A-44155, AUGUST 27, 1932, 12 COMP. GEN. 293

A-44155: Aug 27, 1932

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WERE OR MAY BE SEPARATED FROM THE SERVICE AND ALLOWED THEIR CURRENT ACCUMULATED 1918-1919 LEAVE. WHOSE LAST DAY OF PAY WILL BE SOME TIME DURING THE FISCAL YEAR 1933. (2) EMPLOYEES IN THE FOREIGN OFFICES OF THE FLEET CORPORATION WHOSE LAST DAY OF ACTUAL SERVICE WAS JUNE 30. UNDER OUR LEAVE REGULATIONS ARE ENTITLED TO ACCUMULATED LEAVE NOT TO EXCEED 90 CALENDAR DAYS. RECEIPT IS ACKNOWLEDGED. THE FOLLOWING REGULATION WAS APPROVED: * * * THAT THE 30 DAYS' NOTICE BEFORE SEPARATION BE DISCONTINUED. IT IS FURTHER RECOMMENDED THAT HEREAFTER ALL EMPLOYEES SEPARATED FROM THE PAY ROLL WHO DO NOT HAVE TO THEIR CREDIT 1918-1919 LEAVE BE CARRIED ON THE PAY ROLL FOR A PERIOD OF ONE CALENDAR MONTH AFTER THE LAST DAY OF ACTUAL SERVICE.

A-44155, AUGUST 27, 1932, 12 COMP. GEN. 293

ECONOMY ACT - LEAVES OF ABSENCE - MERCHANT FLEET CORPORATION IN VIEW OF THE PROVISIONS OF SECTIONS 103 AND 108 OF THE ECONOMY ACT, EMPLOYEES OF THE MERCHANT FLEET CORPORATION MAY NOT BE PAID DURING ANY PORTION OF THE FISCAL YEAR 1933 FOR LEAVE OF ABSENCE ACCRUING AND UNUSED ON OR PRIOR TO JULY 1, 1932.

COMPTROLLER GENERAL MCCARL TO THE CHAIRMAN OF THE UNITED STATES SHIPPING BOARD, AUGUST 27, 1932:

CONSIDERATION HAS BEEN GIVEN TO YOUR LETTER OF AUGUST 17, 1932, REQUESTING DECISION WHETHER THE PROVISIONS OF SECTION 103 OF THE ECONOMY ACT OF JUNE 30, 1932, 47 STAT. 400, PROHIBIT PAYMENT OF COMPENSATION FOR ACCRUED UNUSED LEAVE TO THE FOLLOWING DESCRIBED EMPLOYEES OF THE MERCHANT FLEET CORPORATION:

(1) EMPLOYEES WHO, DURING THE MONTH OF JUNE, 1932, OR DURING THE FISCAL YEAR 1933, WERE OR MAY BE SEPARATED FROM THE SERVICE AND ALLOWED THEIR CURRENT ACCUMULATED 1918-1919 LEAVE, WHOSE LAST DAY OF PAY WILL BE SOME TIME DURING THE FISCAL YEAR 1933.

(2) EMPLOYEES IN THE FOREIGN OFFICES OF THE FLEET CORPORATION WHOSE LAST DAY OF ACTUAL SERVICE WAS JUNE 30, 1932, OR DURING THE FISCAL YEAR 1933, AND UNDER OUR LEAVE REGULATIONS ARE ENTITLED TO ACCUMULATED LEAVE NOT TO EXCEED 90 CALENDAR DAYS.

RECEIPT IS ACKNOWLEDGED, ALSO, OF YOUR LETTER OF AUGUST 18, 1932, FORWARDING FOR CONSIDERATION IN CONNECTION WITH THIS MATTER AN OPINION OF THE GENERAL COUNSEL OF THE MERCHANT FLEET CORPORATION, DATED JULY 21, 1932.

YOU STATE THAT ON APRIL 20, 1932, THE FOLLOWING REGULATION WAS APPROVED:

* * * THAT THE 30 DAYS' NOTICE BEFORE SEPARATION BE DISCONTINUED.

IT IS FURTHER RECOMMENDED THAT HEREAFTER ALL EMPLOYEES SEPARATED FROM THE PAY ROLL WHO DO NOT HAVE TO THEIR CREDIT 1918-1919 LEAVE BE CARRIED ON THE PAY ROLL FOR A PERIOD OF ONE CALENDAR MONTH AFTER THE LAST DAY OF ACTUAL SERVICE, LESS THE ACTUAL LEAVE CONSUMED BY EACH EMPLOYEE DURING THE CURRENT CALENDAR YEAR AND THAT EMPLOYEES HAVING 1918-1919 LEAVE TO THEIR CREDIT BE RETAINED ON THE PAY ROLL FOR THE PERIOD OF 1918-1919 LEAVE DUE THEM, PLUS ANY ACTUAL LEAVE TO THEIR CREDIT EARNED DURING THE CURRENT YEAR, BUT IN NO CASE SHALL SUCH LEAVE BE LESS THAN ONE CALENDAR MONTH.

THE LEAVE DESIGNATED AS "1918-1919" APPARENTLY REFERS TO LEAVE ACCRUED DURING A GIVEN SERVICE YEAR AND GRANTED IN THE NEXT OR SUCCEEDING SERVICE YEARS PURSUANT TO REGULATIONS ISSUED IN 1919.

SECTIONS 103, 104 (A), AND 108 OF THE ECONOMY ACT PROVIDE, IN PART, AS FOLLOWS:

SEC. 103. ALL RIGHTS NOW CONFERRED OR AUTHORIZED TO BE CONFERRED BY LAW UPON ANY OFFICER OR EMPLOYE TO RECEIVE ANNUAL LEAVE OF ABSENCE WITH PAY ARE HEREBY SUSPENDED DURING THE FISCAL YEAR ENDING JUNE 30, 1933.

SEC. 104. WHEN USED IN THIS TITLE---

(A) THE TERMS "OFFICER" AND "EMPLOYEE" MEAN ANY PERSON RENDERING SERVICES IN OR UNDER ANY BRANCH OR SERVICE OF THE UNITED STATES GOVERNMENT OR THE GOVERNMENT OF THE DISTRICT OF COLUMBIA, BUT DO NOT INCLUDE * * * (11) ANY PERSON IN RESPECT OF ANY OFFICE, POSITION, OR EMPLOYMENT THE COMPENSATION OF WHICH IS PAID UNDER THE TERMS OF ANY CONTRACT IN EFFECT ON THE DATE OF THE ENACTMENT OF THIS ACT, IF SUCH COMPENSATION MAY NOT LAWFULLY BE REDUCED.

SEC. 108. IN THE CASE OF A CORPORATION THE MAJORITY OF THE STOCK OF WHICH IS OWNED BY THE UNITED STATES, THE HOLDERS OF THE STOCK ON BEHALF OF THE UNITED STATES, OR SUCH PERSONS AS REPRESENT THE INTEREST OF THE UNITED STATES IN SUCH CORPORATION, SHALL TAKE SUCH ACTION AS MAY BE NECESSARY TO APPLY THE PROVISIONS OF SECTIONS 101, 102, 103, 105, AND 107 TO OFFICES, POSITIONS, AND EMPLOYMENTS UNDER SUCH CORPORATION AND TO OFFICERS AND EMPLOYEES THEREOF, WITH PROPER ALLOWANCE FOR ANY REDUCTION IN COMPENSATION SINCE DECEMBER 31, 1931.

EMPLOYEES TO WHOM YOUR QUESTIONS RELATE ARE OFFICERS OR EMPLOYEES WITHIN THE MEANING OF SAID TERMS AS USED IN SECTION 103 OF THE ECONOMY ACT. SEE DECISION TO YOU, DATED AUGUST 23, 1932, A-43276, 12 COMP. GEN. 269. EXCEPTION (11) TO THE DEFINITION OF THE TERMS "OFFICER" AND ,EMPLOYEE" IN SECTION 104 HAS NO APPLICATION HERE. THE CONTENTIONS ADVANCED IN THIS REGARD SEEM TO BE BASED SOLELY ON THE PROPOSITION THAT THE EMPLOYEES HAD A VESTED RIGHT UNDER THEIR EMPLOYMENT CONTRACTS TO BE PAID FOR LEAVE ACCRUED AND UNUSED PRIOR TO JULY 1, 1932. TO BRING A PERSON WITHIN EXCEPTION (11) IT IS NOT ENOUGH THAT THERE WAS A CONTRACT BETWEEN HIM AND THE GOVERNMENT GRANTING CERTAIN RIGHTS AS TO COMPENSATION, BUT THE CONTRACT UNDER THE TERMS OF WHICH THE COMPENSATION IS PAID MUST BE SUCH THAT THE COMPENSATION "MAY NOT LAWFULLY BE REDUCED.' SEE DECISION OF AUGUST 10, 1932, A-43643, 12 COMP. GEN. 224. I ASSUME IT WOULD NOT BE CONTENDED SERIOUSLY THAT THE TERMS OF EMPLOYMENT OF THE EMPLOYEES HERE IN QUESTION ARE SUCH THAT THEIR COMPENSATION COULD NOT LAWFULLY BE REDUCED. THEREFORE, THEY ARE TO BE REGARDED AS EMPLOYEES WITHIN THE MEANING OF THAT TERM AS USED IN TITLE I OF THE ACT AND ANY RIGHTS THEY MAY HAVE HAD UNDER CONTRACT, REGULATION, OR OTHERWISE TO RECEIVE ANNUAL LEAVE OF ABSENCE WITH PAY ARE SUSPENDED DURING THE FISCAL YEAR 1933.

IN DECISION OF JULY 8, 1932, A-43056, 12 COMP. GEN. 9, IT WAS STATED:

THE PLAIN PURPOSE OF THE ENACTMENT IS TO EFFECT A SAVING OR ECONOMY TO THE GOVERNMENT DURING THE FISCAL YEAR 1933, AND IT MUST BE CONSTRUED AND APPLIED TO EFFECTUATE THAT PURPOSE. IN THE ABSENCE OF ANY PROVISION IN THE STATUTE LIMITING THE SUSPENSION TO ANNUAL LEAVE WHICH WOULD BE EARNED OR ACCRUE DURING THE FISCAL YEAR 1933, THERE IS NO ALTERNATIVE BUT TO HOLD THAT THE SUSPENSION APPLIES, ALSO, TO RIGHTS TO ALL ANNUAL LEAVE ACCRUED OR EARNED AND UNUSED PRIOR TO JULY 1, 1932.

IN DECISION OF JULY 9, 1932, A-43069, 12 COMP. GEN. 17, THE SAME APPLICATION WAS MADE TO EMPLOYEES OF THE PANAMA CANAL WHO HAD A CONTRACT RIGHT PRIOR TO JULY 1, 1932, SIMILAR TO THAT OF THE EMPLOYEES OF THE MERCHANT FLEET CORPORATION, PURSUANT TO WHICH THEY WERE AUTHORIZED TO BE PAID FOR ACCRUED UNUSED LEAVE UPON SEPARATION FROM THE SERVICE. IN SAID DECISION OF JULY 8, 1932, A-43056, THE FOLLOWING QUESTIONS WERE ANSWERED IN THE NEGATIVE:

"4. WILL IT BE PERMITTED TO PAY TO EMPLOYEES RESIGNING OR SEPARATED FROM THE SERVICE FOR ANY CAUSE, IN THE FISCAL YEAR 1933, 15 (OR 30) DAYS OF THE LEAVE EARNED IN FISCAL YEAR 1932 AND THE PRO RATA LEAVE EARNED IN FISCAL YEAR 1933 AT THE RATE OF 15 DAYS ANNUALLY?

"5. WILL IT BE PERMITTED TO PAY THE LEGAL REPRESENTATIVE OF AN EMPLOYEE WHO MAY DIE IN FISCAL YEAR 1933, 15 (OR 30) DAYS' LEAVE EARNED IN FISCAL YEAR 1932 AND PRO RATA LEAVE EARNED IN FISCAL YEAR 1933?

SEE, ALSO, DECISION OF AUGUST 2, 1932, A-43620, 12 COMP. GEN. 160, WHEREIN IT WAS STATED:

THE PURPOSE AND EFFECT OF SECTIONS 103 AND 803 OF THE ACT IN QUESTION IS TO PREVENT THE USE OF APPROPRIATIONS OF FUNDS AVAILABLE FOR EXPENDITURE DURING THE FISCAL YEAR 1933 IN PAYING FOR TIME ABSENT ON LEAVE. AND THE INHIBITION OPERATES AGAINST PAYMENTS FOR LEAVE TAKEN WITHOUT PAY DURING A PREVIOUS YEAR AS WELL AS AGAINST PAYMENTS FOR LEAVE ACCRUED IN A PREVIOUS YEAR WHETHER TAKEN OR NOT TAKEN DURING THE FISCAL YEAR 1933, AS WELL AS AGAINST PAYMENTS FOR LEAVE WHICH BUT FOR SAID SECTION WOULD ACCRUE AND BE FOR TAKING DURING THE FISCAL YEAR 1933. IN OTHER WORDS, APPROPRIATIONS FOR THE FISCAL YEAR 1933 MAY NOT BE USED TO PAY FOR ANNUAL LEAVE REGARDLESS OF WHEN IT MAY HAVE BEEN EARNED OR WHETHER IT IS OR IS NOT TAKEN.

THE PRINCIPLES STATED IN THESE DECISIONS ARE APPLICABLE TO THE TWO CLASSES OF EMPLOYEES TO WHOM YOUR QUESTIONS RELATE. ACCORDINGLY, THEY MAY NOT BE PAID DURING ANY PORTION OF THE FISCAL YEAR 1933, FOR LEAVE OF ABSENCE ACCRUED AND UNUSED ON OR PRIOR TO JULY 1, 1932.