B-173815, APR 4, 1973, 52 COMP GEN 629

B-173815: Apr 4, 1973

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THE OFFICER WHO WILL REACH MANDATORY RETIREMENT AGE WITHIN 8 MONTHS OF HIS PROMOTION MAY NOT BE PERMITTED FOR THE PURPOSE OF INCREASING HIS ANNUITY PAYMENTS TO PAY INTO THE FOREIGN SERVICE AND DISABILITY FUND THE ADDITIONAL AMOUNTS THAT WOULD HAVE BEEN DEDUCTED FROM HIS SALARY AND DEPOSITED INTO THE FUND BUT FOR THE DELAY. COMPULSORY CONTRIBUTIONS TO THE RETIREMENT FUND ARE BASED ON ACTUAL SALARY RECEIVED AND SINCE THE EMPLOYEE MAY NOT BE RETROACTIVELY PROMOTED UPON REMOVAL OF THE AGE DISCRIMINATION. HIS ANNUITY PAYMENTS ARE NOT FOR COMPUTATION ON THE SALARY OF GRADE FSO-3 PRIOR TO THE DATE HE WAS PROMOTED TO THAT GRADE. 1973: REFERENCE IS MADE TO YOUR LETTER OF MARCH 5. REQUESTING THAT YOU BE PERMITTED TO PAY INTO THE FOREIGN SERVICE AND DISABILITY FUND THE ADDITIONAL AMOUNTS THAT WOULD HAVE BEEN DEDUCTED FROM YOUR SALARY AND DEPOSITED INTO THE FUND IF YOUR PROMOTION FROM FSO-4 TO FSO-3 HAD BEEN MADE IN 1968 INSTEAD OF BEING DELAYED TO 1972 BECAUSE OF DISCRIMINATION ON ACCOUNT OF YOUR AGE.

B-173815, APR 4, 1973, 52 COMP GEN 629

FOREIGN SERVICE - PROMOTIONS - DELAYED - ANNUITY COMPUTATION NOTWITHSTANDING A 4-YEAR DELAY IN PROMOTING A FOREIGN SERVICE OFFICER FROM FSO-4 TO FSO-3 DUE TO AGE DISCRIMINATION, THE OFFICER WHO WILL REACH MANDATORY RETIREMENT AGE WITHIN 8 MONTHS OF HIS PROMOTION MAY NOT BE PERMITTED FOR THE PURPOSE OF INCREASING HIS ANNUITY PAYMENTS TO PAY INTO THE FOREIGN SERVICE AND DISABILITY FUND THE ADDITIONAL AMOUNTS THAT WOULD HAVE BEEN DEDUCTED FROM HIS SALARY AND DEPOSITED INTO THE FUND BUT FOR THE DELAY. COMPULSORY CONTRIBUTIONS TO THE RETIREMENT FUND ARE BASED ON ACTUAL SALARY RECEIVED AND SINCE THE EMPLOYEE MAY NOT BE RETROACTIVELY PROMOTED UPON REMOVAL OF THE AGE DISCRIMINATION, HIS ANNUITY PAYMENTS ARE NOT FOR COMPUTATION ON THE SALARY OF GRADE FSO-3 PRIOR TO THE DATE HE WAS PROMOTED TO THAT GRADE.

TO KIYONAO OKAMI, AMERICAN CONSUL, EMBASSY OF THE UNITED STATES OF AMERICA, APRIL 4, 1973:

REFERENCE IS MADE TO YOUR LETTER OF MARCH 5, 1973, REQUESTING THAT YOU BE PERMITTED TO PAY INTO THE FOREIGN SERVICE AND DISABILITY FUND THE ADDITIONAL AMOUNTS THAT WOULD HAVE BEEN DEDUCTED FROM YOUR SALARY AND DEPOSITED INTO THE FUND IF YOUR PROMOTION FROM FSO-4 TO FSO-3 HAD BEEN MADE IN 1968 INSTEAD OF BEING DELAYED TO 1972 BECAUSE OF DISCRIMINATION ON ACCOUNT OF YOUR AGE. YOU STATE THAT YOU WILL REACH THE MANDATORY AGE FOR RETIREMENT ON JUNE 30, 1973, AND WISH TO MAKE SUCH ADDITIONAL CONTRIBUTIONS TO THE FUND SO THAT YOUR ANNUITY WILL BE COMPUTED ON THE HIGHER SALARY THAT YOU WOULD HAVE RECEIVED BUT FOR THE DISCRIMINATION.

YOU STATE THAT AFTER BEING PASSED OVER FOR PROMOTION FOR SEVERAL YEARS ON ACCOUNT OF AGE, YOU FILED A GRIEVANCE IN 1971. ON JUNE 5, 1972, THE FOREIGN SERVICE GRIEVANCE BOARD FOUND THAT YOU HAD BEEN DISCRIMINATED AGAINST. ACCORDINGLY, THE BOARD RECOMMENDED TO THE SECRETARY OF STATE THAT YOU BE PROMOTED TO THE FOURTH STEP OF FSO-3, WHICH WOULD HAVE BEEN THE APPROXIMATE POINT IN GRADE WHICH YOU WOULD HAVE HELD HAD YOUR CAREER NOT BEEN IMPEDED BY DISCRIMINATION. THE SECRETARY CONCURRED WITH THE BOARD AND YOU WERE SUBSEQUENTLY PROMOTED TO THE FOURTH STEP OF FSO-3, EFFECTIVE OCTOBER 9, 1972. YOU NOTE THAT YOU WILL HAVE BEEN PAID AT THE HIGHER SALARY FOR ONLY 8 MONTHS AT THE TIME OF YOUR RETIREMENT AND THE INCREASED SALARY PAYMENTS FOR THIS SHORT PERIOD WILL HAVE LITTLE EFFECT ON THE BASIC SALARY FOR THE HIGHEST 3 CONSECUTIVE YEARS OF SERVICE, ON WHICH YOUR ANNUITY IS TO BE BASED. WHILE YOU DO NOT CLAIM ANY BACK PAY, YOU BELIEVE THAT UNDER THE CIRCUMSTANCES YOU SHOULD BE PERMITTED TO MAKE ADDITIONAL DEPOSITS INTO THE RETIREMENT FUND AND THEREBY INCREASE YOUR ANNUITY BACK TO THE DATE IN 1968 WHEN YOU SHOULD HAVE RECEIVED THE PROMOTION TO FSO-3.

SECTION 821 OF THE FOREIGN SERVICE ACT OF 1946, AS AMENDED, 22 U.S.C. 1076, READS IN PART AS FOLLOWS:

(A) THE ANNUITY OF A PARTICIPANT SHALL BE EQUAL TO 2 PER CENTUM OF HIS AVERAGE BASIC SALARY FOR THE HIGHEST THREE CONSECUTIVE YEARS OF SERVICE, FOR WHICH FULL CONTRIBUTIONS HAVE BEEN MADE TO THE FUND, MULTIPLIED BY THE NUMBER OF YEARS, NOT EXCEEDING THIRTY-FIVE, OF SERVICE CREDIT OBTAINED IN ACCORDANCE WITH THE PROVISIONS OF SECTIONS 1091 TO 1093 OF THIS TITLE.***.

SECTION 811 OF THE FOREIGN SERVICE ACT OF 1946, AS AMENDED, 22 U.S.C. 1071 READS IN PART AS FOLLOWS:

(A) SEVEN PER CENTUM OF THE BASIC SALARY RECEIVED BY EACH PARTICIPANT SHALL BE CONTRIBUTED TO THE FUND FOR THE PAYMENT OF ANNUITIES, CASH BENEFITS, REFUNDS, AND ALLOWANCES. AN EQUAL SUM SHALL ALSO BE CONTRIBUTED FROM THE RESPECTIVE APPROPRIATION OR FUND WHICH IS USED FOR PAYMENT OF THE SALARY.***.

(B) EACH PARTICIPANT SHALL BE DEEMED TO CONSENT AND AGREE TO SUCH DEDUCTIONS FROM BASIC SALARY, AND PAYMENT LESS SUCH DEDUCTIONS SHALL BE A FULL AND COMPLETE DISCHARGE AND ACQUITTANCE OF ALL CLAIMS AND DEMANDS WHATSOEVER FOR ALL REGULAR SERVICES DURING THE PERIOD COVERED BY SUCH PAYMENT, EXCEPT THE RIGHT TO THE BENEFITS TO WHICH HE SHALL BE ENTITLED UNDER THIS CHAPTER, NOTWITHSTANDING ANY LAW, RULE, OR REGULATION AFFECTING THE INDIVIDUAL'S SALARY.

REGARDING THE AMOUNT OF THE DEDUCTION, SUBSECTION 102(A) OF PUBLIC LAW 91 -201, 22 U.S.C. 1064, APPROVED FEBRUARY 28, 1970, 84 STAT. 17, SUBSTITUTED "SEVEN" FOR "SIX AND ONE-HALF."

THE ABOVE STATUTORY PROVISIONS PROVIDE THAT THE ANNUITY OF A FOREIGN SERVICE OFFICER IS TO BE COMPUTED ON HIS AVERAGE BASIC SALARY FOR WHICH FULL CONTRIBUTIONS HAVE BEEN MADE TO THE FUND AND REQUIRE DEDUCTIONS FROM THE SALARY OF AN OFFICER IN THE AMOUNT STATED. SUCH DEDUCTIONS ARE A FULL AND COMPLETE DISCHARGE OF THE GOVERNMENT'S OBLIGATION TO THE OFFICER EXCEPT FOR THE RETIREMENT BENEFITS, ETC., CONTAINED IN THE REMAINDER OF THE CODE CHAPTER. THERE IS NO PROVISION FOR COMPUTING THE HIGH 3-YEAR BASIC SALARY ON A CONSTRUCTIVE SALARY BASIS OR ON THE BASIS OF ADDITIONAL CONTRIBUTIONS TO THE FUND. SECTION 881 OF THE FOREIGN SERVICE ACT OF 1946, AS AMENDED, 22 U.S.C. 1116, PROVIDES THAT A PARTICIPANT MAY MAKE VOLUNTARY CONTRIBUTIONS TO THE FUND. HOWEVER, SUCH CONTRIBUTIONS ARE TO BE USED TO PURCHASE AN ADDITIONAL LIFE ANNUITY ACTUARIALLY EQUIVALENT TO SUCH CONTRIBUTIONS, ETC., AND DO NOT AFFECT THE PARTICIPANT'S BASIC SALARY FOR THE PURPOSE OF COMPUTING HIS ANNUITY UNDER 22 U.S.C. 1076.

SINCE THE STATUTES PERTAINING TO COMPULSORY CONTRIBUTIONS TO THE RETIREMENT FUND REQUIRE SUCH CONTRIBUTIONS TO BE BASED ON THE ACTUAL SALARY RECEIVED, IT APPEARS THAT THE ONLY BASIS FOR INCREASING YOUR AVERAGE BASIC SALARY FOR THE PURPOSE OF COMPUTING YOUR ANNUITY WOULD BE THAT YOU ARE ENTITLED TO A RETROACTIVE PROMOTION AND BACK PAY. REGARDING THE REMEDY FOR A DISCRIMINATORY PERSONNEL ACTION IT WAS HELD IN 48 COMP. GEN. 502(1969) THAT A RETROACTIVE PROMOTION BECAUSE OF FAILURE TO TIMELY PROMOTE AN EMPLOYEE BECAUSE OF RACIAL DISCRIMINATION WAS UNAUTHORIZED. WOULD APPEAR THAT THIS RULE WOULD ALSO APPLY IN CASES INVOLVING DISCRIMINATION ON ACCOUNT OF AGE. WE HAVE ALSO EXAMINED LAWS AND REGULATIONS THAT BECAME EFFECTIVE SUBSEQUENT TO THE DATE OF THE DECISION CITED ABOVE. HOWEVER, WE HAVE FOUND NONE THAT WOULD AUTHORIZE THE RETROACTIVE PROMOTION OF AN EMPLOYEE WITH BACK PAY BECAUSE OF FAILURE TO TIMELY PROMOTE HIM DUE TO DISCRIMINATION ON ACCOUNT OF AGE.

IN VIEW OF THE ABOVE, OUR VIEW IS THAT NO BASIS EXISTS WHEREBY YOUR AVERAGE BASIC SALARY FOR ANNUITY COMPUTATION PURPOSES COULD BE COMPUTED ON THE SALARY OF GRADE FSO-3 PRIOR TO THE DATE YOU ACTUALLY WERE PROMOTED TO THAT GRADE.