Washington DC
U.S. Office of Personnel Management
Compensation Claim Decision
Under section 3702 of title 31, United States Code
Office of the Secretary
U.S. Department of Veterans Affairs
Houston, Texas
Ana A. Mazzi
Principal Deputy Associate Director
Agency Compliance and Evaluation
Merit System Accountability and Compliance
11/15/2024
Date
The claimant occupies a General Engineer, GS-0801-14, position with Facilities Planning, Office of the Secretary, U.S. Department of Veterans Affairs, in Houston, Texas. He seeks to correct the setting of his pay from step 6 to step 10 upon promotion to the GS-14 grade level, and to be granted back pay to the effective date of his July 2, 2023, appointment to the position. We received the claim on June 23, 2023, and the agency administrative report on September 18, 2023. For reasons discussed herein, the claim is granted.
Immediately prior to appointment to his current position, the claimant occupied a Healthcare Engineer, GS-0801-13, step 10, position with the Veterans Health Administration (VHA) in Phoenix, Arizona. At that time, his pay was set at $145,079 based on the special salary rate (SSR) table 0773, which covers VHA’s GS-0801 positions assigned to certain locations and performing work in a healthcare environment. The Standard Form 50 shows his appointment to the current GS-14 position was coded as a conversion to an excepted service appointment with Houston, Texas, identified as his duty station (the “48-3280-201” duty station code under Block 38 identifies coverage under Harris County, Texas). The agency set the claimant’s pay at the time of appointment at the GS-14, step 6, rate with basic pay of $116,558, locality adjustment of $40,178, for a total salary of $156,736.
In a June 1, 2023, email to the claimant, the servicing human resources official explains the agency’s pay setting determination. In addition to referencing section 531.205 of title 5, Code of Federal Regulations (CFR), “Converting pay upon change in location of employee’s official worksite,” it states:
The General Conversion rule means we have to convert you back to the Reg GS Basic pay scale, GS-13 Step 10, then on this same scale add the two step rule, crosswalk this to the amount that is equal to or more on the promotion Grade, which comes to the GS-14, Step 6. We then go to the GS pay scale for the location that you are moving to, which is Houston, TX and crosswalk that over to the GS-14, Step 6.
We must first establish the lowest payable rate of basic pay to which the claimant is entitled upon promotion, defined by 5 CFR 531.203 as movement from one GS grade to a higher GS grade while continuously employed. Because the record shows he moved from a GS-13 to a GS-14 position while continuously employed, setting pay upon the claimant’s promotion in the GS is governed by the rules in 5 CFR 531.214, which implements the two-step promotion rule provided in section 5334(b) of title 5, United States Code (U.S.C.). The two-step promotion rule provides that a GS employee promoted to a position in a higher grade is entitled to basic pay at the lowest rate of the higher grade which exceeds his or her existing rate of basic pay by no less than two step increases of the grade from which promoted.
The two-step promotion rule must be applied using the standard method or the alternate method. 5 CFR 531.214(d)(2)(ii) provides that the alternate method is to be applied if the employee is covered by different pay schedules before and after promotion and if the alternate method will produce a higher payable rate upon promotion than the standard method. In the claimant’s situation, a SSR schedule would apply at Phoenix, Arizona, to his GS-13 position but no SSR schedule applies at Houston, Texas, to his GS-14 position. Instead, just a locality rate range applies. Because the alternate method would also not produce a higher payable rate, we applied the standard method as described in 5 CFR 531.214(d)(3) as follows:
Step A: If applicable, apply the geographic conversion rule to determine the employee’s rate(s) and range(s) of basic pay based on the employee’s position of record before promotion and the new official worksite. Use the resulting rate(s) of basic pay as the existing rate(s) in effect immediately before promotion in applying steps B and C.
The geographic conversion rule, provided in 5 CFR 531.205, applies because the claimant’s official worksite changed to an area covered by a different locality schedule after his promotion. Based on the GS-13 position before promotion (the GS-0801 occupational series), the 2023 pay schedules applicable to him at Houston, Texas would be the regular GS (base), the locality rate schedule covering Houston, Texas (HOU salary table), and the SSR table covering VHA’s GS-0801 positions performing work in a healthcare environment in Harris County, Texas (SSR table number 0771).
Step B: Identify the employee’s existing GS rate in the grade before promotion, and increase that rate by two GS within-grade increases for that grade.
Using the underlying GS, increase the GS-13, step 10, rate by two within-grade increases. Because the within-grade amount at the GS-13 level is $2,818, increasing the GS-13, step 10, rate ($109,908) by two within-grade increases ($5,636) results in the rate of $115,544.
Step C: Determine the payable (highest) rate of basic pay for the step or rate determined in step B by applying any locality payment or special rate supplement applicable to the given grade, based on the employee’s position of record before promotion and official worksite after promotion.
Compare the GS-13, step 10, locality rate on the HOU salary table ($147,793) to the GS-13, step 10 rate on SSR table number 0771 covering GS-0801 positions ($164,862) to determine whether the locality rate or SSR is greater. Here, the SSR is higher than the locality rate. The rates from SSR table number 0771 are based on percentage supplements, and the supplement at the GS-13 grade level is 50 percent (https://www.opm.gov/special-rates/2023/Table077101012023.aspx). Multiplying the rate determined in Step B ($115,544) by the special rate supplement plus one ($115,544 x 1.50), rounding to the nearest whole dollar, results in $173,316. [See OPM’s Fact Sheet: Promotion Examples at https://www.opm.gov/policy-data-oversight/pay-leave/pay-administration/fact-sheets/promotion-examples/.]
Step D: Identify the highest applicable rate range for the employee’s position of record after promotion and find the lowest step rate in that range that equals or exceeds the rate determined in step C. This is the employee’s payable rate of basic pay upon promotion.
Because SSR table number 0771 applies to only VHA positions, the highest applicable rate range for the claimant’s current GS-14 position with Office of the Secretary (after promotion) is the GS-14 locality rate range in the HOU salary table. The GS-14, step 10 locality rate ($174,647) is the lowest step rate in that range that equals or exceeds the $173,316 rate from step C.
Therefore, the standard method for setting pay upon promotion provided for in 5 CFR 531.214(d)(2)(i) derives the lowest payable rate of basic pay, i.e., GS-14, step 10, to which the claimant is entitled.
Accordingly, we find the agency's decision to set the claimant's pay at GS-14, step 6, is contrary to the two-step promotion rule in 5 CFR 531.214 and must be reversed. The agency is directed to correct the claimant's rate of pay for the subject appointment action. The claimant is also owed back pay with interest computed under 5 U.S.C. 5596 and 5 CFR part 550, subpart H. If he believes the agency has computed the amount incorrectly, he may file a new claim with this office.
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.