"travel must be in economy class" generally means the agency will pay only for economy-class travel. The U.S. State Dept. certainly allows (allowed?) upgrades if the traveler paid for the difference - even allowing for diversionary travel as long as the traveler arrived when and where he was supposed to and used the economy-class fare as a basis. It was best if one was posted to a place where there were no city-pair fares and only full-fare economy tickets available. Check the agency's regulations carefully.