|
December 27, 1996
MEMORANDUM FOR DIRECTORS OF PERSONNEL (CPM 96-18)
FROM: DONALD J. WINSTEAD
ASSISTANT DIRECTOR FOR COMPENSATION POLICY
SUBJECT: January 1997 Pay Adjustments
The President has signed an Executive order on 1997 pay
adjustments. Among other things, this order implements an
across-the-board increase of 2.3 percent in the rates of basic
pay for the statutory pay systems--the General Schedule (GS), the
Foreign Service Schedule, and certain schedules for the Veterans
Health Administration of the Department of Veterans Affairs--in
accordance with 5 U.S.C. 5303(a). (See Attachment 1 for a
copy of the Executive order.) The increased rates of basic pay
will become effective on the first day of the first applicable
pay period beginning on or after January 1, 1997, the same day
that increases in locality-based comparability payments take
effect. (See information on 1997 locality payments below.)
In addition, the Executive order reflects a decision by the
President to increase the rates of basic pay for members of the
Senior Executive Service (SES) by approximately 2.3 percent at
levels ES-1 through ES-4. Since the maximum rate of basic pay for
SES members is limited by law to the rate for level IV of the
Executive Schedule ($115,700), which is not being increased, the
new rate of basic pay for ES-5 is $115,700 (an increase of about
1.5 percent), and the rate of basic pay for ES-6 remains
unchanged at $115,700. (Public Law 104-208, September 30, 1996,
provided that there would be no increase in the rates of basic
pay for the Executive Schedule.)
The minimum rate of basic pay for senior-level (SL) and
scientific or professional (ST) positions will increase by 2.3
percent (to $85,073) because of the 2.3-percent GS pay
adjustment, while the maximum rate of basic pay, which is limited
by law to the rate for level IV of the Executive Schedule
($115,700), remains unchanged. Rates of basic pay for
administrative law judges (ALJ's) and members of Boards of
Contract Appeals (BCA's) remain unchanged in 1997 because these
rates are calculated as a percentage of the rate for level IV of
the Executive Schedule, which remains unchanged.
The new basic pay schedules for SES, SL/ST, ALJ, and BCA
positions will become effective on the first day of the first
applicable pay period beginning on or after January 1, 1997. (See
information below on the extension of 1997 locality payments to
these employees.)
1997 Locality Payments
The amounts of the 1997 locality payments were established by the
President in an alternative plan dated November 22, 1996. (See
Interagency Advisory Group Memorandum for Directors of Personnel,
CPM 96-14, November 22, 1996.) Under the President's alternative
plan, locality payments will be increased by an overall amount
that will increase the GS payroll by approximately 0.7 percent,
resulting in a total increase for GS employees of about 3
percent.
Definitions of Locality Pay Areas
The locality pay area definitions of the 27 areas established for
1996 remain unchanged in 1997. However, three new metropolitan
areas have been established for 1997--Milwaukee-Racine, WI;
Minneapolis-St. Paul, MN-WI; and Pittsburgh, PA. (See 61 FR
40949, August 7, 1996.) A listing of all locality pay area
definitions (using geographic codes) is provided in Attachment
2.
Electronic Salary Tables
Various 1997 annual salary tables have been posted on
Mainstreet and PayPerNet, including salary tables for SES
members, ALJ's, BCA members, and employees in SL/ST positions in
each of the 30 locality pay areas. Agencies should follow the
instructions in Attachment 3 on how to locate and download
this information from Office of Personnel Management's (OPM's)
two electronic bulletin boards. In addition to the electronic
bulletin boards, the salary tables will be posted soon on OPM's
web site on the Internet. OPM's Internet address is http://www.opm.gov.
Extension of Locality Payments to Other Employees
On December 5, 1996, the President's Pay Agent extended the 1997
locality-based comparability payments to the same Governmentwide
and single-agency categories that were authorized to receive the
1996 locality payments. The Governmentwide categories include the
SES, employees in SL/ST positions, ALJ's, BCA members, the
Foreign Service, and the Senior Foreign Service. By law, the
maximum locality rate of pay for these employees is the rate for
level III of the Executive Schedule ($123,100).
Pay Adjustments for Employees Receiving Special Rates
OPM expects to announce the results of the 1996 annual review of
special rates in the very near future.
IGA Continued Rates
Certain employees in the former interim geographic adjustment
(IGA) areas are entitled to a "continued rate" under 5
CFR part 531, subpart G. (See 61 FR 34713, July 3, l996.) These
continued rates were established in January 1994 when OPM
regulations were revised to discontinue the practice of paying
IGA's on top of nationwide or worldwide special rates. At the
time of the January 1997 general pay increase, an IGA continued
rate will be increased by the dollar amount of the increase in
the employee's underlying GS rate. (See
5 CFR 531.703.) Since a continued rate is a form of saved pay,
it is not affected by other pay actions such as a within-grade
increase or promotion.
Pay Adjustments for Law Enforcement Officers
As in 1996, OPM has issued separate locality rate tables for law
enforcement officers (LEO's) in each locality pay area. These
tables incorporate the statutory worldwide law enforcement
special rates for grades GS-3 through GS-10, which are used as
the base in computing any locality or other geographic payment.
While LEO's are entitled to the same locality pay rates that
apply to other GS employees, higher geographic adjustments
(ranging from 8 to 16 percent) continue to apply to LEO's in five
metropolitan areas: New York, Los Angeles, San Francisco, Boston,
and San Diego.
LEO's covered by the SES or SL/ST pay systems generally are
entitled to the locality rates of pay shown in salary tables
97-ES (LOC) or 97-SL/ST (LOC), respectively. However, since LEO's
covered by these pay systems in some metropolitan areas also are
entitled to special pay adjustments for LEO's, these rates of pay
are provided in salary tables 97-ES (LEO) and 97-SL/ST (LEO).
Certain law enforcement officers may be entitled to a
"continued rate" under 5 CFR 531.307 (established in
January 1994 when OPM regulations were revised to discontinue the
practice of paying LEO geographic adjustments on top of
nationwide or worldwide special rates). As with IGA continued
rates, an LEO continued rate will be increased by the dollar
amount of the January 1997 increase in the officer's underlying
GS rate. (See 5 CFR 531.307(b).)
Order in which Pay Actions are to be Processed
The general pay adjustments that take effect on the first day of
the first pay period beginning in January 1997 must be processed before
any individual pay actions (e.g., a within-grade increase or
promotion) that take effect on the same day. General pay
adjustments include across-the-board increases under 5 U.S.C.
5303, increases in locality payments or other geographic
adjustments, special rate increases, increases in retained rates,
and increases in continued rates under 5 CFR 531.307 or 531.703.
If there are multiple individual pay actions on the effective
date of the January 1997 pay adjustment, those actions should be
processed in the order that satisfies the requirements of
simultaneous action rule in 5 CFR 531.203(f).
Pay Administration
To assist agencies in administering pay as a result of the 1997
pay adjustments for General Schedule employees, Attachment 4
contains examples of pay computations in a variety of situations.
Salary Table No. 97
"Salary Table No. 97" will be published by the
Government Printing Office in early 1997. The salary table book
will provide the 1997 salary tables, locality pay tables
(including hourly rate tables), and detailed information on
administering locality rates of pay, calculating rates of pay,
maximum limitations on pay, and deductions for benefits.
IRS Tax Withholding Tables
Attachment 5 provides excerpts from an early release copy
of Internal Revenue Service (IRS) Publication 15, Circular E, Employers
Tax Guide (Revised January 1997), which shows the 1997 wage
bracket income tax withholding tables for both single and married
persons who are paid on a biweekly basis. Publication 15 will be
mailed by the IRS to employers and also should be available at
IRS offices.
Questions
Questions regarding this memorandum or its attachments may be
directed to OPM's Compensation Administration Division on (202)
606-2858.
Attachments (5)
Attachment to Internet Version of IAG Memorandum CPM 96-18
This Internet version of the IAG memorandum on the January 1997
pay adjustments (CPM 96-18) does not include Attachments 1
through 5. The referenced information in the attachments can be
viewed by clicking on the appropriate subjects:
Attachment 1 A facsimile of the
President's Executive Order
Attachment 2 Locality Pay Area
Definitions.
Attachment 3
1997 Pay Tables
Attachment 4 Examples of
January 1997 pay Computations
Attachment 5 Internal
Revenue Service Publication 15, Circular E, Employers Tax
Guide (Revised January 1997) can be obtained by calling the
IRS at 1-800-829-3676. Additional questions can be answered by
calling 1-800-829-1040.
|
