B-7022, DECEMBER 1, 1939, 19 COMP. GEN. 542

B-7022: Dec 1, 1939

Additional Materials:

Contact:

Edda Emmanuelli Perez
(202) 512-2853
EmmanuelliPerezE@gao.gov

 

Office of Public Affairs
(202) 512-4800
youngc1@gao.gov

RETIREMENT - CIVILIAN - DEDUCTIONS - REFUNDS - "INVOLUNTARY" TRANSFERS TO POSITIONS SUBJECT TO DIFFERENT RETIREMENT ACT WHERE A PROVISO IS ATTACHED TO A GENERAL PROVISION IN A STATUTE. THE PROVISO IS TO BE CONSTRUED STRICTLY AND IS TAKING NO CASE OUT OF THE GENERAL PROVISION WHICH DOES NOT FALL FAIRLY WITHIN THE TERMS OF THE PROVISO. PRESCRIBING A DIFFERENT BASIS FOR COMPUTING REFUNDS OF RETIREMENT FUND MONEYS WHEN SEPARATIONS FROM THE SERVICE ARE INVOLUNTARY THAN WHEN THE SEPARATIONS ARE VOLUNTARY. WERE TRANSFERRED ON THAT DATE TO THE STATE DEPARTMENT AND BECAME SUBJECT TO THE FOREIGN SERVICE RETIREMENT ACT. ARE ENTITLED ONLY TO REFUNDS OF THE AMOUNTS OF RETIREMENT DEDUCTIONS CREDITED TO THEIR INDIVIDUAL ACCOUNTS.

B-7022, DECEMBER 1, 1939, 19 COMP. GEN. 542

RETIREMENT - CIVILIAN - DEDUCTIONS - REFUNDS - "INVOLUNTARY" TRANSFERS TO POSITIONS SUBJECT TO DIFFERENT RETIREMENT ACT WHERE A PROVISO IS ATTACHED TO A GENERAL PROVISION IN A STATUTE, THE PROVISO IS TO BE CONSTRUED STRICTLY AND IS TAKING NO CASE OUT OF THE GENERAL PROVISION WHICH DOES NOT FALL FAIRLY WITHIN THE TERMS OF THE PROVISO. THE PROVISO OF SECTION 12 (B), CIVIL SERVICE RETIREMENT ACT OF MAY 29, 1930, PRESCRIBING A DIFFERENT BASIS FOR COMPUTING REFUNDS OF RETIREMENT FUND MONEYS WHEN SEPARATIONS FROM THE SERVICE ARE INVOLUNTARY THAN WHEN THE SEPARATIONS ARE VOLUNTARY, DOES NOT AUTHORIZE REFUNDS IN CASES OF TRANSFERS TO POSITIONS NOT WITHIN THE PURVIEW OF THE ACT, IN ANY MANNER OTHER THAN THAT PROVIDED BY THE GENERAL PROVISIONS OF SAID SECTION WHICH MAKES NO DISTINCTION BETWEEN VOLUNTARY AND INVOLUNTARY TRANSFERS. FOREIGN COMMERCE SERVICE EMPLOYEES WHO HAD A STATUS UNDER THE CIVIL SERVICE RETIREMENT ACT, BEFORE JULY 1, 1939, AND WHO, BY REASON OF REORGANIZATION PLAN NO. II, WERE TRANSFERRED ON THAT DATE TO THE STATE DEPARTMENT AND BECAME SUBJECT TO THE FOREIGN SERVICE RETIREMENT ACT, ARE ENTITLED ONLY TO REFUNDS OF THE AMOUNTS OF RETIREMENT DEDUCTIONS CREDITED TO THEIR INDIVIDUAL ACCOUNTS, WITH INTEREST, NOTWITHSTANDING THEIR TRANSFERS WERE INVOLUNTARY, AND NOT TO THE TOTAL AMOUNTS OF DEDUCTIONS, WITH INTEREST, REFUNDABLE IN CASES OF EMPLOYEES INVOLUNTARILY SEPARATED FROM THE SERVICE.

COMPTROLLER GENERAL BROWN TO THE PRESIDENT, UNITED STATES CIVIL SERVICE COMMISSION, DECEMBER 1, 1939.

I HAVE YOUR LETTER OF NOVEMBER 1, 1939 (FILE R-437051), AS FOLLOWS:

SECTION 12 (B) OF THE CIVIL SERVICE RETIREMENT ACT OF MAY 29, 1930, READS IN PART AS FOLLOWS:

"IN THE CASE OF ANY EMPLOYEE TO WHOM THIS ACT APPLIES, WHO SHALL BE TRANSFERRED TO A POSITION NOT WITHIN THE PURVIEW OF THE ACT, OR WHO SHALL BECOME ABSOLUTELY SEPARATED FROM THE SERVICE BEFORE BECOMING ELIGIBLE FOR RETIREMENT ON ANNUITY, THE AMOUNT CREDITED TO HIS INDIVIDUAL ACCOUNT SHALL BE RETURNED TO SUCH EMPLOYEE TOGETHER WITH INTEREST AT 4 PERCENTUM PER ANNUM COMPOUNDED ON JUNE 30 OF EACH YEAR: PROVIDED, THAT WHEN AN EMPLOYEE BECOMES INVOLUNTARILY SEPARATED FROM THE SERVICE, NOT BY REMOVAL FOR CAUSE ON CHARGES OF MISCONDUCT OR DELINQUENCY, THE TOTAL AMOUNT OF HIS DEDUCTIONS WITH INTEREST THEREON SHALL BE PAID TO SUCH EMPLOYEE.'

EFFECTIVE JULY 1, 1939, BY OPERATION OF REORGANIZATION PLAN NO. II TRANSFERRING THE FOREIGN COMMERCE SERVICE TO THE DEPARTMENT OF STATE, CERTAIN EMPLOYEES WHO HAD A STATUS UNDER THE ACT OF MAY 29, 1930, AUTOMATICALLY BECAME SUBJECT TO THE FOREIGN SERVICE RETIREMENT ACT ( STATE DEPARTMENT) OF MAY 24, 1924, AS AMENDED.

IN MAKING REFUND OF DEDUCTIONS UNDER THE CIVIL SERVICE RETIREMENT LAW, SHOULD SUCH TRANSACTION BE CONSIDERED AS AN INVOLUNTARY SEPARATION FROM THE SERVICE SUCH AS WOULD AUTHORIZE A RETURN OF TOTAL DEDUCTIONS WITH INTEREST, OR SHOULD SAME BE HELD AS A TRANSFER TO A POSITION NOT WITHIN THE PURVIEW OF THE ACT OF MAY 29, 1930, UNDER WHICH ONLY THE SUM CREDITED TO EACH EMPLOYEE'S INDIVIDUAL ACCOUNT WITH INTEREST MAY BE PAID

YOUR DECISION ON THIS POINT IS RESPECTFULLY REQUESTED.

THE GENERAL PROVISION OF THE QUOTED STATUTE, PRECEDING THE PROVISO, IS TO THE EFFECT THAT ALL EMPLOYEES (1) "WHO SHALL BE TRANSFERRED TO A POSITION NOT WITHIN THE PURVIEW OF THE ACT" AND (2) ,WHO SHALL BECOME ABSOLUTELY SEPARATED FROM THE SERVICE BEFORE BECOMING ELIGIBLE FOR RETIREMENT ON ANNUITY" SHALL BE ENTITLED TO A REFUND OF ONLY THE AMOUNT CREDITED TO THEIR INDIVIDUAL ACCOUNT, WITH INTEREST; WHILE THE PROVISO QUALIFIES THAT GENERAL ENACTMENT BY PROVIDING THAT THOSE WHO BECOME "INVOLUNTARILY SEPARATED FROM THE SERVICE, NOT BY REMOVAL FOR CAUSE CHARGES OF MISCONDUCT OR DELINQUENCY," SHALL BE ENTITLED TO A RETURN OF THE TOTAL DEDUCTIONS, WITH INTEREST.

IT IS AN ESTABLISHED RULE OF STATUTORY CONSTRUCTION THAT WHEN A PROVISO IS ATTACHED TO A GENERAL PROVISION IN A STATUTE--- AS IS THE SITUATION HERE--- THAT PROVISO IS TO BE CONSTRUED STRICTLY AND AS TAKING NO CASE OUT OF THE GENERAL PROVISION WHICH DOES NOT FALL FAIRLY WITHIN THE TERMS OF THE PROVISO. THE GENERAL PROVISION OF THE STATUTE IN THIS INSTANCE RELATES TO BOTH, TRANSFERS TO POSITIONS NOT WITHIN THE PURVIEW OF THE ACT, AND SEPARATIONS FROM THE SERVICE; WHEREAS THE PROVISO RELATES ONLY TO SEPARATIONS FROM THE SERVICE AND IN NOWISE REFERS TO TRANSFERS. IN OTHER WORDS, THE PROVISO PRESCRIBES A DIFFERENT BASIS OF PAYMENT WHEN SEPARATIONS FROM THE SERVICE ARE INVOLUNTARY THAN WHEN THE SEPARATIONS ARE VOLUNTARY, BUT IT DOES NOT PROVIDE FOR ANY DIFFERENT BASIS OF PAYMENT WHEN A TRANSFER TO A POSITION NOT WITHIN THE PURVIEW OF THE ACT IS INVOLUNTARY THAN WHEN A TRANSFER IS VOLUNTARY.

TO HOLD THAT THE PROVISO APPLIES TO CASES OF TRANSFERS WHICH ARE INVOLUNTARY WOULD BE TO READ INTO IT SOMETHING WHICH IS NOT THERE--- TO ENLARGE IT BY CONSTRUCTION--- AND THIS IS NOT AUTHORIZED. SINCE THE GENERAL PROVISION OF THE STATUTE HERE REFERS TO BOTH TRANSFERS AND SEPARATIONS, AND THE PROVISO REFERS ONLY TO SEPARATIONS WHICH ARE INVOLUNTARY IN CHARACTER AS DISTINGUISHED FROM VOLUNTARY SEPARATIONS, THE PROVISO CANNOT BE REGARDED AS HAVING ANY APPLICATION TO TRANSFERS.

THE EMPLOYEES HERE INVOLVED WERE NOT SEPARATED FROM THE SERVICE IN ANY SENSE OF THE WORD. THEIR SERVICES WERE CONTINUOUS. HENCE, THEY ARE NOT EMBRACED BY EITHER THE SEPARATIONS REFERRED TO IN THE GENERAL PROVISION OF THE STATUTE OR BY THE SEPARATIONS EMBRACED BY THE PROVISO. ON THE CONTRARY, THE INVOLVED EMPLOYEES WERE TRANSFERRED BY OPERATION OF LAW AND WHILE A TRANSFER SO MADE MIGHT BE TERMED "INVOLUNTARY," NEVERTHELESS THE GENERAL PROVISION OF THE STATUTE REFERS SPECIFICALLY TO TRANSFERS AND MUST BE HELD TO INCLUDE ALL TRANSFERS WHETHER VOLUNTARY OR INVOLUNTARY.

ACCORDINGLY, IT MUST BE HELD THAT THE PROVISO OF THE STATUTE HAS NO APPLICATION TO THE SITUATION HERE PRESENTED AND SINCE THE INVOLVED TRANSFERS COME WITHIN THE TERMS OF THE STATUTORY PROVISION PRECEDING THE PROVISO, REFUND TO THE EMPLOYEES MUST BE LIMITED TO THE AMOUNT CREDITED TO THEIR INDIVIDUAL ACCOUNTS, WITH INTEREST THEREON.