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The maximum payable rate rule is a special rule that allows an agency to set pay for a General Schedule (GS) employee at a rate above the rate that would be established using normal rules, based on a higher rate of pay the employee previously received in another Federal job. The pay set under the maximum payable rate rule may not exceed the rate for step 10 of the GS grade or be less than the rate to which the employee would be entitled under normal pay-setting rules. The maximum payable rate rule may be used in various pay actions, including reemployment, transfer, reassignment, promotion, demotion, change in type of appointment, termination of a critical position pay authority under 5 CFR part 535, movement from a non-GS pay system, or termination of grade or pay retention under 5 CFR part 536.
The highest previous rate is-
The highest previous rate must be a rate of basic pay received by an employee while serving-
If the highest previous rate is a GS locality rate, the underlying GS rate or an LEO special base rate associated with that locality rate must be used as the highest previous rate in applying the maximum payable rate rule.
An agency may use a GS employee's special rate established under 5 U.S.C. 5305 and 5 CFR part 530, subpart C, or 38 U.S.C. 7455 as the highest previous rate when all of the following conditions apply:
Any rate that does not meet the definition of General Schedule or GS in 5 CFR 531.203 is a rate from a non-GS pay system. If an employee's highest previous rate is a non-GS hourly rate of pay, the agency must convert the hourly rate of pay to an annual rate of pay by multiplying the hourly rate of pay by 2,087.
Pay rates that must be treated as if they were rates under a non-GS pay system:
The highest previous rate may not be based on certain types of rates, including the following:
If a temporary promotion of less than 1 year is extended so that the total time of the temporary promotion equals or exceeds 1 year, the HPR may be based on the rate received during the temporary promotion once the total time of the temporary promotion equals or exceeds 1 year.
When HPR is based on a GS rate:
When an employee's HPR is based on a GS rate, determine the MPR as follows:
Step A: Compare the employee's highest previous rate with the GS rates for the grade in which pay is currently being set using the schedule of GS rates (excluding any locality payment or additional pay of any kind) in effect at the time the highest previous rate was earned.
Step B: Identify the lowest step in the grade at which the GS rate was equal to or greater than the employee's highest previous rate. If the employee's highest previous rate was greater than the maximum GS rate for the grade, identify the step 10 rate.
Step C: Identify the rate on the currently applicable GS rate range for the employee's current position of record and grade that corresponds to the step identified in step B. This rate is the maximum payable GS rate the agency may pay the employee.
Step D: After setting the employee's GS rate within the rate range for the grade (not to exceed the MPR identified in step C), determine the employee's payable rate of basic pay (i.e., locality rate or special rate).
When HPR is based on an LEO special base rate, see 5 CFR 531.221(b) for special MPR rules.
When HPR is based on the special rate of an employee who is reassigned to a position in the same agency as provided by 5 CFR 531.222(c), see 5 CFR 531.221(c) for special MPR rules.
When HPR is based on a rate under a non-GS pay system:
When a GS employee's HPR is based on a non-GS rate, determine the MPR as follows:
Step A: Compare the highest previous rate to the highest applicable rate range (including a locality rate or special rate range) in effect at the time and place where the highest previous rate was earned. The highest applicable rate range is determined as if the employee held the current GS position of record (including the grade in which pay is being set) at that time and place.
Step B: Identify the lowest step rate in that range that was equal to or higher than the highest previous rate (or the step 10 rate if the highest previous rate exceeded the range maximum).
Step C: Convert the step rate identified in step B to a corresponding rate (same step) on the current highest applicable rate range for the employee's current GS position of record and official worksite. That step rate is the employee's maximum payable rate of basic pay.
Step D: After setting the employee's rate of basic pay in the current highest applicable rate range (not to exceed the MPR identified in step C), determine any underlying rate of basic pay to which the employee is entitled at the determined step rate.
See examples 6-8 and 10 on Pay Action Examples Other than Promotions and Grade and Pay Retention.
Highest applicable rate range means the rate range applicable to a GS employee, based on a given position of record and official worksite that provides the highest rates of basic pay, excluding any retained rates. For example, a rate range of special rates may exceed an applicable locality rate range. In certain circumstances, the highest applicable rate range may consist of two types of pay rates from different pay schedules-e.g., a range where special rates (based on a fixed dollar supplement) are higher in the lower portion of the range and locality rates are higher in the higher portion of the range.
General Schedule or GS means the classification and pay system established under 5 U.S.C. chapter 51 and subchapter III of chapter 53. It also refers to the pay schedule of GS rates established under 5 U.S.C. 5332, as adjusted under 5 U.S.C. 5303 or other law (including GS rates payable to GM employees). Law enforcement officers (LEOs) receiving LEO special base rates are covered by the GS classification and pay system, but receive higher base rates of pay in lieu of GS rates at grades GS-3 through GS-10.
Locality rate means a GS rate or an LEO special base rate, if applicable, plus any applicable locality payment.
Position of record means an employee's official position (defined by grade, occupational series, employing agency, LEO status, and any other condition that determines coverage under a pay schedule (other than official worksite)), as documented on the employee's most recent Notification of Personnel Action (Standard Form 50 or equivalent) and current position description. A position to which an employee is temporarily detailed is not documented as a position of record.