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 24.22%. See Salary Table 2015-DCB.)

1. Hourly Rate.

   Divide annual rate of basic pay by 2,087 hours.

   GS-9, step 1 = $ 52,668.
   $ 52,668 / 2,087 hours = $ 25.24.

2. Biweekly Rate.

   Multiply hourly rate of basic pay by 80 hours.

   $ 25.24 x 80 hours = $ 2,019.20.

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.

      $ 25.24 x 1.5 = $ 37.86.

   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 = $ 58,000.
      $ 58,000 / 2,087 hours = $ 27.79.
      $ 27.79 x 1.5 = $ 41.69.

      GS-14, step 1 = $ 107,325.
      $ 107,325 / 2,087 hours = $ 51.43.

   In this example, the employee’s hourly rate of basic pay ($51.43) is greater than the GS-10, step 1, hourly rate of basic pay multiplied by 1.5 ($41.69).  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 = $ 52,668.
   $ 52,668 / 2,087 hours = $ 25.24.
   $ 25.24 x 0.10 = $ 2.52.

5. Sunday Premium Pay.

   Multiply hourly rate of basic pay by 25%.  (5 CFR 550.171)

   $ 25.24 x 0.25 = $ 6.31.

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)

   $ 25.24 x 8 hours = $ 201.92.