Washington, DC
U.S. Office of Personnel Management
Compensation Claim Decision
Under section 3702 of title 31, United States Code
Kadena Air Base, Japan
Damon B. Ford
Compensation and Leave Claims
Program Manager
Agency Compliance and Evaluation
Merit System Accountability and Compliance
05/23/2018
Date
The claimant is a Federal civilian employee of the Department of the Air Force at Kadena Air Base, Japan. He requests the U.S. Office of Personnel Management (OPM) reconsider the agency’s denial of his request for a supervisory differential and to be granted back pay. For the reasons discussed herein, the claim is denied.
The claimant occupies a GS-1101 Supervisory Community Services Specialist position and was paid, at the time of his filing, at the GS-13, step 3, rate for a total salary of $79,556. He states he serves as the immediate supervisor for three non-appropriated fund (NAF) instrumentality positions whose salaries are greater than his pay. The claimant identifies the annual salaries of the NAF positions as $89,490.56; $90,721.89; and $100,363.83. He requests a supervisory differential authorized under section 5755 of title 5, United States Code (U.S.C.), and promulgated in its implementing regulation at section 575.401 of title 5, Code of Federal Regulations (CFR). He requests the supervisory differential be made retroactive to November 13, 2016, which he identifies as the date he began supervising the higher-paid NAF employees.
Payment for a supervisory differential is authorized under 5 U.S.C. 5755 to an employee under the General Schedule who has supervisory responsibility for one or more civilian employees not under the GS if one or more of the subordinate civilian employees would, in the absence of such a differential, be paid more than the supervisory employee. In accordance with 5 U.S.C. 5755, OPM has issued implementing regulations in 5 CFR part 575, subpart D. As provided under 5 CFR 575.402:
(a) The head of an agency may pay a supervisory differential to a supervisor who is –
(1) In a General Schedule position paid under 5 U.S.C. 5332; and
(2) Responsible for providing direct, technical supervision over the work of one or more civilian employees whose positions are not under the General Schedule if the continuing pay (as determined under §575.405(d) of this part) of one or more of the subordinates would, in the absence of such a differential, be more than the continuing pay (as determined under §575.405(c) of this part) of the supervisor.
The agency’s February 8, 2017, decision acknowledges the regulations do not prohibit inclusion of NAF employees from the consideration and calculation of a supervisory differential, but explains the “Air Force has elected not to allow NAF salaries as part of that calculation” as described within Air Force Instruction (AFI) 36-802, Pay Setting. Paragraph 4.7.3 of AFI 36-802 instructs that supervisory differentials “[m]ay not be paid if the subordinate upon which the differential is based is a foreign national (direct or indirect hire) or nonappropriated fund employee.”
The claimant contends in his claim request to OPM:
It’s my contention that AFI 36-802 page 30, para 4.7.3 defeats the purpose and spirit of “5 U.S. Code §5755-Supervisory Differentials” by eliminating the entire workforce I manage. I am requesting that OPM grant an exception to the AFI and authorize Supervisory Differential in this case.
The claimant does not disagree with the agency’s determination that guidance in AFI 36-802 excludes his subordinate NAF employees from consideration of a supervisory differential; rather, he states the AFI is inconsistent with the “purpose and spirit” of the statute. However, the language applying to the supervisory differential authority in 5 CFR 575.402 is revealing. By using the permissive term “may” in relation to its use, agencies are clearly granted discretionary authority in allowing or disallowing its use. The agency exercised its discretionary authority under 5 CFR 575.402 to determine the circumstances for authorizing the payment of the differential. Agency implementing regulations or policies, which may further restrict the granting of the flexibility, control unless they are in conflict with the statute.
It is evident the statutory and regulatory languages are permissive and give agency heads considerable discretion in determining whether to grant supervisory differentials to agency employees. An agency may deny the grant of the differential to an employee when it finds the circumstances justify such action, and the agency’s action will not be questioned unless it is determined the agency’s action was arbitrary, capricious, or unreasonable. Under 5 CFR 178.105, the burden is upon the claimant to establish the liability of the United States and the claimant’s right to payment. Matter of Jones and Short, B-205282, June 15, 1982. Since an agency decision made in accordance with its implementing regulations as is evident in the present case cannot be considered arbitrary, capricious, or unreasonable, there is no basis upon which to reverse the decision and the claimant’s requests for a supervisory differential and back pay are denied.
The claimant requests an exception from the supervisory differential provisions in AFI 36-802. The relevant regulation in this case, 5 CFR 575.402, gives the head of the employee’s agency authority to make determinations regarding the payment of supervisory differentials. Since OPM’s claims adjudication authority under 31 U.S.C. 3702(a)(2) does not include authority to waive at an employee’s request the provisions of implementing regulations properly established by an agency with authority delegated to it by statute, OPM may not consider the claimant’s exception-related request within the context of the claims adjudication function it performs under 31 U.S.C. 3702.
This settlement is final. No further administrative review is available within OPM. Nothing in this settlement limits the claimant’s right to bring an action in an appropriate United States court.