B-150219, NOVEMBER 15, 1962, 42 COMP. GEN. 249

B-150219, NOVEMBER 15, 1962, 42 COMP. GEN. 249

COMPENSATION - PERIODIC STEP-INCREASES - SERVICE CREDITS - EFFECT OF FEDERAL SALARY REFORM ACT COMPENSATION - PERIODIC STEP-INCREASES - SERVICE CREDITS - EARNED TOWARD LONGEVITY INCREASES - COMPENSATION - PERIODIC STEP -INCREASES - SERVICE CREDITS - EARNED TOWARD LONGEVITY INCREASES - COMPENSATION - PERIODIC STEP-INCREASES - SPECIAL ELEVENTH STEP THE VIEW HELD IN SECTION 25.153, CIVIL SERVICE REGULATIONS, THAT CREDITABLE SERVICE IN THE COMPUTATION OF A WAITING PERIOD TO DETERMINE ENTITLEMENT TO A SCHEDULE STEP-INCREASE UNDER SECTION 701 OF THE CLASSIFICATION ACT OF 1949, AS AMENDED, IS CONTINUOUS CIVILIAN EMPLOYMENT IN THE EXECUTIVE, LEGISLATIVE, OR JUDICIAL BRANCHES OF THE FEDERAL GOVERNMENT, OR IN THE DISTRICT OF COLUMBIA, ALSO PREVAILS AS TO THE TERM "SERVICE * * * IN THE GRADE" AS USED IN SECTION 602 (B) (10) OF THE FEDERAL SALARY REFORM ACT, THE 1962 AMENDMENTS TO THE CLASSIFICATION ACT, WHICH RESTRICTS THE COUNTING OF SERVICE CREDITS EARNED PRIOR TO THE ACT TOWARD NOT TO EXCEED ONE STEP-INCREASE, THE LEGISLATIVE HISTORY OF THE 1962 AMENDMENT FAILING TO INDICATE ANY INTENTION TO CHANGE THE INTERPRETATION THAT THE COMPUTATION OF THE SERVICE REQUIREMENTS FOR ENTITLEMENT TO A STEP-INCREASE IS NOT LIMITED TO SERVICE IN THE SAME GRADE OR UNDER THE SAME PAY SYSTEM, SO LONG AS THE EMPLOYEE HAD SERVED THE REQUISITE SERVICE WITHOUT "AN EQUIVALENT INCREASE.' SERVICE CREDITS WHICH EMPLOYEES HAD EARNED TOWARD LONGEVITY STEP INCREASES PRIOR TO THE FEDERAL SALARY REFORM ACT OF 1962, 5 U.S.C. 1171, WHICH ELIMINATED THE 10-YEAR SERVICE REQUIREMENT FOR ADVANCEMENT TO THE FORMER LONGEVITY STEPS MAY BE CREDITED TOWARD ONLY ONE OF THE THREE TOP STEPS PROVIDED BY THE NEW ACT IN VIEW OF THE SERVICE CREDIT RESTRICTION IN SECTION 602 (B) (10); THEREFORE, AN EMPLOYEE WHO PRIOR TO THE NEW ACT HAD COMPLETED 9 CONTINUOUS YEARS OF SERVICE AT THE MAXIMUM SCHEDULED RATE OF HIS GRADE TOWARD THE 10-YEAR SERVICE ELIGIBILITY REQUIREMENT FOR A LONGEVITY STEP-INCREASE IS ONLY ENTITLED TO ONE STEP-INCREASE, ADVANCEMENT TO THE 8TH STEP, AND HAVING LOST THE BALANCE OF HIS SERVICE CREDIT, HE MUST SERVE A FURTHER 156 WEEKS FOR ELIGIBILITY TO THE 9TH STEP, AND ANOTHER 156 WEEKS BEFORE ADVANCEMENT TO THE 10TH STEP. THE 2-YEARS' EXCESS SERVICE REMAINING TO THE CREDIT OF AN EMPLOYEE WHO PRIOR TO THE FEDERAL SALARY REFORM ACT, THE 1962 AMENDMENTS TO THE CLASSIFICATION ACT (5 U.S.C. 1171), ON THE BASIS OF HAVING COMPLETED THE 10-YEAR AGGREGATE SERVICE REQUIREMENT, AS WELL AS 5 YEARS OF SERVICE AT THE MAXIMUM OF HIS GRADE WITHOUT AN INCREASE, RECEIVES A 3 YEAR LONGEVITY PERIOD INCREASE MAY BE RETAINED BY THE EMPLOYEE, AND HE IS ENTITLED UNDER THE AMENDATORY ACT TO COUNT THE EXCESS 2 YEARS TIME TOWARD THE SECOND OF THE THREE TOP STEPS OF HIS GRADE PROVIDED BY THE NEW ACT IN LIEU OF THE FORMER LONGEVITY GRADES; THEREFORE, HIS ADVANCEMENT TO THE 9TH STEP NEED NOT BE POSTPONED UNTIL 156 WEEKS AFTER THE EMPLOYEE RECEIVED THE STEP 8 INCREASE, SECTION 602 (B) (10) PROVIDING THAT CREDITABLE SERVICE EARNED PRIOR TO THE ACT MAY BE COUNTED TOWARD NOT TO EXCEED ONE STEP-INCREASE UNDER SECTION 701 (A) OF THE CLASSIFICATION ACT, AS AMENDED. AN EMPLOYEE IN THE 7TH STEP OF GS-3 WHO HAD COMPLETED ALL REQUIREMENTS FOR THREE LONGEVITY INCREASES AND WAS ENTITLED TO BE ADVANCED TO THE THIRD LONGEVITY STEP (10TH STEP) PRIOR TO OCTOBER 14, 1962, THE EFFECTIVE DATE OF THE FEDERAL SALARY REFORM ACT, WHICH AMENDED TITLE VII OF THE CLASSIFICATION ACT OF 1949 (5 U.S.C. 1121 1125) MAY BE REGARDED AS HAVING BEEN IN THE 10TH STEP OF HIS GRADE IMMEDIATELY PRIOR TO THE EFFECTIVE DATE OF THE AMENDATORY ACT AND THUS ADVANCED TO THE ,SPECIAL ELEVENTH STEP" ON OCTOBER 14, 1962, BY OPERATION OF SECTION 602 (B) (2) OF THE ACT, WHICH ESTABLISHED THE SPECIAL STEP AS AN EQUIVALENT WITHIN-GRADE INCREMENT TO EMPLOYEES IN GRADES GS-3 AND LOWER, THE RIGHT OF THE EMPLOYEE TO THE THIRD LONGEVITY STEP HAVING VESTED BEFORE THE NEW ACT WENT INTO EFFECT AND, THEREFORE, THE EMPLOYEE IS ENTITLED TO HAVE HIS COMPENSATION FIXED AT THE SPECIAL 11TH STEP RATE WITHOUT REGARD TO SECTION 602 (B) (1), REQUIRING EMPLOYEES IN THE 7TH STEP OF GS-3 IMMEDIATELY PRIOR TO THE EFFECTIVE DATE OF THE ACT TO BE ADVANCED TO STEP 8.

TO THE CHAIRMAN, UNITED STATES CIVIL SERVICE COMMISSION, NOVEMBER 15, 1962:

WE REFER TO LETTER OF OCTOBER 31, 1962, FROM THE ACTING CHAIRMAN OF THE COMMISSION, REQUESTING OUR DECISION ON THE FOLLOWING QUESTIONS ARISING OUT OF THE STEP-INCREASE PROVISIONS OF THE FEDERAL SALARY REFORM ACT OF 1962, 5 U.S.C. 1171, PUBLIC LAW 87-793, APPROVED OCTOBER 11, 1962.

1. SECTION 602 (B) (10) OF THE FEDERAL SALARY REFORM ACT READS:

"SERVICE OF OFFICERS AND EMPLOYEES PERFORMED IMMEDIATELY PRECEDING THE FIRST DAY OF THE FIRST PAY PERIOD WHICH BEGINS ON OR AFTER THE DATE OF ENACTMENT OF THIS ACT, IN THE GRADE OF THE GENERAL SCHEDULE IN WHICH THEIR RESPECTIVE POSITIONS WERE PLACED ON SUCH DAY, SHALL BE COUNTED TOWARD NOT TO EXCEED ONE STEP INCREASE UNDER THE TIME IN GRADE PROVISIONS OF SUBSECTION (A) OF SECTION 701 OF THE CLASSIFICATION ACT OF 1949 AS AMENDED BY THIS ACT.'

UNDER TITLE VII OF THE CLASSIFICATION ACT, THE SERVICE WHICH IS CREDITED TOWARD WITHIN-GRADE INCREASES HAS NEVER BEEN LIMITED TO SERVICE IN THE SAME GRADE OR UNDER THE SAME PAY SYSTEM, SO LONG AS THE EMPLOYEE HAD SERVED THE REQUISITE PERIOD WITHOUT AN "EQUIVALENT INCREASE.' THE AMENDED REGULATIONS ISSUED AS A RESULT OF THE AMENDMENTS TO TITLE VII CONTINUE TO REFLECT THAT FACT. ARE WE CORRECT IN OUR BELIEF THAT SECTION 602 (B) (10) LIMITS THE AMOUNT OF SERVICE WHICH MAY BE CREDITED TOWARD THE FIRST WITHIN -GRADE INCREASE UNDER THE AMENDED TITLE VII, REGARDLESS OF WHETHER ALL THE SERVICE WAS IN THE SAME GRADE OF THE CLASSIFICATION ACT?

2. IN NOVEMBER, 1961, AN EMPLOYEE IN GRADE GS-5 HAD COMPLETED 9 CONTINUOUS YEARS OF SERVICE AT THE MAXIMUM SCHEDULED RATE OF HIS GRADE WITHOUT AN INCREASE OTHER THAN GENERAL PAY INCREASES. HE COULD NOT RECEIVE THE THREE LONGEVITY INCREASES UNTIL HE COMPLETED TEN YEARS' AGGREGATE SERVICE IN THE SAME GRADE OR SAME POSITION. HE WOULD HAVE MET THAT REQUIREMENT AND WOULD HAVE BEEN ADVANCED TO THE TOP STEP IN NOVEMBER, 1962.

SECTION 701 OF THE CLASSIFICATION ACT, AS AMENDED BY SECTION 603 OF THE FEDERAL SALARY REFORM ACT OF 1962, NOW PROVIDES FOR ADVANCEMENT TO STEPS, 8, 9, AND 10 (THE THREE TOP STEPS OF THE GRADE) UPON COMPLETING 156 WEEKS OF SERVICE WITHOUT AN EQUIVALENT INCREASE, AND DELETES THE REQUIREMENT OF AN AGGREGATE NUMBER OF YEARS IN THE GRADE OR POSITION. HOWEVER, SECTION 602 (B) (10) OF THE FEDERAL SALARY REFORM ACT PROVIDES THAT SERVICE IMMEDIATELY PRECEDING THE EFFECTIVE DATE OF THE ACT (GENERALLY OCTOBER 14) SHALL BE COUNTED TOWARD NOT TO EXCEED ONE STEP INCREASE.

DOES THIS MEAN THAT THE EMPLOYEE HAS LOST ALL CREDIT TOWARD ANY BUT THE 8TH STEP OF HIS GRADE, AND THAT HE WILL HAVE TO SERVE A FURTHER 156 WEEKS BEFORE BEING ADVANCED TO THE 9TH STEP, AND ANOTHER 156 WEEKS BEFORE BEING ADVANCED TO THE 10TH STEP?

3. AN EMPLOYEE COMPLETED HIS TEN YEARS' AGGREGATE SERVICE IN FEBRUARY, 1962, AT WHICH TIME HE HAD ALSO COMPLETED FIVE YEARS' SERVICE AT THE MAXIMUM RATE OF HIS GRADE WITHOUT AN INCREASE. UNDER THE LAW AT THAT TIME HE RECEIVED ONE LONGEVITY INCREASE BASED ON COMPLETION OF ONE THREE-YEAR LONGEVITY PERIOD, AND THE EXCESS TWO YEARS' TIME WAS CREDITABLE TOWARD THE SECOND LONGEVITY INCREASE, OR 9TH STEP. HE WOULD THEREFORE HAVE ADVANCED TO THE 9TH STEP IN FEBRUARY, 1963.

UNDER THE AMENDED LAW, IS HIS ADVANCEMENT TO THE 9TH STEP POSTPONED UNTIL 156 WEEKS AFTER HE RECEIVED THE INCREASE TO STEP 8, THAT IS, FEBRUARY OF 1965?

4. AN EMPLOYEE IN THE 7TH STEP OF GS-3 HAD COMPLETED ALL REQUIREMENTS FOR THREE LONGEVITY INCREASES BEFORE OCTOBER 14, 1962, THE EFFECTIVE DATE OF THE FEDERAL SALARY REFORM ACT FOR HIS POSITION, AND WAS ENTITLED TO BE ADVANCED TO THE THIRD LONGEVITY STEP, OR 10TH STEP, ON OCTOBER 14.

SECTION 602 (B) (1) OF THE ACT PROVIDES THAT AN EMPLOYEE WHO WAS IN THE 7TH STEP OF GS-3 IMMEDIATELY PRIOR TO THE EFFECTIVE DATE OF THE ACT SHALL BE ADVANCED TO STEP 8. SECTION 602 (B) (2) PROVIDES THAT AN EMPLOYEE IN THE THIRD LONGEVITY STEP OF GS-3 IMMEDIATELY PRIOR TO THE EFFECTIVE DATE OF THE ACT SHALL RECEIVE COMPENSATION AT THE HIGHEST RATE OF THE GRADE PLUS AN AMOUNT EQUAL TO THE MAXIMUM WITHIN-GRADE INCREMENT OF THE GRADE (IN EFFECT A SPECIAL ELEVENTH STEP). THE EVIDENT PURPOSE IS TO GIVE THE EQUIVALENT OF A WITHIN-GRADE INCREMENT TO EMPLOYEES IN GS-3 (AND LOWER GRADES) AS THE PRINCIPAL PART OF THEIR PAY INCREASE UNDER THE ACT.

HOWEVER, IN THE CASE DESCRIBED, IF THE ADVANCEMENT TO STEP 8 IS PROCESSED FIRST, ONE OF THE ALREADY-EARNED LONGEVITY INCREASES WILL APPARENTLY BE LOST UNLESS THE EMPLOYEE CAN BE ADVANCED TO THE SAME RATE AS THE EMPLOYEE WHO WAS IN THE TOP LONGEVITY STEP BEFORE THE ACT (THE SPECIAL ELEVENTH STEP).

WHAT RATE IS TO BE APPLIED TO SUCH AN EMPLOYEE?

CONCERNING QUESTION 1, WE NOTE THAT UNDER SECTION 701 (A) OF THE CLASSIFICATION ACT OF 1949, AS AMENDED BY SECTION 603 OF THE FEDERAL SALARY REFORM ACT OF 1962, 5 U.S.C. 1121, WHICH SPEAKS OF SERVICE IN PARTICULAR STEPS FOR ELIGIBILITY FOR ADVANCEMENT TO A HIGHER STEP, THE COMMISSION HAS DEFINED SUCH SERVICE AS INCLUDING OTHER SERVICE WHICH HAD IN THE PAST BEEN DEEMED CREDITABLE SERVICE FOR STEP INCREASE PURPOSES. SEE SECTION 25.153 OF THE COMMISSION'S REGULATIONS, AS AMENDED BY FEDERAL PERSONNEL MANUAL LETTER NO. 531-17, DATED OCTOBER 11, 1962. APPARENTLY, THE COMMISSION'S REGULATIONS IN THIS RESPECT WERE PREDICATED ON THE PRACTICE UNDER THE CLASSIFICATION ACT OF 1949, PRIOR TO THE 1953 AMENDMENTS AND THE FACT THAT THERE IS NOTHING IN THE LEGISLATIVE HISTORY OF THE 1962 AMENDMENTS (FEDERAL SALARY REFORM ACT) TO INDICATE ANY INTENTION TO CHANGE THAT PRACTICE. WE AGREE WITH THE COMMISSION'S VIEW AS TO CREDITABLE SERVICE CONTAINED IN SECTION 25.153 AND HOLD THAT A SIMILAR VIEW SHOULD PREVAIL AS TO THE TERM "SERVICE * * * IN THE GRADE" AS USED IN SECTION 602 (B) (10) OF THE FEDERAL SALARY REFORM ACT OF 1962, 5 U.S.C. 1113 NOTE. THEREFORE, QUESTION 1 IS ANSWERED IN THE AFFIRMATIVE.

REFERRING TO QUESTION 2, THE EMPLOYEE HAD NOT COMPLETED ALL THE ELIGIBILITY REQUIREMENTS FOR THE LONGEVITY INCREASES PRIOR TO THE CHANGE IN THE LAW PRESCRIBED BY THE FEDERAL SALARY REFORM ACT. WHILE THAT ACT ELIMINATES THE REQUIREMENT FOR 10 YEARS OF SERVICE IN THE SAME OR HIGHER GRADE, IT ALSO (SECTION 602 (B) (10) PLACES A RESTRICTION ON THE AMOUNT OF SERVICE WHICH MAY BE CREDITED TOWARD STEP INCREASES, THAT IS, SERVICE TOWARD NOT TO EXCEED ONE STEP INCREASE. THEREFORE, QUESTION 2 IS ANSWERED IN THE AFFIRMATIVE.

IN THE LIGHT OF OUR ANSWER TO QUESTION 1, THE EMPLOYEE INVOLVED IN QUESTION 3 IS ENTITLED TO RETAIN HIS CREDITABLE SERVICE OF TWO YEARS AND WOULD BE ENTITLED TO RECEIVE AN ADVANCEMENT TO STEP 9 IN FEBRUARY 1963, IF OTHERWISE ELIGIBLE.

AS TO QUESTION 4, WE HELD IN B-150041 OF OCTOBER 12, 1962, 42 COMP. GEN. 202, THAT AN EMPLOYEE WHO HAD COMPLETED 78 CALENDAR WEEKS OF SERVICE BEFORE THE NEW FEDERAL SALARY REFORM ACT WENT INTO EFFECT ON OCTOBER 14, 1962, WAS ENTITLED TO A WITHIN-GRADE INCREASE ON OCTOBER 14, 1962, WITHOUT REGARD TO THE PROVISION OF SUCH ACT WHICH INCREASED ON THAT DATE THE WAITING PERIOD FOR EMPLOYEES IN THIS CATEGORY FROM 78 TO 104 CALENDAR WEEKS. HERE, THE EMPLOYEE LIKEWISE HAD COMPLETED ALL REQUIREMENTS TO BE ADVANCED TO A THIRD LONGEVITY STEP (10TH STEP) BEFORE OCTOBER 14, 1962, THAT IS, HIS RIGHT THERETO BECAME VESTED PRIOR TO SUCH DATE. SEE B- 145902, JUNE 28, 1961, AND 26 COMP. GEN. 119. IN VIEW THEREOF, THE EMPLOYEE MAY BE REGARDED AS HAVING BEEN IN THE 10TH STEP OF HIS GRADE IMMEDIATELY PRIOR TO THE EFFECTIVE DATE OF PUBLIC LAW 87-793, AND THUS ADVANCED TO THE ,SPECIAL ELEVENTH STEP" ON OCTOBER 14, 1962, BY OPERATION OF SECTION 602 (B) (2), 5 U.S.C. 1113 NOTE, OF SUCH ACT.