[Federal Register Volume 71, Number 205 (Tuesday, October 24, 2006)]
[Proposed Rules]
[Pages 62229-62230]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E6-17543]


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AGENCY FOR INTERNATIONAL DEVELOPMENT

48 CFR Part 7

[USAID Acquisition Regulation ``AIDAR'']
RIN 0412-AA56


Application of Post Differential and Danger Pay Allowances To 
Extended Workweeks Under Cost-Reimbursement Type Contracts

AGENCY: United States Agency for International Development.

ACTION: Proposed rule.

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SUMMARY: The U.S. Agency for International Development (USAID) is 
proposing to amend its regulations by adding how Post-differential and 
Danger pay allowances will be applied to extended workweeks under cost-
reimbursement type contracts.

DATES: Submit comments on or before December 26, 2006.

ADDRESSES: Submit comments, identified by title of the Proposed Action, 
and RIN number by any of the following methods:
    Federal eRulemaking Portal: http://www.regulations.gov. Follow the 
instructions for submitting comments.
    E-mail: [email protected]. Include title of the 
proposed action, and RIN number in the subject line of the message.
    Fax: 202-216-3135.
    Mail: U. S. Agency for International Development, Office of 
Acquisition & Assistance, Policy Division, 1300 Pennsylvania Avenue, 
NW., Room 7.9-18, Washington, DC 20523-0001.
    Instructions: All submissions must include the title of the 
proposed action, and Regulatory Information Number (RIN) for this 
rulemaking. Please include your name, title, organization, postal 
address, telephone number, and e-mail address in the text of the 
message.

FOR FURTHER INFORMATION CONTACT: Carol Ketrick, Telephone: 202-712-
1382, E-mail: [email protected].

SUPPLEMENTARY INFORMATION:
    Public Participation: Because security screening precautions have 
slowed the delivery and dependability of surface mail to USAID/
Washington, USAID recommends sending all comments to the Federal 
eRulemaking Portal, e-mail address, or fax number listed above (all 
comments must be in writing to be reviewed). You may submit comments by 
electronic mail avoiding the use of any special characters and any form 
of encryption. All comments will be made available for public review 
without change, including any personal information provided, from three 
days after receipt to finalization of rule at http://www.usaid.gov/policy/regulations/index.html.

A. Background

    Based on a recent surge in requests to interpret the applicable 
regulations for Post differential and Danger pay allowances associated 
with contract awards in Iraq and Afghanistan, we feel it prudent to 
amend 48 CFR 752.7028 of the USAID Acquisition Regulations (the 
``AIDAR'') to clarify the existing policy. This clarification brings 
the policy in line with that applied to direct-hire employees. The 
Department of State's Standardized Regulations (DSSR) provide those 
regulations governing allowances, differentials and defraying of 
official residence expenses for employees in foreign areas. The DSSR 
provides the following definitions for the allowances noted above as 
follows: ``Post allowance'' is ``a cost-of-living allowance granted to 
an employee officially stationed at a post in a foreign area where the 
cost of living, exclusive of quarters costs, is substantially higher 
than in Washington, DC''. It is additional compensation for service at 
places in foreign areas where conditions of environment differ 
substantially from conditions of environment in the continental U.S. 
and warrant additional compensation as a recruitment and retention 
incentive. ``Danger Pay Allowance'' means the ``additional compensation 
of up to 35 percent over basic compensation granted to employees for 
service at designated danger pay posts.'' Direct hire employees are 
compensated in accordance with the DSSR which defines basic 
compensation as the rate of compensation fixed by statute for the 
position held by an employee: administratively in conformity with rates 
paid by the Government for work of a comparable level of difficulty and 
responsibility in the continental United States, before any deduction 
is made and without taking into consideration any additional 
compensation such as overtime pay, night pay differential, hazard 
differential, extra pay for work on holidays, post differential, and 
allowances * * *''. Further, the Department of State Foreign Affairs 
Manual, (FAM) 3 FAM-2333.1-1 establishes the basic workweek for full-
time employees as being a 40-hour workweek.
    Recent contract awards in Iraq and Afghanistan have resulted in 
circumstances where the contractor may be authorized to work in excess 
of a 40-hour workweek. Mission direct-hire employees have, in some 
instances, worked more than a 40-hour workweek; however, for purposes 
of calculating Danger pay allowance, these additional hours are not 
included in the amount defined as ``basic compensation''. In order to 
clarify USAID policy aligning payment of allowances with that of 
direct-hire employees, the Proposed Rule would amend 48 CFR 752.7028 to 
reflect USAID's policy that Post-differential and Danger Pay allowances 
are to be calculated by applying the percentage rates to a maximum 40-
hour workweek, regardless of whether the contractor has been authorized 
a workweek in excess of 40 hours. The proposed amendments made under 
this case are intended to be applicable only to USAID cost 
reimbursement type contracts; however, the policy would also apply to 
contracts or task orders using other than a cost-reimbursement pricing 
structure but that allow for the reimbursement of costs for these 
allowances. USAID is interested in hearing from contractors regarding 
the effect on contractors' standard policies regarding employee 
benefits.
    USAID also seeks comment on the inclusion of an exception to the 
above limitation which would allow Mission Directors to authorize 
calculation of post-differential and danger percentages applied to a 
workweek in excess of 40 hours as approved by a contracting officer.
    In addition to the clarification of the policy, the applicable 
clause is modified to delete reference to the Supplemental

[[Page 62230]]

post allowance to reflect the elimination of that allowance from the 
Department of States' Standardized Regulations (Government Civilians, 
Foreign Areas), Chapter 230.

B. Regulatory Planning and Review

    This is not a significant regulatory action and, therefore, is 
subject to review under Section 6(b) of Executive Order 12866, 
Regulatory Planning and Review, dated September 30, 1993. This rule is 
not a major rule under 5 U.S.C. 804.

C. Regulatory Flexibility Act

    Pursuant to requirements set forth in the Regulatory Flexibility 
Act (RFA) (5 U.S.C. 601 et seq.), USAID has considered the economic 
impact of the rule and has determined that its provisions would not 
have a significant economic impact on a substantial number of small 
entities.

D. Paperwork Reduction Act

    The Paperwork Reduction Act does not apply because the proposed 
changes to the AIDAR do not impose information collection requirements 
that require the approval of the Office of Management and Budget under 
44 U.S.C. 3501 et seq.

List of Subjects in 48 CFR Part 7

    Government procurement.

    For the reasons set forth in the preamble, the U. S. Agency for 
International Development proposes to amend 48 CFR part 7 as follows:
    1. The authority citation for 48 CFR part 7 continues to read as 
follows:

    Authority: Sec. 621, Pub. L. 87-195, 75 Stat. 445, (22 U.S.C. 
2381) as amended; E.O. 12163, Sept. 29, 1979, 44 FR 56673; 3 CFR 
1979 Comp., p. 435.

PART 752--SOLICITATION PROVISIONS AND CONTRACT CLAUSES

    2. Amend Section 752.7028 by revising paragraph (a), removing and 
reserving paragraph (e), and adding a sentence at the end of paragraph 
(j)(1) to read as follows:


Sec.  752.7028  Differential and allowances.

* * * * *
    (a) Post differential. Post differential is an additional 
compensation for service at places in foreign areas where conditions of 
environment differ substantially from conditions of environment in the 
continental United States and warrant additional compensation as a 
recruitment and retention incentive.
    (1) In areas where post differential is paid to USAID direct-hire 
employees, post differentials not to exceed the percentage of salary as 
is provided such USAID employees in accordance with the Standardized 
Regulations (Government civilians, Foreign Areas), Chapter 500 (except 
the limitation contained in Section 552, ``Ceiling on Payment'') 
Tables--Chapter 900, as from time to time amended, will be reimbursable 
hereunder for employees in respect to amounts earned during the time 
such employees actually spend overseas on work under this contract. 
(See Standardized Regulation 510). Payments for post differential are 
limited to that percentage rate applied to a maximum 40-hour work week, 
regardless of whether the contracting officer has authorized a work 
week in excess of 40 hours. Exceptions to this policy may be granted 
either by the Mission Director or the Assistant Administrator having 
program responsibility for the project.
    (2) When such post differential is provided to regular employees of 
the Contractor, it shall be payable beginning on the date of arrival at 
the post of assignment and continue, including periods away from post 
on official business, until the close of business on the day of 
departure from post of assignment en route to the United States. Sick 
or vacation leave taken at or away from the post of assignment will not 
interrupt the continuity of the assignment or require a discontinuance 
of such post differential payments, provided such leave is not taken 
within the United States or the territories of the United States. Post 
differential will not be payable while the employee is away from his/
her post of assignment for purposes of home leave. Short-term employees 
shall be entitled to post differential beginning with the forty-third 
(43rd) day at post.
* * * * *
    (e) Reserved.
* * * * *
    (j) (1) * * * Payments for danger pay are limited to that 
percentage of basic compensation as established by the Standardized 
Regulations applied to a maximum 40-hour work week, regardless of 
whether the contracting officer has authorized a work week in excess of 
40 hours. Exceptions to this policy may be granted either by the 
Mission Director or the Assistant Administrator having program 
responsibility for the project.

    Dated: October 12, 2006.
Michael F. Walsh,
Procurement Executive.
 [FR Doc. E6-17543 Filed 10-23-06; 8:45 am]
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