CPM 2004-21 - October 29, 2004
MEMORANDUM FOR CHIEF HUMAN CAPITAL
OFFICERS
FROM:
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KAY COLES JAMES
Director
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SUBJECT:
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Aggregate Limitation on Pay
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I am pleased to announce that agencies that have received certification of
their performance appraisal systems for members of the Senior Executive Service
(SES) and/or employees in senior-level (SL) and scientific or professional (ST)
positions may now apply the higher aggregate limitation on pay-up to the Vice
President's salary ($203,000 in 2004). In many cases, this means senior employees
in certified agencies who were awarded the rank of Distinguished Executive in
2004 may now receive the full amount of the award in calendar year 2004 (the
year in which it was earned), since they are now subject to a higher aggregate
limitation on pay.
Consistent with 5 U.S.C. 5307(d) and the regulations at 5 CFR 430.405(e) (full
certification) and (f) (provisional certification), agencies that have received
full or provisional certification must apply the higher aggregate limitation
on pay in calendar year 2004 to both SES members and SL/ST employees covered
by certified appraisal systems. Agencies without certification must continue
to apply an annual aggregate limitation on pay equivalent to the rate for level
I of the Executive Schedule ($175,700 in 2004). The current rules in 5 CFR part
530, subpart B, regarding the administration of the aggregate limitation on
pay and deferred payments remain in effect until the Office of Personnel Management
(OPM) issues final regulations later this year.
Agencies with certified appraisal systems that correctly deferred excess payments
earlier in the year under 5 CFR 530.204, because an employee's estimated aggregate
compensation would have exceeded the rate for level I of the Executive Schedule
at the end of calendar year 2004, must make appropriate payments to affected
SES members and/or SL/ST employees in calendar year 2004. For example, if an
agency deferred payment of part of a relocation bonus until January 2005, the
agency must now correct the pay action and pay the relocation bonus in calendar
year 2004, assuming, of course, that the employee's estimated aggregate compensation,
including the relocation bonus, would be less than $203,000.
Agencies may not set the rate of basic pay for SES members above the rate for
level III of the Executive Schedule until OPM issues final regulations in 5
CFR part 534, subpart D, on the administration of pay for SES members.
Additional Information
For additional information, please contact your assigned OPM Human Capital
Officer. Employees should contact their agency human resources office for assistance.
cc: Human Resources Directors
