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Pay & Leave Pay Administration

Fact Sheet: How to Compute Rates of Pay

Background

Hourly and biweekly rates for General Schedule employees are computed under 5 U.S.C. 5504. Premium pay is computed under 5 U.S.C. chapter 55, subchapter V, and 5 CFR part 550, subpart A. The rates are computed based on an employee’s annual rate of basic pay, including any applicable special rate supplement or locality payment. (Note: Overtime pay for nonexempt employees is computed under the Fair Labor Standards Act, subject to some special rules for Federal employees. See 5 CFR part 551. In addition, firefighters covered by 5 U.S.C. 5545b are subject to special rules for computing hourly rates and overtime pay. See 5 CFR part 550, subpart M.)

Rules for Rounding

Rates must be rounded to the nearest cent, counting one-half cent and over as the next higher cent (e.g., round $18.845 to $18.85).

Procedure

Follow the rules below to compute rates of pay. (Note: The examples below are based on annual rates that have been increased by a locality pay percentage of 29.32%. See 2019-DCB.)

  1. Hourly Rate.

    Divide annual rate of basic pay by 2,087 hours.
    GS-9, step 1 = $ 57,510.
    $ 57,510 / 2,087 hours = $ 27.56.

  2. Biweekly Rate.

    Multiply hourly rate of basic pay by 80 hours.
    $ 27.56 x 80 hours = $ 2,204.80.

  3. Title 5 Overtime Hourly Rate
    1. if employee's rate of basic pay is less than rate of basic pay for GS-10, step 1

      Multiply hourly rate of basic pay by 1.5.
      $ 27.56 x 1.5 = $ 41.34.

    2. if employee's rate of basic pay is more than rate of basic pay for GS-10, step 1

      Use the greater of (1) the GS-10, step 1, hourly rate of basic pay multiplied by 1.5 OR (2) the employee’s hourly rate of basic pay. (5 CFR 550.113)

      GS-10, step 1 = $ 63,332.
      $ 63,332 / 2,087 hours = $ 30.35.
      $ 30.35 x 1.5 = $ 45.53.

      GS-14, step 1 = $ 117,191.
      $ 117,191 / 2,087 hours = $ 56.15.

      In this example, the employee's hourly rate of basic pay ($56.15) is greater than the GS-10, step 1, hourly rate of basic pay multiplied by 1.5 ($45.53). Therefore, the employee’s title 5 overtime hourly rate is equal to his or her hourly rate of basic pay.

  4. Night Pay.

    Multiply hourly rate of basic pay by 10%. (5 CFR 550.121)
    GS-9, step 1 = $ 57,510.
    $ 57,510 / 2,087 hours = $ 27.56.
    $ 27.56 x 0.10 = $ 2.76.

  5. Sunday Premium Pay.

    Multiply hourly rate of basic pay by 25%. (5 CFR 550.171)
    $ 27.56 x 0.25 = $ 6.89.

  6. Holiday Premium Pay.

    Multiply hourly rate of basic pay by number of nonovertime hours worked on holiday (not to exceed 8 hours or the number of nonovertime hours of a compressed work schedule). (5 CFR 550.131 and 5 CFR 610.407)
    $ 27.56 x 8 hours = $ 220.48

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