B-152418, B-152414, DECEMBER 5, 1963, 43 COMP. GEN. 478

B-152414,B-152418: Dec 5, 1963

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COMPENSATION - WAGE BOARD EMPLOYEES - CONVERSION TO CLASSIFIED POSITIONS - HIGHEST PREVIOUS RATE - SERVICE BEFORE AND AFTER FEDERAL SALARY REFORM ACT OF 1962 WHEN UPON CONVERSION FROM A WAGE BOARD TO A CLASSIFICATION ACT POSITION THERE IS NO EQUIVALENT OF THE WAGE BOARD RATE UNDER THE CLASSIFICATION ACT AND THE NEXT HIGHER RATE FALLS WITHIN TWO OR MORE GRADES UNDER THE ACT. - ON THE BASIS THAT THE APPLICATION OF THE HIGHEST PREVIOUS RATE RULE IS WITHIN THE DISCRETION OF THE ADMINISTRATIVE OFFICE IN FIXING THE INITIAL SALARY RATE OF THE EMPLOYEE UPON TRANSFER. IN VIEW OF THE DIFFERENT INTERPRETATIONS GIVEN TO THE REGULATIONS OF THE CIVIL SERVICE COMMISSION WE ARE RENDERING OUR DECISION TO YOU.

B-152418, B-152414, DECEMBER 5, 1963, 43 COMP. GEN. 478

COMPENSATION - WAGE BOARD EMPLOYEES - CONVERSION TO CLASSIFIED POSITIONS - HIGHEST PREVIOUS RATE - WAGE RATE WITHIN RANGE OF TWO GRADES. COMPENSATION - WAGE BOARD EMPLOYEES - CONVERSION TO CLASSIFIED POSITIONS - HIGHEST PREVIOUS RATE - SERVICE BEFORE AND AFTER FEDERAL SALARY REFORM ACT OF 1962 WHEN UPON CONVERSION FROM A WAGE BOARD TO A CLASSIFICATION ACT POSITION THERE IS NO EQUIVALENT OF THE WAGE BOARD RATE UNDER THE CLASSIFICATION ACT AND THE NEXT HIGHER RATE FALLS WITHIN TWO OR MORE GRADES UNDER THE ACT, SECTION 25.103 (C) OF THE FEDERAL EMPLOYEES PAY REGULATIONS PROVIDING FOR THE USE OF THE RATE THAT GIVES AN EMPLOYEE THE MAXIMUM BENEFIT IN ESTABLISHING THE HIGHEST PREVIOUS RATE, A $7,155.20 PER ANNUM WAGE RATE THAT FALLS WITHIN THE RANGE OF BOTH THE GS-9 AND GS-10 GRADES MAY BE CONVERTED TO $7,260, GRADE GS-9, STEP 6, UNDER THE 1960 PAY SCHEDULES OF THE CLASSIFICATION ACT, RATHER THAN $7,160, GRADE GS-10, STEP 2, NOT BECAUSE EVENTUALLY THE EMPLOYEE WOULD BE TRANSFERRED TO A GS-9 POSITION BUT BECAUSE THE SELECTION GIVES THE EMPLOYEE THE GREATEST BENEFIT UNDER THE 1962 GENERAL SCHEDULE--- $7,800 RATHER THAN $7,575 PER ANNUM--- ON THE BASIS THAT THE APPLICATION OF THE HIGHEST PREVIOUS RATE RULE IS WITHIN THE DISCRETION OF THE ADMINISTRATIVE OFFICE IN FIXING THE INITIAL SALARY RATE OF THE EMPLOYEE UPON TRANSFER. WHERE THE HIGHEST PREVIOUS RATE IN A WAGE BOARD POSITION COVERS A PERIOD OF SERVICE BEFORE AND AFTER THE ENACTMENT OF THE FEDERAL SALARY REFORM ACT OF 1962 (5 U.S.C. 1171 NOTE), SECTION 25.103 (C) OF THE FEDERAL EMPLOYEES PAY REGULATIONS PROVIDING THAT UPON CONVERSION FROM A WAGE BOARD TO A CLASSIFICATION ACT POSITION THE MAXIMUM BENEFIT SHOULD BE GIVEN AN EMPLOYEE IN COMPUTING HIS HIGHEST PREVIOUS RATE, BOTH IN 1960 CLASSIFICATION ACT SCHEDULE RATE, INCREASED BY THE SALARY REFORM ACT, AND THE APPROPRIATE RATE IN THE 1962 SCHEDULE SHOULD BE APPLIED AND THE EMPLOYEE GIVEN THE BENEFIT OF THE HIGHEST RATE.

TO THE SECRETARY OF THE AIR FORCE, DECEMBER 5, 1963:

ON AUGUST 13, 1963, MR. ROBERT M. ROTH, 1901 SOUTH BROADWAY, SANTA MARIA, CALIFORNIA, PRESENTED TO US, AT THE SUGGESTION OF THE PERSONNEL MANAGEMENT DIVISION OF THE UNITED STATES CIVIL SERVICE COMMISSION, SAN FRANCISCO, CALIFORNIA, A REQUEST FOR OUR INTERPRETATION OF THAT PART OF SECTION 25.103 (C) OF THE FEDERAL EMPLOYEES PAY REGULATIONS, PROMULGATED BY THE UNITED STATES CIVIL SERVICE COMMISSION, FIXING THE PAY RATES UPON CONVERSION FROM A WAGE BOARD POSITION TO A CLASSIFICATION ACT POSITION. THE INFORMATION FURNISHED BY MR. ROTH SHOWS THAT UPON HIS CONVERSION HIS SALARY RATE HAD BEEN ADMINISTRATIVELY SET AT DIFFERENT RATES BY NORTON AIR FORCE BASE AND VANDENBERG AIR FORCE BASE, UNDER THE APPLICABLE PROVISIONS OF THE FOREGOING SECTION, THUS GIVING RISE TO HIS REQUEST FOR CLARIFICATION OF THE SITUATION.

IN VIEW OF THE DIFFERENT INTERPRETATIONS GIVEN TO THE REGULATIONS OF THE CIVIL SERVICE COMMISSION WE ARE RENDERING OUR DECISION TO YOU.

SECTION 25.103 (C/--- COMPUTATION OF HIGHEST PREVIOUS RATE--- READS, IN PERTINENT PART, AS FOLLOWS:

* * * IF SUCH HIGHEST PREVIOUS RATE WAS EARNED IN A POSITION NOT SUBJECT TO THE CLASSIFICATION ACT, THIS RATE SHALL BE COMPUTED AS FOLLOWS: THE ACTUAL RATE EARNED AT THE TIME OF SUCH SERVICE SHALL BE CONVERTED TO THE EQUIVALENT PER ANNUM RATE UNDER THE CLASSIFICATION ACT AS OF THE TIME OF SUCH SERVICE; WHERE THERE WAS NO EXACT EQUIVALENT PER ANNUM RATE UNDER THE CLASSIFICATION ACT, THE NEXT HIGHER CLASSIFICATION ACT RATE SHALL BE CONSIDERED AN EQUIVALENT; WHERE THE RATE THUS DETERMINED FALLS WITHIN TWO OR MORE GRADES UNDER THE ACT, THE RATE IN THE GRADE WHICH GIVES THE EMPLOYEE THE MAXIMUM BENEFIT SHALL BE USED; THE EQUIVALENT CLASSIFICATION ACT RATE THUS DETERMINED SHALL BE CONVERTED TO THE CURRENT RATE FOR SUCH STEP AND GRADE AND SHALL BE THE EMPLOYEE'S HIGHEST PREVIOUS RATE.

THE FOLLOWING PERTINENT INFORMATION WAS FURNISHED BY MR. ROTH WITH HIS LETTER OF AUGUST 13:

1. EMPLOYED AT NORTON AFB IN A WAGE BOARD L-10 POSITION, SALARY $3.44 P/H, ANNUAL SALARY $7155.20, EFFECTIVE NOVEMBER 26, 1961.

2. DOWNGRADED THROUGH RIF ACTION TO A W-10 RATING, SALARY $3.13 P/H, ANNUAL SALARY $6510.30, EFFECTIVE SEPTEMBER 23, 1962.

3. CONVERTED TO A GS-9 STEP 4, SALARY $7350.00 P/H), EFFECTIVE OCTOBER 28, 1962. RE-ASSIGNMENT WAS TO VANDENBERG AFB AND MOVE WAS AT GOVERNMENT EXPENSE.

4. AFTER A RECENT REVIEW BY THE CIVILIAN PERSONNEL OFFICE, VANDENBERG AFB, REGARDING WAGE CONVERSION I WAS INFORMED THAT STEP 5 IS MY CORRECT STEP AND CONVERSION WILL BE RETROACTIVE TO OCTOBER 28, 1962. THIS ACTION IS STILL PENDING.

PLEASE ADVISE WHAT CONVERSION PRINCIPALS ARE CORRECT. THE FEDERAL PERSONNEL MANUAL STATES ACTION SHOULD GIVE THE EMPLOYEE THE MAXIMUM POSSIBLE BENEFIT.

FOLLOWING ARE TWO LOCAL INTERPRETATIONS:

1. NORTON AFB--- HIGHEST SALARY OF $7155.20 IS PARALLED (SIC) TO THE NEAREST STEP WITHIN GS-9 PRIOR TO THE OCTOBER 1963 INCREASE FOR ALL CLASSIFIED EMPLOYEES, AND SUBSEQUENTLY THE SAME STEP IN THE PRESENT WAGE STRUCTURE SHOULD BE HELD. THEIR COMPUTATIONS WOULD PLACE ME IN A GS-9 STEP 6, $7800 P/A.

2. VANDENBERG AFB--- HIGHEST SALARY OF $7155.20 P/A IS PARALLEL (SIC) TO THE NEAREST GS RATE PRIOR TO THE 1963 INCREASE. IN MY CASE THE RATE IS GS -10 STEP 2, WHICH IS CONVERTED TO THE PRESENT GS-10 STEP 2 OF $7535.00 P/A AND PARALLED (SIC) TO THE NEAREST GS-9 WHICH IS STEP 5, $7575.00 P/A.

WE REFERRED THE MATTER TO YOUR DEPARTMENT ON SEPTEMBER 6, 1963, FOR CONSIDERATION AND COMMENT. UNDER DATE OF OCTOBER 28, 1963, REFERENCE AFPCPAA, THE FOLLOWING REPORT WAS FURNISHED:

MR. ROBERT M. ROTH WAS PROMOTED FROM THE WAGE BOARD POSITION, W-10, $3.13 PER HOUR TO GS-9, EFFECTIVE 28 OCTOBER 1962. HIS SALARY WAS ERRONEOUSLY ADJUSTED TO $7350 PER ANNUM AT THAT TIME. HE PREVIOUSLY HELD A WAGE BOARD POSITION L-10 $3.44 PER HOUR FROM 5 APRIL 1959 TO 23 SEPTEMBER 1962, THEN CHANGED TO LOWER GRADE THROUGH REDUCTION-IN FORCE. ON 24 JUNE 1963 THE RATE WAS CORRECTED TO $7575 PER ANNUM BASED ON THE HIGHEST PREVIOUS RATE RULE.

SECTION 103 (C) OF THE COMMISSION'S REGULATIONS PROVIDES THAT IF THE HIGHEST PREVIOUS RATE WAS EARNED IN A POSITION NOT SUBJECT TO THE CLASSIFICATION ACT, THE ACTUAL RATE EARNED AT THE TIME OF SUCH SERVICE SHALL BE CONVERTED TO THE EQUIVALENT PER ANNUM RATE. WHERE THERE IS NOT EXACT EQUIVALENT PER ANNUM RATE THE NEXT HIGHER RATE SHALL BE CONSIDERED AS EQUIVALENT. WHERE THE RATE THUS DETERMINED FALLS WITHIN TWO OR MORE CLASSIFICATION ACT GRADES, THE RATE IN THE GRADE WHICH GIVES THE EMPLOYEE THE MAXIMUM BENEFIT SHALL BE USED.

IN THE SUBJECT CASE THE $3.44 HOURLY RATE AMOUNTS TO $7155.20 PERANNUM. SINCE THIS AMOUNT FALLS WITHIN THE RANGE OF BOTH THE GS-9 AND THE GS-10 GRADES THE NEAREST RATE AT THE TIME OF SUCH SERVICE WAS THE SECOND STEP OF GS-10 $7160 RATHER THAN THE SIXTH STEP OF GS-9, $7260. UNDER THE SALARY REFORM ACT OF 1962 THE SECOND STEP OF GS-10 IS INCREASED TO $7535. THIS IS THE CONVERTED HIGHEST PREVIOUS RATE TO BE USED IN ESTABLISHING THE STEP RATE TO WHICH THE EMPLOYEE IS ENTITLED WHEN CHANGED FROM A WAGE BOARD POSITION TO THE GS-9 CLASSIFICATION ACT POSITION. THE CONVERTED RATE $7535 FALLS BETWEEN THE FOURTH STEP $7350 AND THE FIFTH STEP $7575 OF THE GS-9 GRADE AND THEREFORE, THE ACTION TAKEN BY THE VANDENBERG AFB IN CONVERTING THE EMPLOYEE TO THE STEP RATE OF $7575 IS CORRECT.

IN ADDITION THE MATTER WAS REFERRED TO THE UNITED STATES CIVIL SERVICE COMMISSION FOR CONSIDERATION AND COMMENT SINCE THE COMMISSION PROMULGATED SECTION 25.103 (C) UNDER THE AUTHORITY IN 5 U.S.C. 1072. THE COMMISSION REPORTS AS FOLLOWS:

SECTION 25.103 (C) OF THE COMMISSION'S REGULATIONS IS INTENDED TO PROVIDE DEPARTMENTS A METHOD OF COMPUTING AN EMPLOYEE'S HIGHEST PREVIOUS RATE WHEN HE HAS SERVED IN A POSITION NOT SUBJECT TO THE CLASSIFICATION ACT. IT WAS INTENDED THAT THE METHOD WOULD BE USED IN CONVERTING AN EMPLOYEE'S RATE SO THAT THE EMPLOYEE COULD RECEIVE THE GREATEST POSSIBLE BENEFIT. THE PERTINENT CLAUSE--- "WHERE THE RATE THUS DETERMINED FALLS WITHIN TWO OR MORE GRADES UNDER THE ACT, THE RATE IN THE GRADE WHICH GIVES THE EMPLOYEE THE MAXIMUM BENEFIT SHALL BE USED"--- IS INTENDED TO APPLY.

IN THE CASE REFERRED TO IN YOUR LETTER, THE EMPLOYEE WAS EARNING $3.44 PER HOUR IN NOVEMBER 1961, WHICH RATE CONVERTS TO $7155.20 ON AN ANNUAL BASIS. APPLYING WHAT WE INTENDED BY THIS REGULATION TO THIS SET OF FACTS, THE RATE $7155 WOULD BE CONVERTED TO $7260 IN GRADE GS-9 UNDER THE 1960 PAY SCHEDULE FOR CLASSIFICATION ACT JOBS. THIS RATE, WHICH IS STEP (F) OF GS-9, IS SELECTED NOT BECAUSE THE EMPLOYEE WAS EVENTUALLY TRANSFERRED TO A GS-9 POSITION BUT BECAUSE A SELECTION OF THIS RATE WILL GIVE THE EMPLOYEE THE GREATEST BENEFIT, SINCE THIS RATE IS NOW $7800 UNDER THE 1962 GENERAL SCHEDULE.

THIS SAME PRINCIPLE WOULD BE FOR APPLICATION IN THE OTHER CONVERSION CASE TO WHICH YOU REFER IN YOUR LETTER.

FROM THE FOREGOING IT IS APPARENT THAT THE LANGUAGE OF SECTION 25.103 (C), QUOTED ABOVE, COVERING THE COMPUTATION OF THE HIGHEST PREVIOUS RATE BEFORE CONVERSION--- TRANSFER--- FROM A POSITION OUTSIDE THE CLASSIFICATION ACT, 5 U.S.C. 1071, ET SEQ., TO A POSITION COVERED THEREBY IS SUBJECT TO MORE THAN ONE INTERPRETATION. THE CIVIL SERVICE COMMISSION ACKNOWLEDGES THAT FACT AND HAS ADVISED THAT PROMPT STEPS WILL BE TAKEN TO CLARIFY THE MATTER TO ACCORD WITH THE INTENT EXPRESSED IN THE REPORT QUOTED ABOVE.

SECTION 25.103 (B) OF THE SAME REGULATIONS PROVIDES, IN PERTINENT PART, AS FOLLOWS:

* * * AN EMPLOYEE WHO IS * * * TRANSFERRED * * * MAY BE PAID AT ANY SCHEDULED RATE FOR HIS GRADE WHICH DOES NOT EXCEED HIS HIGHEST PREVIOUS RATE. IF THE EMPLOYEE'S HIGHEST PREVIOUS RATE FALLS BETWEEN TWO SCHEDULED RATES OF HIS NEW GRADE, HE MAY BE GIVEN THE HIGHER RATE * * *

WE HAVE HELD CONSISTENTLY IN OUR DECISIONS THAT THE APPLICATION OF THE HIGHEST PREVIOUS RATE RULE IS WITHIN THE DISCRETION OF THE ADMINISTRATIVE OFFICE IN FIXING THE INITIAL SALARY RATE OF AN EMPLOYEE UPON TRANSFER. COMP. GEN. 368 AND CASES CITED THEREIN.

SINCE MR. ROTH'S SALARY WAS ADMINISTRATIVELY FIXED AT $7,575 PER ANNUM, UNDER PARAGRAPH 6.B OF AFR 40-521, 18 JUNE 1962, IN FORCE AND EFFECT AT THE TIME OF THE CONVERSION--- TRANSFER--- WHICH REGULATION PROVIDED THAT HE MAY BE PAID AT ANY STEP RATE OF HIS GRADE WHICH DOES NOT EXCEED THE HIGHEST RATE HE PREVIOUSLY EARNED IN THE FEDERAL SERVICE, THAT RATE IS PROPER INASMUCH AS IT DOES NOT EXCEED THE HIGHEST RATE PREVIOUSLY EARNED. HOWEVER, IF IN FACT, AS THE RECORD SUGGESTS, IT WAS THE ADMINISTRATIVE INTENT TO ALLOW THE HIGHEST RATE POSSIBLE UNDER THE REGULATIONS OF THE COMMISSION, WE SEE NO OBJECTION, IN THIS INSTANCE, TO A RETROACTIVE CHANGE OF THE RATE TO $7,800 IF OTHERWISE PROPER.

THE LETTER OF OCTOBER 28, 1963, FROM YOUR DEPARTMENT ADVISES THAT ANOTHER SITUATION EXISTS CONCERNING THE CONVERSION OF AN EMPLOYEE FROM A WAGE BOARD POSITION TO A CLASSIFICATION ACT POSITION WHERE THE HIGHEST PREVIOUS RATE IN THE WAGE BOARD POSITION COVERS A PERIOD OF SERVICE BOTH BEFORE AND AFTER ENACTMENT OF THE FEDERAL SALARY REFORM ACT OF 1962, 76 STAT. 841, 5 U.S.C. 1171 NOTE. THE QUESTION IS ASKED AS TO WHETHER IN SUCH A CASE THE CONVERSION RATE IS TO BE ESTABLISHED AT THE APPROPRIATE RATE IN THE 1962 SCHEDULE (5 U.S.C. 1113 (B) ( OR WOULD THE 1960 CLASSIFICATION ACT SCHEDULED RATE BE USED AND THEN INCREASED BY THE FEDERAL SALARY REFORM ACT OF 1962.

WHILE THAT PART OF SECTION 25.103 (C), QUOTED ABOVE, DOES NOT CONTAIN LANGUAGE SPECIFICALLY DIRECTING WHICH SALARY INCREASE ACT IS TO BE USED IN COMPUTING AN EMPLOYEE'S HIGHEST PREVIOUS RATE UNDER SECTION 25.103 (C) WHEN THE PERIOD OF SERVICE CONCERNED INVOLVES 2 SUCH ACTS, THE REPORT OF THE CIVIL SERVICE COMMISSION, QUOTED ABOVE, POINTS OUT THAT THE MAXIMUM BENEFIT SHOULD BE GIVEN TO THE EMPLOYEE BY APPLYING BOTH ACTS AND USING THE HIGHEST RATE. THE QUESTION IS ANSWERED ACCORDINGLY.