[Federal Register Volume 84, Number 82 (Monday, April 29, 2019)]
[Rules and Regulations]
[Pages 17931-17941]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2019-08533]



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 Rules and Regulations
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  Federal Register / Vol. 84, No. 82 / Monday, April 29, 2019 / Rules 
and Regulations  

[[Page 17931]]



OFFICE OF PERSONNEL MANAGEMENT

5 CFR Part 550

RIN 3206-AL55


Compensatory Time Off for Religious Observances and Other 
Miscellaneous Changes

AGENCY: Office of Personnel Management.

ACTION: Final rule.

-----------------------------------------------------------------------

SUMMARY: The Office of Personnel Management (OPM) is issuing final 
regulations to amend its current regulations on compensatory time off 
for religious observances. The final rule addresses comments and 
clarifies provisions on employee coverage, employee and agency 
responsibilities, scheduling time to earn and use religious 
compensatory time off, accumulation and documentation, and employee 
separation or transfer. We are also implementing other miscellaneous 
changes in the pay and leave area.

DATES: Effective May 29, 2019.

FOR FURTHER INFORMATION CONTACT: Jennifer Melvin by telephone at (202) 
606-2858 or by email at [email protected].

SUPPLEMENTARY INFORMATION: On August 30, 2013, the Office of Personnel 
Management (OPM) published proposed regulations (78 FR 53695) regarding 
compensatory time off for religious observances under 5 U.S.C. 5550a 
and other miscellaneous changes.
    The 60-day comment period for the proposed regulations ended on 
October 29, 2013. We received comments from 8 Federal agencies, 2 
religious organizations (including one submission on behalf of 19 other 
religious and policy groups), and 4 individuals. This Federal Register 
document provides general information, addresses the comments received, 
and issues final regulations that reflect changes to the proposed 
regulations. OPM is amending the regulations found in subpart J 
(Compensatory Time Off for Religious Observances) in part 550 (Pay 
Administration (General)) of title 5, Code of Federal Regulations. It 
is also revising two definitions used in other regulations in part 550.

Comments on Proposed Regulations

Modifying From a 26 Pay Period Limitation to a 13 Pay Period Limitation

    Four agencies provided comments disagreeing with the establishment 
of a 26 pay period limitation, generally stating it was an excessively 
long period that could lead to potential abuse, could impact the 
mission of the agency, and would be administratively burdensome on 
managers, supervisors, and timekeepers. Three agencies recommended 
establishing a 13 pay period limitation before and a 13 pay period 
limitation after for religious compensatory time off, thus providing a 
26 pay period total for earning religious compensatory time off.
    One agency objected to the proposed 26 pay period limit for earning 
religious compensatory time following the use of advanced religious 
compensatory time off, and is seeking a two pay period limit following 
the use of religious compensatory time off for employees to repay the 
hours used. The agency was concerned that a 26 pay period limit is 
unreasonably long, and does not balance an agency's responsibility to 
carry out its mission with an employee's right to make up the time in 
26 pay periods. The agency points to other available flexibilities, 
including earning religious compensatory time in advance of when it is 
needed, using annual leave or advanced annual leave, leave without pay, 
compensatory time off in lieu of overtime pay, compensatory time off 
for travel, and adjusting work schedules.
    We have evaluated these comments and are revising the proposed 26 
pay periods before and 26 pay periods after the religious observance in 
which to earn religious compensatory time off to be 13 pay periods 
before and 13 pay periods after a religious observance in which to earn 
religious compensatory time off. That would allow a total period of 26 
pay periods (about 1 year) during which the religious compensatory time 
off could be earned in connection with a religious observance. An 
agency may not prescribe a lesser or narrower timeframe in which an 
employee may earn religious compensatory time off before or after using 
it. This change will allow employees about a year to schedule and earn 
religious compensatory time off while making it more administratively 
feasible for agencies to administer.
    An individual commenter was opposed to the 26 pay period 
limitation, citing that the limitation was too restrictive, and 
recommended the limitation be doubled. The commenter cites that some 
religious observances can be lengthy and questioned if adequate 
compensatory time off could be earned feasibly within the preceding 26 
pay periods.
    We are not adopting this recommendation in the final regulations.
    Below we summarize and respond to other comments on the proposed 
regulations, organized by the affected regulatory section number.

Sec.  550.1001--Purpose

    A religious organization requested clarification that religious 
compensatory time off is not the only method by which agencies may 
accommodate employees who need to abstain from work due to a personal 
religious observance. The commenter requested we clarify this point by 
adding language to the final regulation.
    OPM previously addressed this concern in the Supplementary 
Information of the proposed rule (78 FR 53697), in which (as part of a 
discussion of Sec.  550.1006) we remind agencies and employees of the 
availability of additional workforce flexibilities, including annual 
leave, advanced annual leave, regular compensatory time off, 
alternative work schedules, and leave without pay, all of which may 
play a part in accommodating an employee's need to abstain from work 
for religious purposes.
    We encourage employees to work with their agencies to make use of 
all appropriate workforce flexibilities to meet their needs. However, 
this final rule addresses only religious compensatory time off 
procedures, not the various options that an employee may choose when 
taking time off for a religious observance. We are not adopting this 
recommendation in the final rule.
    Two agencies raised issues related to how earning religious 
compensatory time off hours (via work) is in lieu of

[[Page 17932]]

receiving overtime pay. They pointed out that, contrary to the language 
in the proposed definition of overtime work in Sec.  550.1003 stating 
that overtime pay would normally otherwise be payable for hours worked 
to earn religious compensatory time off, some employees do not normally 
receive overtime pay for work beyond their scheduled hours.
    We agree that certain employees--e.g., members of the Senior 
Executive Service (SES), employees who reach the premium pay cap, 
employees who work during holiday hours, and part-time employees who 
perform nonovertime work beyond their scheduled tour--would not 
otherwise receive overtime pay for hours worked to earn religious 
compensatory time off. As further discussed later in this Supplementary 
Information, we are agreeing to delete language in the definition of 
overtime work in Sec.  550.1003 stating that overtime pay would 
normally be received for the hours of work (but for crediting the hours 
as earned religious compensatory time off). However, as a matter of 
providing general clarification, we are adding language under Sec.  
550.1001 to make clear that hours worked to earn religious compensatory 
time off provide a time off credit in lieu of any pay that would 
otherwise be payable for that work.
    We are also adding the word ``personal'' before ``religious 
requirements'' in two places in Sec.  550.1001 in response to comments 
regarding the definition of religious compensatory time off in Sec.  
550.1003, as discussed below.

Sec.  550.1002--Coverage

    Two agencies asked for clarification regarding employees covered by 
the religious compensatory time off regulations. One agency requested 
the final regulations clarify that members of the Senior Executive 
Service (SES), employees in senior-level (SL) and scientific or 
professional (ST) positions, and wage grade employees are eligible to 
earn religious compensatory time off. Another agency raised SES 
coverage issues in the context of recommending that we delete ``for 
which overtime pay would normally be payable'' from the overtime work 
definition within Sec.  550.1003 in the final rule, since SES members 
may earn religious compensatory time off but are not eligible to be 
compensated for overtime hours worked. We agree with the comments 
received from the agencies and are modifying the final regulations to 
clarify which employees are eligible to earn and use religious 
compensatory time off.
    These final regulations clarify that coverage applies to each 
employee (as defined in 5 U.S.C. 2105) in or under an Executive agency 
(as defined in 5 U.S.C. 105) who has a scheduled tour of duty, which 
would include members of the SES, SL/ST employees, and prevailing rate 
(blue collar wage) employees who have a scheduled tour of duty.
    Religious compensatory time off is provided under section 5550a, 
subchapter V of chapter 55 (Premium Pay) of title 5, United States 
Code. Section 5541(2) of the premium pay statute provides a definition 
for the term ``employee'' to be used generally for the purpose of 
subchapter V. This definition excludes certain categories of employees, 
including SES members (who are excluded under section 5541(2)(xvi) and 
(xvii)) and prevailing rate employees (who are excluded under section 
5541(2)(xi), except for the purpose of applying sections 5544 and 
5550b). However, based on the intent of Congress and the language in 
section 5550a stating that ``any employee'' may use religious 
compensatory time off ``notwithstanding any other provision of law,'' 
it has been OPM's longstanding position that the employee coverage 
exclusions provided within section 5541(2) do not apply in determining 
coverage under section 5550a. This means that members of the SES and 
prevailing rate employees are covered by section 5550a. OPM's position 
on employee coverage dates back to the early implementation of section 
5550a shortly after its enactment on September 29, 1978 (Public Law 95-
390). Further, Comptroller General Decision B-209327 (July 26, 1983) 
stated that ``the language and the legislative history of section 5550a 
show an intent on the part of Congress to provide all Federal 
employees'' with religious compensatory time off. It also found that 
the religious compensatory time off law applies to members of the 
Senior Executive Service, who are generally not covered by the premium 
pay subchapter.
    An OPM regulation in 5 CFR 534.408(b) that was promulgated in 1995 
further clarifies that SES members are eligible to earn religious 
compensatory time off, even though they are not eligible for overtime 
pay or eligible to earn compensatory time off in lieu of overtime 
premium pay.
    Employees in senior-level (SL) and scientific or professional (ST) 
positions who are paid under 5 U.S.C. 5376 are not excluded from the 
definition of ``employee'' in 5 U.S.C. 5541(2). Therefore, there has 
never been any question about their coverage under the religious 
compensatory time off provision in section 5550a. SL/ST employees are 
also covered by the broad definition of ``employee'' OPM has always 
used (in lieu of the section 5541(2) definition) in determining 
coverage under section 5550a.
    In these final regulations, we are modifying the regulations to 
clarify that the definition of ``employee'' in section 5541(2) does not 
apply in determining coverage under the religious compensatory time off 
provision.

Sec.  550.1003--Definitions

Overtime Work
    Four commenters recommended the definition of overtime work be 
modified or deleted. Two agencies recommended modifying the definition 
by deleting ``for which overtime pay would normally be payable''. One 
of the agencies recommended this language be deleted from the overtime 
work definition due to concerns that the language may be construed to 
prevent members of the Senior Executive Service (SES) from earning 
religious compensatory time off, since they are not eligible to earn 
overtime pay. The other agency noted that not all hours beyond an 
employee's scheduled tour of duty may normally be paid as overtime 
work.
    We agree that this language could be misconstrued and are removing 
the language from the definition of overtime work, as suggested, in 
these final regulations.
    One religious organization and one agency commented that the term 
overtime work can cause confusion as it relates to religious 
compensatory time off. The religious organization also stated that 
applying the term overtime work to work performed by part-time 
employees that is below applicable overtime thresholds is confusing. 
Both commenters suggested replacing the term with language that is more 
descriptive.
    The term overtime work is used in the section of law, 5 U.S.C. 
5550a, that authorizes the use of religious compensatory time off. The 
regulations necessarily use the same term. However, a special 
definition of the term is used for purposes of subpart J in order to 
include certain hours that would not be considered overtime work under 
the normally used definition. For example, the regulatory definition of 
overtime work in Sec.  550.1003 in both the proposed and final 
regulations states that it is deemed to include any work performed by a 
part-time employee outside of his or her established part-time tour of 
duty--even though the additional work by a part-time employee may not 
be in

[[Page 17933]]

excess of the daily/weekly overtime thresholds that are normally used 
to define ``overtime work.'' For these reasons, we are not adopting 
this recommendation, and the term overtime work continues to be used in 
the final rule.
    An agency proposed adding language to the definition of overtime 
work to clarify that religious compensatory time off may be earned by 
working on a legal holiday ``whether within or outside the employee's 
holiday clock hours.''
    Consistent with OPM's longstanding guidance, the term overtime work 
is deemed to include work performed by an employee on a legal holiday 
when he or she is relieved from working on the holiday. In other words, 
the holiday hours in question are the hours within the scheduled tour 
of duty (i.e., ``holiday hours'') for which an employee normally 
receives either (1) holiday pay for hours during which the employee is 
excused from work or (2) holiday premium pay for working assigned 
hours. If an employee elects to work on a holiday in order to earn 
religious compensatory time off, the agency may authorize the employee 
to do so. This election can be made when an employee is not otherwise 
assigned to work the holiday hours. The employee is working even though 
he or she would ordinarily (but for the election to earn religious 
compensatory time off) be excused from duty. The employee will receive 
the regular holiday pay as if excused from duty. The work during 
holiday hours will be credited as religious compensatory time off and 
will not generate entitlement to holiday premium pay. The proposed 
regulations stated that overtime work includes ``work performed by an 
employee on a legal holiday.'' Based on the agency comment, we are 
modifying the definition of overtime work to clarify that we are 
referring to holiday hours within the employee's scheduled tour of 
duty--hours during which the employee would be excused from duty but 
for the employee's election (with agency approval) to perform work to 
earn religious compensatory time off. Any work on a holiday outside the 
designated holiday hours would be overtime work hours under the 
normally used definition; such work hours would generate overtime pay, 
not holiday premium pay. Thus, there is no need to ``deem'' such work 
to be overtime work for the purpose of converting overtime work to 
religious compensatory time off under subpart J.
Religious Compensatory Time off
    Two commenters expressed concerns about the definition of religious 
compensatory time off--specifically, the language stating that ``an 
employee whose personal religious beliefs require the abstention from 
work during certain periods of time may elect to perform overtime work 
in order to make up for the time the employee takes off to meet those 
religious requirements.''
    An agency stated that the reference to religious ``requirements'' 
in the proposed definition of religious compensatory time off is an 
overstatement of why an employee chooses to observe certain religious 
activities or ceremonies. A commenter representing the Department of 
Justice requested clarification of the term ``require'' used in the 
same definition, noting that the term ``require'' should be understood 
to include both religiously mandated and religiously motivated conduct. 
The commenter stated that the Department of Justice has taken the 
position in past litigation that the Free Exercise Clause of the First 
Amendment and Religious Freedom Restoration Act (42 U.S.C. 2000bb) 
protect not only actions that are religiously mandated but also actions 
that are religiously motivated. The commenter cited a court case, 
DeHart v. Horn, 227 F.3d 47 (3d Cir. 2000)(en banc) to support its 
position that attempting to distinguish between religiously mandated 
and religiously motivated actions would improperly entangle agencies in 
deciding inherently religious questions, and limit the use of religious 
compensatory time off in a way that would be more narrow than intended. 
The commenter suggested language that could be added to the regulation 
to clarify that religiously motivated actions are a basis for using 
religious compensatory time off.
    Section 5550a provides religious compensatory time off when an 
employee's ``personal religious beliefs require the abstention from 
work during certain periods of time'' (emphasis added). Section 5550a 
also refers to ``time lost for meeting those religious requirements'' 
(emphasis added). OPM's regulatory language uses the same terminology. 
By law, religious beliefs must require (or compel or impose an 
obligation on) the employee to be absent from work. However, it is 
significant that the referenced beliefs are not the official beliefs of 
an organized religion to which the employee may belong, but are the 
employee's ``personal'' religious beliefs. In other words, it is 
sufficient that the employee's personal religious beliefs cause the 
employee to feel an obligation that he or she should be absent from 
work for a religious purpose.
    The DeHart decision dealt with the issue of whether Constitutional 
religious freedom protections applied only to the orthodox beliefs of 
an organized religion that imposed requirements (or commandments) on 
members of that religion or also to the non-orthodox beliefs of 
individual members of that religion. The court ruled that a claim for 
religious protection could not be dismissed solely because of the non-
orthodox or non-mainstream character of the religious belief in 
question. It pointed to Supreme Court decisions stating that courts 
should not question the centrality of a particular religious belief or 
attempt to determine whether a belief is the correct interpretation of 
a religion's creed. Rather, courts should look at only two threshold 
requirements that must be met before beliefs are accorded First 
Amendment protection by a court: (1) The belief is sincerely held, and 
(2) the belief is religious in nature. Id. at 51.
    As noted above, the law establishing religious compensatory time 
off for Federal employees makes clear that ``personal'' religious 
beliefs are a legitimate basis for claiming the right to use 
compensatory time off. The OPM regulations include the statutory 
language describing the condition that ``personal religious beliefs 
require the abstention from work.'' Given the concerns of commenters, 
however, we are adding language in the definition of religious 
compensatory time off to further clarify that the beliefs do not have 
to be in line with the official mandates of a religious organization to 
which the employee belongs and can spring from a sense of personal 
obligation. We are also inserting the word ``personal'' before 
``religious requirements'' and before ``religious obligations'' in the 
definition of religious compensatory time off. Also, as noted earlier, 
we are inserting the word ``personal'' before ``religious 
requirements'' in two places in Sec.  550.1001 (Purpose).

Sec.  550.1004--Employee Responsibilities

    An agency recommended that the term ``in advance'' in Sec.  
550.1004(a) (dealing with employee requests to use religious 
compensatory time off) should be clarified in the final regulations to 
mean ``with enough time to allow the agency to consider the request.'' 
Each agency is responsible for establishing procedures under Sec. Sec.  
550.1005 and 550.1006. Under both the proposed and final Sec.  
550.1005(a), those procedures may include a requirement that an 
employee submit a request to use religious compensatory time off 
``sufficiently in advance to

[[Page 17934]]

accommodate necessary scheduling changes without interfering with the 
agency's ability to efficiently carry out its mission.'' We believe 
this gives agencies sufficient flexibility to handle employee requests; 
therefore, we are not making changes based on this recommendation.
    We received one comment from an individual supporting the proposed 
requirement that an employee provide the agency with the name and/or 
description of the religious observance in his or her request, but an 
agency expressed concerns that an employee must submit this 
information. The agency noted that many Native American tribes 
participate in religious ceremonies that cannot be named or described.
    An agency decision to allow an employee to earn and use religious 
compensatory time off is made on a case-by-case basis. Agencies need 
appropriate information in the employee's request in order to verify 
that the request meets all applicable requirements and to make 
determinations that will balance the religious needs of the employee 
with the agency's ability to accomplish its mission. The exact nature 
of the observance does not need to be described if there are religious 
prohibitions on doing so, as long as the request provides enough 
information for the agency to verify that it meets the requisite 
requirements.
    Similarly, an individual commented that employees may practice a 
wide variety of religious practices, some of which may not be widely 
recognized. The commenter asked OPM to issue guidelines for defining 
religion.
    OPM will not attempt to issue such guidelines. The law authorizing 
religious compensatory time off is based on an individual's ``personal 
religious beliefs,'' and OPM believes that case law sufficiently 
defines religious belief. (See also our earlier discussion in this 
Supplementary Information regarding the definition of religious 
compensatory time off.)
    A commenter representing the Department of Justice also sought 
clarification on the meaning of ``required'' as used in Sec.  
550.1004(b)(1). As discussed in connection with the Department of 
Justice comments on the definition of religious compensatory time off 
in Sec.  550.1003, the word ``require'' is used in the law authorizing 
religious compensatory time off (5 U.S.C. 5550a). The language in Sec.  
550.1004(b)(1) parallels the language in the law. Our changes to the 
definition of ``religious compensatory time off'' in Sec.  550.1003 
make clear that it is the employee's ``personal'' religious beliefs 
that create the requirement or obligation to be absent from work. We 
are making no additional changes in Sec.  550.1004(b)(1).
    A religious organization proposed adjustments be made for the make-
up dates and times in an employee's original request due to unforeseen 
circumstances. They suggested that, in the event an adjustment to the 
dates and times of overtime work is required, an employee will submit 
to the supervisor for approval a revised schedule that reflects those 
changes.
    We concur with this comment and are adding a new paragraph (d) in 
Sec.  550.1004 to address submission of a revised schedule.

Sec.  550.1005--Agency Responsibilities

    A religious organization expressed concern that many employees and 
managers may lack knowledge regarding religious compensatory time off 
and recommended adding regulations that address an employing agency's 
responsibility to inform employees regarding their right to use 
religious compensatory time off. The religious organization recommended 
establishing procedures patterned after those found in regulations 
implementing the Family and Medical Leave Act (FMLA) in 29 CFR part 
825. Specifically, it recommended adding regulatory provisions that 
would require an agency (1) to notify an employee of the right to use 
religious compensatory time off ``when the agency acquires knowledge 
that an employee's expected absence may be for a religious reason;'' 
(2) to ``responsively answer questions'' about religious compensatory 
time off; and (3) to provide a notice to the employee when his or her 
request for religious compensatory time off is denied that states the 
reasons for the denial.
    We are not making changes in the regulations based on the first two 
recommendations identified above. While we agree there is a need to 
ensure that agency managers and employees are informed regarding 
religious compensatory time off, we do not believe it is necessary to 
incorporate a formal notice requirement in regulations. Rather, 
consistent with its administration of other programs related to leave 
and other time off, OPM will take steps to educate agency managers and 
employees regarding the religious compensatory time off program--in 
particular, the changes made in these final regulations. We expect 
managers to responsively answer employee questions about all personnel 
matters and do not believe it is necessary to impose a regulatory 
requirement under each personnel program. With respect to the personnel 
programs it administers, OPM is in a position to adjust its guidance 
and educational efforts as necessary.
    Ultimately, it is the responsibility of the employee to notify the 
supervisor of his or her intent to use religious compensatory time off 
as provided under Sec.  550.1004. We cannot expect supervisors to be 
generally aware that a requested absence is due to an employee's 
personal religious obligation. The employee must choose whether to 
request religious compensatory time off and disclose information about 
his or her personal religious obligation. We note that OPM's FMLA 
regulations (5 CFR part 630, subpart L), which apply to most Federal 
employees, also do not place a regulatory requirement on agency 
managers to discern when FMLA leave may be implicated. (The FMLA 
regulations cited by the commenter are the Department of Labor's title 
29 FMLA regulations, which are generally not applicable to Federal 
employees covered by title 5.)
    We agree with the religious organization's third recommendation--
that, if the employee is not granted religious compensatory time off, 
the agency should provide an explanation for denying the request. We 
are incorporating language within Sec.  550.1005(b) of the final 
regulations to address this recommendation.
    Two agencies commented on the ability of an employee to provide an 
oral request to use religious compensatory time off. The first agency 
recommended that the first sentence in Sec.  550.1005(a) be changed to 
require all employees to submit a request in writing. The second agency 
also recommended modifying paragraph (a) of this section by replacing 
``the supervisor'' with ``the agency'' to allow an agency that accepts 
an oral request to determine how best to document an oral request 
instead of the supervisor. The second agency stated that the agency, 
not the supervisor, is in the best position to determine how to 
document an oral request.
    We do not concur with the first agency's recommendation to mandate 
that a request to use religious compensatory time off must be in 
writing. In extenuating circumstances, an employee may not be able to 
make a request in writing. However, we do agree that a written request 
should be the standard procedure. Accordingly, we are revising the 
proposed regulations to provide that a written request is required to 
the maximum extent practicable. Also, we are requiring the employee to 
provide required

[[Page 17935]]

information as soon as practicable after an oral request is approved, 
instead of relying solely on the supervisor's documentation of the 
request. We do agree with the second agency's recommendation to change 
``the supervisor'' to ``the agency'' in Sec.  550.1005(a) to enable an 
agency to make a determination through its internal policy.
    An agency also recommended changing the third sentence of Sec.  
550.1005(a) to require all employees to submit their requests to use 
religious compensatory time off sufficiently in advance to accommodate 
necessary scheduling changes, but we are not adopting this 
recommendation. Section 550.1004(a) requires employees to submit 
requests in advance of the religious observance. The third sentence in 
Sec.  550.1005(a) gives agencies some discretion in determining how far 
in advance is necessary to avoid interfering with the agency's ability 
to efficiently carry out its mission. Whether a request has been made 
``sufficiently in advance'' would depend on the exact fact situation, 
and thus OPM seeks to preserve agency discretion in this regard.
    Two commenters requested clarification on the process for 
disapproving a request. One agency requested additional guidance on an 
agency's responsibility for denying a request. A second agency asked 
for clarification on several factors that may be relevant when 
considering an employee's request. It asked if a request could be 
denied if the employee has not fulfilled his or her responsibilities 
(such as providing the name of observance, dates and times, etc.) 
within his or her request; or if the request may be denied if the 
description provided is unclear, inadequate, or unreasonable. It also 
asked what the order would be for approving multiple time off requests 
of different types (from different employees) for a given day. The 
agency asked whether religious compensatory time off must be approved 
before other requests for time off from other employees for the same 
time period if an agency cannot approve all of the requests.
    In considering agencies' ability to disapprove an employee's 
request related to religious compensatory time, a distinction must be 
made between a request to ``use'' religious compensatory time off 
(i.e., take time off to engage in a religious observance) and a request 
to ``earn'' religious compensatory time off (i.e., perform extra work 
that will be credited as religious compensatory time off hours to be 
applied against a past or future use of time off). Paragraphs (a) and 
(b) of Sec.  550.1005 pertain to a request to ``use'' religious 
compensatory time off--in other words, the scheduling of time off to 
engage in a religious observance. Paragraph (c) of Sec.  550.1005 
pertains to the earning of religious compensatory time off hours. As 
further explained below, an agency can deny a request to ``use'' 
religious compensatory time off (as defined in Sec.  550.1003) only if 
it would interfere with the agency's ability to efficiently carry out 
its mission. However, an agency has more flexibility in approving or 
denying the timing of overtime work to ``earn'' religious compensatory 
time off hours. When the regulations refer to a request for ``religious 
compensatory time off'' without making a distinction between 
``earning'' versus ``using'' religious compensatory time off (e.g., 
Sec.  550.1004(a)), the regulation in question should be understood as 
referring to a request to ``use'' religious compensatory time off, 
which necessarily includes plans to ``earn'' the necessary hours 
through overtime work.
    We are not providing additional guidance in the regulations on an 
agency's responsibilities for approving a request to use religious 
compensatory time off. As explained in Sec.  550.1005(b), an agency 
must approve an employee's request based on personal religious 
requirements unless the agency determines that approving the request 
would interfere with the agency's ability to efficiently carry out its 
mission. That is to say, an agency may deny a request to use religious 
compensatory time off for a religious observance requiring absence from 
work at specific times based on the requester's sincerely held 
religious beliefs only if approving the request would interfere with 
the agency's ability to efficiently carry out its mission. If the 
information provided by the employee regarding the religious observance 
is not sufficient to determine whether the request is to use religious 
compensatory time off for a religious observance requiring absence from 
work at specific times based on the requester's sincerely held 
religious beliefs, an agency may request more information before acting 
on the request. The requirement that a denial under Sec.  550.1005(b) 
must be based on an agency determination that the employee's absence 
would interfere with the accomplishment of the agency's mission is a 
reflection of the statutory standard for determining whether a request 
to use religious compensatory time off must be approved. In making 
determinations on approving multiple time off requests from different 
employees for the same day, agencies should use appropriate judgment. 
For example, an agency may not be able to approve an employee's request 
to use religious compensatory time off if the office has several 
employees who are ill and are using sick leave, and the employee who is 
requesting religious compensatory time off is needed in the interim to 
achieve the agency's mission. We note that employees have a statutory 
right to use sick leave.
    A religious organization recommended an affirmative statement be 
included in the final regulations that a supervisor should not make any 
judgment about the employee's religious beliefs or his or her 
affiliation with a religious organization--a statement that has been 
included in OPM guidance, as documented on page 5 of the U.S. 
Government Accountability Office's report on religious compensatory 
time off (GAO-13-96, October 12, 2012).
    OPM declines to make this change. Section 550.1005(b) states that 
an agency must approve an employee's request to use religious 
compensatory time off unless the agency determines that approving the 
request would interfere with the agency's ability to efficiently carry 
out its mission. OPM defines the term religious compensatory time off 
in Sec.  550.1003 based on the statutory language. As we are clarifying 
in the final regulations, if an employee feels a personal obligation to 
be absent from work based on the employee's personal religious beliefs, 
the employee's request to use ``religious compensatory time off'' must 
be approved, absent a finding that an employee's absence would 
interfere with the agency mission. Since the employee's personal 
religious beliefs are at issue, the orthodox views of any religious 
organization with which the employee may be affiliated (in any degree) 
are not relevant. As Federal courts have ruled, neither courts nor 
Government officials should be making judgments about the validity or 
correctness of a person's sincerely held beliefs that are religious in 
nature. We have concluded that our clarification of the definition of 
religious compensatory time off in the final regulations sufficiently 
addresses the concerns expressed by the commenter.
    An agency commented that Sec.  550.1005(c) should be revised to 
clarify that agencies may authorize ``up to'' 26 pay periods prior to 
and after a religious observance for an employee to earn religious 
compensatory time off. While we are revising the timeframe to be 13 pay 
periods before or after a religious observance in these final 
regulations, the issue raised by the

[[Page 17936]]

commenter is still relevant. The agency presumed that Sec.  550.1005(c) 
allows agencies to set narrower (shorter) timeframes at their 
discretion.
    The agency's presumption is incorrect, as this provision was 
intended to place an obligation on the agency to allow an employee to 
earn religious compensatory time off within the regulatory timeframe 
established in Sec.  550.1006(c). Proposed Sec.  550.1005(c) was not 
intended to permit agencies to establish a narrower timeframe in which 
an employee may earn religious compensatory time off. Proposed Sec.  
550.1005(c) must be read in conjunction with Sec.  550.1006(b) and 
(c)(1), which allow an employee to earn religious compensatory time off 
within the regulatory timeframe. Agencies do not have the discretion to 
establish a narrower timeframe for earning religious compensatory time 
off hours. Within the regulatory timeframe, agencies do have some 
discretion in approving the specific occasions when an employee will be 
allowed to perform overtime work and earn religious compensatory time 
off hours based on mission requirements; however, that discretion does 
not extend to establishing a blanket policy that narrows the timeframe 
for earning hours set forth in Sec.  550.1006. In response to the 
agency's comments, we are revising Sec.  550.1005(c) to refer to the 
deadline in Sec.  550.1006(c).

Sec.  550.1006--Scheduling Time To Earn and Use Religious Compensatory 
Time Off

    An agency asked whether, for a targeted religious observance, 
employees could earn religious compensatory time off in advance of the 
observance as well as after the observance to repay the time.
    As provided under Sec.  550.1006(a), the scheduling of time to earn 
and use religious compensatory time off by an employee is subject to 
the agency's approval as provided under Sec.  550.1005. These 
regulations provide rules allowing an employee to earn religious 
compensatory time off (by working) before the religious observance, 
after the religious observance, or through a combination of time worked 
both before and after the religious observance. The employee may earn 
the hours in advance of using religious compensatory time off or earn 
the hours to repay the hours already used as religious compensatory 
time off. Agencies must approve an employee's request to earn religious 
compensatory time off as provided under Sec.  550.1005(c) and monitor 
the employee's accumulation of such hours. The specific timing of when 
an employee will be allowed to earn religious compensatory time off by 
performing overtime work is a matter of agency discretion based on the 
needs of the agency. In other words, agencies can consider the specific 
work requirements of the individual employee's organization in deciding 
the specific times when the employee will be allowed to perform 
overtime work to earn religious compensatory time off hours.
    An agency recommended the final rule require employees ``to 
normally earn religious compensatory time off in advance of the 
religious observance.'' Alternatively, if OPM chooses to retain the 
provision allowing an employee to earn religious compensatory time off 
after the given religious observance, the agency recommended that the 
final rule allow an agency to temporarily require an employee to earn 
religious compensatory time off in advance for any future religious 
observances if the employee did not perform the required overtime work 
to make up for the religious compensatory time off used previously 
(e.g., where the agency had to retroactively charge the employee annual 
leave or leave without pay to recover the debt of hours, as provided in 
Sec.  550.1006(c)(3)). The agency proposed that, if this retroactive 
charging occurred, the employee would be required to earn religious 
compensatory time off in advance for a 1-year period beginning on the 
date the action to make a retroactive correction was taken.
    We disagree, and are not adopting these recommendations. We see no 
compelling reason to revise the longstanding policy that allows an 
employee to earn religious compensatory hours after using the hours for 
a religious observance. Nor do we, at this time, support limiting an 
employee's future options based on a past failure to repay hours within 
the regulatory timeframe. Any such failure results in an appropriate 
negative consequence--a retroactive application of annual leave (or 
other appropriate paid time off) or leave without pay. Any debt 
resulting from retroactive application of leave without pay is subject 
to debt collection.
    An agency recommended changing the term ``may'' to ``must'' in 
Sec.  550.1006(c)(3) (and similarly under Sec.  550.1008(b)) with 
regard to agencies taking corrective action to eliminate or reduce the 
negative balance of religious compensatory time off by making a 
corresponding reduction in the employee's annual leave balance.
    We believe the agency perceives there to be a discretionary 
authority for the elimination or reduction of the debt. The charge to 
annual leave is provided in the regulation as a ``may'' authority, but 
there still remains a mandatory requirement to recoup any debt owed 
with a ``must'' charge to leave without pay, thus creating a debt that 
must be repaid. While we agree it would be a reasonable agency policy 
to first charge annual leave to liquidate the debt, we use the term 
``may'' to recognize that agencies may choose not to establish that 
policy or may fail to take this corrective action first before charging 
leave without pay. Allowing agencies the discretion to make an annual 
leave correction is consistent with longstanding OPM guidance. 
Accordingly, we are not adopting this suggestion.
    An agency also recommended allowing employees to cover negative 
balances through credit hours earned, compensatory time off in lieu of 
overtime pay earned, compensatory time off for travel earned, or 
substitution of other paid time.
    We agree with this recommendation and are making changes in the 
final regulations to allow for the substitution of credit hours, 
compensatory time off in lieu of overtime pay, compensatory time off 
for travel, and time-off awards to liquidate an employee's debt of 
hours. We are revising Sec.  550.1006(c)(3) to provide that any 
positive balance of annual leave, credit hours, compensatory time off 
for overtime, compensatory time off for travel, or time-off awards may 
be applied to reduce the debt of hours before it is converted to a 
monetary debt. An agency may determine the order in which to apply 
these forms of paid time off to offset the negative religious 
compensatory time off balance. We are including only types of accrued 
paid time off that can be used for any purpose. Thus, we did not 
include sick leave or military leave, as these types of leave have 
certain parameters and conditions on their use.

Sec.  550.1007--Accumulation and Documentation

    Two agencies recommended establishing a limitation on the number of 
religious compensatory time off hours that may be accumulated. An 
individual commenter recommended placing a limitation on the amount of 
religious compensatory time off hours an employee may earn per pay 
period out of concerns that an employee could be tempted to work 
extreme hours per day or per week in order to earn enough compensatory 
time off for a religious observance.

[[Page 17937]]

    We disagree, as there is no authority for a limitation on the 
number of hours that may be earned or used. In general, an agency must 
approve an employee's request to use religious compensatory time off, 
unless the agency determines that approving the request would interfere 
with the agency's ability to carry out its mission (see Sec.  
550.1005(b)). Further, as explained in the Supplementary Information 
regarding Sec.  550.1007 in the proposed rule (78 FR 53698), agencies 
must monitor any accumulation to ensure that the employee is earning 
the religious compensatory time off for a specific religious observance 
and is not stockpiling the religious compensatory time off for 
unidentified purposes.
    One agency recommended deleting the term ``appropriate'' for the 
type of records that must be kept under Sec.  550.1007(a), which 
includes the name and/or description of the religious observance, the 
dates and times, and the amount of religious compensatory time off each 
employee earns and uses. The same agency also requested clarification 
on whether records may be paper-based or electronic.
    We agree that the term ``appropriate'' is ambiguous and 
unnecessary, and we are deleting it in the final regulations. Each 
agency has the discretion to determine if records should be kept 
electronically or paper-based.
    An agency recommended revising Sec.  550.1007(b) from ``an employee 
may accumulate only the amount needed to cover an approved absence for 
a religious observance that has already occurred'' to read, ``an 
employee may accumulate only the amount needed to fund a previously 
approved absence from work for a religious observance that has already 
occurred.''
    We disagree in applying the term ``fund'' to these regulations. 
Employees accumulate hours to use for religious purposes. An employee 
may earn religious compensatory time off in advance or after it is 
used. Instead of becoming indebted, the employee is choosing to work 
overtime hours to cover periods of absences for religious observances.
    An agency asked if earned religious compensatory time off that is 
not used as planned would be forfeited or paid out as compensatory time 
off in lieu of overtime pay, or any other form of time off.
    As provided within Sec.  550.1008, upon the employee's separation 
from Federal service or transfer to another Federal agency, the losing 
agency must compensate the employee for any positive balance to his or 
her credit. The agency must pay the employee for the hours of religious 
compensatory time off earned at the hourly rate of basic pay in effect 
at the time the religious compensatory time off was earned. Religious 
compensatory time off cannot be forfeited, paid as overtime premium 
pay, provided as compensatory time off in lieu of overtime pay, or 
converted to any other forms of time off.
    An agency requested that Sec.  550.1007(c)(1) be removed from the 
final regulations. This section provides that if the employee does not 
use his or her religious compensatory time off as planned, the positive 
balance may be redirected toward a future religious observance that has 
been approved, even if that future observance is beyond the normally 
applicable regulatory timeframe (notwithstanding Sec.  550.1006(b)). 
The agency recommended removing this section because including it could 
leave room for error in its administration.
    We are not adopting this recommendation to remove Sec.  
550.1007(c)(1) from the final regulations. It is appropriate to allow 
earned religious compensatory time off that has not been used as 
planned to be applied toward a future religious observance that has 
been properly requested and approved.
    Two agencies provided additional comments on allowing the unused 
positive balance of religious compensatory time off to be redirected to 
a future religious observance when the employee was unable to use the 
hours earned as originally planned and approved. One agency agreed with 
allowing employees to redirect earned hours to a different religious 
observance, but objected to not having some kind of deadline for using 
the hours. It recommended establishing a 13 pay period deadline for 
using religious compensatory time off that has been previously earned, 
whether used as originally planned or for a different religious 
observance in the future. We understand this agency to be proposing 
that there be a strict rule that earned hours of religious compensatory 
time off must be used within 13 pay periods of when earned. Any 
different religious observance to which hours are redirected would have 
to occur within that 13 pay period window. The agency did not specify a 
proposed consequence for failure to meet that deadline. Another agency 
commented that there should be a cutoff period established for purposes 
of determining what happens to the religious compensatory time off if 
not used by a certain pay period.
    We disagree with these comments. We do not support a cutoff date 
for eliminating a positive balance of unused religious compensatory 
time off via either forfeiture or cash payment. Earned religious 
compensatory time off hours are intended to be used for a religious 
observance. Under the regulations, the cashing out of unused religious 
compensatory time off hours occurs only when an employee leaves the 
agency (via separation or transfer), which maximizes the possibility 
that the hours will be used for the intended purpose and prevents abuse 
that might occur if employees were allowed to repeatedly cancel planned 
uses of religious compensatory time off and convert the hours to a cash 
payment after a certain amount of time has elapsed.
    Under paragraph (c), if an employee does not use earned religious 
compensatory time off as planned, the employee may redirect the hours 
towards a future religious observance without regard to the normal bar 
on earning hours outside the regulatory timeframe. This is the 
preferred approach, since it ensures that the hours are used to meet 
religious obligations, as intended by the law. If an employee does not 
redirect the hours to another religious observance, the positive 
balance remains to the employee's credit until transfer or separation 
from the agency. An employee with a positive balance of hours will be 
barred from earning any additional religious compensatory time off 
until the hours have been used or the employee establishes the need for 
additional hours, as provided in the regulations. This approach 
prevents employees from stockpiling religious compensatory time off for 
undesignated purposes.
    Given the comments received about a possible cutoff date for 
eliminating a positive balance of unused religious compensatory time 
off via either forfeiture or cash payment, we are adding a new 
paragraph (d) in Sec.  550.1007 to make clear that there are no time 
limits on using accumulated religious compensatory time off--that 
unused religious compensatory time off hours remain to the employee's 
credit until used, or until the employee's separation or transfer.

Sec.  550.1008--Employee Separation or Transfer

    An agency commented that when an employee separates or transfers, 
he or she should only be compensated for unused religious compensatory 
time off when, at the time the employee earned it, he or she did not 
expect to separate or transfer prior to the deadline for using it. The 
agency wanted to ensure that an employee does not stockpile religious 
compensatory time off hours

[[Page 17938]]

when the employee does not expect to use those hours before separating 
or transferring and thus would receive payment for the unused hours.
    Another agency submitted a similar comment concerning the 
stockpiling of hours. The agency recommended that agencies be provided 
the flexibility to liquidate via a cash payment unused religious 
compensatory time off. While the agency appreciates the opportunity 
employees have to retain unused time for future observances, it is 
concerned about the indefinite carryover of hours. Currently, the 
proposed regulations would only allow an agency to pay an employee for 
the unused hours upon separation or transfer to another agency. Instead 
of tracking the time annually or waiting for the employee to separate 
or transfer, the agency recommended the regulations allow agencies to 
determine if and when they would pay out the hours in situations other 
than separation or transfer. The agency asserted this flexibility would 
assist agencies in balancing timekeeping records if an agency has 
determined the unused timeframe to be excessive, since the hours cannot 
be forfeited.
    We disagree. If an employee works the hours but does not use the 
hours (i.e., has a positive balance), the employee should be 
compensated for the hours worked at the time of separation or transfer, 
as provided in Sec.  550.1008(a). As for an employee potentially 
stockpiling hours, Sec.  550.1007(c)(2) provides that an employee may 
accumulate additional religious compensatory time off hours only if 
needed to cover an approved period of absence for a future religious 
observance based on the specific dates and times that the employee has 
identified. This provision is meant to prevent the stockpiling of 
hours.
    An agency also recommended revisions to Sec.  550.1008(b) by 
replacing the term ``may'' to ``must'' when taking corrective action to 
eliminate or reduce a negative balance of religious compensatory time 
off by reducing the employee's annual leave balance upon separation or 
transfer.
    The same agency made a similar recommendation for Sec.  
550.1006(c)(3), which we have already addressed. The charge to annual 
leave is provided in the regulation as an optional authority (using the 
language ``may''), but there remains a mandatory requirement (using the 
language ``must'') for an agency to recoup the debt owed with a charge 
to leave without pay, thus creating a debt that must be repaid.
    It also recommended that the substitution of other forms of paid 
time off--such as earned credit hours, regular compensatory time off 
earned in lieu of overtime, or compensatory time off earned for 
travel--be allowed to repay a negative balance in addition to the use 
of annual leave.
    We agree that the substitution of other forms of paid time off 
should be allowed. Consistent with the change we made in Sec.  
550.1006(c)(3), we are revising Sec.  550.1008(b) to allow for the 
substitution of credit hours, compensatory time off in lieu of overtime 
pay, compensatory time off for travel, or time-off awards to liquidate 
the negative debt. However, the use of sick leave or military leave 
would not be appropriate, as there are parameters on the appropriate 
uses of these specific leave categories.

General Comments

    An individual commenter recommended that the final rule include 
dispute resolution or appeal procedures if an employee's request is 
denied under 5 CFR 550.1005(b). The commenter wanted to ensure a common 
knowledge of the appeals processs within agencies. We are not adopting 
this recommendation in the final regulations. Each agency has 
established appeal procedures that an employee must follow if he or she 
seeks to grieve an agency's denial of a request for religious 
compensatory time off. We have added language to Sec.  550.1005(b) to 
provide that an agency must explain its reasoning for a denial of a 
request to use and/or earn religious compensatory time off.
    An individual commenter was opposed to the establishment of 
religious compensatory time off, observing that some employees may not 
identify with a religious group. The commenter recommended a general 
compensatory personal time off bank be established instead. The 
commenter specifically cited the time off needed by working parents for 
various family commitments. The commenter stated that parents often 
have to opt out of school events and activities because of a lack of 
compensatory time available or having to use other leave, such as 
annual leave or sick leave. The commenter also expressed that the 
proposal could face appeals from employees who do not identify with a 
religious group or practice but routinely participate in humaniatarian 
efforts as a moral or ethical belief. The commenter recommended that 
those individuals should be allowed to earn compensatory time off 
without needing to qualify their efforts as ``religious''.
    We cannot adopt this recommendation because there is no statutory 
authority to establish a compensatory personal time off bank as 
described by the commenter, and Congress has mandated that agencies 
permit religious compensatory time off in the circumstances described 
by these regulations, unless doing so, in a particular instance, would 
interfere with the agency's mission. We note that employees may use 
certain leave or time off for general purposes, including the purposes 
cited by the commenter. For example, annual leave may used used for any 
purpose. While annual leave must normally be earned or accrued before 
it is used, it is possible for an agency to approve advanced annual 
leave. (See https://www.opm.gov/policy-data-oversight/pay-leave/leave-administration/fact-sheets/advanced-annual-leave.) Also, while regular 
compensatory time off in lieu of overtime under 5 U.S.C. 5543 must be 
earned in advance, it may also be used for any purpose.

Transitional Provisions

    An agency commented that the proposed regulations did not address 
the treatment of employees who owe religious compensatory time at the 
time the final regulations become effective. The agency noted that some 
employees may have used religious compensatory time off more than 26 
pay periods prior to the effective date of the final regulations and 
still not have worked the time to make it up. It asked whether such 
employees would have an additional 26 pay periods to repay the debt of 
hours or if the employing agency would have the authority to establish 
an alternative deadline. The agency stated that it favored giving such 
employees a reasonable period to repay the hours owed (by performing 
work).
    We agree that clarification is needed regarding the treatment of 
the employees described by the agency who have a negative balance of 
religious compensatory time off when the final regulations take 
effect--whether the period of time since the religious compensatory 
time off was used exceeds the regulatory timeframe (originally proposed 
as 26 pay periods, but established as 13 pay periods in these 
regulations) or is some lesser period of time. This comment also 
brought to light that the proposed regulations did not specifically 
address employees who have a positive balance of religious compensatory 
time off when the final regulations take effect. Therefore, we are 
adding a new Sec.  550.1010 to provide transitional rules for employees 
who have either a negative or positive balance of religious 
compensatory time off as of the effective date of the final 
regulations.

[[Page 17939]]

    Paragraph (b) of Sec.  550.1010 states that, for an employee who 
has a negative balance (i.e., debt) of used but not-yet-earned 
religious compensatory time off hours as of the effective date of the 
final regulations, the 13 pay period limitation in Sec.  550.1006(c) is 
applied as if the effective date were the date on which all the hours 
of religious compensatory time off (represented in the negative 
balance) were used. Thus, employees will have a full 13 pay periods to 
earn the needed number of religious compensatory time off hours. Since 
these regulations are changing the rules midstream for these employees, 
we believe it is appropriate to start the clock when the new 
regulations take effect.
    Paragraph (c) of Sec.  550.1010 addresses employees who have a 
positive balance of earned but unused religious compensatory time off 
hours as of the effective date of the final regulations. It provides 
that the employing agency must confirm and document that the hours are 
connected to one or more specific religious observances requiring the 
employee's absence from work in order to meet the employee's personal 
religious requirements. The agency must give the employee an 
opportunity to direct all unused hours to such a future religious 
observance. If the employee does not direct all of those unused hours, 
the employee may not earn any additional religious compensatory time 
off hours until the employee establishes a need to earn such time off 
hours, consistent with Sec.  550.1007(c)(2).

Miscellaneous Changes

    In addition to the proposed revision of subpart J of part 550 of 
title 5 of the Code of Federal Regulations, we also proposed to modify 
the definitions of rate of basic pay in Sec.  550.103 and firefighter 
in Sec.  550.1302. We did not receive any comments on those proposed 
revisions. Therefore, these final regulations are making final the 
additional miscellaneous proposed changes.

Executive Order Requirements

    Executive Orders 13563 and 12866 direct agencies to assess all 
costs and benefits of available regulatory alternatives and, if 
regulation is necessary, to select regulatory approaches that maximize 
net benefits (including potential economic, environmental, public 
health and safety effects, distributive impacts, and equity). Executive 
Order 13563 emphasizes the importance of quantifying both costs and 
benefits, of reducing costs, of harmonizing rules, and of promoting 
flexibility. This rule has been designated a ``significant regulatory 
action,'' under Executive Order 12866 and has been reviewed by the 
Office of Management and Budget.

Executive Order 13771

    This final rule is not subject to the requirements of E.O. 13771 
(82 FR 9339, February 3, 2017) because the rule is related to agency 
organization, management, or personnel.

Regulatory Flexibility Act

    I certify that this regulation will not have a significant economic 
impact on a substantial number of small entities because it will apply 
only to Federal agencies and employees.

Paperwork Reduction Act Requirements

    This rule does not impose any new reporting or record-keeping 
requirements subject to the Paperwork Reduction Act.

List of Subjects in 5 CFR Part 550

    Government employees.

    Office of Personnel Management.
 Alexys Stanley,
Regulatory Affairs Analyst.

    For reasons stated in the preamble, OPM is amending part 550 of 
title 5 of the Code of Federal Regulations as follows:

PART 550--PAY ADMINISTRATION (GENERAL)

Subpart A--Premium Pay

0
1. The authority citation for subpart A of part 550 continues to read 
as follows:

     Authority: 5 U.S.C. 5304 note, 5305 note, 5504(d), 5541(2)(iv), 
5545a(h)(2)(B) and (i), 5547(b) and (c), 5548, and 6101(c); sections 
407 and 2316, Pub. L. 105-277, 112 Stat. 2681-101 and 2681-828 (5 
U.S.C. 5545a); section 2(h), Pub. L. 113-277, 128 Stat. 3005; E.O. 
12748, 3 CFR, 1992 Comp., p. 316.

0
2. In Sec.  550.103, the definition of ``rate of basic pay'' is revised 
to read as follows:


Sec.  550.103  Definitions.

* * * * *
    Rate of basic pay means the rate of pay fixed by law or 
administrative action for the position held by an employee, including 
any applicable locality payment under 5 CFR part 531, subpart F; 
special rate supplement under 5 CFR part 530, subpart C; retained rate 
under 5 CFR part 536; or similar payment or supplement under other 
legal authority, before any deductions and exclusive of additional pay 
of any other kind.
* * * * *

0
3. Revise subpart J to read as follows:

Subpart J--Compensatory Time Off for Religious Observances
Sec.
550.1001 Purpose.
550.1002 Coverage.
550.1003 Definitions.
550.1004 Employee responsibilities.
550.1005 Agency responsibilities.
550.1006 Scheduling time to earn and use religious compensatory time 
off.
550.1007 Accumulation and documentation.
550.1008 Employee separation or transfer.
550.1009 Relationship to premium pay and overtime work.
550.1010 Transitional provisions.

     Authority: 5 U.S.C. 5550a.

Subpart J--Compensatory Time Off for Religious Observances


Sec.  550.1001  Purpose.

    This subpart implements 5 U.S.C. 5550a, which permits an employee 
whose personal religious beliefs require the abstention from work 
during certain periods of time to elect to engage in overtime work and 
earn a special form of compensatory time off to make up for the time 
lost in meeting those personal religious requirements. Religious 
compensatory time off differs from other forms of compensatory time off 
in that the sole purpose is to adjust an employee's work schedule to 
accommodate a religious observance. The employee earns religious 
compensatory time off by spending an equal amount of time in overtime 
work before and/or after taking time from the employee's scheduled tour 
of duty to meet personal religious requirements. Hours worked to earn 
religious compensatory time off provide a time off credit in lieu of 
any pay that would otherwise be payable for that work.


Sec.  550.1002   Coverage.

    This subpart applies to each employee (as defined in 5 U.S.C. 2105) 
in or under an Executive agency (as defined in 5 U.S.C. 105) who has a 
scheduled tour of duty. The definition of ``employee'' in section 
5541(2) does not apply to this subpart.


Sec.  550.1003   Definitions.

    In this subpart:
    Overtime work means work performed by an employee outside his or 
her scheduled tour of duty for the purpose of making up time lost for 
meeting personal religious requirements, as such term is explained in 
the definition of ``religious compensatory time off'' in this section. 
It is also deemed to include work performed by a part-time employee 
outside of his or her

[[Page 17940]]

scheduled tour of duty, even if that work is below applicable overtime 
thresholds (e.g., below 40 hours in a week), and work an employee 
performs during holiday hours (within the employee's scheduled tour of 
duty) during which the employee would otherwise be excused from duty.
    Rate of basic pay means the rate of pay fixed by law or 
administrative action for the position held by an employee, including 
any special rate under 5 CFR part 530, subpart C; locality rate under 5 
CFR part 531, subpart F; retained rate under 5 CFR part 536; or similar 
rate under other legal authority, before any deductions and excluding 
additional pay of any other kind. For example, a rate of basic pay does 
not include additional pay such as night shift differentials under 5 
U.S.C. 5343(f) or environmental differentials under 5 U.S.C. 
5343(c)(4).
    Religious compensatory time off means compensatory time off, as 
authorized by 5 U.S.C. 5550a, under which an employee whose personal 
religious beliefs require the abstention from work during certain 
periods of time may elect to perform overtime work in order to make up 
for time the employee takes off to meet those personal religious 
requirements. Those requirements need not be officially mandated by a 
religious organization to which the employee belongs. It is sufficient 
that the employee's personal religious beliefs cause the employee to 
feel an obligation that he or she should be absent from work for a 
religious purpose. An employee approved to perform overtime work under 
this subpart will be granted an equal amount of compensatory time off 
from his or her scheduled tour of duty (in lieu of overtime pay or 
other pay otherwise payable) to meet his or her personal religious 
obligations.
    Scheduled tour of duty means the regular work hours in an 
established full-time or part-time work schedule during which the 
employee is charged leave or time off when absent.


Sec.  550.1004   Employee responsibilities.

    (a) An employee is required to provide his or her supervisor with a 
request for religious compensatory time off in advance of the religious 
observance by following the agency's procedures established in 
accordance with Sec. Sec.  550.1005 and 550.1006.
    (b) At the time the religious compensatory time off is requested, 
the employee must provide the agency with the following information:
    (1) The name and/or description of the religious observance that is 
the basis of the employee's request to be absent from work in order to 
meet the employee's personal religious requirements;
    (2) The date(s) and time(s) the employee plans to be absent to 
participate in the religious observances identified in paragraph (b)(1) 
of this section; and
    (3) The date(s) and time(s) the employee plans to perform overtime 
work to earn religious compensatory time off to make up for the 
absence.
    (c) An employee must comply with the agency's procedures for 
requesting religious compensatory time off, including any time 
limitations prescribed under Sec.  550.1006.
    (d) In the event that an adjustment to the dates and times of 
planned overtime work is required due to unforeseen circumstances, the 
employee must submit for approval a revised schedule to reflect those 
changes.


Sec.  550.1005   Agency responsibilities.

    (a) An agency may require an employee to submit his or her request 
to use religious compensatory time off with all the information 
specified in Sec.  550.1004(b) in a manner that is administratively 
acceptable to the agency. To the maximum extent practicable, the agency 
must require that the request be in writing (including electronic 
communications). If the agency accepts an oral request, the agency must 
document all the information specified in Sec.  550.1004(b) and must 
require the employee to submit a written document containing all the 
information as soon as practicable. An agency may require an employee 
to submit a request to use religious compensatory time off sufficiently 
in advance to accommodate necessary scheduling changes without 
interfering with the agency's ability to efficiently carry out its 
mission.
    (b) An agency must approve an employee's request to use religious 
compensatory time off unless the agency determines that approving the 
request would interfere with the agency's ability to efficiently carry 
out its mission. If the employee's request to use religious 
compensatory time off is denied, the agency must provide a written 
explanation as to the reason the request has been denied, regardless of 
whether the employee's request was written or oral.
    (c) The agency must provide the employee with an opportunity to 
earn religious compensatory time off before the deadline established in 
Sec.  550.1006(c), although the specific timing of when an employee 
will be allowed to earn religious compensatory time off by performing 
overtime work is a matter of agency discretion based on the needs of 
the agency.


Sec.  550.1006   Scheduling time to earn and use religious compensatory 
time off.

    (a) The scheduling of time to earn and use religious compensatory 
time off by an employee is subject to the agency's approval as provided 
in Sec.  550.1005.
    (b) For an employee who earns religious compensatory time off prior 
to using it, religious compensatory time off may be earned up to 13 pay 
periods in advance of the pay period in which the targeted religious 
observance commences and must be linked to specific dates and times for 
future use, as compatible with agency mission requirements.
    (c)(1) An employee who uses religious compensatory time off prior 
to earning it must fulfill his or her obligation to perform overtime 
work in exchange for the advanced religious compensatory time off 
within 13 pay periods after the pay period in which he or she used 
religious compensatory time off, or the agency must take action as 
provided in paragraph (c)(3) of this section.
    (2) The 13 pay periods described in paragraph (c)(1) of this 
section are calculated beginning with the first pay period beginning 
after the date on which the religious compensatory time off was used.
    (3) If the employee fails to earn religious compensatory time off 
within 13 pay periods after taking religious compensatory time off, the 
agency may take corrective action to eliminate or reduce the negative 
balance by making a corresponding reduction in the employee's balance 
of annual leave, credit hours, compensatory time off in lieu of regular 
overtime pay, compensatory time off for travel, or time-off awards. An 
agency may determine the order of precedence for applying the various 
types of paid time off to offset the negative balance. Any negative 
balance of religious compensatory time off remaining after any charging 
of these types of paid time off must be resolved by charging the 
employee leave without pay, which would result in an indebtedness that 
is subject to the agency's internal debt collection procedures.


Sec.  550.1007   Accumulation and documentation.

    (a) Agencies must keep records of the name and/or description of 
the religious observance, and the dates, times, and amount of religious 
compensatory time off each employee earns and uses. An agency must 
credit religious compensatory time off for work performed on a time-
for-time basis,

[[Page 17941]]

under its time and attendance procedures.
    (b) Except as provided in paragraph (c) of this section, an 
employee may accumulate only the amount of religious compensatory time 
off needed to cover an approved absence for a religious observance that 
has already occurred or to cover an approved absence for a future 
religious observance. An employee may only accumulate the amount of 
religious compensatory time off needed to cover the specific dates and 
times for which the employee has submitted a request for religious 
compensatory time off under Sec.  550.1004.
    (c) If the employee does not use his or her earned religious 
compensatory time off as planned--
    (1) The positive balance of unused compensatory time off may be 
redirected toward a future religious observance that has been approved, 
even if that future observance is more than 13 pay periods after the 
compensatory time off was originally earned (notwithstanding Sec.  
550.1006(b)); and
    (2) The employee may not earn any additional religious compensatory 
time off until the retained amount of religious compensatory time off 
has been used or the need to earn additional religious compensatory 
time off has been properly established and documented.
    (d) Accumulated religious compensatory time off that is not used as 
planned is not subject to time limits for usage. Unused religious 
compensatory time off hours remain to the employee's credit until used 
(subject to the agency's approval under Sec.  550.1005), or the 
employee's separation or transfer (subject to Sec.  550.1008), as 
applicable.


Sec.  550.1008   Employee separation or transfer.

    (a) Upon an employee's separation from Federal service or transfer 
to another Federal agency, the losing agency must compensate the 
employee for any positive balance of earned religious compensatory time 
off to his or her credit. The agency must pay the employee for hours of 
earned religious compensatory time off at the hourly rate of basic pay 
in effect at the time religious compensatory time off was earned.
    (b) For an employee who has a negative balance of religious 
compensatory time off upon an employee's separation from Federal 
service or transfer to another Federal agency, the losing agency may 
take corrective action to eliminate or reduce the negative balance by 
making a corresponding reduction in the employee's balance of annual 
leave, earned credit hours, compensatory time off in lieu of regular 
overtime pay, compensatory time off for travel, or time-off awards. An 
agency may determine the order of precedence for applying the various 
types of paid time off to offset the negative balance. Any negative 
balance of religious compensatory time off remaining after any charging 
of these types of paid time off must be resolved by charging the 
employee leave without pay, which would result in an indebtedness that 
is subject to the agency's internal debt collection procedures.
    (c) For purposes of applying paragraphs (a) and (b) of this 
section, an hourly rate of basic pay is computed by dividing the annual 
rate of basic pay by 2,087 hours (or 2,756 hours for firefighter hours 
subject to that divisor under subpart F of this part).


Sec.  550.1009   Relationship to premium pay and overtime work.

    The premium pay provisions for overtime work in subpart A of this 
part and section 7 of the Fair Labor Standards Act of 1938, as amended 
(FLSA), do not apply to overtime work performed by an employee that is 
used to earn religious compensatory time off under this subpart. The 
overtime hours worked to earn religious compensatory time off under 
this subpart do not create an entitlement to premium pay (including 
overtime pay) under subpart A of this part or FLSA overtime pay under 5 
CFR part 551. Religious compensatory time off is not considered in 
applying the premium pay limitations described in Sec. Sec.  550.105, 
550.106, and 550.107.


Sec.  550.1010   Transitional provisions.

    (a) This section applies only with respect to employees who as of 
May 29, 2019 had a positive balance of earned but unused religious 
compensatory time off hours or a negative balance (i.e., a debt) of 
used religious compensatory time off hours not yet repaid by earned 
hours.
    (b) If an employee described in paragraph (a) of this section has a 
negative balance (i.e., a debt) of used but not-yet-earned religious 
compensatory time off hours as of the date specified in paragraph (a) 
of this section, the 13 pay period limitation in Sec.  550.1006(c) is 
applied as if such date were the date on which the hours of religious 
compensatory time off were used.
    (c) If an employee described in paragraph (a) of this section has a 
positive balance of earned but unused religious compensatory time off 
hours as of the date specified in paragraph (a) of this section, the 
agency must confirm and document that the hours are connected to one or 
more specific religious observances requiring the employee's absence 
from work in order to meet the employee's personal religious 
requirements. The agency must give the employee an opportunity to 
direct all unused hours to such a future religious observance. If the 
employee does not so direct all of those unused hours, the employee may 
not earn any additional religious compensatory time off hours until the 
employee establishes a need to earn such time off hours.

Subpart M--Firefighter Pay

0
4. The authority citation for subpart M of part 550 continues to read 
as follows:

    Authority:  5 U.S.C. 5545b, 5548, and 5553.


0
5. In Sec.  550.1302, paragraph (2)(iii) of the definition of 
``firefighter'' is revised to read as follows:


Sec.  550.1302   Definitions.

* * * * *
    Firefighter * * *
    (2) * * *
    (iii) Covered by the General Schedule and classified in the GS-
0099, General Student Trainee Series (as required by Sec.  362.203(f) 
of this chapter), if the position otherwise would be classified in the 
GS-0081 series.
* * * * *

[FR Doc. 2019-08533 Filed 4-26-19; 8:45 am]
 BILLING CODE 6325-39-P