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B-164786, DEC 18, 1970, 50 COMP GEN 414

B-164786 Dec 18, 1970
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ARE ENTITLED TO HAVE THE "NOT LESS THAN TWO STEP INCREASE" AUTHORIZED IN 5 U.S.C. 5334(B) FOR EMPLOYEES WHO ARE PROMOTED OR TRANSFERRED. THE RULE FOR APPLICATION IS THAT RETROACTIVE SALARY INCREASES APPLY AS IF THE INCREASE HAD BEEN IN FORCE AND EFFECT AT THE TIME OF THE CHANGE OF STATUS OF THE EMPLOYEE. WHERE AN AGENCY DOES NOT HAVE AN ESTABLISHED POLICY. IT IS WITHIN THE AGENCY'S DISCRETION WHETHER OR NOT TO ADJUST THE EMPLOYEE'S SALARY TO REFLECT THE INCREASE IN THE POST OFFICE RATE. AN EMPLOYEE WHO WAS NOT ON THE ROLLS AT THE TIME OF ENACTMENT OF THE REORGANIZATION ACT MAY NOT BE GIVEN THE BENEFIT OF THE INCREASED RATE FOR THE PURPOSES OF THE "HIGHEST PREVIOUS RATE" RULE. 1970: THIS IS IN FURTHER REFERENCE TO YOUR LETTER DATED OCTOBER 8.

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B-164786, DEC 18, 1970, 50 COMP GEN 414

POST OFFICE DEPARTMENT - EMPLOYEES - TRANSFERS - DURING RETROACTIVE PERIOD OF COMPENSATION INCREASES FORMER GENERAL SCHEDULE EMPLOYEES OF THE POST OFFICE DEPARTMENT WHO TRANSFERRED TO A HIGHER GENERAL SCHEDULE POSITION IN ANOTHER AGENCY BETWEEN AUGUST 12, 1970, THE DATE OF ENACTMENT OF THE POSTAL REORGANIZATION ACT, WHICH PROVIDES APPROXIMATELY AN 8-PERCENT SALARY INCREASE, AND THE EFFECTIVE OF THE ACT, THE FIRST PAY PERIOD BEGINNING ON OR AFTER APRIL 16, 1970, ARE ENTITLED TO HAVE THE "NOT LESS THAN TWO STEP INCREASE" AUTHORIZED IN 5 U.S.C. 5334(B) FOR EMPLOYEES WHO ARE PROMOTED OR TRANSFERRED, COMPUTED ON THE REVISED GENERAL SCHEDULE RATE OF THE POST OFFICE DEPARTMENT; FOR IN THE ABSENCE OF SPECIFIC LANGUAGE TO THE CONTRARY, THE RULE FOR APPLICATION IS THAT RETROACTIVE SALARY INCREASES APPLY AS IF THE INCREASE HAD BEEN IN FORCE AND EFFECT AT THE TIME OF THE CHANGE OF STATUS OF THE EMPLOYEE. COMPENSATION - RATES - HIGHEST PREVIOUS RATE - RETROACTIVE SALARY INCREASES WHERE AN AGENCY HAS A POLICY TO EXTEND THE BENEFIT OF THE HIGHEST PREVIOUS RATE RULE PRESCRIBED IN 5 U.S.C. 5334(A), THE SALARY OF AN EMPLOYEE WHO LEFT THE POST OFFICE DEPARTMENT DURING THE RETROACTIVE PERIOD BETWEEN ENACTMENT OF THE POSTAL REORGANIZATION ACT AND ITS EFFECTIVE DATE MAY BE ADJUSTED TO REFLECT THE INCREASE AUTHORIZED BY THE ACT; AND WHERE AN AGENCY DOES NOT HAVE AN ESTABLISHED POLICY, BUT DID GIVE THE EMPLOYEE THE BENEFIT OF HIS LAST POST OFFICE DEPARTMENT RATE, IT IS WITHIN THE AGENCY'S DISCRETION WHETHER OR NOT TO ADJUST THE EMPLOYEE'S SALARY TO REFLECT THE INCREASE IN THE POST OFFICE RATE. HOWEVER, SECTION 531.203(D)(4) OF THE CIVIL SERVICE COMMISSION REGULATIONS RELATING TO GENERAL INCREASES IN THE GENERAL SCHEDULE AND NOT TO SPECIAL INCREASES, AN EMPLOYEE WHO WAS NOT ON THE ROLLS AT THE TIME OF ENACTMENT OF THE REORGANIZATION ACT MAY NOT BE GIVEN THE BENEFIT OF THE INCREASED RATE FOR THE PURPOSES OF THE "HIGHEST PREVIOUS RATE" RULE.

TO THE CHAIRMAN, UNITED STATES CIVIL SERVICE COMMISSION, DECEMBER 18, 1970:

THIS IS IN FURTHER REFERENCE TO YOUR LETTER DATED OCTOBER 8, 1970, REQUESTING A DECISION ON CERTAIN QUESTIONS OCCASIONED BY THE PROPOSED ISSUANCE OF A BULLETIN ON THE SUBJECT OF ADJUSTING SALARIES FOR EMPLOYEES WHO SEPARATED FROM THE POST OFFICE DEPARTMENT ON OR AFTER THE EFFECTIVE DATE OF THE RETROACTIVE PAY ADJUSTMENT PROVIDED BY THE POSTAL REORGANIZATION ACT (APRIL 18, 1970, FOR EMPLOYEES IN THE POSTAL FIELD SERVICE; APRIL 19, 1970, FOR GENERAL SCHEDULE EMPLOYEES), AND WERE EMPLOYED IN ANOTHER FEDERAL AGENCY ON THE ENACTMENT DATE OF THE ACT, AUGUST 12, 1970.

SECTION 9 OF THE POSTAL REORGANIZATION ACT, PUBLIC LAW 91-375, APPROVED AUGUST 12, 1970, 84 STAT. 784, 39 U.S.C. 1003 NOTE, PROVIDES, IN PERTINENT PART:

SEC. 9(A) THE POSTMASTER GENERAL, UNDER REGULATIONS MADE BY HIM, SHALL INCREASE THE RATES OF BASIC PAY OR COMPENSATION OF EMPLOYEES IN THE POST OFFICE DEPARTMENT SO THAT SUCH RATES WILL EQUAL, AS NEARLY AS PRACTICABLE, 108 PERCENT OF THE RATES OF BASIC PAY OR COMPENSATION IN EFFECT IMMEDIATELY PRIOR TO THE DATE OF ENACTMENT OF THIS ACT. SUCH INCREASES SHALL TAKE EFFECT ON THE FIRST DAY OF THE FIRST PAY PERIOD WHICH BEGINS ON OR AFTER APRIL 16, 1970.

(B) RETROACTIVE PAY, COMPENSATION, OR SALARY SHALL BE PAID BY REASON OF THIS ACT ONLY IN THE CASE OF AN INDIVIDUAL IN THE SERVICE OF THE UNITED STATES (INCLUDING SERVICE IN THE ARMED FORCES OF THE UNITED STATES) ON THE DATE OF ENACTMENT OF THIS ACT, EXCEPT THAT SUCH RETROACTIVE PAY, COMPENSATION, OR SALARY SHALL BE PAID -

(1) TO AN OFFICER OR EMPLOYEE WHO RETIRED, DURING THE PERIOD BEGINNING ON THE FIRST DAY OF THE FIRST DAY PERIOD WHICH BEGAN ON OR AFTER APRIL 16, 1970, AND ENDING ON THE DATE OF ENACTMENT OF THIS ACT, FOR SERVICES RENDERED DURING SUCH PERIOD; AND

(2) IN ACCORDANCE WITH SUBCHAPTER VIII OF CHAPTER 55 OF TITLE 5, U.S.C. RELATING TO SETTLEMENT OF ACCOUNTS, FOR SERVICES RENDERED, DURING THE PERIOD BEGINNING ON THE FIRST DAY OF THE FIRST PAY PERIOD WHICH BEGAN ON OR AFTER APRIL 16, 1970, AND ENDING ON THE DATE OF ENACTMENT OF THIS ACT, BY AN OFFICER OR EMPLOYEE WHO DIED DURING SUCH PERIOD.

YOU POINT OUT THAT THE ABOVE PROVISIONS AS THEY RELATE TO ENTITLEMENT TO RETROACTIVE PAY ARE SIMILAR TO THOSE CUSTOMARILY INCLUDED IN GENERAL PAY ACTS FOR THIS PURPOSE - AN EMPLOYEE (1) MUST HAVE BEEN AN EMPLOYEE IN THE POST OFFICE DEPARTMENT ON THE DATE OF THE ADJUSTMENT; AND (2) MUST HAVE BEEN IN THE SERVICE OF EITHER THE POST OFFICE DEPARTMENT OR SOME OTHER FEDERAL AGENCY (INCLUDING SERVICE IN THE ARMED FORCES OF THE UNITED STATES) ON AUGUST 12, 1970, THE DATE THE POSTAL REORGANIZATION ACT WAS ENACTED. IT IS STATED FURTHER THAT WHILE IT IS CLEAR THAT AN INDIVIDUAL MUST HAVE BEEN EMPLOYED BY THE POST OFFICE DEPARTMENT IN ORDER TO BE PAID AT A SALARY THAT INCLUDED THE 8-PERCENT INCREASE, THE COMMISSION NEEDS CLARIFICATION ON HOW THIS INCREASE AFFECTS THE SALARIES OF THOSE EMPLOYEES WHO MOVED (OR MOVE) TO OTHER FEDERAL AGENCIES. THE FOLLOWING QUESTIONS HAVE BEEN SUBMITTED FOR OUR DECISION:

(1) MUST THE SALARY FOR AN EMPLOYEE WHO TRANSFERS FROM A GENERAL SCHEDULE POSITION IN THE POST OFFICE DEPARTMENT TO A HIGHER GRADE GENERAL SCHEDULE POSITION IN ANOTHER AGENCY BE FIXED UNDER 5 U.S.C. 5334(B) AT A RATE IN THE REGULAR RANGE OF THE GRADE THAT WILL GIVE HIM THE EQUIVALENT OF TWO STEP INCREASES ABOVE THE SALARY HE WAS RECEIVING UNDER THE INCREASED GENERAL SCHEDULE RANGE IN THE DEPARTMENT? IS THE EQUIVALENT OF TWO STEP INCREASES IN THIS CASE COMPUTED ON THE AMOUNT OF REGULAR STEP INCREASES IN THE GENERAL SCHEDULE, OR ON THE AMOUNT IN THE REVISED SCHEDULE OF THE POST OFFICE DEPARTMENT?

(2) IF AN AGENCY HAS A POLICY OF GIVING AN EMPLOYEE THE BENEFIT OF HIS HIGHEST PREVIOUS RATE OR EXISTING RATE WHEN HE IS BROUGHT ON THE ROLLS BY TRANSFER OR REEMPLOYMENT, IS THE SALARY OF AN EMPLOYEE WHO LEFT THE POST OFFICE DEPARTMENT DURING THE RETROACTIVE PERIOD TO BE ADJUSTED TO GIVE HIM THE BENEFIT OF THE 8-PERCENT INCREASE ASSUMING HE WAS ENTITLED TO THAT INCREASE? IF THE AGENCY DID NOT HAVE SUCH AN ESTABLISHED POLICY BUT DID GIVE THE EMPLOYEE THE BENEFIT OF HIS LAST POST OFFICE DEPARTMENT RATE AT THE TIME HE ENTERED ON DUTY, IS HIS SALARY TO BE ADJUSTED TO REFLECT THE INCREASE IN HIS POST OFFICE DEPARTMENT RATE? IF THIS IS NOT MANDATORY, (A) DOES THE AGENCY HAVE DISCRETION TO MAKE THE ADJUSTMENT, OR (B) MAY IT MAKE THE ADJUSTMENT IF ITS DETERMINES THAT IT WOULD HAVE GIVEN THE HIGHER RATE IF IT HAD BEEN IN EFFECT AT THE TIME OF THE PERSONNEL ACTION?

(3) MAY A FORMER EMPLOYEE OF THE POST OFFICE DEPARTMENT WHO WAS NOT ON THE ROLLS ON THE DATE OF ENACTMENT OF THE POSTAL REORGANIZATION ACT AND NOT ENTITLED TO THE RETROACTIVE INCREASE, BE GIVEN THE BENEFIT OF THE INCREASED RATE FOR THE PURPOSES OF THE "HIGHEST PREVIOUS RATE" RULE?

IN REGARD TO THE FIRST QUESTION, 5 U.S.C. 5334(B) PROVIDES, IN PERTINENT PART, AS FOLLOWS:

(B) AN EMPLOYEE WHO IS PROMOTED OR TRANSFERRED TO A POSITION IN A HIGHER GRADE IS ENTITLED TO BASIC PAY AT THE LOWEST RATE OF THE HIGHER GRADE WHICH EXCEEDS HIS EXISTING RATE OF BASIC PAY BY NOT LESS THAN TWO STEP- INCREASES OF THE GRADE FROM WHICH HE IS PROMOTED OR TRANSFERRED. ***

DECISIONS OF OUR OFFICE CONCERNING THE RETROACTIVE PROVISIONS OF SALARY INCREASE ACTS HAVE CONSISTENTLY REQUIRED - IN THE ABSENCE OF SPECIFIC LANGUAGE TO THE CONTRARY - THAT SUCH ACTS BE APPLIED TO REFLECT THE SALARY STATUS OF EACH EMPLOYEE UNDER THE INCREASED RATES AS IF SUCH RATES HAD BEEN IN FORCE AND EFFECT AT THE TIME OF THE CHANGE OF HIS STATUS. COMP. GEN. 166 (1951); 38 ID. 188 (1958); 44 ID. 171 (1964). THUS, EMPLOYEES WHO WERE ENTITLED TO THE RETROACTIVE INCREASES EVEN THOUGH TRANSFERRED TO ANOTHER AGENCY DURING THE PERIOD APRIL 19, 1970, TO AUGUST 12, 1970, WOULD BE TREATED THE SAME AS EMPLOYEES TRANSFERRED ON AND AFTER THAT DATE ASSUMING THERE HAS BEEN NO CHANGE IN THE LAW OR REGULATIONS.

WE NOTE THAT THE LANGUAGE OF PUBLIC LAW 91-375 DID NOT SPECIFICALLY AMEND THE GENERAL SCHEDULE AS SET FORTH IN 5 U.S.C. 5332, BUT MERELY PROVIDED THAT ALL EMPLOYEES OF THE POST OFFICE DEPARTMENT, WHICH INCLUDES EMPLOYEES IN THE GENERAL SCHEDULE, WOULD HAVE THEIR SALARIES INCREASED BY APPROXIMATELY 8 PERCENT. IN ANY EVENT, THE EFFECT THEREOF WAS TO CREATE SPECIAL SALARY RATES FOR EMPLOYEES IN THE POST OFFICE DEPARTMENT SUBJECT TO THE GENERAL SCHEDULE WHICH ARE APPROXIMATELY 8 PERCENT HIGHER AT THE PRESENT TIME THAN THE SALARIES OF ALL OTHER EMPLOYEES SUBJECT TO THE GENERAL SCHEDULE (EXCLUDING SPECIAL CATEGORIES). SINCE THERE IS NO INDICATION IN PUBLIC LAW 91-375 THAT GENERAL SCHEDULE EMPLOYEES OF THE POST OFFICE DEPARTMENT WERE TO BE REMOVED FROM THE GENERAL SCHEDULE OR OTHERWISE EXEMPTED FROM THE PROVISIONS OF LAW APPLICABLE THERETO, OUR VIEW IS THAT SECTION 5334(B) ABOVE IS APPLICABLE AND THAT THEIR EXISTING RATES OF BASIC COMPENSATION MUST BE REGARDED AS THE REGULAR GENERAL SCHEDULE RATES AS INCREASED BY PUBLIC LAW 91-375. THIS APPEARS TO ACCORD WITH THE TREATMENT IN THE COMMISSION'S REGULATION (531.204) OF SPECIAL RATES AUTHORIZED UNDER 5 U.S.C. 5303. IT FOLLOWS THAT IN PROMOTION SITUATIONS TO WHICH YOU REFER THAT THE REQUIRED TWO-STEP INCREASE WOULD BE COMPUTED ON THE REVISED GENERAL SCHEDULE RATES OF THE POST OFFICE DEPARTMENT.

IN REGARD TO QUESTION (2), CONSISTING OF FOUR PARTS AND CONCERNING THE "HIGHEST PREVIOUS RATE" RULE, 5 U.S.C. 5334(A) PROVIDES THAT THE RATE OF BASIC PAY TO WHICH AN EMPLOYEE IS ENTITLED WHEN, AMONG OTHER THINGS, HE IS TRANSFERRED OR HIS POSITION IS CHANGED FROM ONE GRADE TO ANOTHER, IS GOVERNED BY "REGULATIONS PRESCRIBED BY THE CIVIL SERVICE COMMISSION." THE ABSENCE OF REGULATIONS PRECLUDING OR LIMITING CONSIDERATION OF THE POST OFFICE INCREASES IN THE COMPUTATION OF THE HIGHEST PREVIOUS RATE, SUCH AS, FOR EXAMPLE, 5 CFR 531.203(D) WITH RESPECT TO SPECIAL RATES ESTABLISHED UNDER 5 U.S.C. 5303, THE FIRST PART OF QUESTION (2) IS ANSWERED IN THE AFFIRMATIVE. AS TO THE SECOND PART OF THE QUESTION, WHERE AN AGENCY DID NOT HAVE AN ESTABLISHED POLICY BUT DID GIVE THE EMPLOYEE THE BENEFIT OF HIS LAST POST OFFICE DEPARTMENT RATE AT THE TIME HE ENTERED ON DUTY, IT WOULD BE WITHIN THE DISCRETION OF THE AGENCY CONCERNED AS TO WHETHER HIS SALARY SHOULD BE ADJUSTED TO REFLECT THE INCREASE IN THE POST OFFICE RATE. THIS IS FOR THE REASON THAT PURSUANT TO PART 531.203(C) OF THE COMMISSION'S REGULATIONS, THE AUTHORITY GRANTED ADMINISTRATIVE AGENCIES WITH RESPECT TO USE OF THE HIGHEST PREVIOUS RATE IS NOT MANDATORY, BUT PERMISSIVE. WITH REGARD TO PART THREE, THE AGENCY HAS DISCRETION TO MAKE THE ADJUSTMENT AND PART FOUR, THEREFORE, DOES NOT REQUIRE AN ANSWER.

IN REGARD TO QUESTION (3), THERE IS FOR CONSIDERATION SECTION 531.203(D)(4) OF THE COMMISSION'S REGULATIONS WHICH PROVIDE, IN PERTINENT PART, AS FOLLOWS: "IF THE HIGHEST PREVIOUS RATE WAS EARNED IN A GENERAL SCHEDULE POSITION, IT IS INCREASED BY SUBSEQUENT AMENDMENTS OF THE GENERAL SCHEDULE."

WE BELIEVE THE ABOVE REGULATION WAS INTENDED TO RELATE ONLY TO GENERAL INCREASES IN THE GENERAL SCHEDULE AND NOT TO SPECIAL INCREASES SUCH AS HERE INVOLVED. THUS, A FORMER EMPLOYEE OF THE POST OFFICE DEPARTMENT WHO WAS NOT ON THE ROLLS ON THE DATE OF ENACTMENT OF THE POSTAL REORGANIZATION ACT AND OTHERWISE NOT ENTITLED TO THE RETROACTIVE INCREASE MAY NOT BE GIVEN THE BENEFIT OF THE INCREASED RATE FOR THE PURPOSES OF THE "HIGHEST PREVIOUS RATE" RULE.

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