B-151163, APR. 8, 1963

B-151163: Apr 8, 1963

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THE BASIS FOR THE PROPOSED PAYMENT IS THAT IN RECOMMENDING THE WAGE SCHEDULE. WHICH IS SAID TO HAVE RESULTED IN THE SCHEDULED RATE OF THE POSITION LABORATORY PIPEFITTER BEING FIXED AT $2.85 PER HOUR RATHER THAN $3.05 PER HOUR. THE STATUTORY AUTHORITY FOR FIXING THE COMPENSATION OF THE EMPLOYEES CONCERNED IS FOUND IN 5 U.S.C. 1082 (7). IT PROVIDES THAT THEIR RATES SHALL BE FIXED AND ADJUSTED FROM TIME TO TIME AS NEARLY AS IS CONSISTENT WITH THE PUBLIC INTEREST IN ACCORDANCE WITH PREVAILING RATES. IS VESTED IN WAGE BOARDS OR OTHER ADMINISTRATIVE WAGE FIXING AUTHORITIES. IS NOT A LEGAL RATE. EVEN THOUGH IT CAN BE SHOWN THAT ONE OF THE ELEMENTS NORMALLY ENTERING INTO THE DETERMINATION OF A WAGE RATE WAS ERRONEOUS.

B-151163, APR. 8, 1963

TO MR. W. F. OWEN, JR., BUREAU OF MINES, DEPARTMENT OF THE INTERIOR:

YOUR LETTER OF MARCH 25, 1963, ENCLOSING PAYROLL VOUCHER IN FAVOR OF CERTAIN CIVILIAN WAGE BOARD EMPLOYEES OF THE BUREAU OF MINES, AND RELATED PAPERS, ASKS IN EFFECT WHETHER THE VOUCHER PROPERLY MAY BE CERTIFIED FOR PAYMENT.

THE BASIS FOR THE PROPOSED PAYMENT IS THAT IN RECOMMENDING THE WAGE SCHEDULE, APPROVED NOVEMBER 29, 1961, THE WAGE BOARD USED CERTAIN ERRONEOUS INFORMATION FURNISHED IT BY A PRIVATE FIRM IN REGARD TO THE LOCAL RATES THEN BEING PAID TO JOURNEYMEN PIPEFITTERS, WHICH IS SAID TO HAVE RESULTED IN THE SCHEDULED RATE OF THE POSITION LABORATORY PIPEFITTER BEING FIXED AT $2.85 PER HOUR RATHER THAN $3.05 PER HOUR. AS A MATTER OF FACT THE EMPLOYEES CONTINUED TO RECEIVE THE RATE OF $2.97 PER HOUR FIXED BY THE 1960 SCHEDULE, UNDER A RECOMMENDATION IN THE 1961 SCHEDULE THAT NO PRESENT EMPLOYEE'S RATE OF PAY BE REDUCED SO LONG AS HE REMAINS IN THE POSITION HE PRESENTLY OCCUPIES.

THE STATUTORY AUTHORITY FOR FIXING THE COMPENSATION OF THE EMPLOYEES CONCERNED IS FOUND IN 5 U.S.C. 1082 (7), AND IT PROVIDES THAT THEIR RATES SHALL BE FIXED AND ADJUSTED FROM TIME TO TIME AS NEARLY AS IS CONSISTENT WITH THE PUBLIC INTEREST IN ACCORDANCE WITH PREVAILING RATES.

THE FUNCTION OF FIXING THE RATES UNDER STATUTORY AUTHORITY, WHICH RATES MAY INCLUDE DEVIATIONS FROM LOCAL AREA RATES BECAUSE OF THE EFFECT OF PUBLIC INTEREST, IS VESTED IN WAGE BOARDS OR OTHER ADMINISTRATIVE WAGE FIXING AUTHORITIES. WHEN SUCH A BOARD FIXES A SCHEDULED RATE, AFTER A SURVEY OF LOCAL RATES AND CONSIDERATION OF MATTERS DICTATED BY THE PUBLIC INTEREST, IT BECOMES IMPOSSIBLE TO SAY, IN THE ABSENCE OF EVIDENCE OF ARBITRARY OR CAPRICIOUS ACTION, THAT THE PREVAILING RATE SO FIXED BY A BOARD AND THEREAFTER APPROVED BY PROPER AUTHORITY, IS NOT A LEGAL RATE.

EVEN THOUGH IT CAN BE SHOWN THAT ONE OF THE ELEMENTS NORMALLY ENTERING INTO THE DETERMINATION OF A WAGE RATE WAS ERRONEOUS, THE EXTENT TO WHICH THAT ELEMENT MAY HAVE BEEN ACCEPTED OR REJECTED BY THE BOARD IN THE EXERCISE OF ITS DISCRETION AND JUDGMENT AND IN THE CONSIDERATION OF INTANGIBLES SUCH AS THE PUBLIC INTEREST, IS NOT SUSCEPTIBLE OF PROOF. CHANGE IN THE PUBLISHED RATE, UNDER THE CIRCUMSTANCES, COULD BE FOUNDED ONLY ON SPECULATION.

FROM THE RECORD, OUR VIEW IS THAT THE EMPLOYEES CONCERNED WERE PAID A LAWFUL RATE AND THAT THERE IS NO BASIS NOW FOR ADJUSTING THE RATE RETROACTIVELY. PROSPECTIVE CHANGES WOULD BE CONTINGENT UPON A REDETERMINATION BY THE BOARD OF A NEW RATE AND APPROVAL OF SUCH RATE BY PROPER AUTHORITY. THE SPECIFIC QUESTIONS CONTAINED IN YOUR LETTER ARE ANSWERED ACCORDINGLY.

THE VOUCHER, WHICH MAY NOT BE CERTIFIED FOR PAYMENT, IS RETURNED HEREWITH.