5 U.S.C. § 5334 — Rate on change of position or type of appointment; regulations

**(a)** The rate of basic pay to which an employee is entitled is governed by regulations prescribed by the Office of Personnel Management in conformity with this subchapter and chapter 51 of this title when— (1) he is transferred from a position in the legislative, judicial, or executive branch to which this subchapter does not apply; (2) he is transferred from a position in the legislative, judicial, or executive branch to which this subchapter applies to another such position; (3) he is demoted to a position in a lower grade; (4) he is reinstated, reappointed, or reemployed in a position to which this subchapter applies following service in any position in the legislative, judicial, or executive branch; (5) his type of appointment is changed; (6) his employment status is otherwise changed; or (7) his position is changed from one grade to another grade. For the purpose of this subsection, an individual employed by the Appalachian Regional Commission under [section 14306(a)(2) of title 40](https://uscode.house.gov/view.xhtml?req=granuleid:USC-prelim-title40-section14306/a/2&num=0&edition=prelim), who was a Federal employee immediately prior to such employment by a commission and within 6 months after separation from such employment is employed in a position to which this subchapter applies, shall be treated as if transferred from a position in the executive branch to which this subchapter does not apply. **(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 subchapter VI of this chapter 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 subchapter VI of this chapter were not applicable to him; or (B) his existing rate of basic pay, if that rate is the higher. If an employee’s rate after promotion or transfer is greater than the maximum rate of basic pay for the employee’s grade, that rate shall be treated as a retained rate under section 5363. The Office of Personnel Management shall prescribe by regulation the circumstances under which and the extent to which special rates under section 5305 (or similar provision of law) or locality-adjusted rates under section 5304 (or similar provision of law) are considered to be basic pay in applying this subsection. **(c)** An employee in the legislative branch who is paid by the Secretary of the Senate or the Chief Administrative Officer of the House of Representatives, and who has completed two or more years of service as such an employee, and a Member of the Senate or House of Representatives who has completed two or more years of service as such a Member, may, on appointment to a position to which this subchapter applies, have his initial rate of pay fixed— (1) at the minimum rate of the appropriate grade; or (2) at a step of the appropriate grade that does not exceed the highest previous rate of pay received by him during that service in the legislative branch. **(d)** The rate of pay established for a teaching position as defined by [section 901 of title 20](https://uscode.house.gov/view.xhtml?req=granuleid:USC-prelim-title20-section901&num=0&edition=prelim) held by an individual who becomes subject to subsection (a) of this section is deemed increased by an amount determined under regulations which the Secretary of Defense shall prescribe for the determination of the yearly rate of pay of the position. The amount by which a rate of pay is increased under the regulations may not exceed the amount equal to 20 percent of that rate of pay. **(e)** An employee of a county committee established pursuant to section 8(b) of the Soil Conservation and Domestic Allotment Act ([16 U.S.C. 590h(b)](https://uscode.house.gov/view.xhtml?req=granuleid:USC-prelim-title16-section590h/b&num=0&edition=prelim)) may, on appointment to a position subject to this subchapter, have the initial rate of basic pay of the employee fixed at— (1) the lowest rate of the higher grade that exceeds the rate of basic pay of the employee with the county committee by not less than 2 step-increases of the grade from which the employee was promoted, if the Federal Civil Service position under this subchapter is at a higher grade than the last grade the employee had while an employee of the county committee; (2) the same step of the grade as the employee last held during service with the county committee, if the Federal Civil Service position under this subchapter is at the same grade as the last grade the employee had while an employee of the county committee; or (3) the lowest step of the Federal grade for which the rate of basic pay is equal to or greater than the highest previous rate of pay of the employee, if the Federal Civil Service position under this subchapter is at a lower grade than the last grade the employee had while an employee of the county committee. **(f)** (1) An employee of a nonappropriated fund instrumentality of the Department of Defense or the Coast Guard described in section 2105(c) who moves, without a break in service of more than 3 days, to a position in the Department of Defense or the Coast Guard, respectively, that is subject to this subchapter, may have such employee’s initial rate of basic pay fixed at the minimum rate of the appropriate grade or at any step of such grade that does not exceed— (A) if the highest previous rate of basic pay received by that employee during the employee’s service described in section 2105(c) is equal to a rate of the appropriate grade, such rate of the appropriate grade; (B) if the employee’s highest previous rate of basic pay (as described in subparagraph (A)) is between two rates of the appropriate grade, the higher of those two rates; or (C) if the employee’s highest previous rate of basic pay (as described in subparagraph (A)) exceeds the maximum rate of the appropriate grade, the maximum rate of the appropriate grade. (2) In the case of a nonappropriated fund employee who is moved involuntarily from such nonappropriated fund instrumentality without a break in service of more than 3 days and without substantial change in duties to a position that is subject to this subchapter, the employee’s pay shall be set at a rate (not above the maximum for the grade, except as may be provided for under section 5365) that is not less than the employee’s rate of basic pay under the nonappropriated fund instrumentality immediately prior to so moving. **(g)** In the case of an employee who— (1) moves to a new official duty station, and (2) by virtue of such move, becomes subject to a different pay schedule, any rate adjustment under the preceding provisions of this section, with respect to such employee in connection with such move, shall be made— (A) first, by determining the rate of pay to which such employee would be entitled at the new official duty station based on such employee’s position, grade, and step (or relative position in the rate range) before the move, and (B) then, by applying the provisions of this section that would otherwise apply (if any), treating the rate determined under subparagraph (A) as if it were the rate last received by the employee before the rate adjustment.