[Claim for Increased Compensation in Form of Additional Step Rate]

A decision was requested concerning a claim for increased compensation incident to an employee's promotion. The agency computed the employee's pay increase and rounded off the fractional amount to the nearest whole number, fractionally lower than 4 percent of her existing salary. Federal personnel regulations require that a promoted employee is be paid at a rate which exceeds his or her existing scheduled rate of pay by at least 4 percent. Although rounding off figures to the nearest whole number is certainly an acceptable practice, the agency's computation resulted in a figure that was slightly lower than the required 4 percent. The employee contended that if the agency had rounded off the figure to the next higher whole number, the 4-percent requirement would have been met and she would have been entitled to a higher grade classification. GAO held that Federal personnel regulations clearly state that an employee is entitled to an increase of at least 4 percent of the rate from which he or she is promoted. Since the increase computed and effected by the agency was less than 4 percent, it was not in accordance with the regulatory requirement. Accordingly, the employee may be granted the additional compensation.