Office of the General Counsel

Matter of: [xxx]
Date: March 17, 2000
File Number: 002459

OPM Contact: Jo-Ann Chabot

This claim for additional longevity pay is based on the assertion that locality pay should be considered as part of the claimant's basic pay when computing his longevity pay. The claim is denied for the reasons stated below.

The claimant is employed with the [agency] [name] Division. Pay rates for the [name] Division are governed by certain provisions of Title 4 in the District of Columbia Code (D.C. Code). The agency reports that it calculates the amount of the claimant's longevity pay solely on the basis of his basic compensation, and no longer includes locality pay in the calculation. The claimant bases his claim that locality pay is part of his basic compensation and, therefore, his longevity pay should be calculated on the basis of both, on the argument that section 4-416(c)(1) of the D.C. Code sets forth the salary schedule for the [name] Division, section 4-416 (c)(2) adjusts the rates specified in the schedule by adding locality pay, and section 4-416(c)(5) folds the locality pay into the salary schedule.

Section 4-415(a)(1) grants longevity increases to members of the municipal fire and police departments of Washington, D.C., providing that members of these departments "shall receive per annum, in addition to the rate of basic compensation prescribed in the salary schedule contained in section 4-406, an amount computed in accordance with the following table . . ."⁽¹⁾

(Emphasis added.) According to this table, officers or members completing set amounts of continuous service shall receive annually an amount equal to specific percentages of the "rate of basic compensation prescribed for service step 1 of the salary class of such salary schedule which he occupies.

Section 4-416(a) of the D.C. Code makes members of the [name] Division eligible for the longevity increases described in section 4-415. Section 4-416(c)(1) sets forth the rates of basic compensation for members of the [name] Division, providing that their "annual rates of basic compensation shall be fixed [in] accordance with the . . . schedule of rates [set forth in subsection (c)(1)]. " Section 4-416 (c)(2) provides in relevant part:

Effective at the beginning of the first applicable pay period commencing on or after the first day of the month in which an adjustment takes effect under section 5303 of title 5, United States Code (or any subsequent similar provision of law), in the rates of pay under the General Schedule (or any pay system that may supersede such schedule), the annual rates of basic compensation of [the {name} Division] shall be adjusted by the Secretary of the Treasury by an amount equal to the percentage of such annual rate of pay which corresponds to the overall percentage of the adjustment made in the rates of pay under the General Schedule.

(Emphasis added.)

Section 5303 provides for annual adjustments to be made to the statutory pay systems and specifies that the annual adjustment becomes part of an employee's basic pay. This provision concerns the annual cost-of-living adjustment and does not concern locality pay, which is provided for under 5 U.S.C. 5304. Therefore, section 4-416(c)(2) does not incorporate locality pay into the basic compensation rates of section 4-416(c)(1) and does not support the argument that locality pay is part of the claimant's basic compensation.

Section 4-416(c)(3) of the District of Columbia Code makes the [name] Division eligible for locality pay, and provides that locality payments "authorized under [5 U.S.C. 5304] shall be applicable to the basic pay under this section, except locality-based comparability payments may not be paid at a rate which, when added to the rate of basic pay otherwise payable . . . would cause the total to exceed" the rate of basic pay for level IV of the Executive Schedule. Although section 4-416(c) provides for eligibility to receive locality pay, there is nothing in section 4-416 that makes the locality pay part of the [name] Division's basic pay. Moreover, 5 U.S.C.  5304(c)(2) specifies that locality pay is considered part of an employee's basic compensation for the limited purposes specified in that subsection.⁽²⁾ These purposes do not include computation of longevity pay with respect to the [name] Division. Section 5304(c)(3) further provides that nothing in 5 U.S.C. 5301-5307 (Pay Comparability System) shall be considered to permit or require that any portion of a comparability payment be taken into account for purposes of any adjustment under section 5303. Therefore, locality pay does not enter into the equation for calculating the annual cost of living increase.

Section 4-416(5) provides that statutory references to the salary schedule in section 4-406 shall be considered a reference to the salary schedule in section 4-416(c)(1) as adjusted in accordance with section 4-416(c). The adjustment on which this claim is based and the only adjustment that subsection (c) provides for is the cost of living adjustment under 5 U.S.C. 5303. Accordingly, the claim that locality pay should be part of the claimant's basic salary is denied.

This settlement is final. No further administrative review is available within the Office of Personnel Management. Nothing in this settlement limits the claimant's right to bring an action in an appropriate United States Court.

1. Section 4-406 of the D.C. Code provides for annual rates of basic compensation for members of the Washington, D.C. municipal police and fire departments, described in the schedule set forth in that section.

2. These purposes include retirement under 5 U.S.C. Chapters 83 or 84, life insurance under 5 U.S.C. Chapter 87, premium pay under subchapter V of 5 U.S.C. Chapter 55, and other purposes specified by law or as OPM regulations may prescribe.