Lump-sum payment due to step increase


Q: I am a postal inspector by the U.S. Postal Inspection Service and recently received a step increase, from GS/EAS 15, step 7 (119554) to step 8 (122875) based on time in grade. The step increase was reflected in my pay stub beginning with pay period two, but did not impact my take-home pay. This is likely due to the LEP and SPA that I receive as an 1811, which has kept my total compensation at level 4 of the executive pay grade (155500) for the last two years. I also noticed that my LEP was reduced, probably to absorb the increase in base pay. My question is this, will I receive a lump-sum payment from USPS to represent the benefits of the step increase? Otherwise, I don’t see how I will benefit from the step increase, other than in my annuity calculation.

A: Your lump-sum payment for unused annual leave will be based on the hourly rate of basic pay you were actually receiving on the day you retire. Your annuity will be based on your highest three consecutive years of average basic pay received, not on what you would have received had your pay not been capped.


About Author

Reg Jones was head of retirement and insurance policy at the Office of Personnel Management. Email your retirement-related questions to

Leave A Reply