---
kind: "section"
citation: "5 C.F.R. § 536.301"
title: "5"
number: "536.301"
heading: "Mandatory pay retention."
url: "https://uscodex.org/cfr/5/536.301"
---

# §536.301. Mandatory pay retention.

- (a) Subject to the requirements in [§ 536.102](/cfr/5/536.102.md) and this section, an agency must provide pay retention to an employee who moves between positions under a covered pay system or from a position not under a covered pay system to a position under a covered pay system and whose payable rate of basic pay otherwise would be reduced (after application of any applicable geographic conversion under [§ 536.303(a)](/cfr/5/536.303.md?p=a)) as a result of—
  - (1) The expiration of the 2-year period of grade retention under [subpart B](/cfr/5/subpartB.md) of this part;
  - (2) A reduction in force or reclassification action that places an employee in a lower-graded position when the employee does not meet the eligibility requirements for grade retention under subpart B of this part;
  - (3) A management action that places an employee in a non-special rate position or in a lower-paid special rate position from a special rate position;
  - (4) A management action that places an employee under a different pay schedule;
  - (5) A management action that places an employee in a formal employee development program generally utilized Governmentwide (e.g., Recent Graduates Program); or
  - (6) A reduction or elimination of scheduled rates, special schedules, or special rate schedules, excluding—
    - (i) A statutory reduction in scheduled rates of pay under the General Schedule, including a reduction authorized under [5 U.S.C. 5303(b)](/usc/5/5303.md?p=b); or
    - (ii) A statutory reduction in a prevailing rate schedule established under 5 U.S.C. chapter 53, subchapter IV, and [5 CFR part 532](/cfr/5/part532.md).
- (b) An agency must establish a retained rate when application of a promotion increase rule for General Schedule or prevailing rate employees results in a payable rate of basic pay that exceeds the maximum rate of the highest applicable rate range for the employee's new position. (See the promotion increase rules in 5 U.S.C. [5334(b)](/usc/5/5334.md?p=b) and [5](/usc/5/5.md) CFR 531.214 for GS employees and in [5 CFR 532.407](/cfr/5/532.407.md) for prevailing rate employees—in particular, the special provisions in these promotion increase rules on establishing a retained rate equal to an employee's existing rate when that existing rate exceeds the applicable range maximum.) Once established, such a retained rate is governed by the provisions of this subpart.
- (c) If an employee's official worksite changes in conjunction with an action that may entitle the employee to pay retention under [paragraph (a)](#a) of this section, the agency must apply the geographic conversion rule in [§ 536.303(a)](/cfr/5/536.303.md?p=a) before determining whether an employee's rate of basic pay otherwise would be reduced.
- (d) An employee is considered “placed” under paragraph [(a)(2)](#a-2), [(3)](#a-3), [(4)](#a-4), and [(5)](#a-5) of this section only when the employee remains in a position in the same agency. Optional pay retention under [§ 536.302](/cfr/5/536.302.md) may apply when an employee transfers to a different agency as a result of a reduction in force or reclassification action or is selected by a different agency to fill a position under a formal employee development program, if all other qualifying conditions are met.
- (e) Eligibility for pay retention under this section ceases under the conditions specified in [§ 536.308](/cfr/5/536.308.md).

## Notes

### Amendments

[70 FR 31310, May 31, 2005, as amended at 73 FR 66155, Nov. 7, 2008; 77 FR 28223, May 11, 2012]

### Source

Source: 70 FR 31310, May 31, 2005, unless otherwise noted.

### Authority

Authority: 5 U.S.C. 5361-5366; sec. 4 of the Performance Management and Recognition System Termination Act of 1993 (Pub. L. 103-89), 107 Stat. 981; § 536.301(b) also issued under 5 U.S.C. 5334(b); § 536.308 also issued under sec. 301(d)(2) of the Federal Workforce Flexibility Act of 2004 (Pub. L. 108-411), 118 Stat. 2305; § 536.310 also issued under sections 1913 and 1918 of the Non-Foreign Area Retirement Equity Assurance Act of 2009 (subtitle B of title XIX of Pub. L.111-84), 123 Stat. 2619; § 536.405 also issued under 5 U.S.C. 552, Freedom of Information Act, Public Law 92-502.

### Source

Source: 45 FR 85656, Dec. 30, 1980, unless otherwise noted.

### Amendments

[70 FR 31310, May 31, 2005, as amended at 73 FR 66155, Nov. 7, 2008; 77 FR 28223, May 11, 2012]