When an employee’s highest previous rate (HPR) was earned as a Federal Wage System (FWS) employee, the employee is entitled to receive HPR based on:
The employee’s actual earned rate, or
An adjustment process. Use the following adjustment process to calculate HPR:
Get the current FWS wage schedule for the kind of FWS position (WG, WL, or WS) in which the employee earned his/her HPR. That FWS wage schedule must be for the wage area in which the employee is now being placed.
On that current FWS wage schedule, find the grade and step in which the employee earned his/her HPR. The rate for that step is the employee’s HPR.
Example: An employee is being reinstated as a WG-8 in San Antonio, Texas. The employee’s HPR is $9.45, earned as a WG-10, step 2. The FWS wage schedule that applies is the current WG wage schedule for San Antonio, Texas. The employee’s earned HPR is as a WG-10, step 2. The rate for WG-10, step 2, on the current WG wage schedule for San Antonio, Texas, is $10.05. This becomes the employee’s HPR. Using the employee's HPR to set pay, $10.05 falls between WG-8, step 4, $9.97, and step 5, $10.35. The higher step is used and pay is set at WG-8, step 5, $10.35.
Contact your Servicing Personnel Office (SPO) for complete guidance on HPR for employees in the FWS system.
GS Highest Previous Rate for WG Positions
To calculate a GS employee’s HPR to be used in pay setting in an FWS position, follow the process below:
Get the current GS pay schedule and find the employee’s highest GS grade and step rate. Convert that rate to an hourly rate by dividing the annual rate by 2087, the number of work hours in a year. This is the employee’s HPR.
Get the current FWS schedule for the kind of FWS position (WG, WL, WS) and the grade the employee is being placed in. Find the HPR identified in step 1, in the grade the employee is being placed in. If the HPR falls between two rates of the FWS grade, the higher rate may be paid.
Maximum Rate Under HPR for FWS
Pay is set at step 5 of the grade if HPR exceeds that rate, unless the HPR employee is entitled to pay retention. Contact your SPO for additional information.
FWS Voluntary Demotions
In the FWS, a voluntary demotion is an action in which an employee moves, while continuously employed:
From a higher grade to a lower grade in the same wage schedule (such as from WG-4 to WG-3), or
From a grade with a higher representative rate to a grade with a lower representative rate in a different wage schedule (WG, WL, or WS).
In order for a demotion to be considered voluntary, the employee must:
Request the demotion for personal convenience or benefit and the action cannot be influenced by management decisions, or
Be returned to a lower graded position following a temporary promotion.
Determining Whether a Change Between FWS Schedules is a Demotion
Representative rates are used to decide whether a change between wage schedules is a demotion. The representative rate is step 2 of each grade in WG, WL, and WS wage schedules. The representative rate is used to compare the rates under these three wage schedules.
When an employee requests a voluntary demotion, an employee’s pay can be set using the HPR or using another formula depending on the circumstances surrounding the voluntary demotion.
Voluntary Demotions
When an employee accepts a voluntary demotion in order to move to a position with greater promotion potential than his/her current position, pay is set using HPR.
Note: A demotion taken to enter a Career Enhancement program or other formal career development program is not considered a voluntary demotion.
When an employee requests and accepts a voluntary demotion, with prospects of repromotion to the higher grade, for reasons other than to move into a position with greater promotion potential, a rate of pay in the lower grade is selected, which upon repromotion to the higher grade will place the employee in the rate which would have been attained had the employee remained in grade.
Exception: Management officials with authority to hire, promote, and evaluate employees (typically the first-level supervisor) have full authority to determine when voluntary demotions are in the “best interests of the program” and whether HPR should or should not be granted. Management officials will inform the SPO, in writing, of their decisions and the reason(s) for granting or not granting HPR.
Demotion for Cause (FWS)
A demotion for cause is a reduction in grade based on the conduct or unacceptable performance of an employee. An employee demoted for cause has pay set at step 1 of the grade. This rate will be used to determine any future entitlement to HPR.
