Claim for Retroactive Step Increase and Backpay

An employee of a Federal agency requested a review of a settlement which disallowed her claim for a retroactive step increase and backpay. When the employee transferred from one agency to another, her compensation was set at a step of the grade lower than what she had previously held. The use of the highest previous rate rule by an agency in setting a pay rate upon transfer is discretionary. Since the agency regulations governing employee compensation provide that use of the rule is inapplicable if the higher rate was earned in another agency, the employee was not entitled to have the rate rule used in setting her new pay rate. Accordingly, the disallowance of the claim was sustained.