B-106332, NOVEMBER 6, 1951, 31 COMP. GEN. 163

B-106332: Nov 6, 1951

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COMPENSATION - RETROACTIVE SALARY INCREASES - EMPLOYEES IN UNGRADED POSITIONS THE RETROACTIVE COMPENSATION PROVISION OF THE INCREASED COMPENSATION AMENDMENT TO THE CLASSIFICATION ACT OF 1949 FOR THOSE CLASSES OF EMPLOYEES OCCUPYING POSITIONS THE COMPENSATION AND STANDARDS OF WHICH ARE FIXED BY THE CLASSIFICATION ACT. DOES NOT APPLY TO EMPLOYEES OF THE BUREAU OF CENSUS OCCUPYING UNGRADED POSITIONS THE SALARIES OF WHICH ARE AUTHORIZED BY STATUTE TO BE FIXED ADMINISTRATIVELY. EVEN THOUGH THE COMPENSATION SCHEDULES OF THE CLASSIFICATION ACT HAVE BEEN ADOPTED FOR SUCH EMPLOYEES. 1951: REFERENCE IS MADE TO YOUR LETTER OF OCTOBER 31. LAWFULLY MAY BE PAID TO EMPLOYEES OCCUPYING UNGRADED POSITIONS THE SALARIES OF WHICH ARE AUTHORIZED BY STATUTE TO BE FIXED ADMINISTRATIVELY.

B-106332, NOVEMBER 6, 1951, 31 COMP. GEN. 163

COMPENSATION - RETROACTIVE SALARY INCREASES - EMPLOYEES IN UNGRADED POSITIONS THE RETROACTIVE COMPENSATION PROVISION OF THE INCREASED COMPENSATION AMENDMENT TO THE CLASSIFICATION ACT OF 1949 FOR THOSE CLASSES OF EMPLOYEES OCCUPYING POSITIONS THE COMPENSATION AND STANDARDS OF WHICH ARE FIXED BY THE CLASSIFICATION ACT, DOES NOT APPLY TO EMPLOYEES OF THE BUREAU OF CENSUS OCCUPYING UNGRADED POSITIONS THE SALARIES OF WHICH ARE AUTHORIZED BY STATUTE TO BE FIXED ADMINISTRATIVELY, EVEN THOUGH THE COMPENSATION SCHEDULES OF THE CLASSIFICATION ACT HAVE BEEN ADOPTED FOR SUCH EMPLOYEES.

COMPTROLLER GENERAL WARREN TO THE SECRETARY OF COMMERCE, NOVEMBER 6, 1951:

REFERENCE IS MADE TO YOUR LETTER OF OCTOBER 31, 1951, REQUESTING A DECISION AS TO WHETHER THE RETROACTIVE COMPENSATION AUTHORIZED TO BE PAID BY SECTION 6 OF PUBLIC LAW 201, APPROVED OCTOBER 24, 1951, 65 STAT. 615, LAWFULLY MAY BE PAID TO EMPLOYEES OCCUPYING UNGRADED POSITIONS THE SALARIES OF WHICH ARE AUTHORIZED BY STATUTE TO BE FIXED ADMINISTRATIVELY.

PRIMARILY, YOUR SUBMISSION RELATES TO SOME 1,800 EMPLOYEES OF THE BUREAU OF THE CENSUS, WHOSE SALARIES WERE FIXED ADMINISTRATIVELY PURSUANT TO AUTHORITY CONTAINED IN PUBLIC LAW 759, 81ST CONGRESS, 2D SESSION, 64 STAT. 621, MAKING APPROPRIATIONS FOR THE DEPARTMENT OF COMMERCE FOR THE FISCAL YEAR 1951, AS FOLLOWS:

SEVENTEENTH DECENNIAL CENSUS: FOR EXPENSES NECESSARY FOR TAKING, COMPILING, AND PUBLISHING THE SEVENTEENTH DECENNIAL CENSUS INCLUDING THE CENSUS OF HOUSING AS AUTHORIZED BY LAW (13 U.S.C. 201-219; PUBLIC LAW 171, APPROVED JULY 15, 1949), INCLUDING PERSONAL SERVICES AT THE SEAT OF GOVERNMENT AND ELSEWHERE AT RATES TO BE FIXED BY THE SECRETARY OF COMMERCE WITHOUT REGARD TO THE CLASSIFICATION ACT OF 1949 AND THE FEDERAL EMPLOYEES PAY ACT OF 1945, AS AMENDED * * *

AUTHORITY SIMILAR TO THAT QUOTED ABOVE IS CONTAINED IN THE DEPARTMENT'S APPROPRIATION ACT FOR THE FISCAL YEAR 1952, 65 STAT. 575. YOUR LETTER PROCEEDS AS FOLLOWS:

IN ESTABLISHING AND ADMINISTERING UNGRADED POSITIONS, THE DEPARTMENT FOR SOME YEARS HAS FOLLOWED THE POLICY OF TREATING UNGRADED POSITIONS AS THOUGH THEY ARE GENERALLY SUBJECT TO THE PROVISIONS AND WAGE SCHEDULES OF THE CLASSIFICATION ACT, AS AMENDED. THIS POLICY IS SET FORTH IN DEPARTMENT OF COMMERCE ADMINISTRATIVE ORDER NO. 202-24, WHICH WAS EFFECTIVE APRIL 21, 1947, AND HAS BEEN IN FORCE CONTINUOUSLY SINCE THAT DATE. IN ADMINISTERING THIS POLICY, UNGRADED EMPLOYEES WHO OCCUPY POSITIONS SIMILAR TO GRADED POSITIONS, AS DESCRIBED ABOVE, HAVE HITHERTO BEEN GRANTED EXACTLY THE SAME INCREASES IN BASIC COMPENSATION AS HAVE BEEN GRANTED TO GRADED EMPLOYEES.

AS YOU KNOW, A CURRENT BILL, S. 622, 82ND CONGRESS, ST SESSION, PROVIDES A GENERAL PAY INCREASE FOR ALL GRADED EMPLOYEES, NOT ONLY PROSPECTIVELY BUT ALSO RETROACTIVELY TO THE FIRST PAY PERIOD IN THIS FISCAL YEAR.

IN ENDEAVORING TO CONTINUE TO APPLY THE DEPARTMENT'S POLICY OF EQUITABLE COMPENSATION FOR EMPLOYEES IN UNGRADED POSITIONS, ON THE BASIS OF EXACTLY THE SAME SCHEDULES OF BASIC COMPENSATION, INCLUDING LONGEVITY RATES, AS IS PROVIDED BY THE CONGRESS FOR GRADED EMPLOYEES, WE ASSUME THAT THERE IS NO QUESTION OF THE LEGALITY, PROPRIETY, AND DESIRABILITY OF GRANTING THE SAME BENEFITS TO UNGRADED EMPLOYEES PROSPECTIVELY. A QUESTION HAS ARISEN, HOWEVER, AS TO WHETHER THE RATES OF PAY OF EMPLOYEES IN UNGRADED POSITIONS MAY BE ADJUSTED ON THE SAME BASIS AS THE RATES OF GRADED EMPLOYEES, EFFECTIVE AS OF THE FIRST PAY PERIOD IN THIS FISCAL YEAR.

IN THIS CONNECTION, WE ARE MINDFUL OF THE WELL-SETTLED RULE THAT INCREASES IN PAY MAY NOT LAWFULLY BE MADE AN ADMINISTRATIVE DECISION HAVING RETROACTIVE EFFECT. IF OUR ADMINISTRATIVE DECISION AND POLICY WITH RESPECT TO EQUITABLE COMPENSATION FOR UNGRADED POSITIONS HAD BEEN MADE SINCE JULY 1, 1951, I COULD WELL UNDERSTAND THE IMPROPRIETY OF SUCH ACTION. THE FACTS RELATING TO OUR PROBLEM ARE MATERIALLY DIFFERENT, HOWEVER, IN THAT THE ADMINISTRATIVE DECISION OF THE DEPARTMENT TO ADOPT THE COMPENSATION SCHEDULES OF THE CLASSIFICATION ACT, AS AMENDED, FOR UNGRADED POSITIONS DATES FROM 1947, SOME FOUR YEARS PRIOR TO THE CURRENT AMENDMENT OF THE CLASSIFICATION ACT. THAT ADMINISTRATIVE DECISION WAS PROSPECTIVE IN NATURE AND SOUGHT TO APPLY ENTIRELY IN THE FUTURE, THE BASIC COMPENSATION PROVISIONS OF THE CLASSIFICATION ACT, AS AMENDED, TO UNGRADED EMPLOYEES ON THE SAME BASIS, TO THE SAME EXTENT, AND EFFECTIVE AT THE SAME TIME, AS THAT ACT MIGHT APPLY TO GRADED EMPLOYEES.

UNDER THE FOREGOING CIRCUMSTANCES, WE DO NOT BELIEVE THAT THE PAYMENT OF INCREASED COMPENSATION TO UNGRADED EMPLOYEES, EFFECTIVE AS OF THE SAME DATE AS SUCH PAY IS GRANTED TO GRADED EMPLOYEES, WOULD CONSTITUTE AN ADMINISTRATIVE DECISION OF A RETROACTIVE NATURE.

CAREFUL CONSIDERATION HAS BEEN GIVEN TO THE MATTERS ABOVE SET FORTH AND TO THE OTHER REASONS MENTIONED IN YOUR LETTER URGING THAT THIS OFFICE AUTHORIZE PAYMENT OF THE RETROACTIVE INCREASE TO THE UNGRADED EMPLOYEES INVOLVED.

AS STATED IN YOUR LETTER IT IS A WELL ESTABLISHED RULE THAT INCREASES IN COMPENSATION LAWFULLY MAY NOT BE GRANTED BY ADMINISTRATIVE DETERMINATION TO HAVE RETROACTIVE EFFECT. ACCORDINGLY, THE MANY SOUND REASONS WHY THAT RULE SHOULD NOT BE ABROGATED IN THE INSTANT CASE NEED NOT BE MENTIONED, BUT I SHOULD LIKE TO DIRECT YOUR ATTENTION HERE TO THE HOLDING IN 25 COMP. GEN. 601, AND 28 ID. 300. THERE REMAINS FOR CONSIDERATION ONLY THE QUESTION AS TO WHETHER THE UNGRADED EMPLOYEES OF THE BUREAU OF THE CENSUS FALL WITHIN THE PURVIEW OF PUBLIC LAW 201, SUPRA, EITHER EXPRESSLY OR BY NECESSARY IMPLICATION.

SECTION 6 OF THE SAID ACT, 65 STAT. 615, READS AS FOLLOWS:

SEC. 6. (A) THIS ACT SHALL BECOME EFFECTIVE AS OF THE FIRST DAY OF THE FIRST PAY PERIOD WHICH BEGAN AFTER JUNE 30, 1951.

(B) RETROACTIVE COMPENSATION OR SALARY SHALL BE PAID UNDER THIS ACT ONLY IN THE CASE OF AN INDIVIDUAL IN THE SERVICE OF THE UNITED STATES (INCLUDING SERVICE IN THE ARMED FORCES OF THE UNITED STATES) OR OF THE MUNICIPAL GOVERNMENT OF THE DISTRICT OF COLUMBIA ON THE DATE OF ENACTMENT OF THIS ACT, EXCEPT THAT SUCH RETROACTIVE COMPENSATION OR SALARY SHALL BE PAID A RETIRED OFFICER OR EMPLOYEE FOR SERVICES RENDERED DURING THE PERIOD BEGINNING WITH THE FIRST DAY OF THE FIRST PAY PERIOD WHICH BEGAN AFTER JUNE 30, 1951, AND ENDING WITH THE DATE OF HIS RETIREMENT.

THE PROVISIONS OF THE SAID ACT GENERALLY ARE LIMITED TO THOSE CLASSES OF EMPLOYEES OCCUPYING POSITIONS THE COMPENSATION AND STANDARDS OF WHICH ARE FIXED BY STATUTE--- THERE BEING NO PROVISION THEREIN EXPRESSLY TOUCHING UPON UNGRADED EMPLOYEES.

CONCERNING THE QUESTION OF WHETHER SUCH EMPLOYEES ARE COVERED BY THE ACT BY NECESSARY IMPLICATION, IT IS RECOGNIZED THAT THE HEADS OF DEPARTMENTS AND AGENCIES OF THE GOVERNMENT HAVING STATUTORY AUTHORITY TO FIX ADMINISTRATIVELY THE COMPENSATION OF UNGRADED EMPLOYEES BECAUSE OF THE PECULIAR NATURE OF THE FUNCTIONS ASSIGNED THEIR RESPECTIVE DEPARTMENTS OR AGENCIES BY THE CONGRESS MAY HAVE AS A MATTER OF POLICY, INSTIGATED BY CONSIDERATIONS OF EQUITY OR OTHERWISE, ADOPTED IN WHOLE OR IN PART THE COMPENSATION SCHEDULES OF THE CLASSIFICATION ACT. HOWEVER, IT MUST BE RECOGNIZED TOO THAT SUCH POLICIES NECESSARILY MUST BE SUBJECT TO ADMINISTRATIVE MODIFICATION SHOULD THE EXIGENCIES OF THE SITUATION REQUIRE --- A CONDITION EVIDENTLY CONTEMPLATED BY THE CONGRESS IN INITIALLY GRANTING THE LATITUDE ACCRUING FROM ADMINISTRATIVE AUTHORITY TO FIX SALARIES AS COMPARED WITH THE RELATIVELY INFLEXIBLE SALARY SCHEDULES OF THE CLASSIFICATION ACT. IN VIEW OF THE FOREGOING-- AND IN THIS I BELIEVE YOU WILL CONCUR--- MERE CONFORMANCE WITH THE PROVISIONS OF THE CLASSIFICATION ACT WHERE IT IS NOT REQUIRED BY LAW DOES NOT RENDER THE UNGRADED EMPLOYEES REFERRED TO IN YOUR LETTER SUBJECT TO THE CLASSIFICATION ACT AND THUS THEY MAY NOT BE CONSIDERED AS FALLING WITHIN THE PURVIEW OF PUBLIC LAW 201, SUPRA. A SIMILAR CONCLUSION IS REQUIRED WITH RESPECT TO EMPLOYEES WHOSE COMPENSATION MAY BE LIMITED BY LAW TO THE CLASSIFICATION ACT SCHEDULES BUT WHO ARE NOT NECESSARILY REQUIRED BY STATUTE TO CONFORM WITH THE CLASSIFICATION ACT STANDARDS.

ACCORDINGLY, THIS OFFICE MAY NOT (1) SET ASIDE THE RULE AGAINST RETROACTIVE ADMINISTRATIVE INCREASES IN SALARY; (2) FIND THAT UNGRADED EMPLOYEES ARE WITHIN THE PURVIEW OF PUBLIC LAW 201 FOR THE PURPOSES OF SECTION 6 THEREOF; NOR (3) AUTHORIZE RETROACTIVE INCREASES IN COMPENSATION TO THE UNGRADED EMPLOYEES REFERRED TO IN YOUR LETTER. WHETHER THE INCREASES MAY BE MADE EFFECTIVE PROSPECTIVELY WOULD SEEM TO BE CONTINGENT ON THE SUFFICIENCY OF AVAILABLE FUNDS WITHOUT A VIOLATION OF SECTION 1211 OF THE GENERAL APPROPRIATION ACT, 1951, PUBLIC LAW 759, APPROVED SEPTEMBER 6, 1950, 64 STAT. 765.