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FPCD-81-60 1 (1981-08-26)

handle is hein.gao/gaobabcje0001 and id is 1 raw text is: B-202638 COMPTROLLER GENERAL OF THE UNITED STATES WASHINGTON D.C. 20548 ...e approvE by t AUGUST 26 19B1 The Honorable Mary Rose Oakar Chair, Subcommittee on Compensation and Employee Benefits Committee on Post Office and Civil Service House of Representatives 116278 Dear Madam Chair: Subject: Alternatives to the Current Method of Computing General Schedule Pajy(FPCD-81-60) This report responds to your March 10, 1981, letter request- ing us to determine the costs that could be saved if the method of compensating General Schedule employees was based on the actual work hours in a calendar year. General Schedule employees' annual salaries are based on 2,080 hours, or 260 workdays, even though there are usually one or two additional workdays in a calendar year for which employees are also paid. Our review showed that computing biweekly pay using either actual or average work hours in a year would reduce Government costs by approximately $120 million annually. As you requested, we reviewed the legislative basis for es- tablishing the existing method for computing pay, examined al- ternatives to the current method, and examined the impact these alternatives would have on payroll systems. We identified two feasible alternatives to compensate employees on the basis of either actual or average work hours in a calendar year. LEGISLATIVE BASIS FOR COMPUTING GENERAL SCHEDULE PAY The Congress passed the Federal Employees Pay Act of 1945 (5 U.S.C. 5504) to (1) simplify payroll procedures and computa- tions and (2) correct inequities in the method used to pay over- time to salaried employees. The law provides that General Schedule employees will receive their annual base salary over 26 biweekly pay periods of 80 hours each and establishes the following method for computing biweekly pay: (966013) {/~ ~2~4/