A-49648, JUNE 29, 1933, 12 COMP. GEN. 665

A-49648: Jun 29, 1933

Additional Materials:

Contact:

Edda Emmanuelli Perez
(202) 512-2853
EmmanuelliPerezE@gao.gov

 

Office of Public Affairs
(202) 512-4800
youngc1@gao.gov

IS NOT SUBJECT TO 15 PERCENT REDUCTION UNDER THE ACT OF MARCH 20. YOUR RULING ON A SPECIFIC CASE WHICH IS NOW BEFORE THIS DEPARTMENT FOR DETERMINATION IS REQUESTED. REFERENCE IS MADE TO SECTION 1 (A). 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. REFERENCE IS ALSO MADE TO YOUR DECISION A-48262 OF APRIL 7. WHEREIN IS CONTAINED THE FOLLOWING LANGUAGE: "* * * IF THE DUTIES AND RESPONSIBILITIES OF AN OFFICE OR POSITION ARE PERFORMED FOR OR UNDER THE SUPERVISION OF THE FEDERAL GOVERNMENT. THE BASIC RATE OF COMPENSATION IS FIXED UNDER "ANY EXISTING (FEDERAL) LAW. " THE INCUMBENT THEREOF IS A FEDERAL OFFICER OR EMPLOYEE WITHIN THE MEANING OF SECTION 1 (A) OF TITLE II OF THE ACT OF MARCH 20.

A-49648, JUNE 29, 1933, 12 COMP. GEN. 665

ECONOMY ACT, AMENDED - PERCENTAGE REDUCTION - COMPENSATION FIXED IN A CONTRACT THE COMPENSATION OF A HOUSEKEEPER REQUIRED TO BE PAID BY THE GOVERNMENT PURSUANT TO AN ITEM IN A LEASE BETWEEN THE GOVERNMENT AND A THIRD PARTY COVERING RENTAL OF CONSULAR QUARTERS, IS NOT SUBJECT TO 15 PERCENT REDUCTION UNDER THE ACT OF MARCH 20, 1933, THE STATUS OF THE HOUSEKEEPER COMING SQUARELY WITHIN EXCEPTION 5 TO THE DEFINITION OF THE TERMS "OFFICER" AND "EMPLOYEE" APPEARING IN SECTION 1, TITLE II OF SAID ACT.

COMPTROLLER GENERAL MCCARL TO THE SECRETARY OF STATE, JUNE 29, 1933:

CONSIDERATION HAS BEEN GIVEN TO YOUR LETTER OF JUNE 23, 1933, AS FOLLOWS:

IN CONNECTION WITH THE 15 PERCENT SALARY REDUCTION AS REQUIRED BY EXECUTIVE ORDER OF MARCH 28, 1933, YOUR RULING ON A SPECIFIC CASE WHICH IS NOW BEFORE THIS DEPARTMENT FOR DETERMINATION IS REQUESTED.

THE LEASE COVERING THE RENTAL OF CONSULAR QUARTERS AT BRISTOL, ENGLAND, PROVIDES IN SUBDIVISION 3 (C) OF THE SECOND ITEM THAT THE LESSEE SHALL PAY TO THE LESSOR "FOR THE SERVICES OF THE HOUSEKEEPER THE YEARLY RENT OR SUM OF FORTY POUNDS.'

REFERENCE IS MADE TO SECTION 1 (A), TITLE II, OF THE ACT OF MARCH 20, 1933, WHICH INCLUDES AMONG THOSE PERSONS FROM WHOSE COMPENSATION THE PRESCRIBED SALARY REDUCTION SHALL NOT BE MADE "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.' REFERENCE IS ALSO MADE TO YOUR DECISION A-48262 OF APRIL 7, 1933, WHEREIN IS CONTAINED THE FOLLOWING LANGUAGE:

"* * * IF THE DUTIES AND RESPONSIBILITIES OF AN OFFICE OR POSITION ARE PERFORMED FOR OR UNDER THE SUPERVISION OF THE FEDERAL GOVERNMENT, AND THE BASIC RATE OF COMPENSATION IS FIXED UNDER "ANY EXISTING (FEDERAL) LAW, SCHEDULE, REGULATION, EXECUTIVE ORDER, OR DEPARTMENTAL ORDER," THE INCUMBENT THEREOF IS A FEDERAL OFFICER OR EMPLOYEE WITHIN THE MEANING OF SECTION 1 (A) OF TITLE II OF THE ACT OF MARCH 20, 1933, * * *.'

IN VIEW OF THE FACT THAT THE COMPENSATION OF THE EMPLOYEE IN QUESTION IS FIXED BY CONTRACT, IT IS NOT QUITE CLEAR TO THE DEPARTMENT WHETHER IN VIEW OF THE HOLDING IN YOUR DECISION REFERRED TO ABOVE THE COMPENSATION IS EXEMPT FROM THE 15 PERCENT REDUCTION. IT SHOULD BE STATED THAT WHILE THE SALARY OF THE EMPLOYEE IN QUESTION IS NOT FIXED UNDER "ANY EXISTING (FEDERAL) LAW, SCHEDULE, REGULATION, EXECUTIVE ORDER, OR DEPARTMENTAL ORDER," BUT AS HERETOFORE STATED, IS FIXED BY THE TERMS OF THE CONTRACT OF LEASE, THE NAME OF THIS EMPLOYEE IS CARRIED ON THE CONTINGENT PAY ROLL OF THIS DEPARTMENT AND AN ALLOTMENT FOR THE SALARY IS GRANTED UNDER THE CONTINGENT EXPENSE APPROPRIATION. IT IS THIS FACT WHICH GIVES RISE TO THE QUESTION WHETHER THIS CASE COMES WITHIN THE PURVIEW OF THE ACT OF MARCH 20 AND THE EXECUTIVE ORDER OF MARCH 28, 1933. IT IS THE OPINION OF THE DEPARTMENT, HOWEVER, THAT TO REQUIRE THE REDUCTION WOULD CONSTITUTE A BREACH OF CONTRACT AND IT IS BELIEVED THEREFORE THAT SUFFICIENT FUNDS SHOULD BE MADE AVAILABLE TO THE CONSUL AT BRISTOL TO ENABLE HIM TO PAY THE REQUIRED AMOUNT OF 40 POUNDS PER ANNUM TO COVER THE SERVICES CONTRACTED FOR.

IT WILL BE APPRECIATED IF YOUR DECISION IN THIS CASE MAY BE EXPEDITED IN ORDER THAT APPROPRIATE INSTRUCTIONS MAY BE ISSUED BEFORE JUNE 30, 1933.

SECTION 1 (A), TITLE II, OF THE ACT OF MARCH 20, 1933, 48 STAT. 12, PROVIDES, IN PART, AS FOLLOWS:

SEC. 1. 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 * * * (5) 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 TITLE, IF SUCH COMPENSATION MAY NOT LAWFULLY BE REDUCED.

THE LEASE COVERING RENTAL OF CONSULAR QUARTERS AT BRISTOL, ENGLAND, CONTAINING THE ITEM "FOR THE SERVICES OF THE HOUSEKEEPER THE YEARLY RENT OR SUM OF FORTY POUNDS," IS NOT A PERSONAL SERVICE CONTRACT DIRECTLY BETWEEN THE GOVERNMENT AND THE HOUSEKEEPER WHICH MIGHT HAVE BEEN REDUCED BY THE CONGRESS AND WHICH WOULD NOT HAVE COME WITHIN EXCEPTION (5) TO THE DEFINITION OF THE TERMS ,OFFICER" AND "EMPLOYEE," BUT IS A CONDITION IN A CONTRACT BETWEEN THE GOVERNMENT AND A PRIVATE PARTY FIXING THE COMPENSATION OF A THIRD PARTY, WHICH, IF ABROGATED, MIGHT ANNUL THE ENTIRE CONTRACT. THE STATUS OF THE HOUSEKEEPER IN QUESTION COMES SQUARELY WITHIN EXCEPTION (5), SUPRA, TO THE DEFINITION OF THE TERMS "OFFICER" AND "EMPLOYEE" AND, ACCORDINGLY, THE ANNUAL RATE OF COMPENSATION FOR THE HOUSEKEEPER FIXED IN THE LEASE IS NOT SUBJECT TO THE PERCENTAGE REDUCTION UNDER THE ACT OF MARCH 20, 1933.