Promotion While On Pay Retention

By on August 27, 2015 in Pay & Benefits, Q&A with 0 Comments

Q.  OPM.gov gives examples of GS promotions while on retained pay using the 2 step rule.  But how do you calculate a GS promotion step if your retained pay is already well above the amount computed using the 2 step rule?

A:  The OPM guidance and example essentially gives us two possibilities when an employee is promoted while on retained pay. The first is to calculate the amount of two step increases in the grade from which the employee is being promoted, and add that to the step 10 rate of the lower grade.  Next one looks for the lowest step in the grade to which the employee is being promoted that equals or exceeds the step 10 plus two steps, and set the pay for the promotion at that step.  The example OPM uses someone on retained pay at the GS-11 level is being promoted to the GS-12.  By adding two steps to the GS-11 step 10 rate, the example indicates that the lowest step that equals or exceeds that amount is the GS-12 step 6.  The employee’s pay can be set at this rate if it exceeds his or her retained rate prior to the promotion.

The second method is the one used when the employee’s retained rate is greater than the amount found by adding two steps to the step 10 rate of the lower grade.  When using this second method there are two possible ways to set the pay.  One is used when the retained pay can be accommodated in the steps of the higher grade level and the other is used when the retained pay cannot be accommodated in the steps of the higher grade level.  When the retained rate can be accommodated in the steps of the higher grade level, the employee’s retained rate is compared to the rates in the higher grade, and the pay is set at the lowest step that equals or exceeds the employee’s retained rate before the promotion.

When the retained rate is more than the rate of the maximum step (step 10) of the higher grade level, then the employee’s step is set at 00 in the higher grade and the employee’s pay is set at the retained rate that she or he was receiving prior to the promotion.  If we continue to use the example that OPM showed us, where the employee starts as a GS-11 on retained pay being promoted to the GS-12, and the employee’s retained rate is greater than the amount paid to a GS-12 step 10, then the employee is identified as a GS-12 step 00 after the promotion and will continue to receive the retained rate she or he was receiving prior to the promotion.

Wayne Coleman is a federal pay expert available to help your agency avoid premium pay claims through on-site training. Contact him for more information.

© 2016 Wayne Coleman. All rights reserved. This article may not be reproduced without express written consent from Wayne Coleman.

About the Author

Wayne Coleman is a senior consultant who has written about and provided training on overtime and premium pay, on the principles of FLSA coverage and exemption, and on related federal compensation issues at many different Federal agencies for almost 40 years. He can be reached at wayneslyhouse@comcast.net.

Top