This section applies only to the Executive Pay Plan. An increase in a pay rate under this subsection shall be based on the employee’s performance. For or during a fiscal year, the head of a unit may recommend an increase in an employee’s pay rate above the rate for the previous fiscal year in the same grade in accordance with guidelines promulgated by the Secretary, provided that funds are available. A pay increase under this subsection may be made to recruit or retain competent employees or to recognize increased duties and responsibilities. Subject to the approval of the Governor, the Secretary may approve: a change in pay grade; a change from one class in a series to a different class in the same series; a new class or position; or another form of pay increase.