If an employee receives a -1 or -2 as a category numerical score, then shouldn’t the PAQL score be a “1”?

The categorical numerical scores address compensation. Whether or not the employee is appropriately compensated. A -1 or -2 says the employee is over-compensated compared to his/her contribution. There are circumstances that could justify someone being over-compensated, but still performing adequately, i.e. personal or medication issues.