B-122994, MAY 3, 1955, 34 COMP. GEN. 563

B-122994: May 3, 1955

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IT IS WITHIN THE ADMINISTRATIVE DISCRETION GRANTED BY SECTION 202 (7) OF THE CLASSIFICATION ACT OF 1949 TO DETERMINE. THAT IT IS IN THE PUBLIC INTEREST TO SAVE THE COMPENSATION OF SUCH EMPLOYEES AS LONG AS THEY CONTINUE TO OCCUPY THE POSITIONS HELD ON THE EFFECTIVE DATE OF THE CHANGES. 1955: REFERENCE IS MADE TO YOUR LETTER OF FEBRUARY 15. A CHANGE IN THE WAGE SYSTEM FOR LITHOGRAPHIC AND RELATED POSITIONS WHICH WILL PROVIDE FOR ONLY THREE RATES WITHIN EACH WAGE BOARD GRADE. THE SECOND STEP IS PEGGED TO PREVAILING WAGES. THE FIRST STEP IS FIVE PERCENT BELOW THIS RATE. THE THIRD IS FIVE PERCENT ABOVE THIS RATE. EMPLOYEES NOW AT ONE OF THOSE THREE STEPS WILL RECEIVE THEIR CURRENT RATES UPON EFFECTUATION OF THE NEW SCHEDULE.

B-122994, MAY 3, 1955, 34 COMP. GEN. 563

COMPENSATION - WAGE BOARD, ETC., EMPLOYEES - SAVED COMPENSATION WHERE CHANGES IN A WAGE BOARD PAY SYSTEM WOULD REDUCE THE COMPENSATION OF CERTAIN EMPLOYEES, IT IS WITHIN THE ADMINISTRATIVE DISCRETION GRANTED BY SECTION 202 (7) OF THE CLASSIFICATION ACT OF 1949 TO DETERMINE, EITHER BY GENERAL REGULATION OR INDIVIDUAL CASE, THAT IT IS IN THE PUBLIC INTEREST TO SAVE THE COMPENSATION OF SUCH EMPLOYEES AS LONG AS THEY CONTINUE TO OCCUPY THE POSITIONS HELD ON THE EFFECTIVE DATE OF THE CHANGES.

COMPTROLLER GENERAL CAMPBELL TO THE SECRETARY OF HEALTH, EDUCATION AND WELFARE, MAY 3, 1955:

REFERENCE IS MADE TO YOUR LETTER OF FEBRUARY 15, 1955, REQUESTING OUR DECISION UPON TWO QUESTIONS ARISING UNDER THE FOLLOWING FACTS STATED IN YOUR LETTER.

THE INTERDEPARTMENTAL LITHOGRAPHIC WAGE BOARD FOR THE WASHINGTON AREA HAS ADOPTED, FOR RECOMMENDATION TO PARTICIPATING AGENCIES, A CHANGE IN THE WAGE SYSTEM FOR LITHOGRAPHIC AND RELATED POSITIONS WHICH WILL PROVIDE FOR ONLY THREE RATES WITHIN EACH WAGE BOARD GRADE, INSTEAD OF THE PREVIOUS FOUR. NEW SCHEDULES (INTENDED TO BE EFFECTIVE FEBRUARY 13, 1955) ESTABLISH RATES FOR EACH GRADE EQUAL TO THE FIRST THREE RATES UNDER THE CURRENT SCHEDULE. THE SECOND STEP IS PEGGED TO PREVAILING WAGES, THE FIRST STEP IS FIVE PERCENT BELOW THIS RATE, AND THE THIRD IS FIVE PERCENT ABOVE THIS RATE. EMPLOYEES NOW AT ONE OF THOSE THREE STEPS WILL RECEIVE THEIR CURRENT RATES UPON EFFECTUATION OF THE NEW SCHEDULE. THE PARTICIPATING AGENCIES, INCLUDING YOUR DEPARTMENT, BELIEVE THAT IT WOULD BE INCONSISTENT WITH THE PUBLIC INTEREST TO REDUCE THE PAY OF CURRENT EMPLOYEES WHO HAVE ATTAINED THE FOURTH RATE UNDER THE PREVIOUS SYSTEM, AS LONG AS THEY CONTINUE IN THEIR CURRENT POSITIONS AND AS LONG AS THE SECOND RATE FOR THE GRADE (THE ONE PEGGED TO PREVAILING WAGES) IS NOT REVISED DOWNWARD. REDUCTION OF COMPENSATION FOR THE SMALL NUMBER OF EMPLOYEES AT THESE FOURTH RATES, IN THE ABSENCE OF A GENERAL DOWNWARD REVISION IN WAGE BOARD RATES, COULD BE EXPECTED TO HAVE AN ADVERSE EFFECT ON MORALE AND TURNOVER, AND THEREFORE ON COSTS.

YOU REQUEST TO BE ADVISED (1) WHETHER OUR OFFICE WOULD OBJECT TO THE ESTABLISHMENT OF A SCHEDULE FOR EMPLOYEES PAID IN ACCORDANCE WITH DETERMINATIONS OF THE LITHOGRAPHIC WAGE BOARD THAT WOULD PROVIDE, IN ACCORDANCE WITH BOARD RECOMMENDATIONS, FOR A FOURTH RATE PAYABLE ONLY TO EMPLOYEES CURRENTLY PAID AT SUCH RATE WHILE REMAINING IN THEIR PRESENT POSITIONS AND SUBJECT TO REVISION UPON REDETERMINATION OF WAGE SCHEDULES, AND (2) WHETHER IT WOULD BE IN ORDER FOR YOUR DEPARTMENT TO ADOPT AN ADMINISTRATIVE REGULATION THAT, WHEN RATES PAID TO EMPLOYEES UNDER A PREVAILING RATE SYSTEM ARE ADJUSTED AS A RESULT OF A CHANGE IN THE PAY SYSTEM, EMPLOYEES WHO HAVE ATTAINED RATES ABOVE THE NEW MAXIMUM FOR THEIR POSITIONS SHALL RETAIN SUCH RATES AS LONG AS THEY REMAIN IN THE SAME POSITIONS, EXCEPT THAT DOWNWARD ADJUSTMENTS MAY, BE MADE IN SUCH SAVED RATES TO CONFORM WITH GENERAL DOWNWARD REVISIONS OF THE PAY SCHEDULE. THE LATTER CASE THE SAME DIFFERENTIAL IS TO BE MAINTAINED BETWEEN THE SAVED RATES AND THE HIGHEST REGULARLY SCHEDULED RATES FOR THE CLASS OF POSITIONS INVOLVED.

SECTION 202 (7) OF THE CLASSIFICATION ACT OF 1949, 63 STAT. 955, IS AS FOLLOWS:

SEC. 202. THIS ACT (EXCEPT TITLE XII) SHALL NOT APPLY TO---

(7) EMPLOYEES IN RECOGNIZED TRADES OR CRAFTS, OR OTHER SKILLED MECHANICAL CRAFTS, OR IN UNSKILLED, SEMISKILLED, OR SKILLED MANUAL LABOR OCCUPATIONS * * * AND EMPLOYEES IN THE BUREAU OF ENGRAVING AND PRINTING THE DUTIES OF WHOM ARE TO PERFORM OR TO DIRECT MANUAL OR MACHINE OPERATIONS REQUIRING SPECIAL SKILL OR EXPERIENCE, OR TO PERFORM OR DIRECT THE COUNTING, EXAMINING, SORTING, OR OTHER VERIFICATION OF THE PRODUCT OF MANUAL OR MACHINE OPERATIONS, WHOSE COMPENSATION SHALL BE FIXED AND ADJUSTED FROM TIME TO TIME AS NEARLY AS IS CONSISTENT WITH THE PUBLIC INTEREST IN ACCORDANCE WITH PREVAILING RATES,

THE QUOTED SECTION DOES NOT SPECIFICALLY SAVE COMPENSATION TO AN EMPLOYEE UPON HIS BEING PLACED IN A LOWER WAGE LEVEL AS A RESULT OF A CHANGE IN A PAY SYSTEM. ON THE OTHER HAND, IT DOES NOT REQUIRE THAT THE COMPENSATION OF EMPLOYEES IN THE VARIOUS TRADES, CRAFTS, OR OCCUPATIONS SPECIFIED THEREIN BE ADJUSTED IN EVERY CASE TO CONFORM EXACTLY WITH PREVAILING LOCALITY WAGE RATES. THE SECTION REQUIRES THAT THE WAGES BE ADJUSTED "AS NEARLY AS IS CONSISTENT WITH THE PUBLIC INTEREST IN ACCORDANCE WITH PREVAILING RATES.' THE QUESTION WHETHER IN A PARTICULAR CASE ANY SUCH ADJUSTMENT IS CONSISTENT WITH THE PUBLIC INTEREST IS A MATTER PRIMARILY FOR ADMINISTRATIVE DETERMINATION, AND WHEN MADE IT ORDINARILY WILL NOT BE QUESTIONED BY OUR OFFICE IN THE ABSENCE OF SOME COMPELLING REASON. SO FAR AS CONCERNS THE INSTANT PROBLEM, IT IS NOTEWORTHY THAT THE CONGRESS FREQUENTLY INCLUDES SAVINGS PROVISIONS IN LEGISLATION AFFECTING PAY OF GOVERNMENT EMPLOYEES. WHILE SUCH FACT DOES NOT CONSTITUTE STATUTORY AUTHORITY FOR THE SAVING OF COMPENSATION BY ADMINISTRATIVE ACTION, IT AT LEAST AMOUNTS TO A CONGRESSIONAL RECOGNITION OF THE FACT THAT THE SAVING OF PAY TO EMPLOYEES IN EQUITABLE SITUATIONS IS NOT PER SE CONTRARY TO THE PUBLIC INTEREST.

ACCORDINGLY, WE ARE OF THE VIEW THAT YOU MAY, IN THE EXERCISE OF THE DISCRETION GRANTED UNDER SECTION 202 (7), DETERMINE EITHER IN AN INDIVIDUAL CASE OR BY A GENERAL REGULATION THAT IT IS IN THE PUBLIC INTEREST TO SAVE EMPLOYEES FROM REDUCTIONS IN COMPENSATION RESULTING FROM CHANGES IN PAY SYSTEMS SO LONG AS THEY CONTINUE TO OCCUPY THE POSITIONS HELD BY THEM ON THE DATES THE CHANGES ARE PLACED IN EFFECT.