SEC. 2. DEFINITIONS. 
In this Act: 
(1) DIRECTOR.—The term ‘‘Director’’ means 
the Director of the Federal Housing Finance Agen-
cy. 
(2) EMPLOYEE.—The term ‘‘employee’’ means 
an employee of an enterprise, except that such term 
does not include any employee who would be defined 
as a prevailing rate employee (as defined in section 
5342(2) of title 5, United States Code) if such em-
ployee were employed by an agency (as defined in 
paragraph (1) of such section). 
(3) 
ENTERPRISE.—The 
term 
‘‘enterprise’’ 
means— 
(A) the Federal National Mortgage Asso-
ciation and any affiliate thereof; and 
(B) the Federal Home Loan Mortgage 
Corporation and any affiliate thereof. 
(4) EXECUTIVE OFFICER.—The term ‘‘executive 
officer’’ has the same meaning as is given such term 
in section 1303(12) of the Federal Housing Enter-
prises Financial Safety and Soundness Act of 1992 
(12 U.S.C. 4502(12)). 
SEC. 3. REASONABLE PAY FOR EXECUTIVE OFFICERS. 
(a) SUSPENSION
OF
CURRENT
COMPENSATION 
PACKAGES.—The Director shall suspend the compensa-
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tion packages approved for 2015 for the executive officers 
of an enterprise and, in lieu of such packages, subject to 
the limitation under subsection (c), establish a compensa-
tion system for the executive officers of such enterprise 
in accordance with the schedules of compensation and ben-
efits established and adjusted pursuant to section 1206 
of the Financial Institutions Reform, Recovery, and En-
forcement Act of 1989 (12 U.S.C. 1833b). 
(b) ADDITIONAL REQUIREMENT.—An executive offi-
cer of an enterprise shall be subject to section 111 of the 
Emergency Economic Stabilization Act of 2008 (12 
U.S.C. 5221), which relates to executive compensation and 
corporate governance. 
(c) LIMITATION ON COMPENSATION.—An executive 
officer of an enterprise whose compensation package is 
suspended under subsection (a) shall not be compensated 
more than the highest compensated employee of the Fed-
eral Housing Finance Agency. 
SEC. 4. COMPENSATION RATE OF EMPLOYEES OF FANNIE 
MAE AND FREDDIE MAC. 
(a) IN GENERAL.—During any period that an enter-
prise is federally chartered under the Federal National 
Mortgage Association Charter Act (12 U.S.C. 1716 et 
seq.) or the Federal Home Loan Mortgage Corporation 
Act (12 U.S.C. 1451 et seq.), the compensation of the po-
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sitions held by employees shall be in accordance with this 
section. 
(b) CONVERSION OF COMPENSATION RATE FOR CUR-
RENT EMPLOYEES.— 
(1) IN GENERAL.—Except for as provided in 
section 3, effective for pay periods beginning after 
the date of the enactment of this Act, the Director 
shall fix the rate of basic compensation of positions 
held by employees performing services for an enter-
prise as of the date of the enactment of this Act in 
accordance with the General Schedule set forth in 
section 5332 of title 5, United States Code. In fixing 
such rate— 
(A) if the employee is receiving a rate of 
basic compensation that is less than the min-
imum rate of basic compensation of the appro-
priate grade of the General Schedule in which 
his or her position is placed, such employee’s 
rate of basic compensation shall be increased to 
such minimum rate; 
(B) if the employee is receiving a rate of 
basic compensation that is equal to a rate of 
basic compensation of the appropriate grade of 
the General Schedule in which his or her posi-
tion is placed, such employee’s rate of basic 
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compensation shall be equal to that rate of 
basic compensation of the appropriate grade of 
the General Schedule; 
(C) if the employee is receiving a rate of 
basic compensation that is between 2 rates of 
basic compensation of the appropriate grade of 
the General Schedule in which his or her posi-
tion is placed, such employee’s rate of basic 
compensation shall be at the higher of those 2 
rates under the General Schedule; and 
(D) if the employee is receiving a rate of 
basic compensation that is in excess of the max-
imum rate of basic compensation of the appro-
priate grade of the General Schedule in which 
his or her position is placed, such employee’s 
rate of basic compensation shall be reduced to 
such maximum rate. 
(2) NOT
CONSIDERED
TRANSFERS
OR
PRO-
MOTIONS.—The conversion of positions and employ-
ees to the appropriate grades of the General Sched-
ule and the initial adjustment of rates of basic com-
pensation of those positions and employees provided 
for by this subsection, shall not be considered to be 
transfers or promotions within the meaning of sec-
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tion 5334(b) of title 5, United States Code, and the 
regulations issued thereunder. 
(3) CREDIT FOR INCREASE IN COMPENSATION 
BEFORE ADJUSTMENT.—Each employee performing 
services for an enterprise on the date of the enact-
ment of this Act whose position is converted under 
this subsection to the General Schedule and who 
prior to the initial adjustment of his or her rate of 
basic compensation under paragraph (1) has earned, 
but has not been credited with, an increase in that 
rate, shall be granted credit for such increase before 
his or her rate of basic compensation is initially ad-
justed under such paragraph. 
(4) SERVICE
PERFORMED
SINCE
LAST
COM-
PENSATION INCREASE.—Each employee performing 
services for an enterprise on the date of the enact-
ment of this Act whose position is converted under 
this subsection to the General Schedule shall be 
granted credit, for purposes of his or her first step 
increase under the General Schedule, for all satisfac-
tory service performed since his or her last increase 
in compensation prior to the initial adjustment of 
his or her rate of basic compensation under para-
graph (1). 
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(5) COMPENSATION
INCREASE
UNDER
THIS 
SECTION.—An increase in the rate of basic com-
pensation by reason of the enactment of paragraph 
(1) shall not be considered to be an equivalent in-
crease with respect to step increases for employees 
whose positions are converted to the General Sched-
ule under authority of this subsection. 
(c) NEW EMPLOYEES.—Except for as provided in 
section 3, the grade and rate of basic pay of any individual 
beginning employment with an enterprise after the date 
of enactment of this Act shall be fixed in accordance with 
the General Schedule set forth in section 5332 of title 5, 
United States Code. 
SEC. 5. FANNIE AND FREDDIE EMPLOYEES NOT FEDERAL 
EMPLOYEES. 
Any executive officer or employee affected by any pro-
vision under sections 3 and 4, respectively, shall not be 
considered a Federal employee. 
Æ 
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