10 U.S.C. § 12771 — Reserve officers: grade on transfer to Retired Reserve

(a) Grade on Transfer: Unless another law entitles the officer to a higher grade, a reserve commissioned officer (not a warrant officer) who transfers to the Retired Reserve is placed on the retired list under section 12774(a) at the highest grade they served in satisfactorily. The Secretary concerned decides which grade that was, following section 1370a, based on the armed force the officer serves in on the transfer date. (b) Effect of Subsequent Recall to Active Status: (1) If a retired member who is a commissioned officer is recalled to active status in the Selected Reserve of the Ready Reserve under section 10145(d), and completes at least two years of service in that active status, the member is entitled to have their retired grade adjusted under section 1370a. (2) The Secretary concerned may shorten that two-year requirement for a member who (A) is recalled to serve as adjutant general under section 314 of title 32, or as assistant adjutant general under such an adjutant general, (B) completes at least one year in that position, and (C) fails to complete the full two years only because the appointment ends or is vacated as described in section 324(b) of title 32.