B-126150, MARCH 1, 1956, 35 COMP. GEN. 495

B-126150: Mar 1, 1956

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THE ASSISTANT SECRETARY OF DEFENSE ( COMPTROLLER) REQUESTED OUR DECISION CONCERNING THE PROPER METHOD TO BE USED IN COMPUTING THE "PREMIUM COMPENSATION" FOR FIREFIGHTER PERSONNEL OF THE DEPARTMENT OF DEFENSE STATIONED IN THE PANAMA CANAL ZONE WHO ARE SUBJECT TO SECTION 401 (1) OF THE FEDERAL EMPLOYEES PAY ACT OF 1945. THE THREE PARAGRAPHS OF THE LETTER IN QUESTION HAVE BEEN NUMBERED BY US AND ARE AS FOLLOWS: 1. IF THIS INTERPRETATION IS NOT CORRECT. IF BOTH OF THESE INTERPRETATIONS ARE INCORRECT. SECTION 401 (1) OF THE REFERRED-TO STATUTE AUTHORIZES THE PAYMENT OF PREMIUM COMPENSATION TO ANY OFFICER OR EMPLOYEE WHO IS REQUIRED TO REMAIN AT HIS STATION LONGER THAN ORDINARY PERIODS OF DUTY.

B-126150, MARCH 1, 1956, 35 COMP. GEN. 495

COMPENSATION - EMPLOYEES IN PANAMA CANAL ZONE - PREMIUM PAY PREMIUM COMPENSATION AUTHORIZED BY SECTION 501 (1) OF THE FEDERAL EMPLOYEES PAY ACT OF 1945, AS AMENDED BY THE FRINGE BENEFIT ACT OF SEPTEMBER 1, 1954, FOR FIREFIGHTER PERSONNEL OF THE DEFENSE DEPARTMENT STATIONED IN THE PANAMA CANAL ZONE SHOULD BE COMPUTED ON THE BASIS OF REGULAR CANAL ZONE RATES OF COMPENSATION AS DO NOT EXCEED $6,800, IF SUCH RATES REPRESENT THE MINIMUM RATE FOR GRADE GS-9 IN THE UNITED STATES, PLUS THE 25 PERCENT OVERSEAS DIFFERENTIAL.

TO THE SECRETARY OF DEFENSE, MARCH 1, 1956:

ON NOVEMBER 21, 1955, THE ASSISTANT SECRETARY OF DEFENSE ( COMPTROLLER) REQUESTED OUR DECISION CONCERNING THE PROPER METHOD TO BE USED IN COMPUTING THE "PREMIUM COMPENSATION" FOR FIREFIGHTER PERSONNEL OF THE DEPARTMENT OF DEFENSE STATIONED IN THE PANAMA CANAL ZONE WHO ARE SUBJECT TO SECTION 401 (1) OF THE FEDERAL EMPLOYEES PAY ACT OF 1945, 5 U.S.C. 901, AS AMENDED SEPTEMBER 1, 1954, PUBLIC LAW 763, 68 STAT. 1111, 5 U.S.C. 926. FOR PURPOSES OF OUR REPLY, THE THREE PARAGRAPHS OF THE LETTER IN QUESTION HAVE BEEN NUMBERED BY US AND ARE AS FOLLOWS:

1. IT WOULD APPEAR THAT THE PREMIUM COMPENSATION PROVIDED IN SECTION 401 (1) OF THE FEDERAL EMPLOYEES-PAY ACT OF 1945, AS AMENDED, WOULD BE COMPUTED IN THE CANAL ZONE AS THE APPROPRIATE PERCENTAGE OF SUCH PART OF AN EMPLOYEE'S BASIC COMPENSATION (INCLUDING THE TWENTY FIVE PERCENT DIFFERENTIAL) AS DOES NOT EXCEED $5,440 PER ANNUM, THE MINIMUM SCHEDULED RATE OF BASIC COMPENSATION PROVIDED FOR GRADE GS-9 IN THE CLASSIFICATION ACT OF 1949, AS AMENDED.

2. IF THIS INTERPRETATION IS NOT CORRECT, SHOULD THE PREMIUM COMPENSATION BE COMPUTED AS THE APPROPRIATE PERCENTAGE OF SUCH PART OF BASIC COMPENSATION AS DOES NOT EXCEED $6,800 PER ANNUM, THE MINIMUM SCHEDULED RATE OF BASIC COMPENSATION PROVIDED FOR GRADE GS-9 IN THE CLASSIFICATION ACT OF 1949, AS AMENDED, INCREASED BY THE TWENTY-FIVE PERCENT OVERSEAS DIFFERENTIAL?

3. IF BOTH OF THESE INTERPRETATIONS ARE INCORRECT, WHAT METHOD SHOULD BE USED TO COMPUTE THE ADDITIONAL COMPENSATION?

SECTION 401 (1) OF THE REFERRED-TO STATUTE AUTHORIZES THE PAYMENT OF PREMIUM COMPENSATION TO ANY OFFICER OR EMPLOYEE WHO IS REQUIRED TO REMAIN AT HIS STATION LONGER THAN ORDINARY PERIODS OF DUTY, A SUBSTANTIAL PART OF WHICH IS IN A STANDBY STATUS. THAT SECTION PROVIDES THAT THE PREMIUM COMPENSATION PAID ON AN ANNUAL BASIS THEREUNDER SHALL BE IN LIEU OF OVERTIME, NIGHT DIFFERENTIAL, HOLIDAY PAY, AND OTHER PREMIUM COMPENSATION PROVIDED BY THE 1945 ACT, AS AMENDED. SUCH PREMIUM COMPENSATION UNDER SECTION 401 (1) "SHALL BE DETERMINED AS AN APPROPRIATE PERCENTAGE (NOT IN EXCESS OF 25 PERCENTUM) OF SUCH PART OF THE RATE OF BASIC COMPENSATION FOR ANY SUCH POSITION AS DOES NOT EXCEED THE MINIMUM SCHEDULED RATE OF BASIC COMPENSATION PROVIDED FOR GRADE GS-9 IN THE CLASSIFICATION ACT OF 1949, 5 U.S.C. 1082, AS AMENDED * * *.' ( ITALICS SUPPLIED.)

PURSUANT TO THE FEDERAL EMPLOYEES PAY ACT, AS AMENDED, THE REGULATION OF THE CIVIL SERVICE COMMISSION ( FPM Z1-321; 5 C.F.R. 25.203 (G) ( DEFINES " RATE OF BASIC COMPENSATION" AND PROVIDES " IT IS EXCLUSIVE OF SUCH ADDITIONAL COMPENSATION AS * * * ALLOWANCES OR POST DIFFERENTIALS PAYABLE TO OFFICERS OR EMPLOYEES STATIONED OUTSIDE THE STATES.' IT APPEARS THAT THE ALLOWANCES AND POST DIFFERENTIALS SPECIFIED IN THE QUOTED REGULATION ARE THOSE PRESCRIBED BY THE COMMISSION PURSUANT TO EXECUTIVE ORDER NO. 10,000, AS AMENDED. IN THAT RESPECT, THE CIVIL SERVICE REGULATIONS FPM Z1 -452 ( T.S. 312), 5 C.F.R. 350.2, ALSO PROVIDE THAT THE TERRITORIAL POST DIFFERENTIALS AND COST-OF LIVING ALLOWANCES PRESCRIBED PURSUANT TO EXECUTIVE ORDER NO. 10,000, AS AMENDED, UNDER SECTION 207 OF THE ACT OF APRIL 20, 1948, AS AMENDED, 5 U.S.C. 118H,"DO NOT APPLY TO EMPLOYEES IN THE PANAMA CANAL ZONE WHOSE RATES OF BASIC COMPENSATION ARE FIXED BY STATUTE, OR TO ANY OTHER SUCH GROUPS OF EMPLOYEES FOR WHOM ADDITIONAL COMPENSATION OR SALARY DIFFERENTIALS FOR SERVICE OUTSIDE THE UNITED STATES OR IN ALASKA ARE OTHERWISE SPECIFICALLY AUTHORIZED BY LAW.' FURTHER, WHILE THE DEPARTMENT OF STATE FOREIGN SERVICE REGULATION S-52 (5 C.F.R. 326.1) DESIGNATES THE PANAMA CANAL ZONE AS BEING WITHIN THE SCOPE OF PART II OF EXECUTIVE ORDER NO. 10,000 (5 C.F.R. 301.21 TO 301.30), THAT REGULATION APPEARS TO BE INAPPLICABLE TO THE COMPENSATION PAYABLE TO THE NAMED CLASSES OF EMPLOYEES OF THE DEPARTMENT OF DEFENSE WHO HAVE BEEN DESIGNATED IN ACCORDANCE WITH THE ANNUAL APPROPRIATION ACTS FOR ADDITIONAL COMPENSATION FROM YEAR TO YEAR, AS INDICATED BELOW.

FOR EXAMPLE, BY VIRTUE OF THE PROVISO CONTAINED IN EXECUTIVE ORDER NO. 10,642, UNDER THE PROVISIONS OF PUBLIC LAW 121, SECTION 202 (69 STAT. 235, 236), AND PUBLIC LAW 157, SECTION 610 (69 STAT. 315, 316), THE AVAILABILITY OF APPROPRIATIONS DURING FISCAL YEAR 1956 FOR THE CANAL ZONE GOVERNMENT, THE PANAMA CANAL COMPANY, AND THE DEPARTMENT OF DEFENSE IS CONTINUED FOR COMPENSATION AS FOLLOWS:

* * * (5) THAT ALL CITIZENS OF PANAMA AND THE UNITED STATES RENDERING SKILLED, TECHNICAL, CLERICAL, ADMINISTRATIVE, EXECUTIVE, OR SUPERVISORY SERVICE ON THE CANAL ZONE UNDER THE TERMS OF THIS ACT (A) SHALL NORMALLY BE EMPLOYED NOT MORE THAN FORTY HOURS PER WEEK, (B) MAY RECEIVE AS COMPENSATION EQUAL RATES OF PAY BASED UPON RATES PAID FOR SIMILAR EMPLOYMENT IN CONTINENTAL UNITED STATES PLUS 25 PERCENTUM; (6) THIS ENTIRE SECTION SHALL APPLY ONLY TO PERSONS EMPLOYED IN SKILLED, TECHNICAL, CLERICAL, ADMINISTRATIVE, EXECUTIVE, OR SUPERVISORY POSITIONS ON THE CANAL ZONE DIRECTLY OR INDIRECTLY BY ANY BRANCH OF THE UNITED STATES GOVERNMENT OR BY ANY CORPORATION OR COMPANY WHOSE STOCK IS OWNED WHOLLY OR IN PART BY THE UNITED STATES GOVERNMENT; PROVIDED FURTHER, THAT THE PRESIDENT MAY SUSPEND FROM TIME TO TIME IN WHOLE OR IN PART COMPLIANCE WITH THIS SECTION IF HE SHOULD DEEM SUCH COURSE TO BE IN THE PUBLIC INTEREST.

AS STATED IN YOUR DEPARTMENT'S LETTER OF NOVEMBER 21, 1955, VARIOUS DECISIONS OF OUR OFFICE HAVE CONSTRUED SUCH AUGMENTED SALARY RATES (INCLUDING SUCH "25 PERCENTUM") OF EMPLOYEES STATIONED IN THE CANAL ZONE AS THE REGULAR AND BASIC COMPENSATION FOR THE CANAL ZONE POSITIONS AS ESTABLISHED FOR THE VARIOUS PURPOSES IN QUESTION. SEE 10 COMP. GEN. 519; 21 ID. 205; 22 ID. 79, 769; AND 25 ID. 188, 596, AND 897; CF. 24 COMP. GEN. 181; 25 ID. 151; 28 ID. 402, AND 34 ID. 385. THEREFORE, AND SINCE THE CANAL ZONE AUGMENTED SALARY RATES OF THE DEPARTMENT OF DEFENSE EMPLOYEES APPEAR TO HAVE BEEN "SPECIFICALLY AUTHORIZED BY LAW" WITHIN THE MEANING OF THOSE WORDS AS CONTAINED IN SECTION 207 OF THE ABOVE-CITED ACT OF APRIL 20, 1948, 5 U.S.C. 118H, OUR VIEW IS THAT SUCH AUGMENTED SALARY RATES ARE NOT SUBJECT TO THE CIVIL SERVICE REGULATION 25.203 (G) WHICH, PURSUANT TO THE 1948 ACT, DEFINES " RATE OF BASIC COMPENSATION" AS EXCLUDING "ALLOWANCES OR POST DIFFERENTIALS.'

ACCORDINGLY, WE HOLD THAT SUCH PREMIUM COMPENSATION AS IS AUTHORIZED BY YOUR DEPARTMENT PURSUANT TO SECTION 401 (1) OF PUBLIC LAW 763 FOR YOUR EMPLOYEES IN THE CANAL ZONE MAY BE COMPUTED AT THE APPROPRIATE PERCENTAGE (NOT IN EXCESS OF 25 PERCENTUM) OF THE REGULAR CANAL ZONE RATES OF COMPENSATION AS DO NOT EXCEED $6,800, IF SUCH RATES WOULD REPRESENT THE MINIMUM SCHEDULED RATES PROVIDED FOR SIMILAR EMPLOYMENT IN CONTINENTAL UNITED STATES AT GRADE GS-9 OF THE CLASSIFICATION ACT OF 1949 "PLUS 25 PERCENTUM," AS SUGGESTED IN THE LETTER OF NOVEMBER 21, 1955. HENCE, THE ABOVE-QUOTED FIRST PARAGRAPH OF THE LETTER, NUMBERED 1, IS ANSWERED IN THE NEGATIVE, AND OUR ANSWER TO THE SECOND, OR ALTERNATIVE QUESTION, IS IN THE AFFIRMATIVE.

IN VIEW OF THE ANSWER TO THE QUESTION NUMBERED 2, AN ANSWER TO THE QUESTION NUMBERED 3 IS NOT REQUIRED, EXCEPT THAT IT SHOULD BE NOTED SUCH A PREMIUM COMPENSATION SYSTEM UNDER SECTION 401 (1) MAY BE AUTHORIZED "WITH THE APPROVAL OF THE CIVIL SERVICE COMMISSION," IT BEING SO PROVIDED THEREIN.