B-35329, JULY 9, 1943, 23 COMP. GEN. 11

B-35329: Jul 9, 1943

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" ON WHICH IS TO BE COMPUTED THE 15 PERCENT ADDITIONAL COMPENSATION . ON SO MUCH OF THEIR EARNED BASIC COMPENSATION AS IS NOT IN EXCESS OF A RATE OF $2. IS. " THAT IS. 1943: I HAVE YOUR LETTER OF JUNE 22. PROVIDES IN PART AS FOLLOWS: "THAT OFFICERS OR EMPLOYEES WHOSE COMPENSATION IS BASED ON MILEAGE. OR OTHER THAN A TIME PERIOD BASIS OR WHOSE HOURS OF DUTY ARE INTERMITTENT. SUBSTITUTE EMPLOYEES WHOSE COMPENSATION IS BASED UPON A RATE PER HOUR OR PER DAY. AMOUNTING TO 10 PERCENTUM OF SO MUCH OF THEIR EARNED BASIC COMPENSATION AS IS NOT IN EXCESS OF A RATE OF $2. EACH SUCH EMPLOYEE SHALL BE PAID ONLY SUCH ADDITIONAL COMPENSATION OR PORTION THEREOF AS WILL NOT CAUSE HIS AGGREGATE COMPENSATION TO EXCEED A RATE OF $5.

B-35329, JULY 9, 1943, 23 COMP. GEN. 11

COMPENSATION - ADDITIONAL - WHAT CONSTITUTES "EARNED BASIC COMPENSATION" OF PART TIME EMPLOYEES "EARNED BASIC COMPENSATION," ON WHICH IS TO BE COMPUTED THE 15 PERCENT ADDITIONAL COMPENSATION ,ON SO MUCH OF THEIR EARNED BASIC COMPENSATION AS IS NOT IN EXCESS OF A RATE OF $2,900 PER ANNUM" AUTHORIZED FOR PART TIME EMPLOYEES BY SECTION 3 (C) OF THE WAR OVERTIME PAY ACT OF 1943, IS, AS DEFINED IN THE REGULATIONS ISSUED PURSUANT TO SAID ACT,"THE AMOUNT OF SALARY EARNED BY AN PLOYEE," THAT IS, THE TOTAL PART TIME SALARY RATE FIXED ON AN ANNUAL BASIS, AND, THEREFORE, THE 15 PERCENT ADDITIONAL COMPENSATION SHOULD BE COMPUTED ON THE ENTIRE AMOUNT OF THE PART TIME SALARY RATE, NOT IN EXCESS OF $2,900 PER ANNUM.

ACTING COMPTROLLER GENERAL YATES TO THE CHAIRMAN, WAR MANPOWER COMMISSION, JULY 9, 1943:

I HAVE YOUR LETTER OF JUNE 22, 1943, AS FOLLOWS:

PUBLIC LAW 821, APPROVED DECEMBER 22, 1942, PROVIDES IN PART AS FOLLOWS:

"THAT OFFICERS OR EMPLOYEES WHOSE COMPENSATION IS BASED ON MILEAGE, POSTAL RECEIPTS, FEES, PIECEWORK, OR OTHER THAN A TIME PERIOD BASIS OR WHOSE HOURS OF DUTY ARE INTERMITTENT, IRREGULAR, OR LESS THAN FULL TIME, SUBSTITUTE EMPLOYEES WHOSE COMPENSATION IS BASED UPON A RATE PER HOUR OR PER DAY, AND EMPLOYEES IN OR UNDER THE LEGISLATIVE AND JUDICIAL BRANCHES, SHALL BE PAID ADDITIONAL COMPENSATION, IN LIEU OF OVERTIME COMPENSATION AUTHORIZED HEREIN, AMOUNTING TO 10 PERCENTUM OF SO MUCH OF THEIR EARNED BASIC COMPENSATION AS IS NOT IN EXCESS OF A RATE OF $2,900 PER ANNUM, AND EACH SUCH EMPLOYEE SHALL BE PAID ONLY SUCH ADDITIONAL COMPENSATION OR PORTION THEREOF AS WILL NOT CAUSE HIS AGGREGATE COMPENSATION TO EXCEED A RATE OF $5,000 PER ANNUM.'

SECTION 3 (C) OF PUBLIC LAW 49, APPROVED MAY 7, 1943, PROVIDES AS FOLLOWS:

"ANY OFFICER OR EMPLOYEE TO WHOM THIS ACT APPLIES AND WHOSE HOURS OF DUTY ARE LESS THAN FULL TIME, OR WHOSE COMPENSATION IS BASED UPON OTHER THAN A TIME PERIOD BASIS SHALL BE PAID, IN LIEU OF OVERTIME COMPENSATION OR ADDITIONAL COMPENSATION UNDER THE FOREGOING PROVISIONS OF THIS ACT, ADDITIONAL COMPENSATION AT A RATE OF 15 PERCENTUM OF SO MUCH OF THEIR EARNED BASIC COMPENSATION AS IS NOT IN EXCESS OF A RATE OF $2,900 PER ANNUM.'

A CAREFUL REVIEW HAS BEEN MADE OF THE DECISIONS FROM YOUR OFFICE, PARTICULARLY DECISION OF JANUARY 2, 1943, B-31316, 22 COMP. GEN. 589, TO THE ARCHITECT OF THE CAPITOL, AND DECISION OF FEBRUARY 2, 1943, B 31872, 22 COMP. GEN. 738, TO MR. O. H. NEILSON, AUTHORIZED CERTIFYING OFFICER, WAR PRODUCTION BOARD, RELATIVE TO THE METHOD OF COMPUTING OVERTIME PAYMENTS FOR PART-TIME EMPLOYEES. NEITHER OF THESE DECISIONS, HOWEVER, NOR ANY OF THE OTHER DECISIONS RELATIVE TO OVERTIME PAYMENTS WHICH HAVE BEEN REVIEWED, SET FORTH CLEARLY AN INTERPRETATION OF THE TERM ,EARNED BASIC COMPENSATION" WHICH IS USED IN PUBLIC LAW 821 AND ALSO IN PUBLIC LAW 49 AND WHICH, IT SEEMS, IS REQUIRED FOR THE PURPOSE OF COMPUTING ADDITIONAL COMPENSATION IN LIEU OF OVERTIME FOR PART-TIME ANNUAL SALARIED EMPLOYEES ASSIGNED TO POSITIONS FOR WHICH THE COMPENSATION FOR FULL-TIME EMPLOYMENT IS IN EXCESS OF $2,900 PER ANNUM.

UNDER THE AUTHORITY VESTED IN THE NATIONAL YOUTH ADMINISTRATION BY THE NATIONAL YOUTH ADMINISTRATION APPROPRIATION ACT OF 1943, APPROVED JULY 2, 1942, AN EO-GRADE SCALE HAS BEEN ESTABLISHED AS AN ANNUAL SALARIED BASIS FOR COMPENSATION OF VARIOUS CLASSES OF EMPLOYEES, INCLUDING PART-TIME ANNUAL SALARIED EMPLOYEES PAID FROM ADMINISTRATIVE AND PROJECT FUNDS. THE EO SALARY SCALE CURRENTLY IN EFFECT IS CONTAINED IN ADMINISTRATIVE ORDER NO. 22, DATED FEBRUARY 10, 1943.

CONCERNING THE EMPLOYMENT OF PART-TIME ADMINISTRATIVE AND PART-TIME PROJECT SUPERVISORY EMPLOYEES, ADMINISTRATIVE ORDER NO. 22 PROVIDES THAT SUCH EMPLOYEES SHALL BE "COMPENSATED ON AN ANNUAL SALARY BASIS IN ACCORDANCE WITH THE EO-GRADE SCALE APPLICABLE TO A CORRESPONDING FULL TIME POSITION * * *.' UNDER ADMINISTRATIVE ORDER NO. 22, THE MINIMUM RATE FOR EO-GRADE 15, WHICH WILL BE USED FOR THE PURPOSE OF THIS LETTER, IS $4,600 PER ANNUM. THEREFORE, A PERSON WHO IS EMPLOYED TO WORK PART-TIME IN A POSITION FOR WHICH THE COMPENSATION IS $4,600PER ANNUM FOR FULL TIME EMPLOYMENT IS APPOINTED TO EO-GRADE 15, IN CONFORMITY WITH THE REQUIREMENTS SET FORTH IN 11 COMP. GEN. 362 AND THE APPOINTMENT DOCUMENT ALSO INCLUDES (1) THE SERVICE REQUIRED, AND (2) THE ACTUAL AMOUNT OF SALARY THE PART-TIME EMPLOYEE IS TO RECEIVE. HOWEVER, THE DOCUMENTS HAVE BEEN INDICATING THE BASIC SALARY "PLUS 10 PERCENT ADDITIONAL COMPENSATION IN LIEU OF OVERTIME" PRIOR TO MAY 1, 1943, AND "PLUS 15 PERCENT ADDITIONAL COMPENSATION IN LIEU OF OVERTIME" BEGINNING MAY 1, 1943. FOR THE PURPOSE OF THIS LETTER, THE POSSIBLE METHODS FOR CALCULATING THE ADDITIONAL COMPENSATION IN LIEU OF OVERTIME FOR A PART-TIME ANNUAL SALARIED EMPLOYEE APPOINTED TO A POSITION THE COMPENSATION FOR WHICH IS $4,600 FOR FULL TIME ARE SET FORTH IN THE FOLLOWING EXAMPLES:

EXAMPLE NO. 1. PART-TIME ANNUAL SALARIED EMPLOYEE APPOINTED TO WORK 24 HOURS PER WEEK IN A POSITION THE COMPENSATION FOR WHICH IS $4,600 FOR FULL TIME EMPLOYMENT. CHART

METHOD A.

24/48TH OF $4,600-------------------------------$2,300.00

PLUS 15 PERCENT OF $2,300----------------------- 345.00

TOTAL ANNUAL SALARY-----------------$2,645.00

METHOD B.

ANNUAL SALARY FOR FULL TIME POSITION-----------------$4,600.00

PLUS 15 PERCENT OF $2,900----------------------------- 435.00

ANNUAL SALARY FOR FULL TIME EMPLOYMENT PLUS 15 PERCENT OF

$2,900------$5,035.00

ANNUAL SALARY FOR HALF-TIME EMPLOYMENT, 1/2 OF

$5,035.00 OR-----$2,517.50

EXAMPLE NO. 2. PART-TIME ANNUAL SALARIED EMPLOYEE APPOINTED TO WORK 36 HOURS PER WEEK IN A POSITION THE COMPENSATION OF WHICH IS $4,600 FOR FULL TIME EMPLOYMENT.

METHOD A.

36/48TH OF $4,600.00----------------------------------$3,450.00

PLUS 15 PERCENT OF $2,900------------------------------ 435.00

TOTAL ANNUAL SALARY-----------------------$3,885.00

METHOD B.

ANNUAL SALARY FOR FULL-TIME POSITION-----------------$4,600.00

PLUS 15 PERCENT OF $2,900------------------------------ 435.00

ANNUAL SALARY FOR FULL-TIME EMPLOYMENT PLUS 15 PERCENT OF

$2,900--------5,035.00

ANNUAL SALARY FOR 36/48TH OR THREE-QUARTER TIME

EMPLOYMENT--- 3/4TH X $5,035, OR-----------------3,776.25

IN EACH OF THE ABOVE EXAMPLES, METHOD A REPRESENTS A CONCEPT CONCERNING THE CALCULATION OF ADDITIONAL COMPENSATION IN LIEU OF OVERTIME DIFFERENT FROM THAT REPRESENTED BY METHOD B. EACH METHOD OF CALCULATION IS BASED ON A DIFFERENT INTERPRETATION OF THE TERM "EARNED BASIC COMPENSATION.' THIS CONNECTION, IT HAS BEEN OBSERVED THAT IN 22 COMP. GEN. 738 THE INDEFINITENESS OF THE STATEMENT IS RECOGNIZED IN THAT IT IS STATED:

"WHILE THE CONGRESS USED THE EXPRESSION EARNED BASIC COMPENSATION WHICH IS NOT ENTIRELY CLEAR * * *"

HOWEVER, UNITED STATES CIVIL SERVICE COMMISSION IN SECTION 6 OF DEPARTMENTAL CIRCULAR NO. 424, DATED MAY 8, 1943, DEFINES "EARNED BASIC COMPENSATION" AS FOLLOWS:

"EARNED BASIC COMPENSATION IS THE AMOUNT OF SALARY ACTUALLY EARNED BY AN EMPLOYEE, EXCLUSIVE OF OVERTIME COMPENSATION OR ADDITIONAL COMPENSATION IN LIEU THEREOF, BUT INCLUSIVE OF ANY SALARY DIFFERENTIAL FOR DUTY OUTSIDE THE CONTINENTAL UNITED STATES, INCLUDING ALASKA, AND THE VALUE OF QUARTERS, SUBSISTENCE, AND OTHER MAINTENANCE ALLOWANCES UNDER SECTION 3 OF THE ACT OF MARCH 5, 1928 (45 STAT. 193; 5 U.S.C. 75A).'

IN VIEW OF THE INTERPRETATION OF THE U.S. CIVIL SERVICE COMMISSION, AS SET FORTH IN THE ABOVE-CITED CIRCULAR LETTER, AND, FURTHER, IN VIEW OF THE COMMENT OF YOUR OFFICE IN 22 COMP. GEN. 738 WHEREIN IT IS STATED THAT:

"IT DOES SEEM CLEAR THAT THE CONGRESS DID NOT INTEND TO REDUCE THE SALARIES OR GRANT AN INCREASE IN EXCESS OF 10 PERCENTUM TO EMPLOYEES SUCH AS THOSE DISCUSSED IN YOUR LETTER.'

IT SEEMS THAT THE METHOD OF CALCULATING ADDITIONAL COMPENSATION IN LIEU OF OVERTIME FOR PART-TIME EMPLOYEES AS SET FORTH IN METHOD A OF EACH OF THE ABOVE EXAMPLES IS CORRECT, PARTICULARLY SINCE THIS METHOD OF CALCULATION PRODUCES THE FOLLOWING RESULTS:

(1) THE EMPLOYEE IN EXAMPLE NO. 1 RECEIVES EXACTLY 15 PERCENT ADDITIONAL COMPENSATION IN LIEU OF OVERTIME, AND

(2) THE EMPLOYEE IN EXAMPLE NO. 2 RECEIVES ADDITIONAL COMPENSATION IN LIEU OF OVERTIME AMOUNTING TO EXACTLY 15 PERCENT OF THE "SALARY ACTUALLY EARNED" "AS IS NOT IN EXCESS OF A RATE OF $2,900 PER ANNUM" (QUOTATIONS FROM DEPARTMENTAL CIRCULAR 424 REFERRED TO ABOVE AND SECTION 3 (C) OF WAR OVERTIME PAY ACT OF 1943).

THE METHOD OF CALCULATING ADDITIONAL COMPENSATION IN LIEU OF OVERTIME FOR PART-TIME EMPLOYEES AS SET FORTH IN METHOD B OF EACH OF THE ABOVE EXAMPLES PRODUCES THE FOLLOWING RESULTS:

(1) THE EMPLOYEE IN EXAMPLE NO. 1 RECEIVES COMPENSATION EQUIVALENT TO 1/2 OF $4,600.00 PLUS ONLY 9.4 PERCENT ADDITIONAL COMPENSATION IN LIEU OF OVERTIME.

(2) THE EMPLOYEE IN EXAMPLE NO. 2 RECEIVES COMPENSATION EQUIVALENT TO 3/4 OF $4,600.00 PLUS ONLY 11.2 PERCENT OF $2,900.00 ADDITIONAL COMPENSATION IN LIEU OF OVERTIME.

WHILE THE METHOD OF CALCULATING ADDITIONAL COMPENSATION IN LIEU OF OVERTIME AS SET FORTH IN METHOD A OF EXAMPLES NOS. 1 AND 2 ABOVE APPEARS TO BE CORRECT, YOUR OPINION IS RESPECTFULLY REQUESTED SINCE THE QUESTION HAS BEEN RAISED BY CERTIFYING OFFICERS FOR THE NATIONAL YOUTH ADMINISTRATION AND SINCE THE EXAMPLES SET FORTH IN 22 COMP. GEN. 738 DO NOT CLEAR THIS POINT IN THAT THE CALCULATIONS ARE ON THE BASIS OF EMPLOYMENT IN POSITIONS WHERE THE COMPENSATION IS LESS THAN $2,900 FOR FULL-TIME EMPLOYMENT.

THE TERM "EARNED BASIC COMPENSATION" AS USED IN THE JOINT RESOLUTION OF DECEMBER 22, 1942, WAS APPLIED IN THE REFERRED-TO DECISION (22 COMP. GEN. 738) WITHOUT AID OF ANY REGULATORY DEFINITION OF THAT TERM, BUT UNDER THE DEFINITION OF THAT TERM (AS USED IN THE NEW STATUTE) SET FORTH IN SECTION 6, PART 11 OF THE CIVIL SERVICE COMMISSION'S REGULATIONS QUOTED IN YOUR LETTER, THERE NOW IS NO ROOM FOR DOUBT BUT THAT THE "EARNED BASIC COMPENSATION" OF PART-TIME EMPLOYEES, ON THE BASIS OF WHICH "ADDITIONAL COMPENSATION AT A RATE OF 15 PERCENTUM OF SO MUCH OF THEIR EARNED BASIC COMPENSATION AS IS NOT IN EXCESS OF A RATE OF $2,900 PER ANNUM" (QUOTING FROM THE STATUTE), IS "THE AMOUNT OF SALARY ACTUALLY EARNED BY AN EMPLOYEE" (QUOTING FROM THE REGULATION), THAT IS, THE TOTAL PART-TIME SALARY RATE FIXED ON AN ANNUAL BASIS. THUS, THE EARNED BASIC COMPENSATION IN EXAMPLE NO. 1 IS THE TOTAL PART TIME SALARY RATE, OR $2,300 PER ANNUM, AND IN EXAMPLE NO. 2, $3,450.

IT FOLLOWS, THEREFORE, THAT IN EXAMPLE NO. 1 THE 15 PERCENT ADDITIONAL COMPENSATION IS AUTHORIZED TO BE COMPUTED ON THE ENTIRE AMOUNT OF THE PART -TIME SALARY RATE OF $2,300 PER ANNUM (WHICH IS LESS THAN $2,900), AND THAT IN EXAMPLE NO. 2 THE 15 PERCENT ADDITIONAL COMPENSATION IS AUTHORIZED TO BE COMPUTED ON THE FULL CEILING RATE OF $2,900 PER ANNUM (THE PART-TIME SALARY RATE BEING MORE THAN THAT AMOUNT). IN OTHER WORDS, METHOD A IS THE CORRECT ONE FOR COMPUTING THE TOTAL SALARY RATE (INCLUDING THE EARNED BASIC COMPENSATION AND THE ADDITIONAL COMPENSATION) IN BOTH EXAMPLES NOS. 1 AND 2. SEE DECISION OF MAY 17, 1943, 22 COMP. GEN. 1043, TO THE SECRETARY OF WAR.