B-172195(19), MAY 16, 1974

B-172195(19), MAY 16, 1974

NAVY EMPLOYEE DOWNGRADED FROM GS-7, STEP 7, TO GS-5, STEP 10, WHO WAS PROMOTED TO GS-9, STEP 1, WITHIN RETENTION PERIOD, CLAIMS PAY FOR STEP 3 OF GS-9. CLAIM IS DISALLOWED SINCE THE PAY RATE OF GS-9, STEP 1, EXCEEDS BOTH THE RATE OF GS-5, STEP 10, PLUS 2 STEP INCREASES IN GS-5 AND EMPLOYEE'S EXISTING OR RETAINED RATE AT TIME OF PROMOTION AND THUS WAS PROPER RATE UNDER 5 U.S.C. 5334(B). SEE COMP. GEN. DECISIONS CITED.

TO MRS. FLORENCE N. ONTAI:

THIS ACTION CONCERNS THE DETERMINATION BY THE DEPARTMENT OF THE NAVY FIXING THE PAY OF MRS. FLORENCE N. ONTAI, AN EMPLOYEE OF THE PEARL HARBOR NAVAL SHIPYARD, AT GS-9, STEP 1, UPON HER PROMOTION FROM GS-5, STEP 10, WHILE RECEIVING THE RETAINED PAY OF GS-7, STEP 7, PURSUANT TO THE PROVISIONS OF 5 U.S.C. 5337.

THE RECORD INDICATES THAT INCIDENT TO A REDUCTION IN FORCE MRS. ONTAI WAS REDUCED IN GRADE FROM GS-7, STEP 7, TO GS-5, STEP 10, EFFECTIVE JUNE 4, 1972, WITH PAY RETENTION UNDER 5 U.S.C. 5337. EFFECTIVE NOVEMBER 11, 1973, MRS. ONTAI WAS PROMOTED TO GS-9, STEP 1. MRS. ONTAI BELIEVES SHE SHOULD HAVE BEEN PLACED IN GS-9, STEP 3, SINCE SHE WAS RECEIVING THE PAY OF GS-7, STEP 7, $11,961 PER ANNUM. PURSUANT TO A LETTER OF DECEMBER 4, 1973, FROM THE SAN FRANCISCO REGION, UNITED STATES CIVIL SERVICE COMMISSION, ADVISING HER THAT THE PAY ACTION WAS CORRECT BUT SHE COULD APPEAL TO THIS OFFICE, MRS. ONTAI SUBMITTED HER CLAIM.

SECTION 5334, TITLE 5, U.S.C. PROVIDES IN PERTINENT PART AS FOLLOWS:

"(B) AN EMPLOYEE WHO IS PROMOTED OR TRANSFERRED TO A POSITION IN A HIGHER GRADE IS ENTITLED TO BASIC PAY AT THE LOWEST RATE OF THE HIGHER GRADE WHICH EXCEEDS HIS EXISTING RATE OF BASIC PAY BY NOT LESS THAN TWO STEP- INCREASES OF THE GRADE FROM WHICH HE IS PROMOTED OR TRANSFERRED. IF, IN THE CASE OF AN EMPLOYEE SO PROMOTED OR TRANSFERRED WHO IS RECEIVING BASIC PAY AT A RATE IN EXCESS OF THE MAXIMUM RATE OF HIS GRADE, THERE IS NO RATE IN THE HIGHER GRADE WHICH IS AT LEAST TWO STEP INCREASES ABOVE HIS EXISTING RATE OF BASIC PAY, HE IS ENTITLED TO -

"(1) THE MAXIMUM RATE OF THE HIGHER GRADE; OR

"(2) HIS EXISTING RATE OF BASIC PAY, IF THAT RATE IS THE HIGHER.

IF AN EMPLOYEE SO PROMOTED OR TRANSFERRED IS RECEIVING BASIC PAY AT A RATE SAVED TO HIM UNDER SECTION 5337 OF THIS TITLE ON REDUCTION IN GRADE, HE IS ENTITLED TO -

"(A) BASIC PAY AT A RATE TWO STEPS ABOVE THE RATE WHICH HE WOULD BE RECEIVING IF SECTION 5337 OF THIS TITLE WERE NOT APPLICABLE TO HIM; OR

"(B) HIS EXISTING RATE OF BASIC PAY, IF THAT RATE IS THE HIGHER."

SECTION 5337(A) OF TITLE 5, U.S.C. WHICH IS APPLICABLE IN THE PRESENT CASE, PROVIDES THAT UNDER THE CONDITIONS STATED THEREIN AN EMPLOYEE WHO IS REDUCED IN GRADE FROM A GRADE OF THE GENERAL SCHEDULE IS ENTITLED TO BASIC PAY AT THE RATE TO WHICH HE WAS ENTITLED IMMEDIATELY BEFORE THE REDUCTION FOR A PERIOD OF TWO YEARS FROM THE EFFECTIVE DATE OF THE REDUCTION. UNDER THAT STATUTE MRS. ONTAI'S RATE OF COMPENSATION WAS TO BE RETAINED FOR 2 YEARS BUT HER GRADE WAS ACTUALLY REDUCED, AND IF SHE HAD NOT BEEN PROMOTED DURING THE RETAINED COMPENSATION PERIOD, HER SALARY WOULD HAVE BEEN REDUCED AT THE COMPLETION OF SUCH PERIOD.

IN VIEW OF THE ABOVE, MRS. ONTAI WAS ENTITLED UPON PROMOTION WITHIN THE COMPENSATION RETENTION PERIOD TO THE LOWEST RATE IN GS-9 WHICH EXCEEDED THE RATE OF GS-5, STEP 10, PLUS A 2-STEP INCREASE IN GS-5 OR HER EXISTING RATE, WHICHEVER WAS HIGHER. SPECIFICALLY, MRS. ONTAI WAS ENTITLED TO (1) THE RATE OF GS-5, STEP 10, $10,467, PLUS THE EQUIVALENT OF 2 STEP INCREASES IN GS-5, WHICH IS $536, A TOTAL OF $11,003; (2) HER EXISTING RATE OF $11,961; OR AN APPROPRIATE RATE IN GS-9. IN THIS CONNECTION WE POINT OUT THAT THE TERM "EXISTING RATE" IS IDENTICAL WITH THE RETAINED RATE. SEE 42 COMP. GEN. 702, 704 (1963). SINCE THE RATE FOR STEP 1 OF GS -9, $12,167, EXCEEDS BOTH OF THE FIRST 2 RATES SPECIFIED ABOVE, MRS. ONTAI'S COMPENSATION RATE WAS PROPERLY ESTABLISHED AT THAT RATE. SEE B- 178909, AUGUST 6, 1973.

WE NOTE THAT THE COMMISSION'S REGIONAL OFFICE ADVISED MRS. ONTAI THAT HER SAVED PAY WAS ADDITIONAL AND WAS, THEREFORE, NOT CONSIDERED PART OF HER BASIC PAY. WE DEEM THAT LANGUAGE TO INDICATE MERELY THAT MRS. ONTAI'S BASIC RATE OF PAY AT THE TIME OF PROMOTION WAS THAT FOR GS-5, STEP 10, AND THAT SHE RECEIVED ADDITIONAL PAY WHICH SHE WOULD NOT HAVE RECEIVED EXCEPT FOR THE RETAINED PAY PROVISIONS OF 5 U.S.C. 5337. HOWEVER, REGARDLESS OF THE TERMS USED, 5 U.S.C. 5334(B) CLEARLY PROVIDES FOR THE FIXING OF PAY UPON PROMOTION IN A CASE SUCH AS THAT HERE INVOLVED AS AN EXCEPTION TO THE GENERAL RULE THAT A PROMOTED EMPLOYEE IS ENTITLED TO AN INCREASE IN PAY EQUAL TO 2 STEP INCREASES IN THE GRADE FROM WHICH PROMOTED. MRS. ONTAI'S PAY WAS FIXED IN ACCORDANCE WITH THAT EXCEPTION.

IN VIEW OF THE ABOVE THE CLAIM OF MRS. ONTAI IS DISALLOWED.

THE ACTION OF THIS OFFICE ON CLAIMS AGAINST THE UNITED STATES IS FINAL AND CONCLUSIVE ON THE EXECUTIVE BRANCH OF THE GOVERNMENT. SHOULD THE CLAIMANT WISH TO TAKE FURTHER ACTION SHE IS REFERRED TO 28 U.S.C. 1346 AND 1491 FOR MATTERS COGNIZABLE BY THE UNITED STATES DISTRICT COURTS AND THE COURT OF CLAIMS.