[Federal Register: December 19, 2000 (Volume 65, Number 244)]
[Notices]
[Page 79433-79438]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr19de00-109]
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OFFICE OF PERSONNEL MANAGEMENT
OPM Criteria for IRS Broadbanding System
AGENCY: Office of Personnel Management.
ACTION: Notice.
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SUMMARY: This publicizes final criteria for broadbanding systems for
the Internal Revenue Service (IRS). The Internal Revenue Service
Restructuring and Reform Act of 1998 authorizes the Secretary of the
Treasury to establish one or more broadbanding systems covering all or
any portion of the IRS workforce under the General Schedule (GS). Title
5, United States Code, directs the Office of Personnel Management (OPM)
to prescribe criteria for IRS broadbanding systems and specifies
certain principles that such criteria must follow, at a minimum.
DATES: Effective December 19, 2000.
FOR FURTHER INFORMATION CONTACT: Gregory Zygiel, Workforce Compensation
and Performance Service, Strategic Compensation Policy Center, OPM,
1900 E Street NW., Room 7305, Washington, DC 20415-8320, 202-606-8047,
strategiccomp@opm.gov.
SUPPLEMENTARY INFORMATION:
Background
The Internal Revenue Service Restructuring and Reform Act of 1998
(Public Law 105-206) authorizes the Secretary of the Treasury to
establish one or more broadbanding systems covering all or any portion
of the IRS workforce under the General Schedule (GS). Section 9509(b)
of title 5, United States Code, directs OPM to prescribe criteria for
IRS broadbanding systems and specifies certain principles that such
criteria must follow, at a minimum. OPM publicized the interim criteria
in the Federal Register on July 16, 1999, and requested comments.
The Criteria
OPM developed the criteria after conferring with the Department of
the Treasury, the Internal Revenue Service, and the National Treasury
Employees Union. The criteria are broadly written to give IRS the
flexibility to establish pay practices that support mission
accomplishment, and to base pay decisions on performance. The criteria
incorporate lessons learned from previous experience with broadbanding
under personnel demonstration projects.
Before implementing any broadbanding system under this authority,
IRS must develop written plans, policies, and implementing procedures
that address each relevant criterion, including descriptions of
broadbanding structure(s), classification criteria, positions covered,
the method of pay progression within a band, pay-setting policies,
policies for paying supervisors or management officials, and policies
for converting positions into broadbanding systems.
Section 9509(b)(3) of title 5, United States Code, requires that
employees covered by IRS broadbanding systems remain subject to the
laws and regulations covering General Schedule employees (e.g.,
locality payments, the aggregate limitation on pay, premium pay, and
recruitment and relocation bonuses and retention allowances), except as
otherwise provided in the criteria.
Changes From the Interim Criteria
OPM made one change. We gave particular consideration to the
unusual situation where an employee is moved out of the broadbanding
system shortly after entering it. In this situation, we found that the
regular conversion rules could produce an undesirable pay result.
Therefore, we have modified the rules for converting employees back to
the General Schedule pay system. The change affects only employees who
move back to the General Schedule before any pay adjustment event
(e.g., any within-band increase, a promotion, or any systemwide pay
adjustment) under the broadbanding system. The change ensures that
these employees will not experience an unwarranted gain or an
unwarranted loss in pay.
To make this change, we added one paragraph to Appendix B--
Conversion into Broadbanding System, and revised Appendix C--Procedures
for Converting Employees Back to the General Schedule Pay System.
Comments on the Interim Criteria
OPM received comments from three individuals. The commenters were
concerned that broadbanding could lead to fewer and/or smaller pay
increases for employees, and that broadbanding created the potential
for inequitable treatment of employees. The commenters suggested that
broadbanding systems align with the IRS's employee retention
strategies, and that OPM require IRS to collect and report data to
permit demographic analysis of broadbanding's effects.
OPM believes that the final criteria and existing laws and
requirements address the commenters' concerns and suggestions
appropriately.
Dated: December 7, 2000.
Office of Personnel Management.
Janice R. Lachance,
Director.
Table of Contents
I. Authority
II. Applicability
III. Broadbanding System Plan
IV. Definitions
V. Broadbanding Criteria
Appendix A--Staffing Supplements
Appendix B--Conversion into Broadbanding Systems
Appendix C--Procedures for Converting Employees Back to the General
Schedule Pay System
I. Authority
Section 9509 of title 5, United States Code, as added by the
Internal Revenue Service (IRS) Restructuring and Reform Act of 1998
(Public Law 105-206), provides the Secretary of the Treasury with the
authority to establish one or more broadbanding systems covering all or
any portion of the IRS workforce under the General Schedule (GS).
Section 9509(b) directs the Office of Personnel Management (OPM) to
prescribe criteria for IRS broadbanding systems and specifies certain
principles that such criteria must follow, at a minimum.
II. Applicability
Section 9509(a) defines a ``broad-banded system'' as a system for
grouping positions for pay, job evaluation, and other purposes that is
different from the General Schedule pay and classification system
established
[[Page 79434]]
under chapter 51 and subchapter III of chapter 53 of title 5, United
States Code. Employees covered by IRS broadbanding systems are not
covered by subchapter III of chapter 53 or by those provisions of
chapter 51 that define General Schedule grades. However, selected
provisions from those parts of law are used in applying parallel
features to employees in IRS broadbanding systems, as provided in these
criteria.
As required by 5 U.S.C. 9509(b)(3), employees covered by IRS
broadbanding systems are to be treated as if they are General Schedule
employees for the purpose of applying other laws and regulations
governing General Schedule employees, except as otherwise provided in
these criteria. Applicable laws and regulations include, but are not
limited to: 5 U.S.C. 5304, authorizing locality-based comparability
payments; 5 U.S.C. 5307, establishing a limitation on aggregate pay; 5
U.S.C. chapter 55, subchapter V, authorizing various forms of premium
pay; and 5 U.S.C. 5753 and 5754, authorizing recruitment and relocation
bonuses and retention allowances.
Note: Many title 5 provisions apply to Federal employees on a
more general basis and do not base coverage on whether an employee
is covered by the General Schedule system (e.g., severance pay,
leave, retirement, and insurance).
Employees in IRS broadbanding systems are not covered by the
special salary rate program established under 5 U.S.C. 5305. However,
IRS broadbanding systems may use a parallel authority to establish
staffing supplements, which are linked to established special salary
rates, as described in Appendix A.
These criteria apply only to broadbanding systems that cover
General Schedule positions. Section 9509(b)(1)(B) of title 5, United
States Code, authorizes the Secretary of the Treasury, with the prior
approval of the Director of OPM, to include in a broadbanding system
positions that otherwise would be subject to subchapter IV of chapter
53 (prevailing rate systems) or 5 U.S.C. 5376 (senior-level positions).
Including such positions would require OPM's separate review and
approval of a specific plan for that purpose. The criteria presented
here are not intended to apply to broadbanding systems that include
such positions.
III. Broadbanding System Plan
Before implementing any broadbanding system under this authority,
IRS must develop a written plan that includes policies and implementing
procedures to address each criterion that is relevant to the
broadbanding system, including descriptions of broadbanding
structure(s), positions covered, classification criteria, the method of
pay progression within a band, policies for setting and adjusting pay,
policies for paying supervisors or managerial employees, and policies
for converting positions into broadbanding systems.
IV. Definitions
Under these criteria--
Band means a pay level or work level within a career path
containing one or more General Schedule grades and related ranges of
pay.
Broadbanding system means a system for grouping positions for pay,
job evaluation, and other purposes that is different from the General
Schedule system established under chapter 51 and subchapter III of
chapter 53 of title 5, United States Code, as a result of combining the
grades and related ranges of pay for one or more occupational series.
Career path means a grouping of one or more occupational series
into broad occupational families or career tracks for job evaluation,
pay, or other purposes. A career path may contain one or more bands.
Employee means an individual who would otherwise be covered by
chapter 51 and subchapter III of chapter 53 of title 5, United States
Code, if not covered by a broadbanding system.
Supervisor and managerial employee have the meaning given those
terms in OPM's General Schedule Supervisory Guide.
V. Broadbanding Criteria
Criteria are provided below under the applicable principles listed
in 5 U.S.C. 9509(b)(3)(A)-(F) (labeled A-F) and an additional principle
(labeled G).
A. Ensure That the Structure of Any Broadbanding System Maintains the
Principle of Equal Pay for Substantially Equal Work
IRS broadbanding systems must--
1. Link to the General Schedule.
2. Assign occupations to career paths based on the nature of work
performed, the qualifications required, the normal career and pay
progression, and other characteristics of those occupations.
3. Combine General Schedule grades into bands following the
criteria in B. The range of difficulty and responsibility of each band
must be the same as the range of difficulty and responsibility of the
band's constituent grades (i.e., consistent with the grade level
criteria in standards published by OPM in accordance with 5 U.S.C.
5105) and must represent the normal range of work performed in the
organization.
4. Place positions into bands within career paths in accordance
with--
a. Classification standards published by OPM under 5 U.S.C. 5105;
or
b. Any agency guidance which places a position within its correct
band and career path (but which need not be sufficient to determine a
position's correct General Schedule grade).
5. Not include law enforcement officers covered by special salary
rates under section 403 of the Federal Employees Pay Comparability Act
of 1990 in the same band as non-law enforcement officers when the
maximum grade in the band is any one of grades 3 through 10.
6. Use established General Schedule rates of pay (including any
applicable locality rates or special salary rates) for premium pay
purposes under subchapter V of chapter 55 of title 5, United States
Code, and 5 CFR part 550, subpart A (i.e., for the purpose of
determining the maximum hourly overtime rate and the biweekly premium
pay limitation).
B. Establish the Minimum and Maximum Number of Grades That May Be
Combined Into Bands
A band under an IRS broadbanding system may contain--
1. A minimum of one General Schedule grade.
2. A maximum of--
a. Eight General Schedule grades when grades 13, 14, and 15 are not
included in the band.
b. Five General Schedule grades when grade 13 is included, but
neither grade 14 nor 15 is included in the band.
c. Three General Schedule grades when grade 14 is included, but
grade 15 is not included in the band.
d. Two General Schedule grades when grade 15 is included in the
band.
C. Establish the Requirements for Setting the Minimum and Maximum Rates
of Pay in a Band
1. The minimum rate of basic pay for each band must equal the
minimum rate of basic pay payable under 5 U.S.C. 5332 for the lowest
General Schedule grade in that band. The maximum rate of basic pay for
each band must equal the maximum rate of basic pay payable under 5
U.S.C. 5332 for the highest General Schedule grade in that band.
a. Notwithstanding C1, preceding, the maximum rates of basic pay
for bands covering law enforcement officers must equal the maximum
special salary rates for grades 3 through 10 established under section
403 of the Federal
[[Page 79435]]
Employees Pay Comparability Act of 1990, where applicable.
b. The minimum and maximum rates of basic pay that define each band
must be adjusted at the same time and in the same manner as adjustments
are made in the corresponding minimum and maximum General Schedule
rates of basic pay under 5 U.S.C. 5303 or similar provision of law.
2. The maximum rate of basic pay for any band may not exceed the
maximum rate of basic pay for grade 15.
3. Employees in IRS broadbanding systems are not covered by the
special salary rate authority in 5 U.S.C. 5305. However, IRS
broadbanding systems may provide for the use of staffing supplements
instead of special salary rates under Appendix A of these criteria. If
special salary rates are not replaced with staffing supplements,
special rate employees must be converted into a broadbanding system
under the procedures established in Appendix B of these criteria.
4. Only employees receiving retained rates of pay under subchapter
VI of chapter 53 of title 5, United States Code, as applied in the
broadbanding system, or in an approved staffing supplement category may
receive rates of pay that exceed the locality-adjusted band maximum
rates.
D. Establish the Requirements for Adjusting the Pay of an Employee
Within a Band
1. IRS broadbanding systems must include--
a. Policies for adjusting the pay of an employee within a band,
including--
(1) Adjustments made in accordance with paragraphs D2a and D3a; and
(2) Increases based on individual factors such as an employee's
performance, skills, or competencies and/or time at pay level, except
that such increases may not be based solely on time at pay level.
Increases that advance an employee's relative position in a band (i.e.,
exceed the adjustments made in accordance with paragraphs D2a and D3a)
may be paid only to employees whose performance meets or exceeds
retention standards.
b. Policies concerning which level of management will make pay
adjustment decisions for employees.
c. Principles for managing pay progression and payroll costs
associated with basic pay adjustments. IRS must provide funding for
salary increases under its broadbanding systems. Because broadbanding
systems provide more choices on how to distribute pay to employees, it
is necessary to have an overall budget to manage the costs associated
with such choices. At a minimum, the salary increase budget must
include funds equal to the amounts that would be required for
individual pay adjustments made at the time of schedule adjustments
under 5 U.S.C. 5303 (or similar provision of law) and locality-based
comparability payments under 5 U.S.C. 5304 (or similar provision of
law). A salary increase budget must meet salary cost objectives and be
consistent with policies and procedures for adjusting pay under a
broadbanding system that are established to ensure equal pay for work
of equal value.
2. IRS broadbanding systems must provide for--
a. Making adjustments in the rates of basic pay for all employees
who are not supervisors or managerial employees equivalent to the
annual adjustments provided to General Schedule employees under 5 CFR
531.205. Employees on pay retention must be granted 50 percent of the
increase in the maximum rate of basic pay for their band.
b. The payment of locality-based comparability payments for
employees covered by 5 U.S.C. 5304 and 5 CFR part 531, subpart F, and
special geographic adjustments for law enforcement officers covered by
section 404 of the Federal Employees Pay Comparability Act of 1990 and
5 CFR part 531, subpart C. (See Appendix A of these criteria for
information on possible staffing supplements.)
3. IRS pay adjustment policies may provide for--
a. Determining the circumstances under which adjustments in rates
of basic pay may be granted to supervisors or managerial employees up
to the equivalent of the annual adjustments provided to General
Schedule employees under 5 CFR 531.205. However, an employee's rate of
basic pay may not fall below the minimum rate of his or her band as a
result of receiving less than the full adjustment.
b. Reducing an employee's rate of basic pay within a band, but only
for unacceptable performance, misconduct, or loss of supervisory status
(if such loss results in reversal of a within-band adjustment granted
at the time of placement in a supervisory position). Any reductions
based on unacceptable performance or misconduct are adverse actions
under 5 U.S.C. 7512.
c. Control points within bands. Control points are dollar points
within bands that limit or restrict pay-setting or the movement of
employees through the rate range of the band. If control points are
used, IRS broadbanding systems must include policies on the number of
control points within bands and how they are derived (e.g., as a
percentage of the rate range) and applied (i.e., the circumstances
under which an employee's rate of pay may be set or adjusted at, above,
or below a control point).
E. Establish the Requirements for Setting the Pay of a Supervisory
Employee Whose Position Is in a Broad Band or Who Supervises Employees
Whose Positions Are in Broad Bands
1. IRS broadbanding systems may provide for a separate broadbanding
system or career path for supervisors and managerial employees.
2. A supervisor's or managerial employee's rate of pay may not be
based on the salaries of the employees he or she supervises or manages.
F. Establish the Requirements and Methodologies for Setting the Pay of
an Employee Upon Conversion to a Broadbanding System, Initial
Appointment, Change of Position or Type of Appointment (Including
Promotion, Demotion, Transfer, Reassignment, Reinstatement, Placement
in Another Broad Band, or Movement to a Different Geographic Location),
and Movement Between a Broadbanding System and Another Pay System
1. Conversion into a broadbanding system. IRS broadbanding systems
must include policies for determining the career path, band, and pay
rate for employees upon conversion into the system consistent with the
provisions in Appendix B. IRS broadbanding systems may also include
policies for making prorated within-grade increase or career-ladder
promotion payments to employees as an adjustment in basic pay or a
lump-sum payment upon conversion from the General Schedule to a
broadbanding system consistent with the provisions in Appendix B.
2. Pay-setting policies. IRS broadbanding systems must include
policies for determining an employee's career path, band, and rate of
basic pay upon initial appointment, promotion, demotion, transfer,
reassignment, or placement in a different band or career path. The
methods used to set pay must be consistent with the principle of equal
pay for substantially equal work.
a. Pay must be set at least at the minimum rate and must not exceed
the maximum rate of basic pay of the band to which assigned (unless pay
retention applies).
b. Policies must specify the conditions under which pay may be set
above the minimum rate of the band and the amount of any minimum or
maximum pay increase upon
[[Page 79436]]
promotion. The time-in-grade provisions in 5 CFR 300.601-605 do not
apply to employees under a broadbanding system.
c. Upon movement to a different geographic area, locality-based
comparability payments and special pay adjustments for law enforcement
officers must be redetermined and paid in accordance with 5 CFR part
531, subparts F and C, respectively. Staffing supplements must also be
redetermined consistent with the provisions in Appendix A of these
criteria.
d. Movement of an employee to a band with a lower maximum rate of
basic pay than the employee's former band is equivalent to a reduction
in grade for the purpose of chapters 43 and 75 of title 5, United
States Code.
3. Conversion to the General Schedule. Agencies must use the
procedures in Appendix C of these criteria for determining an
employee's GS equivalent grade and pay rate upon conversion from a
broadbanding system to the General Schedule.
G. Conform Related Provisions of Law and Regulations to Broadbanding
Systems
1. For provisions of chapter 51 that apply to the determination of
General Schedule grades, other than sections 5104 and 5105, the term
``grade'' is deemed to mean ``band within a career path''.
2. The provisions in these criteria related to grade and pay
retention are based on the current grade and pay retention authority in
subchapter VI of Chapter 53 of title 5, United States Code, and 5 CFR
part 536. When applying the grade and pay retention provisions, the
term ``band'' has the same meaning as ``grade'' under the statute and
regulations. Under 5 U.S.C. 9509(c), the Secretary of the Treasury may
provide for variations from the grade and pay retention authority for
employees who are covered by broadbanding systems with prior approval
of the Director of OPM and in accordance with a plan for implementing
such variations.
3. When applying paragraph (4) in the definition of ``reasonable
offer'' in the severance pay provisions at 5 CFR part 550.703 to
employees covered by IRS broadbanding systems, the term ``band'' has
the same meaning as ``grade''. When applying paragraph (4), IRS will
also consider a position one band below the employee's current band
level a ``reasonable offer'' in the case of a broadbanding system under
which the next lower band comprises two or more grades.
Appendix A--Staffing Supplements
Internal Revenue Service (IRS) broadbanding systems may use
staffing supplements instead of the special salary rate authority in
5 U.S.C. 5305 under the following terms and conditions:
A. If an employee is assigned to an occupational series and
geographic area covered by a special salary rate under 5 U.S.C. 5305
and is in a band where the maximum adjusted rate for the banded GS
grades is a special rate that exceeds the maximum GS locality rate
under 5 U.S.C. 5304 (or similar provision of law) for the banded
grades, the employee is eligible for a staffing supplement.
B. Conversion. Upon conversion, the employee's broadbanding rate
of basic pay is established by dividing the employee's old GS
adjusted rate (the higher of the special rate or locality rate) by
the staffing factor. The staffing factor is determined by dividing
the maximum special rate for the banded grades by the GS unadjusted
rate corresponding to that special rate (step 10 of the GS rate for
the same grade as the special rate). The employee's staffing
supplement is derived by multiplying the employee's broadbanding
rate of basic pay by the staffing factor minus one. The employee's
final staffing supplement-adjusted rate equals the employee's
broadbanding rate of basic pay plus the staffing supplement. This
amount will equal the employee's former GS adjusted rate of pay.
Since the employee's total pay immediately after conversion into the
broadbanding system will be the same as immediately before
conversion, adverse action and pay retention provisions do not
apply.
C. Formulas. The conversion rules in paragraph B of Appendix A
of these criteria are expressed by the following formulas:
[GRAPHIC] [TIFF OMITTED] TN19DE00.037
D. If an employee is in a band where the maximum GS adjusted
rate for the banded grades is a locality rate, the broadbanding
basic rate upon conversion into a broadbanding system is derived by
dividing the employee's former GS adjusted rate (the higher of the
locality rate or special rate) by the applicable locality pay factor
(e.g., 1.0905 in the Washington-Baltimore locality pay area in
2000). The employee's broadbanding locality-adjusted rate will equal
the employee's former GS adjusted rate. Adverse action and pay
retention provisions do not apply because there is no change in
total salary.
E. The staffing supplement is added to the employee's
broadbanding basic rate much like locality adjustments are added to
basic pay. Any General Schedule or special rate schedule adjustment
will require recomputation of the staffing supplement. Employees
receiving a staffing supplement remain entitled to an underlying
locality rate, which may, over time, supersede the need for a
staffing supplement. If OPM discontinues or decreases a special rate
schedule on which staffing supplements are based, pay retention
rules will be applied, as appropriate. Upon geographic movement, an
employee who receives a staffing supplement will have the supplement
removed or recomputed to reflect any applicable special rates in the
new location, consistent with paragraph C. Any
[[Page 79437]]
resulting reduction in pay is not an adverse action or a basis for
pay retention.
F. The employee's broadbanding basic rate adjusted by the
staffing supplement is basic pay for the same purposes as a locality
rate under 5 CFR 531.606(b)--i.e., for retirement, life insurance,
premium pay, and severance pay purposes, and for advances in pay.
The staffing supplement is also basic pay under 5 U.S.C. 5363 and
subchapter II of chapter 75 for the limited purpose of determining
whether a reduction in basic pay occurs at the point of an
employee's conversion into a broadbanding system. The staffing
supplement will also be used to compute worker's compensation
payments and lump-sum payments for accrued and accumulated annual
leave.
G. The Office of Personnel Management may approve staffing
supplements for categories of employees within an IRS broadbanding
system who are not in approved special rate categories for General
Schedule employees, consistent with the provisions in 5 U.S.C.
5305(a) and (b).
Appendix B--Conversion into Broadbanding Systems
Internal Revenue Service (IRS) broadbanding systems must include
policies for determining the career path, band, and pay rate for
employees upon conversion into a broadbanding system under the
following terms and conditions:
A. Employees may not suffer a reduction in total pay upon
initial conversion to a broadbanding system.
B. If conversion into a broadbanding system is accompanied by a
simultaneous geographic move, the employee's General Schedule pay
entitlements in the new geographic area must be determined before
converting the employee into the broadbanding system.
C. IRS broadbanding systems may include policies for making
prorated within-grade increase or career-ladder promotion payments
to employees as an adjustment in basic pay or a lump-sum payment
upon conversion from the General Schedule to a broadbanding system
under the following conditions:
1. The amount of any within-grade increase or career-ladder
promotion payment may not be more than the prorated value of the
employee's within-grade increase or career-ladder promotion at the
time of conversion, based on the number of weeks of creditable
service the employee has performed as of the date of initial
conversion into the broadbanding system. There is no restriction on
when such payments may be made.
2. A prorated within-grade increase or career-ladder promotion
payment may be made only to an employee whose performance meets or
exceeds retention standards at the time of conversion into a
broadbanding system.
3. A within-grade increase payment may not be made to an
employee receiving the maximum rate of pay for his or her grade (or
band, if made after conversion into a broadbanding system) or a
retained rate.
4. For employees receiving special rates before conversion into
an IRS broadbanding system, the pay conversion described in
paragraph D of Appendix B of these criteria must be applied before
making any prorated within-grade increase or career-ladder promotion
payment.
5. Adverse action and pay retention provisions do not apply to
reductions in basic pay that occur when the IRS subtracts any
prorated within-grade or career-ladder promotion increase from a
career-ladder employee's rate of basic pay upon conversion back to
the General Schedule as required by the introductory note in
Appendix C (dealing with reconstruction of GS pay rates).
D. Special salary rate employees. If an IRS broadbanding system
uses staffing supplements instead of special rates under 5 U.S.C.
5305, special rate employees must be converted into the system
consistent with the provisions in Appendix A. If an IRS broadbanding
system eliminates special salary rates, a new locality-adjusted rate
of pay must be derived for each employee, as follows:
1. Divide the employee's adjusted rate of basic pay (the higher
of the special rate or locality rate or similar adjusted rate) by
the locality pay factor for the area (e.g., 1.0905 for the
Washington-Baltimore locality pay area in 2000) to determine the new
broadbanding rate of basic pay. If the employee's broadbanding rate
of basic pay exceeds the maximum rate of basic pay for the
employee's band, the employee must be placed on pay retention.
2. Add the full locality adjustment to the employee's
broadbanding rate of basic pay, including any retained rate. The
locality adjustment is basic pay under 5 U.S.C. 5363 and subchapter
II of chapter 75 for the limited purpose of determining whether a
reduction in basic pay occurs at the point of an employee's
conversion into a broadbanding system.
E. Employees on pay retention. Upon conversion, employees on pay
retention must be placed in the band commensurate with the grade of
their position. If possible, an employee's rate of basic pay will be
placed within the assigned band. If not possible (because the
employee's retained rate is higher than the maximum rate of basic
pay of the band), the employee will be placed on pay retention.
F. Employees on grade retention. Upon conversion, employees on
grade retention must be placed in the band that encompasses their
retained grade until the original 2-year grade retention period
expires. When the 2-year period expires, employees must be moved to
the band that encompasses the grade of their position. If the rate
of basic pay exceeds the maximum rate of the new band, the employee
is entitled to pay retention.
Appendix C--Procedures for Converting Employees Back to the General
Schedule Pay System
When an employee covered by a broadbanding system moves
voluntarily or involuntarily to a General Schedule (GS) position,
IRS must use the following procedures to convert the employee's band
and pay rate to a GS-equivalent grade and rate of pay before the
employee moves out of the system. IRS must determine the converted
GS-equivalent grade and rate of pay before any accompanying
geographic move, promotion, or other simultaneous action. The new
employing organization must use the converted GS-equivalent grade
and rate of pay in applying various pay administration rules that
govern how pay is set in the GS position (e.g., rules for promotion,
highest previous rate, and pay retention). For the purpose of those
rules, the converted GS grade and rate of pay are deemed to have
been in effect at the time the employee left the broadbanding
system. The rules for determining the converted GS grade for pay
administration purposes do not apply to the determination of an
employee's GS-equivalent grade for other purposes, such as
reduction-in-force or adverse action.
Note: The conversion procedures below do not apply to employees
who involuntarily move back to the same General Schedule career-
ladder position they held immediately before conversion into the
broadbanding system prior to any pay adjustment event under the
system (including any promotion, demotion, or systemwide pay
adjustment). (A pay adjustment event does not include any prorated
within-grade or career-ladder promotion pay increase received as
part of conversion into the system or any across-the-board
increase.) For such employees, IRS must subtract any prorated
within-grade or career-ladder promotion payment and reconstruct the
employee's grade and adjusted rate of pay under the General Schedule
as if he or she had never entered the broadbanding system.
A. GS grade level determination--Upon conversion of an employee
out of a broadbanding system to the GS pay system, IRS must
determine the employee's GS-equivalent grade level under the
following rules (except as otherwise provided in section C of these
procedures):
1. Convert an employee in a band encompassing a single GS grade
to that grade.
2. For an employee in a band encompassing more than one GS
grade, compare the employee's adjusted rate of pay (including any
locality adjustment (or similar geographic adjustment) or staffing
supplement, as applicable) with the rates of pay in the highest
applicable GS rate range for each grade encompassed by the
employee's band. (For this purpose, a ``GS rate range'' includes a
rate range in (1) the GS basic pay schedule, (2) the locality pay
schedule (including any special geographic-adjusted schedule for law
enforcement officers (LEOs)) for the locality pay area in which the
position is located, or (3) the appropriate special rate schedule
for the employee's occupational series and geographic location, as
applicable.) If the employee's occupational series is a two-grade
interval series, consider only odd-numbered grades between GS-5 and
GS-11.
3. If the employee's adjusted rate of pay fits into an area of
the rate range for a GS grade that does not overlap with the rate
range of the next higher or lower grade in the same band, convert
the employee to that GS grade.
4. If the employee's adjusted rate of pay fits into an area of
the rate range for a GS grade that overlaps with the rate range of
the next higher or lower grade in the same band, compare the
employee's adjusted rate of pay
[[Page 79438]]
with the dollar midpoint of the overlap area. If the employee's
adjusted rate of pay is lower than the dollar midpoint of the
overlap area, convert the employee to the lower grade. If the
employee's adjusted rate of pay is equal to or higher than the
dollar midpoint of the overlap area, convert the employee to the
higher grade.
5. Exception: An employee's converted GS grade may not be lower
than the GS grade held by the employee immediately preceding a
lateral conversion into the broadbanding system, unless the employee
was retaining a GS grade immediately before conversion or the
employee underwent a reduction in band while in the broadbanding
system.
6. Exception: If an employee moves back to the General Schedule
before any pay adjustment event under the broadbanding system
(including any promotion, demotion, or systemwide pay adjustment),
the employee's converted GS grade is the grade the employee held
immediately before conversion into the broadbanding system. (A pay
adjustment event does not include any prorated within-grade or
career-ladder promotion pay increase received as part of conversion
into the system or any across-the-board increase.)
B. GS pay rate determination--IRS must determine the employee's
GS-equivalent rate of pay under the following rules (except as
otherwise provided in section C). If an employee voluntarily moves
back to the General Schedule before any pay adjustment event under
the broadbanding system (as described in paragraph 6 of section A of
these procedures), IRS must subtract any prorated basic pay increase
received as part of conversion into the broadbanding system
(including any applicable locality payment or staffing supplement
associated with that increase) before applying these rules.
1. Convert the employee's adjusted rate of basic pay under the
broadbanding system (including any locality adjustment (or similar
geographic adjustment) or staffing supplement, as applicable) to a
GS adjusted rate on the highest applicable rate range for the
converted GS grade derived under section A of these procedures. (For
this purpose, a ``GS rate range'' includes a rate range in (1) the
GS basic pay schedule, (2) an applicable locality pay schedule
(including any special geographic-adjusted schedule for LEOs), or
(3) an applicable special rate schedule.)
2. If the highest applicable GS rate range is under a locality
pay schedule, convert the employee's adjusted rate of pay under the
broadbanding system to a GS locality rate of pay. Since this
converted rate is used only as a basis for setting the employee's
rate in the new position, do not adjust the converted rate to equal
a standard step rate. The rate of basic pay underlying the converted
GS locality rate of pay becomes the employee's converted GS
unadjusted rate of basic pay. (If such an employee is also covered
by a special rate schedule, add the special rate increment for the
grade to the employee's converted GS unadjusted rate of basic pay to
derive the employee's converted special rate.)
3. If the highest applicable GS rate range is a special rate
range, convert the employee's adjusted rate of pay to a special
rate. The converted special rate may fall between the standard step
rates. The converted special rate is the employee's converted GS
unadjusted rate of basic pay.
4. If the employee's adjusted rate of pay exceeds the maximum
rate of the highest applicable rate range, apply the procedures
provided in the table under C.2., following, to determine the
employee's GS-equivalent pay rate. Use the employee's adjusted rate
of pay and unadjusted rate of pay in place of ``adjusted retained
rate'' and ``unadjusted retained rate,'' respectively.
C. Apply the following procedures to determine the converted GS-
equivalent grade and pay rate for employees retaining a band or pay
rate under the broadbanding system.
1. If an employee is retaining a band, apply the procedures in
sections A and B using the grades encompassed by the employee's
retained band to determine the employee's GS-equivalent retained
grade and pay rate. The time in a retained band counts toward the 2-
year limit on grade retention in 5 U.S.C. 5362.
2. If the employee's rate of pay under the broadbanding system
is a retained rate, the employee's GS-equivalent grade is the
highest grade encompassed in his or her band.
------------------------------------------------------------------------
If the employee's adjusted retained rate*
* * Then* * *
------------------------------------------------------------------------
(i) is less than the maximum rate of the apply the procedures in B.1.-
highest applicable rate range. B.3. to determine the
employee's GS-equivalent
pay rate.
(ii) exceeds the maximum rate of the convert the employee's
highest applicable rate range and the unadjusted retained rate to
employee is not in a special rate a GS-equivalent retained
category. rate.
(iii) exceeds the maximum rate of the convert the employee's
highest applicable rate range and the adjusted retained rate to a
employee is in a special rate category. GS-equivalent retained
rate.
------------------------------------------------------------------------
D. Within-grade increase ``equivalent increase''determinations--
Service under a broadbanding system is creditable for within-grade
increase purposes upon conversion to the GS pay system. Basic pay
increases (excluding across-the-board increases) under a
broadbanding system are ``equivalent increases'' for the purpose of
determining the beginning of a within-grade increase waiting period
under 5 CFR 531.405(b). A performance-based increase in basic pay of
any amount (including a zero increase) is considered a last
``equivalent increase'' for this purpose. Do not include any
prorated within-grade or career-ladder promotion basic pay increases
received as part of the conversion into the broadbanding system in
determining an employee's last ``equivalent increase,'' if such
increases were subtracted prior to determining the employee's GS-
equivalent rate of pay under section B of these procedures.
[FR Doc. 00-31710 Filed 12-18-00; 8:45 am]
BILLING CODE 6325-01-P