B-207701 L/M, NOV 30, 1982

B-207701 L/M, NOV 30, 1982

PRECIS-UNAVAILABLE

HENRY M. JACKSON, UNITED STATES SENATE:

WE REFER TO YOUR LETTER DATED MAY 19, 1982, ON BEHALF OF MS. LINDA MITCHELL OF PSC BOX 4184, APO MIAMI 34001, AN EMPLOYEE OF THE DEPARTMENT OF THE AIR FORCE IN PANAMA, CONCERNING THE WAGE SCHEDULE UPON WHICH HER SALARY HAS BEEN BASED SUBSEQUENT TO BEING HIRED IN PANAMA BY THE AIR FORCE EFFECTIVE OCTOBER 26, 1981.

MS. MITCHELL BEGAN A CIVIL SERVICE CAREER ON FEBRUARY 9, 1979, AS A SECRETARY WITH THE INTERNAL REVENUE SERVICE, IN OGDEN, UTAH. SHE WAS GRANTED LEAVE WITHOUT PAY STATUS BY THE INTERNAL REVENUE SERVICE EFFECTIVE MAY 26, 1981, FOR A PERIOD NOT TO EXCEED MAY 23, 1982. WHEN MS. MITCHELL BEGAN HER LEAVE SHE WAS A GENERAL SCHEDULE GRADE 5, STEP 2. EFFECTIVE OCTOBER 26, 1981, SHE WAS GIVEN A CAREER-CONDITIONAL CANAL ZONE REAPPOINTMENT BY THE AIR FORCE AS A CLERK-STENOGRAPHER GRADE 4, STEP 3, IN THE CANAL ZONE MERIT SYSTEM PURSUANT TO REGULATIONS GOVERNING NONCOMPETITIVE APPOINTMENTS PROMULGATED BY THE SECRETARY OF THE ARMY FOR THE PANAMA CANAL EMPLOYMENT SYSTEM AND FOUND AT TITLE 35 OF THE CODE OF FEDERAL REGULATIONS.

PRIOR TO THE IMPLEMENTATION OF THE 1977 PANAMA CANAL TREATY, THE CANAL ZONE MERIT SYSTEM ENCOMPASSED VARIOUS WAGE SCHEDULES INCLUDING (1) A GENERAL SCHEDULE FOR UNITED STATES CITIZENS; (2) A WAGE BASE FOR OTHER THAN UNITED STATES CITIZENS, (3) CANAL ZONE WAGE BASE FOR UNITED STATES CITIZENS; AND (4) A CANAL ZONE WAGE BASE FOR OTHER THAN UNITED STATES CITIZENS. ARTICLE X, SECTION 6 OF THE PANAMA CANAL TREATY, ARTICLE VII OF THE STATUS OF FORCES AGREEMENT, AND SUBCHAPTER II, SECTION 1216 OF THE PANAMA CANAL ACT OF 1979, IMPLEMENTING BOTH THE PANAMA CANAL TREATY AND THE STATUS OF FORCES AGREEMENT, PROHIBIT WAGE DISCRIMINATION ON THE BASIS OF NATIONALITY, SEX OR RACE.

IN ACCORDANCE WITH THE PAY FORMULA SPECIFIED IN SECTION 1225(B)(1) AND (2) OF THE PANAMA CANAL ACT OF 1979, THE PANAMA AREA WAGE BASE WAS ESTABLISHED AND IMPLEMENTED ON OCTOBER 1, 1979. THIS LOCAL WAGE SCHEDULE IS REQUIRED TO BE APPLIED EQUALLY TO BOTH UNITED STATES CITIZENS AND OTHERS HIRED LOCALLY SUBSEQUENT TO ITS IMPLEMENTATION DATE.

ON JANUARY 10, 1982, THE PANAMA AREA WAGE BASE WAS REVISED TO CONFORM IN PRINCIPLE TO THE GENERAL WAGE SCHEDULE, WITH TEN STEPS. THIS REVISION PROVIDED FOR REGULAR WITHIN GRADE INCREASES, IN ADDITION TO THE 2 PERCENT WAGE INCREASE ALLOWED ANNUALLY, AND PERMITS SUPERVISORS TO RECOMMEND DESERVING EMPLOYEES FOR QUALITY SALARY INCREASES. FURTHERMORE, AGENCIES WERE AUTHORIZED TO USE THE HIGHEST PREVIOUS RATE RULE, WHICH BENEFITS EMPLOYEES BY PLACING THEM IN A HIGHER STEP OF THEIR GRADE.

ALTHOUGH THE PANAMA CANAL EMPLOYMENT SYSTEM IS PATTERNED AFTER THE COMPETITIVE CIVIL SERVICE, THE TWO ARE DISTINCT AND SEPARATE SYSTEMS. HAVE BEEN INFORMED BY THE EXECUTIVE DIRECTOR OF THE PANAMA AREA PERSONNEL BOARD THAT WHEN AN EMPLOYEE TRANSFERS FROM OBTAINED FROM THE EMPLOYEE THAT SHE IS LEAVING THE THE COMPETITIVE SERVICE TO A POSITION IN THE PANAMA CANAL EMPLOYMENT SYSTEM, THE ACTION IS PROCESSED AS A NEW APPOINTMENT AND A STATEMENT OF UNDERSTANDING IS COMPETITIVE SERVICE VOLUNTARILY. THE EXECUTIVE DIRECTOR HAS SPECIFICALLY ADDRESSED MS. MITCHELL'S CONCERN WITH THE NEW PAY SCALE AS FOLLOWS:

"IN REGARDS TO MS. MITCHELL'S CONCERN WITH THE NEW LOCAL PAY SCALE, THE REGULATIONS OF THE SECRETARY OF THE ARMY (35 CFR, PART 251.12, PARAGRAPHS B(1) AND B(2)) AUTHORIZE THE ESTABLISHMENT OF DIFFERENT RATES OF PAY FOR EMPLOYEES HIRED AFTER SEPTEMBER 30, 1979. AS A MATTER OF CLARIFICATION, OUR PAY SYSTEM IS DIFFERENT FROM ANY OTHER IN U. S. OVERSEAS LOCATIONS IN THAT WE CANNOT DISCRIMINATE IN TERMS OF PAY BASED SOLELY ON THE CITIZENSHIP OF AN EMPLOYEE. IN OTHER WORDS, WE ARE PRECLUDED FROM PAYING A GS RATE TO A U. S. CITIZEN AND A LOCAL RATE TO A NON-U. S. CITIZEN IF BOTH EMPLOYEES DO THE SAME JOB AND WERE HIRED AT THE SAME TIME. WITH THE IMPLEMENTATION OF THE 1977 TREATY ON OCTOBER 1, 1979, THE U. S. WAS COMMITTED TO RECRUITING AS MANY PANAMANIAN NATIONALS AS POSSIBLE. IT WOULD BE ECONOMICALLY IMPRUDENT, THEREFORE, TO PAY A U. S. RATE (GS) TO ALL POST-TREATY HIRES WHEN THE VAST MAJORITY (95 PERCENT) OF THESE NEW EMPLOYEES ARE NON-U. S. CITIZENS HIRED LOCALLY."

HOWEVER, THE PANAMA CANAL ACT OF 1979, AND ITS IMPLEMENTING REGULATIONS (35 C.F.R. PART 251, MARCH 31, 1982) DO PROVIDE FOR THE PAYMENT OF ADDITIONAL COMPENSATION, IN ADDITION TO BASIC PAY, AS AN OVERSEAS RECRUITMENT OR RETENTION DIFFERENTIAL TO ANY INDIVIDUAL WHO WAS RECRUITED ON OR AFTER OCTOBER 1, 1979, FROM OUTSIDE OF THE REPUBLIC OF PANAMA FOR PLACEMENT IN THE REPUBLIC OF PANAMA. THIS PANAMA AREA DIFFERENTIAL MAY BE PAID ONLY TO AN INDIVIDUAL WHOSE RECRUITMENT OR RETENTION THE AGENCY HEAD DETERMINES TO BE ESSENTIAL. IT WOULD APPEAR THAT MS. MITCHELL WOULD NOT BE ELIGIBLE FOR A PAY DIFFERENTIAL AS SHE WAS NEITHER RECRUITED FROM OUTSIDE PANAMA NOR ARE WE AWARE OF A DETERMINATION BY THE SECRETARY OF THE AIR FOCE OR HIS DESIGNEE THAT HER RECRUITMENT WAS ESSENTIAL.

ADDITIONAL SALARY PROTECTION IS PROVIDED BY SECTION 1219 OF THE PANAMA CANAL ACT OF 1979 IN THE CASE OF ANY EMPLOYEE WHOSE RATE OF BASIC PAY IS DETERMINED IN RELATION TO RATES OF BASIC PAY FOR THE SAME OR SIMILAR WORK IN THE UNITED STATES. HOWEVER, THIS SALARY PROTECTION DOES NOT APPLY IF THE EMPLOYEE IS PLACED IN A POSITION WHICH IS OF A LOWER GRADE. THEREFORE, IN VIEW OF THE FACT THAT MS. MITCHELL WAS PLACED IN A LOWER GRADED POSITION (FROM A GRADE 5 IN OGDEN, UTAH, TO A GRADE 4 AT HOWARD AIR FORCE BASE), IT HAS NO APPLICABILITY TO HER.

MS. VICKI J. BOYLE OF YOUR OFFICE HAS REQUESTED THAT WE ADVISE YOU AS TO THE STATUS OF A PAY SCHEDULE COMPLAINT ALLEGEDLY SUBMITTED BY OTHER CIVILIAN EMPLOYEES IN THE PANAMA CANAL AREA. OUR RECORDS REVEAL THAT NO COMPLAINTS OF THIS NATURE HAVE BEEN RECEIVED BY OUR OFFICE OTHER THAN MS. MITCHELL'S LETTER WHICH YOU HAVE FORWARDED TO US.

IN VIEW OF THE ABOVE, THE AGENCY ACTION IN THIS MATTER APPEARS TO BE PROPER.