A-56990, OCTOBER 6, 1934, 14 COMP. GEN. 285

A-56990: Oct 6, 1934

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HAVE NOW BEEN GENERALLY CONSTRUED AND APPLIED TO AUTHORIZE AN EMPLOYEE WHO ONCE BECOMES ENTITLED TO RETIREMENT BENEFITS TO COUNT TOWARD LONGEVITY IN COMPUTING THE AMOUNT OF HIS ANNUITY ANY CIVIL SERVICE UNDER THE UNITED STATES NOT SUBJECT TO ANOTHER RETIREMENT ACT. IT MUST BE CONCLUDED THAT REEMPLOYMENT OF A RETIRED ANNUITANT BY A GOVERNMENT -OWNED CORPORATION IN ANY CAPACITY IS CONTROLLED BY THE SAME CONDITIONS AND RESTRICTIONS UNDER THE RETIREMENT ACT AS ARE APPLICABLE TO REEMPLOYMENT IN THE CLASSIFIED CIVIL SERVICE OF THE UNITED STATES. WAS FOUND TOTALLY DISABLED FOR USEFUL AND EFFICIENT SERVICE IN THE POSITION HELD. HE WAS RETIRED EFFECTIVE DECEMBER 1. 5 DAYS OF SERVICE AND WAS AWARDED AN ANNUITY AT THE RATE OF $1.

A-56990, OCTOBER 6, 1934, 14 COMP. GEN. 285

RETIREMENT - REEMPLOYMENT OF DISABLED ANNUITANTS - GOVERNMENT-OWNED CORPORATIONS UPON THE REEMPLOYMENT UNDER THE GOVERNMENT IN ANY CIVILIAN CAPACITY, THE DISABILITY RETIREMENT ANNUITY BEING RECEIVED AT THE TIME OF REEMPLOYMENT UNDER THE TERMS OF SECTION 6 OF THE CIVIL RETIREMENT ACT, MUST CEASE EVEN THOUGH THE POSITION IN WHICH REEMPLOYED MAY NOT BE COMPARABLE WITH THE POSITION FROM WHICH RETIRED FOR DISABILITY, THE PURPOSE AND INTENT OF THE CIVIL RETIREMENT LEGISLATION BEING ENTIRELY INCONSISTENT WITH DUAL PAYMENT OF ACTIVE SERVICE COMPENSATION AND CIVILIAN RETIREMENT ANNUITY TO THE SAME PERSON FOR THE SAME PERIOD OF TIME. AS SECTIONS 5 AND 9 OF THE CIVIL RETIREMENT ACT AS AMENDED BY THE ACT OF MAY 29, 1930, 46 STAT. 472, HAVE NOW BEEN GENERALLY CONSTRUED AND APPLIED TO AUTHORIZE AN EMPLOYEE WHO ONCE BECOMES ENTITLED TO RETIREMENT BENEFITS TO COUNT TOWARD LONGEVITY IN COMPUTING THE AMOUNT OF HIS ANNUITY ANY CIVIL SERVICE UNDER THE UNITED STATES NOT SUBJECT TO ANOTHER RETIREMENT ACT, IT MUST BE CONCLUDED THAT REEMPLOYMENT OF A RETIRED ANNUITANT BY A GOVERNMENT -OWNED CORPORATION IN ANY CAPACITY IS CONTROLLED BY THE SAME CONDITIONS AND RESTRICTIONS UNDER THE RETIREMENT ACT AS ARE APPLICABLE TO REEMPLOYMENT IN THE CLASSIFIED CIVIL SERVICE OF THE UNITED STATES.

COMPTROLLER GENERAL MCCARL TO THE PRESIDENT, UNITED STATES CIVIL SERVICE COMMISSION, OCTOBER 6, 1934:

THERE HAS BEEN RECEIVED LETTER DATED AUGUST 1, 1934, FROM THE ADMINISTRATOR OF VETERANS' AFFAIRS, AS FOLLOWS:

MR. WILLIAM C. CARTER, R-35344, FORMERLY EMPLOYED AS MACHINIST, WASHINGTON, D.C., NAVY YARD, NAVY DEPARTMENT, FILED APPLICATION FOR RETIREMENT ON ACCOUNT OF DISABILITY UNDER DATE OF MARCH 27, 1931, AND WAS FOUND TOTALLY DISABLED FOR USEFUL AND EFFICIENT SERVICE IN THE POSITION HELD, AND UNDER THE PROVISIONS OF SECTION 6 OF THE CIVIL SERVICE RETIREMENT ACT OF MAY 29, 1930, HE WAS RETIRED EFFECTIVE DECEMBER 1, 1930. AT THE TIME OF RETIREMENT HE HAD COMPLETED 32 YEARS, 8 MONTHS, 5 DAYS OF SERVICE AND WAS AWARDED AN ANNUITY AT THE RATE OF $1,200.00 PER ANNUM.

SUBSEQUENT TO RETIREMENT, NOVEMBER 1, 1931, A COMMUNICATION WAS RECEIVED FROM THE SUPERINTENDENT, NATIONAL TRAINING SCHOOL FOR BOYS, WASHINGTON, D.C., ADVISING THAT MR. CARTER HAD BEEN EMPLOYED BY THAT ESTABLISHMENT AND REQUESTING ADVICE AS TO WHETHER SUCH REEMPLOYMENT WAS PROPER IN VIEW OF THE RECEIPT BY MR. CARTER OF ANNUITY ON ACCOUNT OF HIS SERVICE AS A MACHINIST. SECTION 6 OF THE CIVIL SERVICE RETIREMENT ACT OF MAY 29, 1930, PROVIDES IN PART:

"IF AN ANNUITANT SHALL RECOVER BEFORE REACHING RETIREMENT AGE AND BE RESTORED TO AN EARNING CAPACITY WHICH WOULD PERMIT HIM TO BE APPOINTED TO SOME APPROPRIATE POSITION FAIRLY COMPARABLE IN COMPENSATION TO THE POSITION OCCUPIED AT THE TIME OF RETIREMENT, PAYMENT OF THE ANNUITY SHALL BE CONTINUED TEMPORARILY TO AFFORD THE ANNUITANT OPPORTUNITY TO SEEK SUCH AVAILABLE POSITION, BUT NOT IN ANY CASE EXCEEDING NINETY DAYS FROM THE DATE OF THE MEDICAL EXAMINATION SHOWING SUCH RECOVERY.'

UNDER DATE OF NOVEMBER 11, 1931, COMMUNICATION WAS ADDRESSED TO THE SUPERINTENDENT, NATIONAL TRAINING SCHOOL FOR BOYS, READING AS FOLLOWS:

"REPLYING TO YOUR LETTER YOU ARE ADVISED THAT THE TEST OF MR. CARTER'S RIGHT TO EMPLOYMENT WOULD BE THE INHIBITION AGAINST REEMPLOYMENT IN ANY POSITION WITHIN THE PURVIEW OF THE RETIREMENT LAW WHILE IN RECEIPT OF ANNUITY. THE EXPRESS PROVISION CONTAINED IN THE FINAL PARAGRAPH OF SECTION 2 OF THE ACT TO THE EFFECT THAT NO PERSON SEPARATED FROM THE SERVICE WHO IS RECEIVING AN ANNUITY UNDER THE PROVISIONS OF SECTION 1OF THE ACT SHALL BE EMPLOYED AGAIN IN ANY POSITION WITHIN THE PURVIEW OF THIS ACT IS HELD TO BE APPLICABLE TO ANNUITANTS UNDER SECTION 6 OF THE ACT BASED UPON DISABILITY TO THE EXTENT THAT WHEREAS THERE WOULD BE A RIGHT TO REEMPLOYMENT IN A POSITION WITHIN THE PURVIEW OF THE ACT, SUCH REEMPLOYMENT WOULD HAVE THE EFFECT OF TERMINATING THE ANNUITY. EMPLOYMENT WHILE IN RECEIPT OF ANNUITY BASED UPON DISABILITY WOULD ALSO FREQUENTLY BE EVIDENCE THAT THERE WAS A RECOVERY AND TERMINATION OF THE ANNUITY WOULD BE JUSTIFIED ON THAT ACCOUNT. HOWEVER, IN THE CASE OF MR. CARTER IT IS UNDERSTOOD THAT THE DUTIES NOW PERFORMED BY HIM AT THE NATIONAL TRAINING SCHOOL FOR BOYS ARE SO DIFFERENT FROM THOSE REQUIRED OF HIM AS A MACHINIST IN THE LOCAL NAVY YARD THAT SUCH PERFORMANCE IS NOT IN ITSELF INCONSISTENT WITH THE ACCEPTANCE OF A CONTINUANCE OF TOTAL DISABILITY IN HIS CASE.

"A POSITION WITHIN THE PURVIEW OF THE RETIREMENT LAW HAS BEEN ACCEPTED THUS FAR TO BE CONFINED TO A POSITION IN THE CLASSIFIED CIVIL SERVICE OR IN SOME OTHER BRANCH OF THE PUBLIC SERVICE FORMING THE BASIS FOR RETIREMENT UPON ANNUITY RATHER THAN SERVICE OR POSITIONS OF THE KIND MENTIONED IN SECTION 5, ACT OF MAY 29, 1930, WHICH MAY FORM THE BASIS OF SERVICE CREDIT SUBJECT TO THE CONDITIONS THEREIN STATED:

"IN YOUR LETTER YOU STATE THAT THE NATIONAL TRAINING SCHOOL FOR BOYS IS AN INDEPENDENT ESTABLISHMENT OF THE GOVERNMENT AND DOES NOT COME UNDER THE CIVIL SERVICE. BY CONSULTING THE STATUTORY PROVISIONS PERTAINING TO THE CREATION, GOVERNMENT, AND OPERATION OF THE NATIONAL TRAINING SCHOOL FOR BOYS, IT APPEARS THAT THE SAME IS IN CHARGE OF AND IS MANAGED OR GOVERNED BY A BOARD OF SEVEN TRUSTEES APPOINTED BY THE PRESIDENT OF THE UNITED STATES UPON THE RECOMMENDATION OF THE ATTORNEY GENERAL, THE BOARD BEING A CORPORATE BODY FOR THE PURPOSE OF TAKING AND HOLDING IN TRUST FOR THE UNITED STATES PROPERTY OF EVERY DESCRIPTION PURCHASED, APPROPRIATED, OR SET APART FOR THE USE OF SAID INSTITUTION WITH ALL THE REMAINING POWERS NECESSARY TO CARRY INTO EFFECT THE OPERATION AND MANAGEMENT OF THE SCHOOL INCLUDING THE POWER TO MAKE BYLAWS, RULES, AND REGULATIONS FOR THEIR OWN GOVERNMENT AND THE GOVERNMENT OF THE INSTITUTION, ITS OFFICERS, EMPLOYEES, AND INMATES. THE POWERS VESTED IN THE BOARD OF TRUSTEES INCLUDE THE AUTHORITY TO APPOINT THE OFFICIALS AND OTHER PERSONS NECESSARY TO OPERATE THE INSTITUTION AND FIX THEIR COMPENSATION SUBJECT TO THE APPROVAL OF THE ATTORNEY GENERAL.

"EVER SINCE THE INCEPTION OF THE CIVIL-SERVICE RETIREMENT SYSTEM IT HAS BEEN ACCEPTED THAT EMPLOYEES OF CORPORATIONS CREATED BY THE GOVERNMENT ARE NOT EMPLOYEES OF THE UNITED STATES OR WITHIN THE PURVIEW OF THE RETIREMENT LAW EXCEPT WHERE THE STATUTES MAY HAVE MADE AN EXCEPTION AS IN THE CASE OF PANAMA RAILROAD COMPANY EMPLOYEES AND EMPLOYEES OF THE NATIONAL HOME FOR DISABLED VOLUNTEER SOLDIERS WHOSE TENURE OF EMPLOYMENT IS NOT INTERMITTENT NOR OF UNCERTAIN DURATION, ETC., AS PROVIDED IN THE SPECIFIC ACTS BRINGING THESE GENERAL CLASSES OF EMPLOYEES WITHIN THE PURVIEW OF THE CIVIL-SERVICE RETIREMENT SYSTEM. AS THERE IS NO PROVISION OF LAW GRANTING OFFICERS AND EMPLOYEES OF THE NATIONAL TRAINING SCHOOL FOR BOYS THE BENEFIT OF ANY OF THE VARIOUS RETIREMENT LAWS, IT MUST BE ACCEPTED THAT MR. CARTER AS AN EMPLOYEE OR OFFICIAL OF SAID INSTITUTION IS NOT OCCUPYING A POSITION WITHIN THE PURVIEW OF THE RETIREMENT LAW AND THERE WOULD, THEREFORE, APPEAR TO BE NO OBJECTION TO HIS EMPLOYMENT THERE IN A POSITION WHERE THE DUTIES ARE OF SUCH A CHARACTER AS TO NOT WARRANT THE CONCLUSION THAT HE HAS MADE A RECOVERY TO SUCH AN EXTENT AS TO BE ABLE TO RESUME HIS FORMER DUTIES AS A MACHINIST IN THE LOCAL NAVY YARD OR DUTIES OF A CLOSELY ANALOGOUS CHARACTER. IT IS UNDERSTOOD, AS HEREINBEFORE STATED, THAT MR. CARTER'S PRESENT DUTIES ARE NOT OF SUCH A CHARACTER.'

IT WILL BE NOTED THAT THE FOREGOING COMMUNICATION, WHEREIN IT WAS STATED IN SUBSTANCE THAT EMPLOYEES OF CORPORATIONS OWNED BY THE GOVERNMENT WERE NOT WITHIN THE PURVIEW OF THE CIVIL-SERVICE RETIREMENT LAW, WAS DATED NOVEMBER 11, 1931. SINCE THAT TIME IT HAS BEEN ESTABLISHED THAT EMPLOYMENT FOR GOVERNMENT-OWNED CORPORATIONS MAY BE INCLUDED IN COMPUTING ANNUITABLE SERVICE. (37 OP.ATTY.GEN-L 7; DEPT. CIR. NO. 90, CIVIL SERVICE COM.; OPS.SOLICITOR, VETERANS' ADM. APRIL 28. 1933, JULY 28, 1933, SEPT. 5, 1933, MAR. 5, 1934; VETERANS' ADM. CIRCULAR LETTER OF NOV. 10, 1933.)

WITH SERVICE FOR GOVERNMENT-OWNED CORPORATIONS NOW BEING INCLUDED IN COMPUTING ANNUITABLE SERVICE UNDER THE CIVIL-SERVICE RETIREMENT LAWS, IT WOULD SEEM THAT THE REASONS PREVIOUSLY ADVANCED FOR PERMITTING THE CLAIMANT TO RECEIVE ANNUITY AND AT THE SAME TIME RECEIVE COMPENSATION FROM A GOVERNMENT-OWNED CORPORATION WOULD NOT NOW BE EQUALLY APPLICABLE. FURTHERMORE, ATTENTION IS CALLED TO YOUR DECISION OF AUGUST 23, 1933 (13 COMP. GEN. 54), WHEREIN IT WAS HELD:

"IN NO CASE MAY BOTH RETIREMENT ANNUITY AND CIVILIAN COMPENSATION BE PAID TO THE SAME PERSON FOR THE SAME PERIOD OF TIME.'

IN VIEW OF THE FOREGOING, YOUR DECISION IS REQUESTED RESPECTING WHAT ACTION SHOULD BE TAKEN IN THIS CASE.

THE PORTION OF SECTION 6 OF THE CIVIL RETIREMENT ACT QUOTED IN THE LETTER DOES NOT, ALONE, CONTROL DISPOSITION OF THIS CASE. THE PORTION QUOTED PROVIDES ONLY FOR THE TEMPORARY CONTINUANCE OF DISABILITY RETIREMENT ANNUITY AFTER IT HAS BEEN DETERMINED BY PROPER AUTHORITY THAT THE ANNUITANT HAS BEEN "RESTORED TO AN EARNING CAPACITY WHICH WOULD PERMIT HIM TO BE APPOINTED TO SOME APPROPRIATE POSITION FAIRLY COMPARABLE IN COMPENSATION TO THE POSITION OCCUPIED AT THE TIME OF RETIREMENT.' SAID PROVISION MAY NOT BE REGARDED AS AUTHORIZING OR RECOGNIZING THE LEGALITY OF ANNUITY PAYMENTS FOR DISABILITY AFTER REEMPLOYMENT UNDER THE GOVERNMENT, BUT ON THE CONTRARY SAID SECTION NEGATIVES SUCH DUAL PAYMENTS. PARAGRAPH 353 OF THE REGULATIONS APPROVED BY THE COMMISSIONER OF PENSIONS JUNE 8, 1928, PUBLISHED ON PAGE 48 OF THE RETIREMENT ACT HANDBOOK, EXPLAINS THE APPLICATION OF THE PROVISION AS FOLLOWS:

WHEN A MEDICAL EXAMINATION MADE IN COMPLIANCE WITH THE DIRECTION OF THE COMMISSIONER OF PENSIONS SHOWS THAT THE ANNUITANT HAS RECOVERED AND HAS BEEN RESTORED TO AN EARNING CAPACITY WHICH WOULD PERMIT HIM TO BE APPOINTED TO SOME APPROPRIATE POSITION FAIRLY COMPARABLE IN COMPENSATION TO THE POSITION OCCUPIED AT THE TIME OF RETIREMENT, PAYMENT OF THE ANNUITY SHALL BE CONTINUED TEMPORARILY TO AFFORD THE ANNUITANT OPPORTUNITY TO SEEK SUCH AVAILABLE POSITION, BUT NOT IN ANY CASE EXCEEDING 90 DAYS FROM THE DATE OF THE MEDICAL EXAMINATION SHOWING SUCH RECOVERY. IF THE ANNUITANT SHALL BE REINSTATED IN THE GOVERNMENT SERVICE WITHIN THE 90 DAYS THE ANNUITY SHALL BE DISCONTINUED ON AND INCLUDING THE DAY PRIOR TO SUCH REINSTATEMENT.

THE PURPOSE AND INTENT OF CIVIL RETIREMENT LEGISLATION IS ENTIRELY INCONSISTENT WITH THE DUAL PAYMENT OF ACTIVE SERVICE PAY AND CIVIL RETIREMENT ANNUITY TO THE SAME PERSON FOR THE SAME PERIOD OF TIME. THE VARIOUS PROVISIONS OF THE CIVIL RETIREMENT ACT LIMIT ITS BENEFITS TO EMPLOYEES WHO ARE NOT IN THE ACTIVE SERVICE OF THE UNITED STATES IN ANY CAPACITY AND ALSO PROHIBIT DUAL PAYMENTS OF ANNUITY AND DISABILITY COMPENSATION UNDER THE EMPLOYEES' COMPENSATION ACT. SEE SECTION 1 PROHIBITING REEMPLOYMENT, SECTION 6 REQUIRING DISCONTINUANCE OF ANNUITY WHEN THERE HAS BEEN SUCH A RECOVERY AS TO ENABLE THE EMPLOYEE TO BE REEMPLOYED, AND PROHIBITING DUAL PAYMENTS OF DISABILITY RETIREMENT ANNUITY AND DISABILITY COMPENSATION, AND SECTION 7 REQUIRING DISCONTINUANCE OF INVOLUNTARY SEPARATION ANNUITY UPON REEMPLOYMENT. THE GENERAL PRINCIPLE HAS BEEN STATED IN THE DECISION CITED, VIZ, 13 COMP. GEN. 54, AS FOLLOWS: "IN NO CASE MAY BOTH RETIREMENT ANNUITY AND CIVILIAN COMPENSATION BE PAID TO THE SAME PERSON FOR THE SAME PERIOD OF TIME.' SEE ALSO, 10 COMP. GEN. 309.

THIS PRINCIPLE IS APPLICABLE TO ANY REEMPLOYMENT IN ANY CAPACITY IN THE GOVERNMENT CIVIL SERVICE WHICH MAY BE COUNTED TOWARD LONGEVITY IN COMPUTING RETIREMENT ANNUITY, INCLUDING SERVICE WITH GOVERNMENT-OWNED CORPORATIONS. THAT IS TO SAY, AS SECTIONS 5 AND 9 OF THE CIVIL RETIREMENT ACT, AS AMENDED BY THE ACT OF MAY 29, 1930, 46 STAT. 472, HAVE NOW BEEN GENERALLY CONSTRUED AND APPLIED TO AUTHORIZE AN EMPLOYEE WHO ONCE BECOMES ENTITLED TO RETIREMENT BENEFITS TO COUNT TOWARD LONGEVITY IN COMPUTING THE AMOUNT OF HIS ANNUITY ANY CIVIL SERVICE UNDER THE UNITED STATES NOT SUBJECT TO ANOTHER RETIREMENT ACT, INCLUDING SERVICE WITH GOVERNMENT-OWNED CORPORATIONS, IT MUST BE CONCLUDED THAT REEMPLOYMENT OF A RETIRED ANNUITANT BY A GOVERNMENT-OWNED CORPORATION IN ANY CAPACITY IS CONTROLLED BY THE SAME TERMS, CONDITIONS, AND RESTRICTIONS UNDER THE RETIREMENT ACT AS ARE APPLICABLE TO REEMPLOYMENT IN THE CLASSIFIED CIVIL SERVICE OF THE UNITED STATES.

THE NATIONAL TRAINING SCHOOL FOR BOYS WAS CREATED BY STATUTE AND IS MAINTAINED WITH APPROPRIATED FUNDS. IT IS A FEDERAL INSTITUTION AND THE SERVICE THEREUNDER IS IN THE CIVIL SERVICE OF THE UNITED STATES. WHILE IT IS UNDERSTOOD INITIAL SERVICE AS AN OFFICER OR EMPLOYEE OF THE INSTITUTION WOULD NOT ENTITLE TO RETIREMENT, SUCH SERVICE IS AUTHORIZED TO BE COUNTED IN COMPUTING LONGEVITY OF AN EMPLOYEE ONCE HAVING A RETIREMENT STATUS. ACCORDINGLY, THE REEMPLOYMENT OF MR. CARTER, AN ANNUITANT, WITH THE NATIONAL TRAINING SCHOOL FOR BOYS, SHOULD HAVE TERMINATED HIS ANNUITY. PAYMENT OF THE ANNUITY SHOULD NOW BE DISCONTINUED, THE EMPLOYEE'S RIGHT TO SUBSEQUENT RETIREMENT BEING FOR CONSIDERATION UNDER THE TERMS OF THE RETIREMENT ACT THEN IN EFFECT. IN VIEW OF THE PREVIOUS ADMINISTRATIVE ACTION IN THIS CASE AND IN THE ABSENCE OF AN AUTHORITATIVE DECISION ON THE MATTER, NO REFUND OF RETIREMENT ANNUITY PRIOR TO THE DATE OF THIS DECISION WILL BE REQUIRED.