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Texas Payroll/Personnel Resource

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Salary Adjustments for State Agency Employees
Equity Adjustments and Lateral Transfers (Reason Codes 040, 046, A46)

Equity Adjustments (Reason Code 040)

Agencies have the authority to issue equity adjustments. State agencies may use equity adjustments to maintain desirable salary relationships. Equity adjustments are intended to maintain salary equality between or among agency employees or in comparison to employees in similar positions in relevant job markets.

Example: If private companies were routinely paying higher wages and affecting the turnover for a specific position, the agency may offer the employees an equity adjustment to bring their salaries in line with the competition and aid in retention.

Any increase to the salary through an equity adjustment must not exceed the employee’s current maximum for his or her salary group, but may increase to any amount within the group. An employee’s job class or salary group may not change with an equity adjustment.

Agencies do not have the authority to remove or rescind an equity adjustment once it has been awarded.

Lateral Transfer to Different Job Classification (Reason Code 046)

An agency may need to reclassify an employee to a new job with a different job classification in the same salary group. This is known as a lateral transfer. The minimum salaries of both groups must be the same for the change to be a lateral transfer.

Note: The job classification number must change with this lateral transfer.

The agency has a choice regarding the employee’s salary for a lateral move. The salary can:

  • Remain the same.
  • Increase by up to 3.4 percent.
  • Decrease, but not below the minimum of the salary group.

Lateral Transfer to Same Job Classification (Reason Code A46)

Agencies may need to adjust the salary of an employee who applies and is selected for a position within his or her employing agency when the current and new positions both have the same job classification.

In this case, the salary can be adjusted higher or lower but must remain within the range of the salary group.

Note: The job classification number must not change with this lateral transfer.

Sources

Texas Government Code, Sections 659.251-259, 2101.035 and 2101.037; General Appropriations Act, Article V, Rider 7 – Texas Department of Criminal Justice, Rider 21 – Texas Juvenile Justice Department, Article IX, Part 2, Article IX, Parts 3.01-3.04 and 3.07; Texas Administrative Code, Section 5.41.