440. CEA Red Circle Rates
This is a rate of pay authorized to facilitate an employee’s adjustment to a lower salary. A red circle rate may be authorized for:
- a former CEA appointee who is reinstating to a civil service classification, or
- a CEA with no prior civil service who participated in a promotional exam and is being appointed from a list without a break in service, or
- a CEA appointee who is being reduced to a lower CEA salary rate.
All departments have delegated authority to approve red circle rates.
Legal Authority
DPA Rule
599.988 mandates a red circle rate for an employee who has ten years of State service if the following conditions apply:
- One or more years of State service was under a CEA appointment,
- The employee has been terminated from a CEA, and
- The termination was not voluntary nor was it based on unsatisfactory performance.
If the employee’s CEA termination was voluntary, but the all of the other criteria above are met, Rule 599.988 allows the employee to be permissively granted a red circle rate. This rate is based upon the CEA salary rate received at the time of termination, less 5 percent.
Government Code Section
13332.05 describes the intent of the Legislature in granting funds for CEA red circle rates:
No funds may be encumbered for paying a civil service employee a salary which is above the maximum of the salary range of the employee’s present classification for a period of more than 90 calendar days following termination of a career executive assignment appointment. The intent of the Legislature in permitting payment above the maximum of the salary range for the 90-day period is to facilitate the employee’s adjustment to a lower salary level. The provisions of this section shall not apply with respect to an employee who accepted any career executive assignment appointment on or after June 20, 1976, and before July 1, 1977, and any employee meeting that requirement, who is otherwise eligible, shall receive a salary rate pursuant to the provision of Rule 548.25, adopted by State Personnel Board on May 18, 1976, based upon the highest career executive assignment level held by the employee during that period.
Note: State Personnel Board Rule 548.25 was repealed August 28, 1985 and renumbered Department of Personnel Administration Rule 599.988.
90-Day Red Circle Rate
This section does not apply to employees who have a bona fide CEA appointment within the “window period” of June 20, 1976 through June 30, 1977.
A 90-day red circle rate applies to an employee being terminated from a CEA appointment or being reduced to a lower CEA salary rate. The employee must meet the criteria listed below:
An employee who meets the above criteria shall be eligible for a salary rate above the maximum of the class to which the employee is mandatorily reinstated. The red circle rate is based upon the CEA salary rate received at the time of termination, less 5 percent. The department reinstating the employee requests and pays for the red circle rate.
Extended Red Circle Rate
This section applies only to employees being terminated from a CEA appointment who accepted any CEA appointment within the “window period” of June 20, 1976 through June 30, 1977. The employee must meet the criteria listed below:
- Termination is not voluntary nor is it based on unsatisfactory performance; and
- The employee had a bona fide appointment during the “window period” of June 20, 1976 through June 30, 1977; and
- CEA service has been continuous since the qualifying “window period” appointment.
An employee who meets the above criteria shall be eligible for a salary rate above the maximum of the class (red circle rate) to which the employee is being mandatorily reinstated or is being appointed from a promotional list. The red circle rate is based upon the highest CEA level held by such employee during the “window period,” less 5 percent (for instance, if the employee was a CEA II during the “window period,” but was a CEA IV at the time of termination, the employee’s rate would be based on the CEA II, less 5 percent). The extended red circle rate will be in effect until absorbed by any salary changes.
The eligibility for an extended red circle rate based on any “window period” appointment may be used only once. An employee who received a “window period” appointment, and who has since received an appointment to a regular civil service class no longer qualifies for an extended red circle rate.
Note: It has been over 25 years since the “window period,” and it may be more beneficial for certain qualifying CEA employees to opt for the 90-day red circle rate than the extended (indefinite) rate. In this situation, make the choice that is best for the employee.
Documentation
All red circle rate requests must be documented and filed for audit purposes. Documentation should include:
