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Examples of January 2003 Pay Computations

Below are examples showing how various categories of employees will be affected by the January 2003 pay adjustments. Annual rates are shown. The annual rate providing the highest entitlement (shown in bold font) is used to calculate the employee's hourly rate in biweekly pay computations. An hourly rate is computed by dividing the annual rate by 2,087 and rounding the result to the nearest cent. (Note: Firefighters compensated under 5 U.S.C. 5545b are subject to special pay computation rules, including the use of an hourly rate computed using a 2,756-hour divisor. See 5 CFR part 550, subpart M.)

1. General Schedule (GS) employee
Grade/step: GS-9, step 5
Location: Rest of U.S. locality pay area

2002 GS basic rate

2002 locality rate

$39,043
$42,416

($39,043 x 1.0864)

2003 GS basic rate

2003 locality rate

$40,255

$44,128

(after 3.1% across-the-board increase)

($40,255 x 1.0962)

2. GS employee promoted on same day the 2003 pay adjustments take effect

Grade/step: GS-11, step 5, before promotion
Location: Rest of U.S. locality pay area

Step 1: Apply the across-the-board pay adjustment to the GS-11, step 5, rate.

2002 GS basic rate

2002 locality rate

$47,240

$51,322

($47,240 x 1.0864)

2003 GS basic rate

2003 locality rate

$48,708

$53,394

(after 3.1% across-the-board increase)

($48,708 x 1.0962)

Step 2: Process the promotion to GS-12 using the 2-step rule.

2003 GS basic rate

2003 locality rate

$53,225

$58,345

(GS-12, step 2, is the lowest GS-12 step rate that equals or exceeds the GS-11, step 7, rate of $51,574)

($53,225 x 1.0962)

3. GM employee
(See examples 7a and 7b for GM employees at GS-13 on the IT special salary rate schedule.)

Grade/step: GM-13, step 00, $72,034 (not on step)
Location: Washington, DC, locality pay area

Reference: 5 CFR 531.205(a)(2)

Step 1: Subtract the GS-13, step 1, rate of basic pay from the employee's GM rate in 2002. (Use the 2002 rates of basic pay.)

2002 GM rate

2002 GS basic rate

Difference

$72,034
$59,409
$12,625

(employee's GM basic rate)

(GS-13, step 1)

($72,034 - $59,409)

Step 2: Subtract the GS-13, step 1, rate of basic pay from the GS-13, step 10, rate of basic pay. (Use the 2002 rates of basic pay.)

2002 GS basic rate

2002 GS basic rate

Difference

$77,229

$59,409

$17,820

(GS-13, step 10)

(GS-13, step 1)

($77,229 - $59,409)

Step 3: Divide the result of step 1 by the result of step 2. Carry the results to the seventh decimal place and truncate.

$12,625 / $17,820 = 0.7084736

Step 4: Subtract the GS-13, step 1, rate of basic pay from the GS-13, step 10, rate of basic pay. (Use the 2003 rates of basic pay.)

2003 GS basic rate

2003 GS basic rate

Difference

$79,629

$61,251

$18,378

(GS-13, step 10)

(GS-13, step 1)

($79,629 - $61,251)

Step 5: Multiply the result in step 3 by the result in step 4.

0.7084736 x $18,378 = $13,020.32782

Step 6: Add the result in step 5 to the GS-13, step 1, rate of basic pay (2003) and round to the next whole dollar.

$13,020.32782 + $61,251 = $74,272

2003 GM basic rate

2003 GM locality rate

$74,272

$83,734

(after applying 3.1% increase by following the above steps under 5 CFR 531.205(a)(2))

($74,272 x 1.1274)

4. GS-11 employee receiving a retained rate of pay

Grade/step: GS-11, step 00 (above rate range)
Location: Rest of U.S. locality pay area

2002 retained rate

2002 locality rate
(No special rate)

$57,431

$62,393

($57,431 x 1.0864)

2003 retained rate

2003 locality rate

$58,275

$63,881

($57,431 plus $844, where $844 is one-half of the dollar increase in the GS-11, step 10, rate from 2002 to 2003; ($55,873 - $54,185) / 2 = $844)

($58,275 x 1.0962)

5. Special rate employee where locality rate exceeds special rate for the first time in January 2003.

Grade/step: GS-4, step 5
Location: Washington, DC
Special Rate Schedule: Table 0029 (DC Clerical)

2002 GS basic rate

2002 locality rate

2002 special rate

$23,030

$25,674

$25,738

($23,030 x 1.1148)

2003 GS basic rate

2003 locality rate

2003 special rate

$23,744

$26,769

$26,536

(after 3.1% across-the-board increase)

($23,744 x 1.1274)

(after 3.1% increase is applied to the 2002 special rate schedule)

6. Special rate employee where special rate exceeds locality rate

Grade/step: GS-3, step 1
Location: Washington, DC
Special Rate Schedule: Table 0029 (DC Clerical)

2002 GS basic rate

2002 locality rate

2002 special rate

$18,103

$20,181

$21,721

($18,103 x 1.1148)

2003 GS basic rate

2003 locality rate

2003 special rate

$18,664

$21,042

$22,396

(after 3.1% across-the-board increase)

($18,664 x 1.1274)

(after 3.1% increase is applied to the 2002 special rate schedule)

7. Law enforcement officer (LEO)

Grade/step: GS-7, step 1
Location: Boston, MA (LEO 1 schedule applies)

2002 LEO special rate

2002 LEO locality rate

2002 LEO GEO adj. rate

$31,920

$36,252

$37,027

($31,920 x 1.1357)

($31,920 x 1.16)

2003 LEO special rate

2003 LEO locality rate

2003 LEO GEO adj. rate

$32,909

$37,845

$38,174

(after 3.1% across-the-board increase)

($32,909 x 1.15 )

($32,909 x 1.16 )

8a. GM employee at grade GS-13 on the IT special rate schedule IT Special Rate Adjustment Basic Rate for GS-2210-13, step 00 (not on step): $75,543 (December 2002) Location: Washington-Baltimore, DC-MD-VA-WV 2002 Locality Rate: $84,215 ($75,543 x 1.1148) IT Special Rate Schedule: Table 999C IT Special Rate: $79,320 Reference: 5 CFR 530.306(a)(3), 530.307(c), and 531.205(a)(2)
Step 1: Subtract the GS-13, step 1, special rate from the employee's IT special rate in 2002. (Use the 2002 IT special rate table, 999C.)
2002 GM IT special rate 2002 IT special rate Difference	$79,320 $62,379 $16,941	(employee's GM special rate) (GS-13, step 1) ($79,320 - $62,379)
Step 2: Subtract the GS-13, step 1, special rate from the GS-13, step 10, special rate. (Use the 2002 IT special rate table, 999C.)
2002 IT special rate 2002 IT special rate Difference	$81,090 $62,379 $18,711	(GS-13, step 10) (GS-13, step 1) ($81,090 - $62,379)
Step 3: Divide the result of step 1 by the result of step 2. Carry the result to the seventh decimal place and truncate.
$16,941 / $18,711 = 0.9054032
Step 4: Subtract the GS-13, step 1, rate from the GS-13, step 10, rate. (Use the 2003 IT special rate table, 999C.)
2003 IT special rate 2003 IT special rate Difference	$83,610 $64,314 $19,296	(GS-13, step 10) (GS-13, step 1) ($83,610 - $64,314)
Step 5: Multiply the result in step 3 by the results in step 4.
0.9054032 x $19,296 = $17,470.66015
Step 6: Add the result of step 5 to the GS-13, step 1, IT special rate from the 2003 Table 999C and round to the next whole dollar.
$17,470.66015 + $64,314 = $81,785
The employee's GM IT special rate in 2003 is $81,785.

8b. GM employee at grade GS-13 on the IT special rate schedule Locality Rate Determination Basic Rate for GS-2210-13, step 00 (not on step): $75,543 (December 2002) Location: Washington-Baltimore, DC-MD-VA-WV IT Special Salary Rate: Table 999C NOTE: First compute the employee's 2003 GM unadjusted rate of basic pay following the steps in 5 CFR 531.205(a)(2). (See steps 1-6.) (Use unadjusted rates of basic pay. Do not use the special rates of pay.) Then apply the applicable locality payment. (See step 7.)
Step 1: Subtract the GS-13, step 1, GS basic rate in 2002 from employee's the rate of basic pay in 2002. (Use the 2002 GS basic schedule.)
2002 GM basic rate 2002 GS-13 basic rate Difference	$75,543 $59,409 $16,134	(employee's GM basic rate) (GS-13, step 1) ($75,543 - $59,409)
Step 2: Subtract the GS-13, step 1, GS basic rate in 2002 from the GS-13, step 10, GS basic rate in 2002. (Use the 2002 GS basic schedule.)
2002 GS-13 basic rate 2002 GS-13 basic rate Difference	$77,229 $59,409 $17,820	(GS-13, step 10) (GS-13, step 1) ($77,229 - $59,409)
Step 3: Divide the result of step 1 by the result of step 2. Carry the result to the seventh decimal place and truncate.
$16,134 / $17,820 = 0.9053872
Step 4: Subtract the GS-13, step 1, rate in 2003 from the GS-13, step 10, rate in 2003. (Use the 2003 GS basic schedule.)
2003 GS-13 basic rate 2003 GS-13 basic rate Difference	$79,629 $61,251 $18,378	(GS-13, step 10) (GS-13, step 1) ($79,629 - $61,251)
Step 5: Multiply the result in step 3 by the result in step 4.
0.9053872 x $18,378 = $16,639.20596
Step 6: Add the result of step 5 to the GS-13, step 1, GS basic rate in 2003 and round to the next whole dollar.
$16,639.20596 + $61,251 = $77,891 [Note that $77,891 exceeds the employee's former GM basic rate of $75,543 by approximately 3.1%, which is the amount of the GS across-the-board increase in January 2003.]
Step 7: Multiply the result of step 6 by the DC locality rate in 2003.
2003 GM basic rate 2003 GM locality rate	$77,891 $87,814	(2003 GM basic rate, determined in step 6) ($77,891 x 1.1274 )
The employee's locality rate in 2003 is $87,814. The employee's IT special rate ($81,785) is the underlying rate of basic pay used for some pay administration purposes. (IT special rate table 999C provides a 5 percent special rate supplement at grade 13. Note that the employee's IT special rate of $81,785 is approximately 5 percent above the GM basic rate of $77,891.)

9. Promotion for IT special rate employee (with underlying GS-13 special rate) after 2003 pay adjustments take effect. Grade/step: GS-12, step 5 Location: Washington-Baltimore, DC-MD-VA-WV IT Special Salary Rate: Table 999C
Step 1: An employee is entitled to the lowest GS-13 rate that is equal to or greater then the GS-12 rate that is two steps above the employee's current GS-12 rate of pay.
2003 IT special rate 2003 IT special rate	$67,132 $71,082	(GS-12, step 5, Table 999C) (GS-12, step 7, Table 999C)
Step 2: Find the lowest GS-13 IT special rate that equals or exceeds the GS-12, step 7, IT special rate.
$71,082 falls between step 4 and step 5. The employee's rate of pay is set at GS-13, step 5, on the IT special rate schedule = $72,890.
Step 3: Compare the GS-13, step 5, 2003 IT special rate of pay to the GS-13, step 5, 2003 locality rate of pay.
$72,890 (2003 IT special rate) < $78,263 (2003 locality rate)
Step 4: The employee is paid the GS-13, step 5, locality rate of pay because the locality rate of pay is higher than the 2003 IT special rate of pay. The GS-13, step 5, IT special salary rate is an underlying rate of basic pay used for certain pay administration purposes.

10. Promotion for IT special rate employee at GS-12, step 10, after 2003 pay adjustments take effect. Grade: GS-12, step 10 Location: Washington-Baltimore, DC-MD-VA-WV IT Special Salary Rate: Table 999C
2003 DC locality rate 2003 IT special rate	$75,492 $77,005	(GS-12, step 10) (GS-12, step 10)
An employee is entitled to the lowest GS-13 rate that is equal to or greater than the GS-12 rate that is two steps above the employee's current GS-12 rate.
Step 1: Subtract the GS-12, step 9, IT special rate from the GS-12, step 10, IT special rate. Note: Since there is no step 11 rate, the two-step increase must be derived using the difference between steps 9 and 10. This approach must be used whenever an IT special rate employee is at step 9 or 10 before promotion.
$77,005 (GS-12, step 10) - $75,031 (GS-12, step 9) = $1,974
Step 2: Multiply the difference by 2 because an employee is entitled to a two-step increase.
$1,974 x 2 = $3,948
Step 3: Add the increase to the employee's current rate of pay (GS-12, step 10, IT special rate).
$77,005 + $3,948 = $80,953
Step 4: Find the lowest GS-13 IT special rate that equals or exceeds the rate from step 3.
$80,953 falls between step 8 and step 9. The employee's rate of pay is set at a GS-13, step 9, on the IT special rate (Table 999C) = $81,466.
Step 5: Compare the GS-13, step 9, IT special rate of pay to the GS-13, step 9, locality rate of pay for the Washington-Baltimore locality pay area.
$81,466 (2003 IT special rate) < $87,472 (2003 locality rate)
Step 6: The employee is paid the GS-13, step 9, locality rate of pay because the locality rate is higher than the 2003 IT special rate of pay. The GS-13, step 9, IT special rate is an underlying rate of basic pay used for certain pay administration purposes.

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