CHAPTER 6: CONVERSION TO DEMONSTRATION PROJECT COVERAGE AND MOVEMENT FROM COVERAGE

On this page:

• 6-1. Conversion to the Demonstration Project
• 6-2. Conversion or Movement from a Project Position to a General Schedule Position

Section I - General

6-1. Conversion to the Demonstration Project.

1. Initial entry into the demonstration project will be accomplished through a full employee protection approach that ensures each employee an initial place in the appropriate payband without loss of pay. Employees serving under regular term appointments at the time of the implementation of the demonstration project will be converted to the contingent employee appointment, so long as the original term appointment was made under competitive procedures. An automatic conversion from current GS/GM grade and pay into the new broadband system will be accomplished. Each employee's initial total salary under the demonstration project will equal the total salary received immediately before conversion. Employees who enter the demonstration project later by lateral reassignment or transfer will be subject to pay conversion rules. If conversion into the demonstration project is accompanied by a geographic move, the employee's GS pay entitlements in the new geographic area must be determined before performing the pay conversion.
2. Employees who are on temporary promotions at the time of conversion will be converted to a payband commensurate with the grade equivalent of the position to which temporarily promoted. At the conclusion of the temporary promotion, the employee will revert to the payband which corresponds to the grade of record. When a temporary promotion is terminated, the employee's pay entitlements will be determined based on the employee's position of record, with appropriate adjustments to reflect pay events during the temporary promotion and subject to specific policies and rules. Employee will revert to the salary held just prior to the temporary promotion, if a retained salary rate is what employee was previously entitled to and rate is beyond the assigned payband, pay retention is maintained. In no case may those adjustments increase the pay for the position of record beyond the applicable pay range maximum rate. The only exception will be if the original competitive promotion announcement stipulated that the promotion could be made permanent; in these cases actions to make the temporary promotion permanent will be considered, and if implemented, will be subject to all existing priority placement programs.
3. Employees who are covered by special salary rates, prior to the demonstration project, will no longer be considered a special rate employee under the Demonstration Project. These employees will, therefore, be eligible for full locality pay. The adjusted salaries of these employees will not change. Rather, the employees will receive a new basic pay rate computed by dividing their adjusted basic pay (higher of special rate or locality rate) by the locality pay factor for their area. A full locality adjustment will then be added to the new basic pay rate. Adverse action and pay retention provisions will not apply to the conversion process as there will be no change in total salary. See Appendix J for numerical example.
4. During the first 12 months following conversion, employees will receive pay increases for non-competitive promotion equivalents, the employee's performance warrants the promotion and promotions would have otherwise occurred during that period. Employees who receive an in-level promotion at the time of conversion will not receive a prorated step increase equivalent as defined below.
5. Under the current General Schedule (GS) pay structure, employees progress through their assigned grade in step increments. Since the GS structure has been replaced under the demonstration project, employees will be awarded that portion of the next higher step based upon the portion of the waiting period they have completed prior to the date of implementation. This payment will be lump sum in nature (Not added to base pay and paid at the one-year anniversary of the date of implementation of the demonstration project.) Employees added to MRDC by actions such as Transfer of Function, Base Realignment and Closure (BRAC), etc. after initial implementation, will be awarded that portion of the waiting period they have completed at the time they convert into the demonstration project. Such lump sum payment will be made upon conversion, but not earlier than one year after project implementation. Rules governing within-grade increases under the current Army performance plan will be in effect until the implementation date. Employees at step 10, or receiving retained rates, on the date of implementation will not be eligible for a prorated lump sum buyout of the WGI since they are already at or above the top of the scale.
6. Interns will be appraised in accordance with the pay-for-performance management system. At the six month point of the initial rating cycle of internship, in conjunction with the inprocess appraisal review, interns will be given a special performance appraisal to determine their eligibility for a pay adjustment and/or promotion in accordance with their Intern Plan, regulatory, and qualification requirements.

6-2. Conversion or Movement from a Project Position to a General Schedule Position.

1. Policy. If a demonstration project employee is moving to a General Schedule (GS) position not under the demonstration project, or if the project ends and each project employee must be converted back to the GS system, the following procedures will be used to convert the employee's project payband to a GS-equivalent grade and the employee's project rate of pay to GS equivalent rate of pay. The converted GS grade and GS rate of pay must be determined before movement or conversion out of the demonstration project and any accompanying geographic movement, promotion, or other simultaneous action. For conversions upon termination of the project and for lateral reassignments, the converted GS grade and rate will become the employee's actual GS grade and rate after leaving the demonstration project (before any other action). For transfers, promotions, and other actions, the converted GS grade and rate will be used in applying any GS pay administration rules applicable in connection with the employee's movement out of the project (e.g., promotion rules, highest previous rate rules, pay retention rules), as if the GS converted grade and rate were actually in effect immediately before the employee left the demonstration project.
2. Grade-Setting Provisions. An employee in a payband corresponding to a single GS grade is converted to that grade. An employee in a payband corresponding to two or more grades is converted to one of those grades according to the following rules:
   1. The employee's adjusted rate of basic pay under the demonstration project (including any locality payment) is compared with the step 4 rate in the highest applicable GS rate range. (For this purpose, a "GS rate range" includes a rate in (1) the GS base schedule, (2) the locality rate schedule for the locality pay area in which the position is located, or (3) the appropriate special rate schedule for the employee's occupational series, as applicable.) If the series is a two-grade interval series, only odd-numbered grades are considered below a GS-11.
   2. If the employee's adjusted project rate equals or exceeds the applicable step 4 rate of the highest GS grade in the band, the employee is converted to that grade.

   3. If the employee's adjusted project rate is lower than the applicable step 4 rate of the highest grade, the adjusted rate is compared with the step 4 rate of the second highest grade in the employee's payband. If the employee's adjusted rate equals or exceeds step 4 rate of the second highest grade, the employee is converted to that grade.

   4. This process is repeated for each successively lower grade in the band until a grade is found in which the employee's adjusted project rate equals or exceeds the applicable step 4 rate of the grade. The employee is then converted at that grade. If the employee's adjusted rate is below the step 4 rate of the lowest grade in the band, the employee is converted to the lowest grade.

   5. Exception: If the employee's adjusted project rate exceeds the maximum rate of the grade assigned under the above-described "step 4" rule but fits in the rate range for the next higher applicable grade (i.e., between step 1 and step 4), then the employee shall be converted to that next higher applicable grade.

   6. Exception: An employee will not be converted to a lower grade than the grade held by the employee immediately preceding a conversion, lateral reassignment, or lateral transfer into the project, unless since that time the employee has undergone a reduction in band.

3. Pay-Setting Provisions. An employee's pay within the converted GS grade is set by converting the employee's demonstration project rate of pay to GS rate of pay in accordance with the following rules:
   1. The pay conversion is done before any geographic movement or other pay-related action that coincides with the employee's movement or conversion out of the demonstration project.
   2. An employee's adjusted rate of basic pay under the project (including any locality payment) is converted to a GS adjusted rate on the highest applicable rate range for the converted GS grade. (For this purpose, a "GS rate range" includes a rate range in (1) the GS base schedule, (2) an applicable locality rate schedule, or (3) an applicable special rate schedule.)
   3. If the highest applicable GS rate range is a locality pay rate range, the employee's adjusted project rate is converted to a GS locality rate of pay. If this rate falls between two steps in the locality-adjusted schedule, the rate must be set at the higher step. The converted GS unadjusted rate of basic pay would be the GS base rate corresponding to the converted GS locality rate (i.e., same step position). (If this employee is also covered by a special rate schedule as a GS employee, the converted special rate will be determined based on the GS step position. This underlying special rate will be basic pay for certain purposes for which the employee's higher locality rate is not basic pay.)
   4. If the highest applicable GS rate range is a special rate range, the employee's adjusted project rate is converted to a special rate. If this rate falls between two steps in the special rate schedule, the rate must be set at the higher step. The converted GS unadjusted rate of basic pay will be the GS rate corresponding to the converted special rate (i.e., same step position).
4. E&S Payband V Employees. An employee in Payband V of the E&S occupational family will convert out of the demonstration project at the GS-15 level. A procedure will be developed to ensure that employees entering Payband V understand that if they leave the demonstration project and their adjusted pay exceeds GS-15, step 10 rate, there is no entitlement to retained pay; their GS-equivalent rate will be deemed to be the rate for GS-15, step 10. For those Payband V employees paid below the adjusted GS-15, step 10 rate, the converted rates will be set in accordance with pay-setting provisions above.
5. Employees with Band or Pay Retention.
   1. If an employee is retaining a band level under the demonstration project, apply the procedures in paragraphs b. and c. above, using the grades encompassed in the employee's retained band to determine the employee's GS-equivalent retained grade and pay rate. The time in a retained band under the demonstration project counts toward the 2-year limit on grade retention.
   2. If an employee is receiving a retained rate under the demonstration project, the employee's GS-equivalent grade is the highest grade encompassed in his or her band level.
6. Within-Grade Increase - Equivalent Increase Determinations. Service under the demonstration project is creditable for within-grade increase purposes upon conversion back to the GS pay system. Performance pay increases (including a zero increase) under the demonstration project are equivalent increases for the purpose of determining the beginning of a within-grade increase waiting period.