HRPAY 23-01, Annual Pay Raise

Published: January 5, 2023
Effective: Pay Period 1, 2023


The National Finance Center (NFC) will be processing the 2023 Federal pay raise in accordance with the Office of Personnel Management (OPM) guidelines as described below.


This bulletin contains the following sections:

  1. Federal Pay Increase
    • Federal pay increases not processed for Pay Period 01 of the current pay raise year
    • Federal pay increases processed automatically for Pay Period 01 of the current pay raise year
  2. Special Rate Supplement
  3. Law Enforcement Officers Covered by the GL Pay Plan
  4. Locality Pay
  5. Life Insurance Coverage
  6. Personnel Action Processing Information
  7. Availability of Standard Form 50B, Notification of Personnel Action
  8. Additional Information

1. Federal Pay Increase

Executive Order Number 14090, dated December 23, 2022, authorizes an average 4.6 percent increase (combination of the base of 4.1 percent and a locality of .5 percent, for a total of 4.6 percent), depending upon locality, effective January 1, 2023, for employees under the General Schedule (GS) and Foreign Service Schedule statutory pay systems.

Note: Agencies should reference OPM Compensation Memoranda (CPM) for detailed information.

By law (5 United States Code (U.S.C.) 5318), the rates for Levels I through V of the Executive Schedule (EX) (EX-I through EX-V) will increase by 4.1 percent (rounded to the nearest $100). Under Executive Order Number 14090, the President has also authorized an increase in the rates of basic pay for Administrative Law Judges (ALJ) of 4.1 percent (rounded to the nearest $100). The rate of basic pay for Administrative Law Judge (AL) AL-1 will be $183,500.00. The rate for AL-2 will be $178,900.00. The rate of basic pay for AL-3/A through AL-3/F will range from $122,400.00 to $169,600.00. The rates for Administrative Appeals Judges (AAJ) are directly linked to those of ALJs (see 5 U.S.C. 5372). Therefore, the rate of basic pay for AA-1 through AA-6 will also range from $122,400.00 to $169,600.00.

Pay Rates for Certain Other Employees That Are Linked to the Executive Schedule

The rates of basic pay for Board of Contract Appeals (BCA) members are calculated as a percentage of the rate for Level IV of the Executive Schedule. Therefore, BCA rates of basic pay will increase by approximately 4.1 percent. The rate of basic pay will be as follows: Chairman $183,500.00, Vice-Chairman $177,995.00, and other members $172,490.00. In addition, the pay for the Inspector General (IG) at establishments (those covered by the IG pay plan) is also calculated as a percentage of the EX-III plus 3 percent, and thus will increase by approximately 4.1 percent. The IG pay plan rate will be $200,850.00.

The increase in Federal pay and any applicable locality-based comparability payments or special rate supplements for all eligible biweekly employees will be reflected in salary payments for Pay Period 01 of the current pay raise year. The Federal pay increase is outlined as follows:

Federal Pay Increases Not Processed for Pay Period 01 of the Current Pay Raise Year

NFC will not process Federal pay increases for the following types of employees:

NFC will not process Federal pay increases for the following employees (with the exception of employees in Agencies notifying NFC to automatically process the pay increase):

Federal Pay Increases Processed Automatically for Pay Period 01 of the Current Pay Raise Year

NFC will automatically process Federal pay increases for the following types of employees:

2. Special Rate Supplement

For employees who currently receive a Special Salary Rate (SSR) supplement because their highest payable rate is currently from an SSR table, it is important to remember that in the event that the locality rate in the employee's area exceeds his/her SSR supplement entitlement, the employee will cease to be covered by the SSR table and will instead be entitled to the higher locality rate. NFC will implement this for entities for whom it is generating the pay raise. Agencies will be responsible for handling this function for any pay raise action that the Agency processes.

Note: For those SSR tables applicable to more than one geographic area, it is possible for a grade and step to remain active on the SSR even though that rate is superseded by locality pay in some of the coverage area(s). In these instances, employees in areas with higher locality pay would cease to be covered by the SSR.

SSR tables have been updated to incorporate the 4.1 percent general increase. See the OPM Web site for a list of these SSR tables.

3. Law Enforcement Officers Covered by the GL Pay Plan

Employees that were converted from GS to GL and are now using the Law Enforcement Officer (LEO) pay table code will have actions generated by NFC. For those GL employees for whom the current pay increase will remove their entitlement to an SSR supplement, NFC will still process NOAC 894, Pay Adj. However, NFC will remove PRD 6 from the employee’s record and replace the SSR Table in the Position Management System Online (PMSO) with LEO, which is the LEO special base rate table code.

4. Locality Pay

The locality rate of pay for GS employees may not exceed the rates displayed on Table Management System (TMGT), Table 016, Geographical Location Codes with Names, for the current pay raise year.

Federal Employees Pay Comparability Act of 1990 (FEPCA) (Public Law 101-509) provides for comparability payments within each locality that is determined to have a pay disparity of greater than five percent with non-Federal workers.

The President’s Pay Agent has determined that the current pay raise year Locality-Based Comparability payments will be the same as the Government-wide and single-Agency categories that were authorized for the 2023 Locality-Based Comparability Payments.

Locality Pay Areas

Locality pay area definitions are posted on OPM's Web site. See the OPM Web site for the Locality Pay Tables.

The percentage factor for each locality is based on the geographic location of the employee’s official duty station. The areas designated as locality pay areas for the current pay raise year are displayed on TMGT, Table 27, COLA/Post Differential Codes.

Note: Geographic scope of each locality pay area can be found on OPM’s Web site. See the OPM Web site for the Salaries and Wages.

Locality payments will be paid as part of the employee’s biweekly salary and will be used in determining the calculations for retirement annuity and contributions to the Thrift Savings Plan (TSP), life insurance, overtime, and other premium pay. For most employees, the amount of locality pay will be determined by multiplying the employee’s scheduled annual rate of pay by the percentage factor for the locality pay area.

ES/SL/ST Employees in Non-Foreign Areas

Employees assigned to ES/SL/ST positions in the non-foreign areas on or after January 3, 2010, are not eligible for locality pay (only the adjusted COLA, if any, in effect for their official duty station) if a covered ES/SL/ST employee reaches the applicable pay rate cap. If this occurs, the law provides that the employee will continue to receive the frozen COLA rate subject to an offset until the employee leaves the COLA area, the employee leaves the pay system, or the employee becomes entitled to receive a rate of basic pay (including locality pay) that exceeds the employee's existing COLA adjusted rate.

COLA rates are available on OPM's Web site. See the OPM Web site for the COLA-Rates.

The formula for calculating the adjusted COLA percentages is contained in OPM Memo, Subject: Non-Foreign Area Retirement Equity Assurance Act, CPM 2009-27, dated December 30, 2009. For these employees, COLA payments should not be placed on time and attendance (T&A) reports for payments, but should be submitted by the Agencies via the Web-based Special Payroll Processing System (SPPS Web). Any COLA amounts added to T&As will be paid via Table Management System Table 027 (the standard COLA-reduced rates for employees in the non-foreign areas).

Employees Ineligible to Receive Locality-Comparability Payments

The following groups of GS employees do not receive locality-based comparability payments because they are already receiving pay rates that exceed locality:

5. Life Insurance Coverage

If there is an increase in the regular life insurance coverage as a result of the pay increase, the related increase in life insurance deductions will be effective at the same time.

6. Personnel Action Processing Information

OPM does not require a separate personnel action for those employees who receive a locality payment or SSR supplement increase along with the Federal pay increase authorized under 5 U.S.C. 5303. Therefore, NFC will automatically generate one personnel action for both the Federal pay increase and locality-based comparability payment/SSR-supplement increase.

In addition to the standard items required for a salary change, the personnel action must include the following data for a salary change personnel action:

Note: Agencies with special authorities must use the authority specific to their Agency. For detailed instructions, refer to OPM's Guide to Processing Personnel Actions (GPPA), Chapter 17.

7. Availability of Standard Form 50B, Notification of Personnel Action

NFC will not print Standard Form (SF) 50Bs. The forms can be viewed online via an electronic Official Personnel File (eOPF) and the Remote Forms Queuing System (RFQS). SF 50Bs will run after the completion of processing for Pay Period 01, of the current pay raise year.

8. Additional Information

Processing Personnel Actions in Pay Period 01, of the Current Pay Raise Year

The general adjustments that take effect in January of the current pay raise year must be processed before any individual pay action (e.g., within-range increase or promotion) that takes effect on the same date. General adjustments include across-the-board increases under 5 U.S.C. 5303 and increases in locality payments or other geographic adjustments, special rate supplements, and retained rates. If multiple individual pay actions become effective on the date of the January pay adjustment, those actions must be processed in the order applicable to the employee’s pay system (e.g., the simultaneous action rule for GS employees in 5 CFR 531.206).

Personnel Input and Edit System (PINE) Edit Messages

To avoid a system-generated rollback, Agencies should ensure that all personnel actions with effective dates prior to Pay Period 01, of the current pay raise year, were entered before the processing of the first pass of PINE (on or before Sunday, January 1, 2023). Any rollback action will result in the rollback of all personnel actions (Agency-initiated or system-generated) that have applied in the current pay period, including the system-generated change in the service computation date (SCD) and the Federal pay increase/locality-based comparability. These actions are then placed in suspense and will appear on the Listing of Personnel Error Messages with Override Code F and with the edit message In Suspense Due To Rollback-Take Appropriate Action. The document(s) will remain in suspense until action is taken.

The system will produce Document Type 999, Informational Edit Messages, on the Listing of Personnel Edit Error Messages for Pay Period 01 to identify employees who did not receive an automatic pay raise (e.g., GM employees whose salaries are less than the minimum salary range for the step).

The first pass of PINE for Pay Period 01 will be executed on Sunday, January 1, 2023. Consult the NFC Electronic Access Bulletin Board on the NFC Mainframe or the NFC Home Page for updates on the processing of the pay raise actions and system availability.

Note: PINE will not execute on January 9, 2023, and January 10, 2023; therefore, files dependant upon the daily process will not be transferred via Secure File Transfer Protocol (SFTP). PINE execution will resume on January 11, 2023.

Suspense Documents

Documents that are processed by NFC for the annual pay raise will not appear under any of the Agency’s normal user identification (ID) on suspense reports. It is especially critical at this time of year for Agencies to verify all documents in suspense, not just those of individual human resources staff members. Failure to work an NFC-generated pay raise personnel action that falls into suspense for any reason will prevent the employee from receiving his/her January pay adjustment. If an Agency deletes an NFC-generated pay raise personnel action from suspense, then the Agency will have to generate a replacement action manually.

History Correction

If a History Correction package is processed during Pay Period 01, of the current pay raise year, the system-generated personnel actions (e.g., the change in SCD and the Federal pay increase/locality-based comparability payment) will become part of the package. Special measures should be taken to ensure that these system-generated personnel actions were reapplied during Pay Period 01 regardless of whether the package is subsequently deleted.

Note: The system will hold history correction processing for the first pass of PINE for Pay Period 01 only.


For questions about NFC processing, authorized Servicing Personnel Office representatives should contact the NFC Contact Center at 1-855-NFC-4GOV (1-855-632-4468) or via the customer service portal at ServiceNow Portal for Federated Users and at ServiceNow Portal for Non-Federated Users.