[Federal Register Volume 72, Number 50 (Thursday, March 15, 2007)]
[Rules and Regulations]
[Pages 12032-12037]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E7-4696]


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OFFICE OF PERSONNEL MANAGEMENT

5 CFR PARTS 317, 353, 550, and 551

RIN 3206-AL21


Employment in the Senior Executive Service, Restoration To Duty 
From Uniformed Service or Compensable Injury, Pay Administration 
(General), and Pay Administration Under the Fair Labor Standards Act; 
Miscellaneous Changes to Pay and Leave Rules

AGENCY: Office of Personnel Management.

ACTION: Final rule.

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SUMMARY: The Office of Personnel Management is issuing final 
regulations to amend a number of rules on pay and leave administration, 
including employment in the Senior Executive Service, use of paid leave 
during uniformed service, time limits for using compensatory time off 
earned in lieu of overtime pay, and other miscellaneous changes. The 
final regulations are being issued to standardize pay and leave 
policies in support of the consolidation of agency human resources and 
payroll systems.

DATES: The regulations are effective on May 14, 2007.

FOR FURTHER INFORMATION CONTACT: Sharon Dobson by telephone at (202) 
606-2858; by fax at (202) 606-0824; or by e-mail at <a href="/cdn-cgi/l/email-protection#a3d3c2da8ed3c6d1c5ccd1cec2cdc0c68ed3cccfcac0dae3ccd3ce8dc4ccd5"><span class="__cf_email__" data-cfemail="2e5e4f57035e4b5c48415c434f404d4b035e4142474d576e415e4300494158">[email protected]</span></a>.

SUPPLEMENTARY INFORMATION: On January 5, 2005, the Office of Personnel 
Management (OPM) issued a comprehensive package of proposed regulations 
on Restoration to Duty From Uniformed Service or Compensable Injury; 
Payrates and Systems (General); Pay Under the General Schedule; Pay 
Administration (General); Pay Administration Under the Fair Labor 
Standards Act; Recruitment and Relocation Bonuses; Retention 
Allowances; Supervisory Differentials; Hours of Duty; and Absence and 
Leave (70 FR 1068). The proposed regulations are available at http://www.opm.gov/fedregis. The 60-day comment period ended on March 7, 2005. 
We received a total of 93 comments on the proposed regulations.
    In these final regulations, we are addressing the revisions to 
rules concerning the retention of pay and benefits for a Senior 
Executive Service (SES) member who accepts a Presidential appointment, 
use of paid leave during uniformed service, time limits for using 
compensatory time off earned in lieu of overtime pay, and other 
miscellaneous rules. We have already published regulations for some of 
the subject areas included in the January 2005 proposed regulations in 
separate issuances in the Federal Register. Comments received on the 
proposed changes to the rules on Adjustments of Work Schedules for 
Religious Observances, Hours of Duty, and Absence and Leave will be 
addressed in subsequent issuances in the Federal Register.
    Except as otherwise stated in this supplementary information, the 
purpose of the revisions in these final regulations is to standardize 
pay and leave policies in support of the consolidation of agency human 
resources and payroll systems and in general to aid agencies in the 
administration of these programs. All revisions are being made to 
regulations in title 5, Code of Federal Regulations.

Regulations Already Issued

    Some of the changes included in the January 2005 proposed 
regulations have already been addressed in subsequent regulations 
issued by OPM on May 13, 2005, May 31, 2005, and August 17, 2006, as 
discussed below.
    The January 2005 regulations proposed to amend the definition of 
rate of basic pay in Sec. Sec.  575.103, 575.203, and 575.303 to 
clarify that night pay and environmental differential pay under the 
Federal Wage System are not included in the rate of basic pay for the 
purposes of recruitment, relocation, and retention incentives. The 
amended definition of rate of basic pay for the purpose of recruitment, 
relocation, and retention incentives was included in OPM's interim 
regulations issued on May 13, 2005, for recruitment, relocation, and 
retention incentives (70 FR 25732). The interim regulations are 
available at http://www.opm.gov/fedregis.
    The January 2005 regulations proposed to add a new Sec.  531.605 to 
define the requirements for determining an employee's official worksite 
for the purpose of identifying an employee's location-based pay 
entitlements, including locality rates and special

[[Page 12033]]

rates. The proposed regulations also addressed official worksite 
determinations for employees temporarily working at other locations and 
teleworking from an alternative worksite. The comments OPM received on 
proposed Sec.  531.605 were addressed and changes made as an interim 
rule on May 31, 2005 (70 FR 31278). The interim regulations are 
available at http://www.opm.gov/fedregis. Section 531.605 was again 
revised in interim regulations issued on August 17, 2006, to clarify 
the rules for determining an employee's official worksite when he or 
she teleworks from an alternative worksite during an emergency 
situation, such as a pandemic health crisis (71 FR 47692). The interim 
regulations are available on OPM's Web site at http://www.opm.gov/fedregis.
    Finally, the January 2005 regulations proposed to amend 5 CFR part 
630, subpart D, concerning the use of sick leave for family care or 
bereavement purposes. The regulations proposed, among other changes, 
removing the requirement that a full-time employee must maintain 80 
hours of sick leave in his or her sick leave account to use up to 104 
hours (13 workdays) of his or her sick leave for general family care or 
bereavement purposes and up to 480 hours (12 workweeks) of sick leave 
to care for a family member with a serious health condition. The 
comments OPM received on the proposed amendments to 5 CFR part 630, 
subpart D, were addressed and changes made as a final rule on August 
17, 2006 (71 FR 47693). The final regulations on sick leave are 
available at http://www.opm.gov/fedregis.

Final Regulations in This Issuance

    In this issuance, the final regulations address the changes made to 
the rules on employment in the Senior Executive Service, use of paid 
leave during uniformed service, time limits for using compensatory time 
off earned in lieu of overtime pay, and other miscellaneous changes. 
For these subject areas, we received 29 comments on the January 2005 
proposed regulations--20 from agencies, 6 from individuals, 2 from 
Federal labor unions, and 1 from a Federal employee association.

Senior Executive Service

    Under 5 U.S.C. 5307(d), a higher aggregate limitation on pay (equal 
to the total annual compensation payable to the Vice President under 3 
U.S.C. 104) applies to SES members in positions covered by a certified 
senior executive performance appraisal system. An agency questioned 
whether a former SES member may continue to retain the higher aggregate 
limitation on pay under the authority provided in 5 U.S.C. 3392(c) and 
Sec.  317.801(b) to retain SES pay and benefits when he or she accepts 
a Presidential appointment. In these final regulations, we have amended 
Sec.  317.801(b) to clarify that a former SES member who chooses to 
retain SES provisions related to basic pay, performance awards, 
awarding of ranks, severance pay, leave, and retirement may also choose 
to retain the higher aggregate limitation on pay that applied to the 
employee.

Paid Leave While Performing Uniformed Service

    OPM proposed to amend Sec.  353.208 to permit an employee, upon 
request, to use any accrued annual leave or military leave while 
performing service with the uniformed service, but not to use sick 
leave. An agency objected to the proposed change. The agency stated 
that the use of sick leave during a period of military service is a 
legitimate right of an employee under the provisions and intent of the 
Uniformed Services Employment and Reemployment Rights Act of 1994 
(USERRA), (Public Law 103-353, October 13, 1994). We agree and are not 
adopting the proposed amendment. Section 353.208 will continue to 
permit an employee performing service in the uniformed service to use 
sick leave, when appropriate.
    An agency recommended that OPM permit an employee to use 
compensatory time off earned in lieu of overtime pay and earned credit 
hours while performing uniformed service, since they both provide paid 
time off. We are not adopting this suggestion because employees are 
entitled to payment for unused compensatory time off and credit hours 
only in certain situations. We note that Sec.  550.114(f)(2)(i) and 
Sec.  551.531(f)(1) require agencies to provide payment for unused 
earned compensatory time off when an employee is separated or placed in 
a leave without pay status to perform uniformed service.
    We believe it would be appropriate to allow an employee to use 
earned compensatory time off for travel under 5 CFR part 550, subpart 
N, while performing uniformed service because an employee may not 
receive payment for unused earned compensatory time off for travel. 
(See 5 U.S.C. 5550b(b) and Sec.  550.1408.) We have revised Sec.  
353.208 to permit an employee to use earned compensatory time off for 
travel under 5 CFR part 550, subpart N, to perform uniformed service.
    Section 1106 of the National Defense Authorization Act for Fiscal 
Year 2000 (Public Law 106-65, October 5, 1999) amended 5 U.S.C. 
6323(a)(1) to permit an employee to use his or her entitlement to 15 
days of military leave for ``inactive duty training'' (as defined in 
section 101 of title 37, United States Code) in addition to active duty 
and active duty training. Consistent with this statutory amendment, we 
proposed to delete the last sentence of Sec.  353.208, which states an 
employee may not use military leave for inactive duty training. We did 
not receive any comments, and therefore, have deleted the last sentence 
in Sec.  353.208 in these final regulations.

Time Limits for Using Earned Compensatory Time Off

    The consolidation of human resources and payroll processing systems 
has revealed varying discretionary policies among agencies concerning 
time limits for using compensatory time off earned in lieu of overtime 
pay. These varying policies have resulted in increased costs for 
payroll providers to accommodate the myriad of agency policies within 
their systems and those increased costs are passed on to the agencies. 
As part of OPM's effort to support the consolidation of human resources 
and payroll processing systems, we proposed a standardized time limit 
of 26 pay periods for using compensatory time off earned in lieu of 
overtime pay that would be applied Governmentwide. The 26-pay period 
time limit would be applied to both employees not covered by the FLSA 
(FLS-exempt) under Sec.  550.114 and employees covered by the FLSA 
(FLSA-nonexempt) under Sec.  551.531. To assist in transitioning to the 
new time limitation, we proposed to provide an employee with unused 
compensatory time off to his or her credit on the effective date of the 
final regulations 26 pay periods after the effective date to use such 
compensatory time off.
    In Sec.  550.114(d), we proposed to provide agencies with 
discretionary authority to provide payment to FLSA-exempt employees 
for, or require forfeiture of, compensatory time off that is not used 
within the 26-pay period time limit. The proposed regulations at Sec.  
550.114(d)(2) allowed that if an FLSA-exempt employee is unable to take 
earned compensatory time off within 26 pay periods due to an exigency 
of the service beyond the employee's control, the agency must provide 
payment for the unused compensatory time off at the overtime rate in 
effect for the period during which the compensatory time off was 
earned. In addition, the proposed regulations at Sec.  550.114(e)(2) 
(Sec.  550.114(f)(2) in the final regulations) required that if an 
FLSA-exempt

[[Page 12034]]

employee separates or goes on extended leave without pay to perform 
service in one of the uniformed services or because of an on-the-job 
injury with entitlement to injury compensation under 5 U.S.C. chapter 
81, the agency must provide payment for the unused compensatory time 
off at the overtime rate in effect for the period during which the 
compensatory time off was earned.
    In addition, to ensure consistent treatment of affected employees, 
OPM proposed amending Sec.  551.531(d) to require an FLSA-nonexempt 
employee to use earned compensatory time off within 26 pay periods. An 
FLSA-nonexempt employee who fails to use earned compensatory time off 
earned within 26 pay periods or who separates or transfers from the 
agency before the earned compensatory time off is used, must be paid 
for the unused compensatory time off at the overtime rate in effect for 
the period during which the compensatory time off was earned. The 
proposed regulations at Sec.  551.531(e) (Sec.  551.531(f) in the final 
regulations) also required that, if an FLSA-nonexempt employee is 
placed on leave without pay to perform service in the uniformed 
services or because of an on-the-job injury with entitlement to injury 
compensation under 5 U.S.C. chapter 81, the agency must provide payment 
for the unused compensatory time off at the overtime rate in effect for 
the period during which the compensatory time off was earned.
    One agency recommended a shorter time limitation--e.g., 13 pay 
periods--for using compensatory time off earned in lieu of overtime 
pay. An individual opposed the limitation of 26 pay periods. The two 
labor organizations opposed providing agencies with discretionary 
authority to determine whether an FLSA-exempt employee must forfeit or 
receive payment for unused compensatory time off. One labor 
organization recommended expanding the circumstances in which an 
employee must receive payment for unused compensatory time off to 
include reduction in force (RIF) situations. The other labor 
organization believed FLSA-exempt employees should receive payment for 
compensatory time off not used within 26 pay periods or be given 
additional time to use the compensatory time off.
    We disagree with these recommendations. Unlike FLSA-nonexempt 
employees, who have a statutory entitlement to receive payment for 
unused compensatory time off, FLSA-exempt employees do not have any 
such statutory entitlement. Legislation is needed to provide FLSA-
exempt employees with an entitlement to receive payment for unused 
compensatory time off. In addition, requiring agencies to provide 
payment for unused compensatory time off to FLSA-exempt employees would 
significantly increase costs for Federal agencies. Finally, we believe 
26 pay periods is sufficient time for most employees to use their 
earned compensatory time off. We note that Sec.  550.114(d)(2) requires 
agencies to provide payment for compensatory time off if an employee's 
failure to use his or her earned compensatory time off is due to an 
exigency of the service beyond the employee's control.
    An agency was concerned that a ``rolling'' 26-pay period time limit 
would be an administrative burden for agencies to track. Another agency 
suggested using a fixed yearly date for employees to use earned 
compensatory time off because it would provide for easier tracking and 
monitoring. We are not adopting these suggestions. We believe most 
agencies already impose on employees a ``rolling'' time limit for using 
earned compensatory time off. Therefore, the proposed regulations would 
not impose an additional administrative burden on the agencies. A fixed 
yearly date for using earned compensatory time off would result in 
providing varying lengths of time for individual employees to use 
earned compensatory time off, depending on when the employee earned the 
compensatory time off. We believe imposing a time limit of 26 pay 
periods within which to use earned compensatory time off results in 
fair and equitable treatment of affected employees and supports our 
goal of standardizing pay policies. Employees will all have the same 
number of pay periods within which they must use their earned 
compensatory time off. We are adopting the revised regulations in Sec.  
550.114(d) and (f) and Sec.  551.531(f) as final.
    Two agencies disagreed with proposed Sec.  550.114(d), which would 
give an employee with unused compensatory time off to his or her credit 
as of the effective date of the final regulations 26 pay periods after 
the effective date of the final regulations to use the compensatory 
time off. One agency suggested providing agencies with discretionary 
authority to extend the time limitation for using earned compensatory 
time off for employees who have been unable to use earned compensatory 
time off prior to the effective date of the final regulations because 
of work requirements or scheduling conflicts. Another agency is 
concerned that the proposed rule would have major budgetary 
implications if the agency's policy were to provide payment for unused 
compensatory time off and employees are unable to use their earned 
compensatory time off within 26 pay periods after the effective date of 
the final regulations. The agency suggested that employees who have 
compensatory time off to their credit as of the effective date of the 
final regulations be given a minimum of 3 years to use the compensatory 
time off. We agree and have added a new paragraph (e) to Sec.  550.114 
and Sec.  551.531 of the final regulations to allow an employee who has 
compensatory time off to his or her credit as of the effective date of 
the final regulations at least 3 years to use the earned compensatory 
time off.
    One agency suggested revising the proposed regulations to require 
an employee to use earned compensatory time off within 26 pay periods 
after the pay period during which it was earned. The agency suggested 
beginning the 26-pay period time limit after the pay period during 
which it was earned will ensure standardized recordkeeping and 
tracking. We agree and have revised Sec.  550.114(d) and Sec.  
551.531(d) to require that compensatory time off that is not used 
within 26 pay periods after the pay period during which it was earned 
must be paid by the agency or forfeited by the employee.
    An agency noted that proposed Sec.  550.114(e)(1) addresses the 
treatment of compensatory time off when an employee either transfers or 
separates from an agency, while Sec.  551.531(d) addresses the 
treatment of compensatory time off only when an employee separates from 
an agency. To remedy this, we have revised Sec.  551.531(d) to address 
the treatment of compensatory time off when an employee transfers to a 
different agency.
    Finally, we are redesignating Sec.  551.531(e) as Sec.  551.531(g), 
and correcting new paragraph (g) by deleting language that states the 
value of compensatory time off for FLSA-nonexempt employees is 
considered in applying pay limitations. Compensatory time off for FLSA-
nonexempt employees should not be considered in applying the biweekly 
or annual premium pay limitations established under 5 U.S.C. 5547 or 
the aggregate limitation on pay established under 5 U.S.C. 5307. In 
addition, we are correcting a citation in Sec. Sec.  550.112(j)(1) and 
551.422(d) from ``(41 CFR 301-1.3(c)(4))'' to ``(41 CFR 300-3.1),'' 
which references the definition of official station in the General 
Services Administration's Federal Travel Regulations.

[[Page 12035]]

    An individual requested clarification of the terms irregular or 
occasional overtime work in relationship to earning compensatory time 
off. As defined in Sec.  550.103, irregular or occasional overtime work 
means overtime work that is not part of an employee's regularly 
scheduled administrative workweek (i.e., the period within an 
administrative workweek in which an employee is regularly scheduled to 
work).

Other Miscellaneous Changes

Lump-Sum Payments for Annual Leave

    The regulations governing lump-sum payments for accumulated and 
accrued annual leave for employees who separate from Federal service in 
5 CFR 550, subpart L, have been revised to ensure consistency with the 
guidance provided in the OPM Operating Manual on the Federal Wage 
System. The revised regulations ensure that a lump-sum payment for 
employees who work a regular rotating schedule involving work on both 
day and night shifts is calculated as if the employee had continued to 
work beyond the effective date of separation. An agency asked that we 
clarify what is meant by ``work beyond the effective date of 
separation.'' Another agency requested clarification in determining 
whether a lump-sum payment should be extended to the end of an 
employee's last scheduled shift. Under 5 U.S.C. 5551, a lump-sum 
payment must equal the pay an employee would have received had he or 
she remained in Federal service until expiration of the period of 
annual leave. Agencies must project a lump-sum period to include any 
accumulated and accrued annual leave to the employee's credit, as of 
the date of separation. The lump-sum leave period is the employee's 
annual leave projected forward for all workdays the employee would have 
worked if he or she had remained in Federal service, including holidays 
(even though they are typically nonworkdays) as required by 5 U.S.C. 
5551(a), until the expiration of the employee's accumulated and accrued 
annual leave. The final regulations in Sec.  550.1205(b)(5) state that 
a night differential is payable for that portion of the lump-sum period 
that would have occurred when the employee was scheduled to work night 
shifts. The lump-sum period extends only through the last hour of 
annual leave.

Restriction on Paying Sunday Premium Pay

    Section 636 of the Treasury and General Government Appropriations 
Act, 1998 (Public Law 105-61, October 10, 1997), permanently restricted 
the payment of Sunday premium pay for all employees Governmentwide who 
are paid from appropriated funds and who do not actually perform work 
on Sunday. Section 624 of the Treasury and General Government 
Appropriations Act, 1999 (Public Law 105-277, October 21, 1998), 
expanded the permanent restriction on the payment of Sunday premium pay 
to cover employees who are paid from any Act (including payments from 
revolving funds). These provisions effectively prohibit the payment of 
Sunday premium pay to employees during any period when no work is 
performed. This includes holidays, periods of paid leave, excused 
absence (administrative leave), compensatory time off, credit hours, or 
time off as an incentive or performance award. The restriction covers 
employees who are paid from any Act, including payments from revolving 
funds. Consistent with this permanent legal restriction, we have 
revised Sec.  550.171(a) by deleting language stating that Sunday 
premium pay is paid during periods of paid leave or excused absence. We 
also will revise our guidance on payment of Sunday premium pay during 
periods of paid leave in the OPM Operating Manual for the Federal Wage 
System.

E.O. 12866, Regulatory Review

    This rule has been reviewed by the Office of Management and Budget 
in accordance with E.O. 12866.

Regulatory Flexibility Act

    I certify that these regulations would not have a significant 
economic impact on a substantial number of small entities because they 
would apply only to Federal agencies and employees.

List of Subjects in 5 CFR Parts 317, 353, 550, and 551

    Administrative practice and procedure, Claims, Government 
employees, Law enforcement officers, Reporting and recordkeeping 
requirements, Wages.

Office of Personnel Management.
Linda M. Springer,
Director.

0
Accordingly, OPM amends parts 317, 353, 550, and 551 of title 5 of the 
Code of Federal Regulations to read as follows:

PART 317--EMPLOYMENT IN THE SENIOR EXECUTIVE SERVICE

0
1. The authority citation for part 317 continues to read as follows:

    Authority: 5 U.S.C. 3392, 3393, 3395, 3397, 3592, 3593, 3595, 
3596, 8414, and 8421.

Subpart H--Retention of SES Provisions

0
2. In Sec.  317.801, paragraph (b)(1) is revised to read as follows:
* * * * *
    (b) Election. (1) At the time of appointment, an appointee covered 
by paragraph (a) of this section may elect to retain some, all, or none 
of the following SES provisions related to basic pay (including the 
aggregate limitation on pay established by 5 U.S.C. 5307), performance 
awards, awarding of ranks, severance pay, leave, and retirement. That 
election will remain in effect for no less than 1 year, unless the 
appointee leaves the position sooner.
* * * * *

PART 353--RESTORATION TO DUTY FROM UNIFORMED SERVICE OR COMPENSABLE 
INJURY

0
3. The authority citation for part 353 continues to read as follows:

    Authority: 38 U.S.C. 4301 et. seq., and 5 U.S.C. 8151

Subpart B--Uniformed Service

0
4. Section 353.208 is revised to read as follows:


Sec.  353.208  Use of paid leave during uniformed service.

    An employee performing service with the uniformed services must be 
permitted, upon request, to use any accrued annual leave under 5 U.S.C. 
6304, military leave under 5 U.S.C. 6323, or earned compensatory time 
off for travel under 5 U.S.C. 5550b during such service.

PART 550--PAY ADMINISTRATION (GENERAL)

Subpart A--Premium Pay

0
5. The authority citation for subpart A continues to read as follows:

    Authority: 5 U.S.C. 5304 note, 5305 note, 5504(d), 5541(2)(iv), 
5545a(h)(2)(B) and (i), 5547(b) and (c), 5548, and 6101(c); sections 
407 and 2316, Pub. L. 105-277, 112 Stat. 2681-101 and 2681-828 (5 
U.S.C. 5545a); E.O. 12748, 3 CFR, 1992 Comp., p. 316.


Sec.  550.112  [Amended]

0
6. In Sec.  550.112(j)(1), remove the citation ``(41 CFR 301-
1.3(c)(4))'' and add in its place ``(41 CFR 300-3.1).''

0
7. In Sec.  550.114, paragraph (d) is revised, paragraph (e) is 
redesignated as paragraph (g), and new paragraphs (e) and (f) are added 
to read as follows:

[[Page 12036]]

Sec.  550.114  Compensatory time off.

* * * * *
    (d) Except as provided in paragraph (f)(2) of this section, an 
employee must use accrued compensatory time off to which he or she is 
entitled under paragraph (a) or (b) of this section by the end of the 
26th pay period after the pay period during which it was earned. The 
head of an agency, at his or her sole and exclusive discretion, may 
provide that an employee who fails to take compensatory time off to 
which he or she is entitled within 26 pay periods after the pay period 
during which it was earned must--
    (1) Receive payment for such unused compensatory time off at the 
dollar value prescribed in paragraph (g) of this section; or
    (2) Forfeit the unused compensatory time off, unless the failure to 
take the compensatory time off is due to an exigency of the service 
beyond the employee's control, in which case the agency head must 
provide payment for the unused compensatory time off at the dollar 
value prescribed in paragraph (g) of this section.
    (e) Except as provided in paragraph (f)(2) of this section, 
compensatory time off to an employee's credit as of May 14, 2007 must 
be used by the end of the pay period ending 3 years after May 14, 2007. 
The head of an agency, at his or her sole and exclusive discretion, may 
provide that an employee who fails to take compensatory time off to 
which he or she is entitled by the end of the pay period ending 3 years 
after May 14, 2007 must--
    (1) Receive payment for such unused compensatory time off at the 
dollar value prescribed in paragraph (g) of this section; or
    (2) Forfeit the unused compensatory time off, unless the failure to 
take the compensatory time off is due to an exigency of the service 
beyond the employee's control, in which case the agency head must 
provide payment for the unused compensatory time off at the dollar 
value prescribed in paragraph (g) of this section.
    (f)(1) Except as provided in paragraph (f)(2) of this section, an 
employee with unused compensatory time off under paragraph (a) or (b) 
of this section who transfers to another agency or separates from 
Federal service before the expiration of the time limit established 
under paragraphs (d) or (e) of this section may receive overtime pay or 
forfeit the unused compensatory time off, consistent with the employing 
agency's policy established under paragraphs (d) and (e) of this 
section.
    (2) If an employee with unused compensatory time off under 
paragraph (a) or (b) of this section separates from Federal service or 
is placed in a leave without pay status under the following 
circumstances, the employee must be paid for unused compensatory time 
off at the dollar value prescribed in paragraph (g) of this section:
    (i) The employee separates or is placed in a leave without pay 
status to perform service in the uniformed services (as defined in 38 
U.S.C. 4303 and Sec.  353.102); or
    (ii) The employee separates or is placed in a leave without pay 
status because of an on-the-job injury with entitlement to injury 
compensation under 5 U.S.C. chapter 81.
* * * * *

0
8. In Sec.  550.171, paragraph (a) is revised to read as follows:


Sec.  550.171  Authorization of pay for Sunday work.

    (a) A full-time employee is entitled to pay at his or her rate of 
basic pay plus premium pay at a rate equal to 25 percent of his or her 
rate of basic pay for each hour of Sunday work (as defined in Sec.  
550.103).
* * * * *

Subpart L--Lump-Sum Payment for Accumulated and Accrued Annual 
Leave

0
9. The authority citation for subpart L continues to read as follows:

    Authority: 5 U.S.C. 5553, 6306, and 6311.


0
10. In Sec.  550.1205, revise paragraph (b)(5)(i) and paragraph (g) to 
read as follows:


Sec.  550.1205.  Calculating a lump-sum payment.

* * * * *
    (b) * * *
    (5) * * *
    (i) Night differential under 5 U.S.C. 5343(f) at the applicable 
percentage rate received by a prevailing rate employee for all 
regularly scheduled periods of night shift duty covered by the unused 
annual leave as if the employee had continued to work beyond the 
effective date of separation, death, or transfer. In the case of an 
employee who is assigned to a regular rotating schedule involving work 
on both day and night shifts, the night differential is payable for 
that portion of the lump-sum period that would have occurred when the 
employee was scheduled to work night shifts.
* * * * *
    (g) For a reemployed annuitant who becomes eligible for a lump-sum 
payment under Sec.  550.1203, the agency must compute the lump-sum 
payment using the annuitant's pay before any reductions required under 
Sec.  837.303 of this chapter.
* * * * *

PART 551--PAY ADMINISTRATION UNDER THE FAIR LABOR STANDARDS ACT

0
11. The authority citation for part 551 continues to read as follows:

    Authority: 5 U.S.C. 5542(c); Sec. 4(f) of the Fair Labor 
Standards Act of 1938, as amended by Pub. L. 93-259, 88 Stat. 55 (29 
U.S.C. 204f).

Subpart D--Hours of Work


Sec.  551.422  [Amended]

0
12. In Sec.  551.422(d), remove the citation ``(41 CFR 301-1.3(c)(4))'' 
and add in its place ``(41 CFR 300-3.1).''

Subpart E--Overtime Pay Provisions

0
13. In Sec.  551.531, paragraph (d) is revised, paragraph (e) is 
revised and redesignated as paragraph (g), and new paragraphs (e) and 
(f) are added to read as follows:


Sec.  551.531  Compensatory time off.

* * * * *
    (d) If compensatory time off earned under paragraph (a) or (b) of 
this section is not taken within 26 pay periods after the pay period 
during which it was earned or if the employee transfers or separates 
from an agency before using the compensatory time, the employee must be 
paid for overtime work at the dollar value prescribed in paragraph (g) 
of this section.
    (e) Compensatory time off to an employee's credit as of May 14, 
2007 must be used by the end of the pay period ending 3 years after May 
14, 2007. If the earned compensatory time off is not taken by the end 
of the pay period ending 3 years after May 14, 2007, the employee must 
be paid for overtime work at the dollar value prescribed in paragraph 
(g) of this section.
    (f) If an employee with unused compensatory time off under 
paragraphs (a), (b), or (e) of this section separates from Federal 
service or is placed in a leave without pay status under the following 
circumstances, the employee must be paid for overtime work at the 
overtime rate at the dollar value prescribed in paragraph (g) of this 
section:
    (1) The employee is separated or placed in a leave without pay 
status to perform service in the uniformed services (as defined in 38 
U.S.C. 4303 and Sec.  353.102); or

[[Page 12037]]

    (2) The employee is separated or placed in a leave without pay 
status because of an on-the-job injury with entitlement to injury 
compensation under 5 U.S.C. chapter 81.
    (g) The dollar value of compensatory time off when it is liquidated 
is the amount of overtime pay the employee otherwise would have 
received for hours of the pay period during which compensatory time off 
was earned by performing overtime work.
* * * * *
[FR Doc. E7-4696 Filed 3-14-07; 8:45 am]
BILLING CODE 6325-39-P


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