B-50789, JULY 10, 1945, 25 COMP. GEN. 35

B-50789: Jul 10, 1945

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FEDERAL EMPLOYEES PAY ACT OF 1945 - APPLICABILITY - PER DIEM EMPLOYEES WHOSE BASIC COMPENSATION IS ADJUSTED ADMINISTRATIVELY PURSUANT TO STATUTORY AUTHORITY THE BASIC COMPENSATION OF PER DIEM EMPLOYEES OF THE UNITED STATES SECTION. WHICH IS FIXED ADMINISTRATIVELY PURSUANT TO STATUTORY AUTHORITY WITHOUT REGARD TO THE CLASSIFICATION ACT. IS NOT AUTOMATICALLY INCREASED BY ANY OF THE PROVISIONS OF THE FEDERAL EMPLOYEES PAY ACT OF 1945 RELATING TO BASIC COMPENSATION RATE INCREASES. SUCH EMPLOYEES ARE ENTITLED TO OVERTIME COMPENSATION UNDER SECTION 201 OF SAID ACT. 1945: I HAVE YOUR LETTER OF JUNE 29. TITLE II RELATES TO COMPENSATION FOR OVERTIME AND SETS UP A FORMULA FOR COMPUTING THE OVERTIME PAY OF EMPLOYEES WHOSE BASIC COMPENSATION IS AT A RATE LESS THAN $2.

B-50789, JULY 10, 1945, 25 COMP. GEN. 35

FEDERAL EMPLOYEES PAY ACT OF 1945 - APPLICABILITY - PER DIEM EMPLOYEES WHOSE BASIC COMPENSATION IS ADJUSTED ADMINISTRATIVELY PURSUANT TO STATUTORY AUTHORITY THE BASIC COMPENSATION OF PER DIEM EMPLOYEES OF THE UNITED STATES SECTION, INTERNATIONAL BOUNDARY COMMISSION, UNITED STATES AND MEXICO, WHICH IS FIXED ADMINISTRATIVELY PURSUANT TO STATUTORY AUTHORITY WITHOUT REGARD TO THE CLASSIFICATION ACT, IS NOT AUTOMATICALLY INCREASED BY ANY OF THE PROVISIONS OF THE FEDERAL EMPLOYEES PAY ACT OF 1945 RELATING TO BASIC COMPENSATION RATE INCREASES, BUT MUST BE ADJUSTED ADMINISTRATIVELY, IF AT ALL, SUBJECT TO THE AVAILABILITY OF FUNDS THEREFOR; HOWEVER, SUCH EMPLOYEES ARE ENTITLED TO OVERTIME COMPENSATION UNDER SECTION 201 OF SAID ACT. THE OVERTIME COMPENSATION FOR WORK IN EXCESS OF 40 HOURS PER WEEK OF PER DIEM EMPLOYEES OF THE UNITED STATES SECTION, INTERNATIONAL BOUNDARY COMMISSION, UNITED STATES AND MEXICO, WHOSE PER DIEM COMPENSATION AMOUNTS TO A PER ANNUM EQUIVALENT (2,080 TIMES THE HOURLY RATE) OF LESS THAN $2,980, SHOULD BE COMPUTED UNDER SECTION 201 OF THE FEDERAL EMPLOYEES PAY ACT OF 1945 ON THE BASIS OF 1 1/2 TIMES THEIR DAILY OR HOURLY RATE OF COMPENSATION.

ACTING COMPTROLLER GENERAL YATES TO THE COMMISSIONER, UNITED STATES SECTION, INTERNATIONAL BOUNDARY COMMISSION, UNITED STATES AND MEXICO, JULY 10, 1945:

I HAVE YOUR LETTER OF JUNE 29, 1945, AS FOLLOWS:

A QUESTION HAS ARISEN IN THIS OFFICE CONCERNING THE INTERPRETATION OF S. 807," FEDERAL EMPLOYEES PAY ACT OF 1945," RECENTLY PASSED BY THE CONGRESS, AS APPLIED TO THE PER DIEM EMPLOYEES OF THE UNITED STATES SECTION, INTERNATIONAL BOUNDARY COMMISSION, UNITED STATES AND MEXICO.

SECTION 101 (B) PROVIDES THAT " TITLE IV OF THIS ACT SHALL APPLY TO OFFICERS AND EMPLOYEES WHO OCCUPY POSITIONS SUBJECT TO THE CLASSIFICATION ACT OF 1923, AS AMENDED.' SECTION 405 OF TITLE IV RELATES TO INCREASES IN BASIC RATES OF COMPENSATION. SINCE NONE OF OUR PER DIEM EMPLOYEES OCCUPY POSITIONS SUBJECT TO THE CLASSIFICATION ACT OF 1923, AS AMENDED, IT APPEARS THAT S. 807 HAS NO EFFECT UPON THE BASIC RATES OF COMPENSATION OF THESE EMPLOYEES. SECTION 101 (A) PROVIDES IN PART THAT TITLE II OF THE ACT SHALL APPLY TO ALL CIVILIAN OFFICERS AND EMPLOYEES IN OR UNDER THE EXECUTIVE BRANCH OF THE GOVERNMENT, WITH CERTAIN EXCEPTIONS NOT APPLICABLE TO THE INSTANT PROBLEM. TITLE II RELATES TO COMPENSATION FOR OVERTIME AND SETS UP A FORMULA FOR COMPUTING THE OVERTIME PAY OF EMPLOYEES WHOSE BASIC COMPENSATION IS AT A RATE LESS THAN $2,980.00 PER ANNUM, AND A SCHEDULE FOR COMPUTING THE OVERTIME COMPENSATION FOR EMPLOYEES WHOSE BASIC COMPENSATION IS AT A RATE OF $2,980.00 PER ANNUM OR MORE.

IN THE LIGHT OF SECTION 101 (A) IT APPEARS THAT THE PER DIEM EMPLOYEES OF THIS AGENCY ARE ENTITLED TO OVERTIME COMPENSATION UNDER THE ACT. THE DIFFICULTY IS THAT PARAGRAPH (A) OF SECTION 201 PRESCRIBES A FORMULA FOR COMPUTING THE OVERTIME COMPENSATION OF PER ANNUM EMPLOYEES ONLY. SINCE NONE OF OUR PER DIEM EMPLOYEES ARE PAID AS MUCH AS $2,980.00 PER ANNUM THEIR POSITIONS WOULD NECESSARILY FALL IN CATEGORY (A) RATHER THAN CATEGORY (B) OF SECTION 201, BUT, AS I HAVE POINTED OUT, THERE IS NO FORMULA PRESCRIBED IN PARAGRAPH (A) FOR PER DIEM EMPLOYEES. THE BASIC RATE OF COMPENSATION OF THESE EMPLOYEES IS NOT FIXED OR ADJUSTED BY WAGE BOARDS OR SIMILAR ADMINISTRATIVE AUTHORITY. THESE EMPLOYEES ARE PRESENTLY BEING PAID OVERTIME COMPENSATION UNDER EXISTING LAW COMPUTED IN THE MANNER PRESCRIBED BY YOUR OFFICE IN DECISION B-31623 (22 COMPTROLLER GENERAL 926). THIS FORMULA IS AS FOLLOWS (QUOTING FROM THE SYLLABUS).

"UNDER THE OVERTIME AND ADDITIONAL COMPENSATION ACT OF DECEMBER 22, 1942, AND EXECUTIVE ORDER NO. 9289 ISSUED IN CONNECTION THEREWITH, THE PRORATED OVERTIME COMPENSATION FOR ONE DAY FOR FULL TIME EMPLOYEES WHO REGULARLY WORK A 6-DAY, 48-HOUR WEEK AND WHO ARE PAID ON A PER DIEM BASIS FOR EVERY DAY IN THE YEAR EXCEPT SUNDAYS SHOULD BE COMPUTED BY MULTIPLYING THE BASIC DAILY RATE BY 313 (365 LESS 52 SUNDAYS) TO DETERMINE THE EQUIVALENT ANNUAL RATE, WHICH RATE SHOULD BE DIVIDED BY 360 TO ASCERTAIN THE DAILY RATE FOR OVERTIME PURPOSES, AND SUCH DAILY RATE SHOULD BE MULTIPLIED BY ONE AND ONE -HALF (THE OVERTIME RATE) AND THAT AMOUNT MULTIPLIED BY 52 (WEEKS IN A YEAR) TO DETERMINE THE PER ANNUM OVERTIME RATE, FROM WHICH THE DAILY RATE OF OVERTIME COMPENSATION IS OBTAINED BY DIVIDING THE SAID PER ANNUM OVERTIME RATE BY 313.'

BY WAY OF ILLUSTRATION, AN EMPLOYEE WITH A BASIC PAY RATE OF $8.00 PER DAY RECEIVES UNDER EXISTING LAW AND UNDER THE ABOVE FORMULA, BASED ON A 48 -HOUR WEEK, $9.73 1/3 PER DAY, OR $58.39 PER WEEK. IF, UNDER THE NEW LAW, THE OVERTIME COMPENSATION IS TO BE FIGURED ON A STRICT TIME AND ONE-HALF BASIS THESE EMPLOYEES WOULD RECEIVE ONLY $52.00 PER WEEK FOR A 48-HOUR WEEK: THAT IS, $8.00 PER DAY FOR 5 DAYS, OR 40 HOURS, AND $12.00 FOR THE 6TH DAY, BEING ONE AND ONE-HALF TIMES THE BASIC PER DIEM RATE OF $8.00. THE EFFECT OF THE NEW LAW, IF CONSTRUED IN THIS MANNER, WOULD THEREFORE BE TO REDUCE THE COMPENSATION OF PER DIEM EMPLOYEES RATHER THAN TO INCREASE IT. IT IS NOT BELIEVED THAT THIS WAS THE INTENT OF CONGRESS.

PER DIEM EMPLOYEES IN THE LOWER BRACKETS, WHOSE OVERTIME COMPENSATION WOULD BE LESS THAN A RATE OF $300.00 PER ANNUM, UNDER THE ABOVE FORMULA, ARE PAID ADDITIONAL COMPENSATION IN THE AMOUNT OF 25 PERCENT OF THEIR EARNED BASIC COMPENSATION, UNDER THE AUTHORITY OF DEPARTMENTAL CIRCULAR NO. 424, UNITED STATES CIVIL SERVICE COMMISSION, DATED MAY 8, 1943. SINCE THESE REGULATIONS WERE ISSUED UNDER THE AUTHORITY OF THE WAR OVERTIME PAY ACT OF 1943 (57 STAT. 75), WHICH WILL TERMINATE ON JUNE 30, 1945, APPARENTLY THIS METHOD OF COMPUTING THE OVERTIME COMPENSATION WILL NO LONGER APPLY, THUS RESULTING IN SOME DECREASE IN COMPENSATION FOR THESE PER DIEM EMPLOYEES IN THE LOWER BRACKETS.

THE PROBLEM IS SIMILAR TO THE ONE ABOUT WHICH THIS OFFICE WAS ADVISED IN DECISION B-31623 ABOVE REFERRED TO. THE DECISION IN THAT CASE WAS BASED UPON WHAT WAS CONSIDERED TO HAVE BEEN THE INTENT OF CONGRESS, THAT ALL CLASSES OF FULL-TIME EMPLOYEES WORKING ON A TIME BASIS, WHETHER BY THE HOUR, DAY, OR WEEK, SHOULD RECEIVE THE STATUTORY INCREASE IN COMPENSATION FOR WORK IN EXCESS OF 40 HOURS PER WEEK, ON SUBSTANTIALLY THE SAME BASIS, DESPITE THE FACT THAT THE LAW ITSELF PROVIDED NO METHOD FOR COMPUTING OVERTIME COMPENSATION FOR PER DIEM EMPLOYEES.

THE INTENT OF THE CONGRESS, AS EXPRESSED IN SECTION 101 (A) OF S. 807, WOULD APPEAR TO BE THE SAME AS THE INTENTION REFLECTED IN THE JOINT RESOLUTION APPROVED DECEMBER 22, 1942 (56 STAT. 1068) AS INTERPRETED IN DECISION B-31623.

THERE APPEARS TO BE A POSSIBILITY THAT THE INTENT OF CONGRESS IN THIS REGARD WOULD BE FULFILLED IF A PER DIEM EMPLOYEE'S ANNUAL COMPENSATION WERE FIRST DETERMINED BY MULTIPLYING HIS DAILY RATE BY THE 313 WORK DAYS IN THE NUMBER OF BASIC WORK DAYS UNDER THE NEW LAW--- THAT IS, THE 52 WEEKS TIMES THE 5 BASIC WORK DAYS PER WEEK, TO ARRIVE AT THE EMPLOYEES NEW BASIC PER DIEM RATE. FOR EXAMPLE, A PRESENT RATE OF $8.00 PER DAY UNDER THE ABOVE FORMULA WOULD PRODUCE $2,504.00 AS THE ANNUAL COMPENSATION, AND $2,504.00 DIVIDED BY 260 OR $9.63 AS THE NEW BASIC PER DIEM RATE. THIS RATE WOULD PRODUCE FOR A 48-HOUR WEEK $9.63 TIMES 5 OR $48.15 FOR THE 40- HOURS WEEK PLUS ONE AND ONE-HALF TIMES $9.63 OR $14.44 FOR THE OVERTIME OF 8 HOURS, OR A TOTAL OF $62.59. THIS COMPARES WITH THE $58.39 NOW BEING RECEIVED.

WE SHOULD THEREFORE APPRECIATE YOUR ADVICE AS TO WHETHER UNDER S. 807, " FEDERAL EMPLOYEES PAY ACT OF 1945," THE OVERTIME COMPENSATION OF PER DIEM EMPLOYEES SHOULD BE COMPUTED BY THE SAME FORMULA AS LAID DOWN IN DECISION B-31623, OR IN THE MANNER SUGGESTED IN THE PRECEDING PARAGRAPH, OR IN SOME OTHER MANNER.

IN VIEW OF THE PROBABILITY OF THE ESTABLISHMENT, IN THE NEAR FUTURE, OF AN ADMINISTRATIVE WORKWEEK OF 44 HOURS, YOUR ADVICE IS FURTHER REQUESTED AS TO WHETHER THE FORMULA WOULD BE ANY DIFFERENT FOR DETERMINING OVERTIME COMPENSATION FOR PER DIEM EMPLOYEES WHO WORK 44 HOURS A WEEK RATHER THAN 48 HOURS. TAKING THE ILLUSTRATION ABOVE CITED OF A PER DIEM EMPLOYEE WHOSE BASIC RATE IS $8.00 PER DAY AND WHO IS NOW BEING PAID $9.73 1/3 PER DAY, BY APPLICATION OF THE PRESENT REGULATIONS RELATING TO OVERTIME COMPENSATION, IT IS OUR THOUGHT THAT SUCH AN EMPLOYEE, BY AN APPLICATION OF THE ABOVE PRINCIPLES, WOULD BE PAID $53.53 FOR A 44-HOUR WEEK (5 1/2 TIMES $9.73 1/3) RATHER THAN $58.39, HIS WEEKLY PAY BASED ON A 48-HOUR WEEK.

IN VIEW OF THE FACT THAT PAY ROLLS MUST BE PREPARED FOR PER DIEM EMPLOYEES OF THIS AGENCY ON JULY 15, YOUR EARLY ADVICE ON THIS MATTER WOULD BE DEEPLY APPRECIATED.

THE ONLY PROVISIONS IN THE " FEDERAL EMPLOYEES PAY ACT OF 1945," APPROVED JUNE 30, 1945, PUBLIC LAW 106, WHICH AUTHORIZE INCREASES IN BASIC RATES OF COMPENSATION ARE FOUND IN (A) SECTION 405, 59 STAT. 300, APPLICABLE TO EMPLOYEES WHOSE COMPENSATION IS FIXED IN ACCORDANCE WITH THE CLASSIFICATION ACT OF 1923, AS AMENDED; (B) SECTION 501, 59 STAT. 301, APPLICABLE TO EMPLOYEES OF THE LEGISLATIVE BRANCH OF THE GOVERNMENT; (C) SECTION 521, 59 STAT. 301, APPLICABLE TO EMPLOYEES OF THE JUDICIAL BRANCH OF THE GOVERNMENT; (D) SECTION 602 (A,) 59 STAT. 302, APPLICABLE TO CERTAIN EMPLOYEES IN THE CUSTOMS SERVICE; AND (E) SECTION 602 (B,) 59 STAT. 302, APPLICABLE TO EMPLOYEES WHOSE BASIC RATE OF COMPENSATION IS "PRESCRIBED BY STATUTE.' HENCE, THERE IS NO PROVISION IN THE STATUTE WHICH SPECIFICALLY OR BY IMPLICATION INCREASES THE BASIC RATE OF COMPENSATION OF PER DIEM EMPLOYEES OF THE UNITED STATES SECTION, INTERNATIONAL BOUNDARY COMMISSION, UNITED STATES AND MEXICO. NEITHER IS THERE ANY AUTHORITY UNDER THE LAW FOR ADOPTING ANY FORMULA WHICH, IN EFFECT, WOULD INCREASE THE BASIC COMPENSATION OF SUCH EMPLOYEES BY PAYING THEM FOR FIVE DAYS PER WEEK THE SAME AMOUNT OF COMPENSATION THEY RECEIVED PRIOR TO JULY 1, 1945, FOR SIX DAYS PER WEEK UNDER THE FORMULAS ADOPTED UNDER PRIOR STATUTES. SEE SECTION 23 OF THE ACT OF MARCH 28, 1934, 48 STAT. 522. IT FOLLOWS, THEREFORE, THAT NEITHER THE FORMULAS USED IN THIS DECISION CITED IN YOUR LETTER NOR THOSE STATED IN YOUR LETTER PROPERLY MAY BE USED IN RESPECT OF THE CLASS OF EMPLOYEES HERE INVOLVED.

IT IS UNDERSTOOD THAT THE BASIC COMPENSATION OF THE EMPLOYEES INVOLVED IS FIXED ADMINISTRATIVELY UNDER THE ACTS OF AUGUST 29, 1935, 49 STAT. 961, AND JUNE 4, 1936, 49 STAT. 1463, AND THE APPLICABLE ANNUAL APPROPRIATION ACTS. SEE, GENERALLY, 22 COMP. GEN. 651. HENCE, ANY INCREASE IN EXISTING BASIC RATES OF COMPENSATION WOULD BE FOR ADMINISTRATIVE CONSIDERATION, SUBJECT TO THE AVAILABILITY OF FUNDS THEREFOR.

THE ONLY FORMULA IN THE NEW LAW FOR PAYING OVERTIME COMPENSATION IS THAT FOUND IN SECTION 201, 59 STAT. 296, WHICH PROVIDES, SO FAR AS HERE MATERIAL, AS FOLLOWS:

OFFICERS AND EMPLOYEES TO WHOM THIS TITLE APPLIES SHALL, IN ADDITION TO THEIR BASIC COMPENSATION, BE COMPENSATED FOR ALL HOURS OF EMPLOYMENT, OFFICIALLY ORDERED OR APPROVED, IN EXCESS OF FORTY HOURS IN ANY ADMINISTRATIVE WORKWEEK, AT OVERTIME RATES AS FOLLOWS:

(A) FOR EMPLOYEES WHOSE BASIC COMPENSATION IS AT A RATE LESS THAN $2,980 PER ANNUM, THE OVERTIME HOURLY RATE SHALL BE ONE AND ONE-HALF TIMES THE BASIC HOURLY RATE OF COMPENSATION. PROVIDED, THAT IN COMPUTING SUCH OVERTIME COMPENSATION FOR PER ANNUM EMPLOYEES, THE BASIC HOURLY RATE OF COMPENSATION SHALL BE DETERMINED BY DIVIDING THE PER ANNUM RATE BY TWO THOUSAND AND EIGHTY.

IT IS TRUE, AS STATED IN YOUR LETTER, THAT SECTION 101 (A) OF THE STATUTE, 59 STAT. 295, HAS THE EFFECT OF INCLUDING PER DIEM EMPLOYEES, WHO OTHERWISE WERE NOT EXEMPTED BY SECTION 102, 59 STAT. 296, WITHIN THE PURVIEW OF THE OVERTIME PROVISIONS OF THE STATUTE. I FIND NO PROVISION IN SECTION 102 OF THE STATUTE WHICH WOULD EXEMPT PER DIEM EMPLOYEES OF THE INTERNATIONAL BOUNDARY COMMISSION, UNITED STATES AND MEXICO, FROM SUCH OVERTIME PROVISIONS. HENCE, SINCE THEIR RATE OF COMPENSATION IS FIXED ON A PER DIEM BASIS, THE ONLY METHOD FOR APPLYING THE FORMULA FOR PAYMENT OF OVERTIME COMPENSATION WOULD BE TO PAY THEM 1 1/2 TIMES THEIR DAILY OR HOURLY RATE FOR WORK IN EXCESS OF 40 HOURS PER WEEK--- IT BEING UNDERSTOOD FROM YOUR LETTER THAT NO EMPLOYEE RECEIVES A PER ANNUM EQUIVALENT OF AS MUCH AS $2,980 PER ANNUM. EVEN WHEN APPLYING THE FORMULA PRESCRIBED FOR COMPUTING OVERTIME COMPENSATION OF PER ANNUM EMPLOYEES THE RESULT IS THE SAME. USING THE EXAMPLE STATED IN YOUR LETTER OF AN EMPLOYEE RECEIVING $8 PER DAY, WHICH WOULD BE $1 PER HOUR FOR AN 8-HOUR DAY, THE PER ANNUM EQUIVALENT WOULD BE 2,080 TIMES THE HOURLY RATE OF $1, OR $2,080, WHICH, REDUCED BACK TO THE HOURLY RATE, WOULD BE $1 PER HOUR OR $8 PER DAY FOR AN 8-HOUR DAY UPON WHICH OVERTIME COMPENSATION AT THE RATE OF 1 1/2 TIMES WOULD BE COMPUTED. HENCE, IN THE EXAMPLE STATED, THE WEEKLY COMPENSATION OF THE EMPLOYEES FOR A 44-HOUR WEEK BASED UPON EXISTING BASIC RATES AND THE OVERTIME FORMULA PROVIDED BY THE LAW, WOULD BE 40 TIMES $1 OR $40 BASIC WEEKLY COMPENSATION, PLUS 4 TIMES $1.50, OR $6 OVERTIME COMPENSATION, A TOTAL OF $46; AND FOR A 48-HOUR WEEK THE COMPENSATION WOULD BE 40 TIMES $1 OR $40 BASIC WEEKLY COMPENSATION, PLUS 8 TIMES $1.50 OR $12 OVERTIME COMPENSATION, A TOTAL OF $52.