES saved pay and the increase to which the employee is entitled under 5 CFR 359.705(d)(1) for 2020 needs to be calculated. First, identify the maximum payable rate in 2020 for GS-15, step 10 (i.e., $170,800) and subtract from that the maximum payable rate in 2019 for GS-15, step 10 (i.e., $166,500). The difference in the amount of the maximum payable rate for a GS-15 employee in DC is $170,800 - $166,500 = $4,300. 5 CFR 359.705(d)(1) entitles the employee to a pay adjustment equal to 50% of that dollar amount, which would be $2,150.

If, as a result of an increase in the scheduled rate(s) of the grade of the employee’s position, the employee’s saved pay becomes equal to or lower than the maximum rate of that grade, saved pay ceases and the employee receives the maximum rate. For example, if the saved pay falls to between GS-15, step 8 and GS-15, step 9, the employee is entitled to the GS-15, step 10 rate.

Effect of limited appointment. If an employee on saved pay at GS-15 receives a limited SES appointment and then returns to the GS-15 position after the limited appointment terminates, without a break in service, the employee shall resume the saved pay based on what the pay would have been had the employee remained at GS-15. 

Limited appointees who return to the General Schedule. These appointees are not eligible for retained pay, but they may have pay set under the “maximum payable rate” rule, as determined by the agency. It does not matter whether the return to the General Schedule is voluntary or is the result of a management decision. However, the SES appointment must have been for more than 90 days, even though the appointee may have not actually served that long. In determining the General Schedule rate, agencies may take into account such factors as how long the individual served under the limited appointment and what the individual’s pay would have been had the individual remained in the General Schedule.

Termination of saved pay. Termination of saved pay is covered by 5 CFR 359.705(f).

Discontinued Service Retirement

An employee may elect discontinued service retirement if eligible in lieu of guaranteed placement. [See Chapter 11, Other Provisions Affecting the SES].