5 CFR 591.239 : Administrative Personnel (§ 1.1 To Parts 10003-10049) — (§ 1.1 To Parts 631-699) — Office Of Personnel Management (§ 1.1 To Parts 631-699) — Civil Service Regulations (§ 110.101 To Parts 631-699) — Allowances And Differentials (§ 591.101 To § 591.406) — Cost-Of-Living Allowance And Post Differential - Nonforeign Areas (§ 591.201 To Appendix B To Subpart B Of Part 591) — Program Administration (§ 591.235 To § 591.244) — How do agencies treat COLAs and post differentials for the purpose of overtime pay and other entitlements?

(a) Agencies include COLAs in the employee's straight time rate of pay and include COLAs and post differentials in an employee's regular rate of pay for computing overtime pay entitlements for nonexempt employees under the Fair Labor Standards Act of 1938, as amended.

(b) Agencies may not include a COLA or post differential as part of an employee's rate of basic pay for the purpose of computing entitlements to overtime pay, retirement, life insurance, or any other additional pay, COLA, or post differential under title 5, United States Code.

(c) Payment of a COLA or post differential is not an equivalent increase in pay within the meaning of 5 U.S.C. 5335.