B-71906, FEBRUARY 25, 1948, 27 COMP. GEN. 472

B-71906, FEBRUARY 25, 1948, 27 COMP. GEN. 472

LUMP-SUM LEAVE PAYMENTS - REFUNDS UPON REEMPLOYMENT - INTERVENING TEMPORARY EMPLOYMENT WHERE A PERMANENT EMPLOYEE WAS SEPARATED FROM THE SERVICE AND THEREAFTER REEMPLOYED UNDER THE SAME LEAVE SYSTEM PRIOR TO EXPIRATION OF THE PERIOD OVER WHICH A LUMP-SUM PAYMENT FOR LEAVE HAD BEEN COMPUTED PURSUANT TO THE ACT OF DECEMBER 21, 1944, A REFUND IS REQUIRED OF THE COMPENSATION COVERING THE UNEXPIRED PORTION OF SUCH PERIOD--- FOR DEPOSIT AS " MISCELLANEOUS RECEIPTS"--- EVEN THOUGH THE EMPLOYEE HAD INTERVENING TEMPORARY EMPLOYMENT UNDER A DIFFERENT LEAVE SYSTEM.

COMPTROLLER GENERAL WARREN TO THE SECRETARY OF COMMERCE, FEBRUARY 25, 1948:

CONSIDERATION HAS BEEN GIVEN YOUR LETTER OF DECEMBER 8, 1947, AS FOLLOWS:

IT IS DESIRED TO BRING TO YOUR ATTENTION, FOR CLARIFICATION, A QUESTION WHICH ARISES IN CONNECTION WITH THE REFUND OF COMPENSATION REQUIRED BY LAW IN THE CASE OF A PERSON WHO IS REEMPLOYED, IN A POSITION UNDER THE SAME LEAVE SYSTEM, DURING THE PERIOD COVERED BY THE LUMP SUM PAYMENT FOR ANNUAL LEAVE ACCRUED IN A FORMER POSITION.

YOUR DECISION OF OCTOBER 24, 1946 (26 COMP. GEN. 259), AND INSTRUCTIONS CONTAINED IN THE FEDERAL PERSONNEL MANUAL ARE CLEAR IN CASES OF REEMPLOYMENT UNDER THE SAME LEAVE SYSTEM, OR UNDER DIFFERENT LEAVE SYSTEM, DURING THE LUMP SUM PAYMENT PERIOD. OUR QUESTIONS, HOWEVER, ARISE FROM CASES SUCH AS THAT OUTLINED BELOW:

AT THE CLOSE OF BUSINESS SEPTEMBER 16, 1947, AN EMPLOYEE RESIGNED (IN LIEU OF REDUCTION IN FORCE) FROM A POSITION SUBJECT TO THE PERMANENT LEAVE SYSTEM, AND WAS PAID FOR 227 HOURS TERMINAL LEAVE, THROUGH 3 HOURS ON OCTOBER 27, 1947.

AS OF SEPTEMBER 17, 1947, THE LIMITATION WAS REMOVED FROM THE TEMPORARY APPOINTMENT AND LUMP SUM PAYMENT MADE TO HIM FOR SUCH ANNUAL LEAVE AS HAD ACCRUED FROM THE TEMPORARY SERVICE SEPTEMBER 17 THROUGH OCTOBER 18. THIS REMOVAL OF LIMITATION HE AGAIN BECAME SUBJECT TO THE PERMANENT LEAVE SYSTEM, WITHIN THE PERIOD FOR WHICH HE HAD RECEIVED LUMP SUM PAYMENT FOR LEAVE EARNED UNDER THAT SAME SYSTEM.

QUESTION 1: SHOULD A REFUND BE REQUIRED FROM THE EMPLOYEE FOR THE PERIOD OCTOBER 19 THROUGH 3 HOURS ON OCTOBER 27?

QUESTION 2: SHOULD THE INTERIM SERVICE IN THE TEMPORARY POSITION BE CONSIDERED AS VOIDING THE REQUIREMENT FOR ANY REFUND?

QUESTION 3: IF YOUR ANSWER TO THE SECOND QUESTION IS IN THE AFFIRMATIVE, MAY THE EMPLOYEE EARN LEAVE AS A PERMANENT EMPLOYEE DURING THE PERIOD FOR WHICH HE ALREADY HAS RECEIVED THE LUMP SUM PAYMENT?

SECTION 1 OF THE ACT OF DECEMBER 21, 1944, PUBLIC LAW 525, 58 STAT. 845, PROVIDES:

THAT WHENEVER ANY CIVILIAN OFFICER OR EMPLOYEE OF THE FEDERAL GOVERNMENT OR THE GOVERNMENT OF THE DISTRICT OF COLUMBIA IS SEPARATED FROM THE SERVICE OR ELECTS TO BE PAID COMPENSATION FOR LEAVE IN ACCORDANCE WITH THE ACT OF AUGUST 1, 1941, AS AMENDED BY THE ACT OF APRIL 7, 1942, OR SECTION 4 OF THE ACT OF JUNE 23, 1943, HE SHALL BE PAID COMPENSATION IN A LUMP SUM FOR ALL ACCUMULATED AND CURRENT ACCRUED ANNUAL OR VACATION LEAVE TO WHICH HE IS ENTITLED UNDER EXISTING LAW. SUCH LUMP-SUM PAYMENT SHALL EQUAL THE COMPENSATION THAT SUCH EMPLOYEE WOULD HAVE RECEIVED HAD HE REMAINED IN THE SERVICE UNTIL THE EXPIRATION OF THE PERIOD OF SUCH ANNUAL OR VACATION LEAVE: PROVIDED, THAT IF SUCH EMPLOYEE IS REEMPLOYED IN THE FEDERAL SERVICE OR IN OR UNDER THE GOVERNMENT OF THE DISTRICT OF COLUMBIA UNDER THE SAME LEAVE SYSTEM PRIOR TO THE EXPIRATION OF THE PERIOD COVERED BY SUCH LEAVE PAYMENT, HE SHALL REFUND TO THE EMPLOYING AGENCY AN AMOUNT EQUAL TO THE COMPENSATION COVERING THE PERIOD BETWEEN THE DATE OF REEMPLOYMENT AND THE EXPIRATION OF SUCH LEAVE PERIOD, AND THE AMOUNT OF LEAVE REPRESENTED BY SUCH REFUND SHALL BE CREDITED TO HIM IN THE EMPLOYING AGENCY. IN THE CASE OF REEMPLOYMENT IN THE FEDERAL SERVICE THE SUM SO REFUNDED SHALL BE COVERED INTO THE TREASURY AS " MISCELLANEOUS RECEIPTS," AND IN CASE OF REEMPLOYMENT IN OR UNDER THE GOVERNMENT OF THE DISTRICT OF COLUMBIA THE SUM SO REFUNDED SHALL BE COVERED INTO THE TREASURY TO THE CREDIT OF THE DISTRICT OF COLUMBIA: PROVIDED FURTHER, THAT THE LUMP-SUM PAYMENT HEREIN AUTHORIZED SHALL NOT BE REGARDED, EXCEPT FOR PURPOSES OF TAXATION, AS SALARY OR COMPENSATION AND SHALL NOT BE SUBJECT TO RETIREMENT DEDUCTIONS. ( ITALICS SUPPLIED.) WITH REFERENCE TO THAT SECTION, THE DECISION OF OCTOBER 24, 1946, B-60657, 26 COMP. GEN. 259, TO WHICH REFERENCE IS MADE IN YOUR LETTER, HELD AS FOLLOWS (QUOTING FROM THE LAST PARAGRAPH OF THE SYLLABUS):

ON THE BASIS THAT ANNUAL LEAVE IS GRANTED TO PERMANENT AND TEMPORARY EMPLOYEES ACCORDING TO SEPARATE SYSTEMS, ALTHOUGH THE GRANT OF LEAVE TO BOTH CLASSES OF EMPLOYEES IS PROVIDED FOR BY THE SAME STATUTE, THE APPOINTMENT, REAPPOINTMENT OR TRANSFER OF AN EMPLOYEE FROM A PERMANENT TO A TEMPORARY POSITION WITHOUT BREAK IN SERVICE MAY BE REGARDED AS A TRANSFER TO A POSITION UNDER A ,DIFFERENT LEAVE SYSTEM" WITHIN THE MEANING OF SECTION 3 OF THE ACT OF DECEMBER 21, 1944, ENTITLING THE EMPLOYEE TO A LUMP-SUM PAYMENT FOR THE LEAVE TO HIS CREDIT IN THE PERMANENT POSITION, COMPUTED AS OF THE LAST DAY OF SERVICE IN SUCH POSITION. 24 COMP. GEN. 726, OVERRULED.

ALSO, WITH REFERENCE TO THAT SECTION, IT WAS HELD IN DECISION IN NOVEMBER 28, 1947, B-70596, 27 COMP. GEN. 301:

WHENEVER A PAYMENT IS MADE UNDER THAT SECTION OF THE STATUTE TO AN EMPLOYEE FOR ACCUMULATED OR ACCRUED ANNUAL LEAVE DUE UPON SEPARATION FROM THE GOVERNMENT SERVICE, AND THE EMPLOYEE THEREAFTER IS REEMPLOYED IN THE FEDERAL SERVICE OR IN OR UNDER THE GOVERNMENT OF THE DISTRICT OF COLUMBIA UNDER THE SAME LEAVE SYSTEM PRIOR TO THE EXPIRATION OF THE PERIOD OVER WHICH THE PAYMENT WAS COMPLETED, THE EMPLOYEE MUST REFUND TO THE EMPLOYING AGENCY AN AMOUNT EQUAL TO THE COMPENSATION COVERING THE PERIOD BETWEEN THE DATE OF REEMPLOYMENT AND THE EXPIRATION OF THE LEAVE PERIOD. THE AMOUNT OF LEAVE REPRESENTED BY THE REFUNDS IS TO BE CREDITED IN THE EMPLOYING AGENCY. NO EXCEPTION TO THIS PROCEDURE IS PROVIDED REGARDLESS OF THE AMOUNT OF LEAVE FOR WHICH A LUMP-SUM PAYMENT IS MADE, AND NO EXCEPTION IS AUTHORIZED EXCEPT TO THE EXTENT THAT LEAVE CREDIT THEREFOR WOULD BE PROHIBITED. 25 COMP. GEN. 592. * * *

IN THE ILLUSTRATION GIVEN THE EMPLOYEE WAS REEMPLOYED IN THE FEDERAL SERVICE UNDER THE SAME LEAVE SYSTEM PRIOR TO THE EXPIRATION OF THE PERIOD OVER WHICH THE ORIGINAL LUMP-SUM PAYMENT WAS COMPUTED AND, THEREFORE, UNDER THE PLAIN TERMS OF THE ACT, AND IN LINE WITH THE DECISION QUOTED ABOVE, THERE IS REQUIRED A REFUND OF AN AMOUNT EQUAL TO THE COMPENSATION COVERING THE PERIOD BETWEEN THE DATE OF REEMPLOYMENT UNDER THE SAME LEAVE SYSTEM AND THE EXPIRATION OF THE LEAVE PERIOD, THAT IS, FOR THE PERIOD OCTOBER 19 THROUGH THREE HOURS ON OCTOBER 27. THAT REFUND MUST BE RECOVERED INTO THE TREASURY AS " MISCELLANEOUS RECEIPTS.' THERE IS NOTHING IN THE LAW WHICH WOULD AFFECT THAT REQUIREMENT BECAUSE OF THE INTERVENING EMPLOYMENT IN A TEMPORARY POSITION.

IN LINE WITH THE FOREGOING, QUESTION 1 IS ANSWERED IN THE AFFIRMATIVE AND QUESTION 2 IS ANSWERED IN THE NEGATIVE, RENDERING UNNECESSARY ANY ANSWER TO QUESTION 3.