Section 531.608 - Relationship of locality rates to other pay rates(a) An employee must receive the greatest of the following rates of pay, as applicable-(1) The scheduled annual rate of pay payable to the employee;(2) A locality rate under this subpart;(3) A special rate under 5 CFR part 530, subpart C, or a similar rate under other legal authority (e.g., 38 U.S.C. 7455 ) ; or(4) A retained rate under 5 CFR part 536 or a similar rate under other legal authority.(b) A GS employee receiving a special rate is entitled to any applicable locality payment on the same basis as any other GS employee. The locality payment is computed based on the employee's scheduled annual rate of pay, which excludes any special rate. The employee is entitled to the higher of the locality rate or the corresponding special rate. As provided in 5 U.S.C. 5305(h) and 5 CFR 530.303(d) , when an employee's locality rate exceeds a corresponding special rate, the employee's entitlement to the special rate is terminated. 70 FR 31304 , May 31, 2005