B-138310, SEPTEMBER 28, 1959, 39 COMP. GEN. 235

B-138310: Sep 28, 1959

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TIME - SAVED RATES - ELECTION TO CONVERT TO ANNUAL PREMIUM BASIS FIREFIGHTER EMPLOYEES WHO ARE IN RECEIPT OF PREMIUM COMPENSATION FOR STANDBY TIME AT A SAVED RATE. TO HAVE THEIR PREMIUM COMPENSATION CONVERTED TO THE ANNUAL RATE BASIS SO LONG AS THEIR EXISTING AGGREGATE RATE OF COMPENSATION SAVED IS MORE THAN THE ANNUAL PREMIUM RATE. EVEN THOUGH THEIR ACTUAL "TAKE HOME PAY" UNDER THE SAVED PAY FORMULA IS BELOW THE ANNUAL PREMIUM RATE. SUCH ELECTIONS WHICH HAVE BEEN MADE PURSUANT TO ADMINISTRATIVE REGULATION PRIOR TO THE TIME THE AGGREGATE SAVED RATE OF COMPENSATION EQUALED OR EXCEEDED THE ANNUAL PREMIUM RATE WILL NOT BE QUESTIONED. PROVIDED THAT NO FURTHER ELECTIONS ARE MADE. THE ADMINISTRATIVE DEPARTMENTS HAVE THE RESPONSIBILITY TO DETERMINE WHICH PAY FACTORS.

B-138310, SEPTEMBER 28, 1959, 39 COMP. GEN. 235

CIVILIAN PERSONNEL - COMPENSATION - OVERTIME - STANDBY, ETC., TIME - SAVED RATES - ELECTION TO CONVERT TO ANNUAL PREMIUM BASIS FIREFIGHTER EMPLOYEES WHO ARE IN RECEIPT OF PREMIUM COMPENSATION FOR STANDBY TIME AT A SAVED RATE, AS PRESCRIBED IN SECTION 401 OF THE FEDERAL EMPLOYEES PAY ACT OF 1945, AS ADDED BY SECTION 208 OF THE ACT OF SEPTEMBER 1, 1954, 5 U.S.C. 926 NOTE, MAY NOT BE PERMITTED TO ELECT, PURSUANT TO ADMINISTRATIVE REGULATION, TO HAVE THEIR PREMIUM COMPENSATION CONVERTED TO THE ANNUAL RATE BASIS SO LONG AS THEIR EXISTING AGGREGATE RATE OF COMPENSATION SAVED IS MORE THAN THE ANNUAL PREMIUM RATE, EVEN THOUGH THEIR ACTUAL "TAKE HOME PAY" UNDER THE SAVED PAY FORMULA IS BELOW THE ANNUAL PREMIUM RATE; HOWEVER, SUCH ELECTIONS WHICH HAVE BEEN MADE PURSUANT TO ADMINISTRATIVE REGULATION PRIOR TO THE TIME THE AGGREGATE SAVED RATE OF COMPENSATION EQUALED OR EXCEEDED THE ANNUAL PREMIUM RATE WILL NOT BE QUESTIONED, PROVIDED THAT NO FURTHER ELECTIONS ARE MADE. IN THE ABSENCE OF A SPECIFIC DEFINITION OF THE TERM "EXISTING AGGREGATE RATE" IN THE SAVINGS CLAUSE OF THE PREMIUM COMPENSATION PROVISIONS IN SECTION 401 OF THE FEDERAL EMPLOYEES PAY ACT OF 1945, AS ADDED BY SECTION 208 (B) OF THE ACT OF SEPTEMBER 1, 1954, 5 U.S.C. 926 NOTE, AND OF A MANDATORY FORMULA PRESCRIBED BY THE CIVIL SERVICE COMMISSION FOR THE DETERMINATION OF EXISTING AGGREGATE RATES OF COMPENSATION, THE ADMINISTRATIVE DEPARTMENTS HAVE THE RESPONSIBILITY TO DETERMINE WHICH PAY FACTORS--- THE AMOUNT OF OVERTIME, NIGHT DUTY, AND HOLIDAY WORK--- ARE SIGNIFICANT IN ESTABLISHING AN EXISTING AGGREGATE RATE FOR EACH EMPLOYEE OR GROUP OF EMPLOYEES TO ASCERTAIN WHETHER ENTITLEMENT TO SAVED COMPENSATION EXISTS UNDER SECTION 208 (B).

TO THE SECRETARY OF THE NAVY, SEPTEMBER 28, 1959:

ON JULY 13, 1959, THE CHIEF OF INDUSTRIAL RELATIONS, FILE OIR 250:IB, MADE CERTAIN RECOMMENDATIONS TO OUR ASSISTANT DIRECTOR, DEFENSE ACCOUNTING AND AUDITING DIVISION, CONCERNING THE CONVERSION OF THE AGGREGATE ANNUAL RATE OF COMPENSATION OF FIREFIGHTERS TO THE ANNUAL PREMIUM RATE PRESCRIBED BY SECTION 401 OF THE FEDERAL EMPLOYEES PAY ACT OF 1945, AS ADDED BY SECTION 208 (A) OF THE ACT OF SEPTEMBER 1, 1954 ( PUBLIC LAW 763, 830 CONGRESS), 68 STAT. 1111 (5 U.S.C. 926).

THE PERTINENT PROVISIONS OF SECTION 208 (A), 5 U.S.C. 926, READ AS FOLLOWS:

THE HEAD OF ANY DEPARTMENT, INDEPENDENT ESTABLISHMENT, OR AGENCY, * * * MAY, WITH THE APPROVAL OF THE CIVIL SERVICE COMMISSION, PROVIDE THAT---

(1) ANY OFFICER OR EMPLOYEE IN A POSITION REQUIRING HIM REGULARLY TO REMAIN AT, OR WITHIN THE CONFINES OF, HIS STATION DURING LONGER THAN ORDINARY PERIODS OF DUTY, A SUBSTANTIAL PART OF WHICH CONSISTS OF REMAINING IN A STANDBY STATUS RATHER THAN PERFORMING WORK, SHALL RECEIVE PREMIUM COMPENSATION FOR SUCH DUTY ON AN ANNUAL BASIS IN LIEU OF PREMIUM COMPENSATION PROVIDED BY ANY OTHER PROVISIONS OF THIS CHAPTER, EXCEPT FOR IRREGULAR, UNSCHEDULED OVERTIME DUTY IN EXCESS OF HIS REGULARLY SCHEDULED WEEKLY TOUR. * * *

PARAGRAPH (B) OF SECTION 208, 5 U.S.C. 926 NOTE, PROVIDES AS FOLLOWS:

NOTHING CONTAINED IN THIS SECTION SHALL BE CONSTRUED TO DECREASE THE EXISTING AGGREGATE RATE OF COMPENSATION OF ANY PRESENT EMPLOYEE, BUT WHEN THE POSITION OF SUCH EMPLOYEE BECOMES VACANT ANY SUBSEQUENT APPOINTEE THERETO SHALL RECEIVE PREMIUM COMPENSATION PROVIDED FOR SUCH POSITION IN ACCORDANCE WITH THIS SECTION.

THE PERTINENT PROVISIONS OF THE NAVY REGULATIONS ( NCPI 85.4-5C) CONCERNING THE TIME THE SAVING CLAUSE OF THE ABOVE-QUOTED PARAGRAPH (B) CEASES TO APPLY ARE AS FOLLOWS:

* * * THE SAVING CLAUSE CEASES TO APPLY WHEN PAY AT THE ANNUAL PREMIUM RATE EXCEEDS PAY AT THE SAVED RATE. THE SAVING CLAUSE WILL CEASE TO APPLY UPON AN EARLIER REQUEST OF THE FIREFIGHTER FOR CHANGE TO THE ANNUAL PREMIUM RATE, REGARDLESS OF THE APPARENT DIFFERENCE BETWEEN THE SAVED RATE AND THE ANNUAL PREMIUM RATE. THE FIREFIGHTER'S REQUEST MUST BE VOLUNTARY AND IN WRITING AND SHOULD INDICATE UNDERSTANDING THAT THE CHANGE IS PERMANENT, AS WELL AS UNDERSTANDING OF WHAT HIS PAY AT THE ANNUAL PREMIUM RATE WILL BE.

THE FIRST RECOMMENDATION IS THAT THE NAVY BE ALLOWED TO CONTINUE TO FOLLOW THE AGGREGATE ANNUAL RATE OF COMPENSATION FORMULA ADOPTED IN 1954 FOR FIREFIGHTER EMPLOYEES. THIS WAS RECOMMENDED SO THAT THE NAVY COULD FIX WITH CERTAINTY THE TIME SUCH EMPLOYEES ARE REQUIRED TO HAVE THEIR COMPENSATION CHANGED FROM A SAVED RATE TO THE ANNUAL PREMIUM RATE.

SINCE PARAGRAPH (B) AS QUOTED ABOVE DOES NOT SPECIFICALLY DEFINE THE TERM "EXISTING AGGREGATE RATE" AND SINCE THE CIVIL SERVICE COMMISSION DOES NOT APPEAR TO HAVE PRESCRIBED A MANDATORY FORMULA, THE RESPECTIVE ADMINISTRATIVE DEPARTMENTS HAVE THE RESPONSIBILITY TO DETERMINE WHICH PAY FACTORS--- THE AMOUNT OF OVERTIME, NIGHT DUTY, AND HOLIDAY WORK--- ARE SIGNIFICANT IN ESTABLISHING AN EXISTING AGGREGATE RATE FOR EACH EMPLOYEE OR GROUP OF EMPLOYEES. THEREFORE, WE WILL NOT QUESTION THE FORMULA ADOPTED BY THE NAVY FOR ITS FIREFIGHTER EMPLOYEES.

THE SECOND RECOMMENDATION IS THAT EMPLOYEES HAVING THE BENEFITS OF SAVED PAY BE ALLOWED TO ELECT TO CONVERT TO THE ANNUAL PREMIUM RATE WHEN THEIR "TAKE-HOME PAY" UNDER THE SAVED PAY FORMULA IS IN FACT BELOW THE ANN PREMIUM RATE. THE FOLLOWING INFORMATION IS PRESENTED IN SUPPORT OF THIS RECOMMENDATION.

THE SAVED ANNUAL RATE IS AT BEST A FICTITIOUS FIGURE. THE SUM ARRIVED AT, REGARDLESS OF FORMULA, IS SUBJECT TO REDUCTION BY PERIODS OF ANNUAL AND SICK LEAVE OF 8 OR MORE HOURS DURATION. ALSO, IT IS SUBJECT TO ADJUSTMENT BASED UPON HOLIDAYS ACTUALLY WORKED. THUS, WHILE THE SAVED RATE MAY BE ESTABLISHED, THE AMOUNT THE EMPLOYEE RECEIVES IS, IN MOST CASES, A LOWER FIGURE. FREQUENTLY, THE FIREFIGHTER WOULD BENEFIT BY CHANGING TO THE ANNUAL PREMIUM RATE SINCE THAT RATE IS NOT SUBJECT TO ADJUSTMENT BECAUSE OF ANNUAL OR SICK LEAVE TAKEN, OR HOLIDAYS NOT WORKED. FOR THIS REASON, WE BELIEVE THAT THERE IS CONSIDERABLE MERIT IN ALLOWING FIREFIGHTERS TO MOVE TO THE ANNUAL PREMIUM RATE VOLUNTARILY SINCE IT APPEARS THAT THE INTENT OF THE LAW IS MET IF "TAKE-HOME PAY" IS NOT REDUCED.

THE PURPOSE OF SECTION 208 (B) AS QUOTED ABOVE IS SET FORTH ON PAGE 24 OF HOUSE REPORT NO. 2665, 83D CONGRESS, 2D SESSION, AS FOLLOWS:

THE COMMITTEE OF CONFERENCE FURTHER AGREED, HOWEVER, THAT THE PAY OF THOSE FIRE FIGHTERS NOW IN THE SERVICE WHO RECEIVE MORE THAN THE 25 PERCENT ADDITIONAL PAY PROVIDED BY THE CONFERENCE SUBSTITUTE SHOULD NOT BE REDUCED. THIS IS ACCOMPLISHED BY SECTION 208 (B) OF THE CONFERENCE SUBSTITUTE WHICH PROVIDES THAT THE PROVISIONS OF THE NEW TITLE IV ADDED BY SECTION 208 (A) OF THE CONFERENCE SUBSTITUTE TO THE FEDERAL EMPLOYEES PAY ACT OF 1945, AS AMENDED, SHALL NOT BE CONSTRUED TO DECREASE THE AGGREGATE RATE OF COMPENSATION OF ANY PRESENT EMPLOYEE. * * *

IN OUR DECISION OF NOVEMBER 29, 1954, B-121783, TO THE SECRETARY OF DEFENSE, IN ANSWER TO QUESTION ONE, WE EXPRESSED THE VIEW THAT THE COMPUTATION OF PAY FOR AN EMPLOYEE AFFECTED BY SECTION 208 (B) WOULD BE CONTINUED ON THE BASIS OF THE "TWO-THIRDS" RULE DISCUSSED IN 25 COMP. GEN. 161 UNTIL THE EMPLOYEE'S EXISTING AGGREGATE RATE OF COMPENSATION SAVED BY SECTION 208 (B) IS EQUALED OR EXCEEDED BY THE RATE HE WOULD RECEIVE IF HIS COMPENSATION WAS COMPUTED UNDER SECTION 208 (A). THEREFORE, OUR VIEW IS THAT EMPLOYEES HAVING THE BENEFITS OF SAVED PAY MAY NOT BE ALLOWED TO ELECT TO CONVERT TO THE ANNUAL PREMIUM RATE SO LONG AS THEIR EXISTING AGGREGATE RATE OF COMPENSATION SAVED BY SECTION 208 (B) IS MORE THAN THE ANNUAL PREMIUM RATE EVEN THOUGH THEIR ACTUAL "TAKE-HOME PAY" UNDER THE SAVED PAY FORMULA IS BELOW THE ANNUAL PREMIUM RATE.

OUR ATTENTION HAS BEEN DIRECTED TO A PROVISION IN YOUR REGULATIONS ( NCPI 85.4-5), WHICH INDICATES THE SAVINGS CLAUSE WILL CEASE TO APPLY, PRIOR TO THE TIME THE ANNUAL PREMIUM RATE EXCEEDS PAY AT THE SAVED RATE, WHEN A FIREFIGHTER REQUESTS A CHANGE TO THE ANNUAL PREMIUM RATE REGARDLESS OF THE APPARENT DIFFERENCE BETWEEN THE SAVED RATE AND THE ANNUAL PREMIUM RATE. THIS PROVISION APPEARS CONTRARY TO THE INTENT OF THE SAVINGS PROVISION OF THE STATUTE AND OUR VIEWS AS EXPRESSED ABOVE. HOWEVER, SINCE THE APPARENT PURPOSE OF PUBLIC LAW 763 WAS TO CONVERT ALL FIREFIGHTER EMPLOYEES TO THE ANNUAL PREMIUM RATE AT THE EARLIEST POSSIBLE TIME WITHOUT REDUCING THE PAY OF SUCH EMPLOYEES, WE WILL NOT QUESTION AT THIS TIME ANY ELECTIONS HERETOFORE MADE BY THE FIREFIGHTERS UNDER THE REGULATION PROVIDED NO FURTHER ELECTIONS ARE PERMITTED AND PROVIDED FURTHER THAT ACTION IS INITIATED BY YOUR DEPARTMENT TO REQUEST THE CONGRESS TO AMEND SECTION 208 (B) TO AUTHORIZE AN ELECTION BY THE EMPLOYEES IF SUCH ELECTION IS ADMINISTRATIVELY DEEMED APPROPRIATE. WE SHOULD APPRECIATE YOUR INFORMING US OF YOUR ACTION IN THE MATTER.