How the General Schedule 2021 Base Pay Table is Created
The Office of Human Resources often receives questions about how the General Schedule (GS) locality pay tables are updated. The process begins with updating the GS non-locality base pay table.
By law, GS pay in all geographic locations is increased across-the-board based on nationwide changes in the cost of non-federal salaries as reflected by the Employment Cost Index (ECI). However, the President has authority to issue an alternative across-the-board increase, and he exercised that authority for 2021, ordering a 1 percent increase via Executive Order. The 2020 step 1 rate for each grade was increased by 1 percent and rounded to the nearest dollar to derive the 2021 step 1 rates. Each new 2021 step 1 rate was then divided by 30 to produce a standard Within-Grade Amount for each grade. The standard Within-Grade amount is then added to step 1 to derive the step 2 rate, added to step 2 to derive the step 3 rate, and so forth. GS-1 and GS-2 have some differences in their calculations that will not be discussed here.This two-step process results in the GS 2021 nonlocality base pay table. This table is the basis for creating all the GS locality pay tables.
How the 2021 General Schedule Locality Pay Tables are Created
The previous section described the process to update the GS non-locality base pay table. This section describes how the GS locality pay tables are created. Most GS employees are entitled to locality pay. Many people believe that locality pay is meant to compensate for the higher costs of living in various parts of the country. In fact, locality pay is based on a percentage rate that reflects pay levels for non-federal employees in different geographic areas as determined by pay surveys conducted by the U.S. Bureau of Labor Statistics. As the Executive Order did not authorize adjustments to locality pay percentages for 2021, GS employees in all areas received a 1 percent pay adjustment. However, the new locality pay tables are still calculated based on the percentage rate determined by process described above (for instance, the D.C. area locality pay percentage of 30.48 percent, which was unchanged from 2020).
Each salary figure on the GS 2021 non-locality pay table was multiplied by 1.3048 to create the 2021 Washington DC area locality pay table, which covers DC and surrounding areas in parts of Maryland, Virginia, West Virginia and Pennsylvania. The locality table construction differs from the GS nonlocality base table, in which steps 2-10 are derived by adding the standard Within-Grade Amount for each grade. GS locality pay tables do not have standard Within-Grade Amounts. Biweekly pay is based on the respective GS locality pay table. You can perform this same calculation for whichever locality area you work in if you know your area’s locality pay percentage (see Schedule 9 of the President’s Executive Order) and you have access to the GS 2021 nonlocality base pay table. Note that by law GS locality pay rates are limited to the rate for Level IV of the Executive Schedule ($172,500 in 2020) so certain steps of the grade 15 pay scale may be capped at this amount.