B-8227, FEBRUARY 5, 1940, 19 COMP. GEN. 705

B-8227: Feb 5, 1940

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WHERE UNACCRUED ANNUAL LEAVE GRANTED TO AN EMPLOYEE IN SEVERAL PERIODS DURING THE CALENDAR YEAR IS NOT SUBSEQUENTLY EARNED DURING THE YEAR BECAUSE OF LEAVE WITHOUT PAY RESULTING IN A REDUCTION OF ANNUAL LEAVE EARNED. THE AMOUNT OF OVERDRAWN ANNUAL LEAVE IS LESS THAN THE ANNUAL LEAVE GRANTED DURING THE LAST PERIOD FOR WHICH SUCH LEAVE WAS ADVANCED. WHERE IT IS DETERMINED ADMINISTRATIVELY THAT THE FINANCIAL CONDITION OF AN EMPLOYEE CLEARLY JUSTIFIES SUCH ACTION. THE BALANCE OF THE INDEBTEDNESS IS AUTOMATICALLY CANCELED UNDER THE LAST SENTENCE OF SECTION 4 (B) OF THE UNIFORM ANNUAL LEAVE REGULATIONS EFFECTIVE JANUARY 1. 1940: I HAVE YOUR LETTER OF JANUARY 23. AS FOLLOWS: REFERENCE IS MADE TO SECTION 4 (A) OF THE ANNUAL LEAVE REGULATIONS.

B-8227, FEBRUARY 5, 1940, 19 COMP. GEN. 705

LEAVES OF ABSENCE - ANNUAL - ACT, MARCH 14, 1936 - ADVANCES - UNEARNED LEAVE DEDUCTIONS SECTIONS 4 (A) OF THE UNIFORM ANNUAL LEAVE REGULATIONS EFFECTIVE JANUARY 1, 1938, ISSUED PURSUANT TO THE ANNUAL LEAVE ACT OF MARCH 14, 1936, 49 STAT. 1161, CLEARLY REQUIRES DEDUCTIONS FROM AN EMPLOYEE'S COMPENSATION FOR OVERDRAWN ANNUAL LEAVE (UNACCRUED LEAVE ADVANCED AND NOT SUBSEQUENTLY EARNED) TO BE MADE ON A CALENDAR YEAR BASIS, AND DOES NOT AUTHORIZE OR PERMIT THE OVERDRAWN LEAVE IN 1 YEAR TO BE CHARGED TO ACCRUALS OF ANNUAL LEAVE AS EARNED IN THE SUCCEEDING YEAR. SICK LEAVE ACT OF MARCH 14, 1936, 49 STAT. 1162, AND UNIFORM SICK LEAVE REGULATIONS, DISTINGUISHED, AND 18 COMP. GEN. 13, AMPLIFIED. DEDUCTIONS REQUIRED BY SECTION 4 (A) OF THE UNIFORM ANNUAL LEAVE REGULATIONS EFFECTIVE JANUARY 1, 1938, FOR OVERDRAWN ANNUAL LEAVE AT THE END OF EACH CALENDAR YEAR IN CASES OF EMPLOYEES WHO REMAIN IN THE SERVICE, SHOULD BE ON THE BASIS OF 1 DAY'S PAY FOR EACH DAY OF ABSENCE AT THE RATE OF COMPENSATION PAID DURING THE PERIOD OF ADVANCED ANNUAL LEAVE, EXCLUSIVE OF SUNDAYS AND HOLIDAYS, AND CHARGING SATURDAY AS 4 HOURS. WHERE UNACCRUED ANNUAL LEAVE GRANTED TO AN EMPLOYEE IN SEVERAL PERIODS DURING THE CALENDAR YEAR IS NOT SUBSEQUENTLY EARNED DURING THE YEAR BECAUSE OF LEAVE WITHOUT PAY RESULTING IN A REDUCTION OF ANNUAL LEAVE EARNED, AND THE AMOUNT OF OVERDRAWN ANNUAL LEAVE IS LESS THAN THE ANNUAL LEAVE GRANTED DURING THE LAST PERIOD FOR WHICH SUCH LEAVE WAS ADVANCED, DEDUCTIONS FROM THE EMPLOYEE'S COMPENSATION TO LIQUIDATE THE OVERDRAWN LEAVE SHOULD BE BASED UPON THE RATE OF COMPENSATION APPLICABLE OVER THE LAST PERIOD OF ADVANCED ANNUAL LEAVE. COLLECTIONS FROM EMPLOYEES FOR OVERDRAWN ANNUAL LEAVE IN ANY CALENDAR YEAR SHOULD BE MADE AS SOON AS POSSIBLE DURING THE NEXT YEAR BY DEDUCTION FROM THE FIRST AND SUBSEQUENT PAYMENTS OF COMPENSATION DUE THE EMPLOYEE FOR SERVICES RENDERED, BUT WHERE IT IS DETERMINED ADMINISTRATIVELY THAT THE FINANCIAL CONDITION OF AN EMPLOYEE CLEARLY JUSTIFIES SUCH ACTION, THE DEDUCTIONS FROM COMPENSATION MAY BE MADE IN INSTALLMENTS NOT TO EXTEND BEYOND THE CURRENT YEAR--- DUE REGARD TO BE GIVEN TO PROTECTING THE INTEREST OF THE UNITED STATES IN THE EVENT OF POSSIBLE DEATH OR RETIREMENT OF THE EMPLOYEE DURING THE YEAR--- AND NO CHARGE SHOULD BE RAISED IN SUCH CASES AGAINST THE RETIREMENT FUND AS LONG AS THE EMPLOYEE REMAINS IN THE SERVICE. WHERE AN EMPLOYEE DIES BEFORE HIS INDEBTEDNESS FOR OVERDRAWN ANNUAL LEAVE IN THE PRIOR CALENDAR YEAR HAS BEEN LIQUIDATED IN FULL, THE BALANCE OF THE INDEBTEDNESS IS AUTOMATICALLY CANCELED UNDER THE LAST SENTENCE OF SECTION 4 (B) OF THE UNIFORM ANNUAL LEAVE REGULATIONS EFFECTIVE JANUARY 1, 1938, BUT IF THE EMPLOYEE RESIGNS BEFORE SUCH AN INDEBTEDNESS HAS BEEN LIQUIDATED, THE BALANCE WOULD BE PROPERLY FOR LIQUIDATING BY SET-OFF AGAINST ANY SALARY DUE HIM, OR AGAINST THE AMOUNT TO HIS CREDIT IN THE RETIREMENT FUND.

ACTING COMPTROLLER GENERAL ELLIOTT TO THE FEDERAL WORKS ADMINISTRATOR, FEBRUARY 5, 1940:

I HAVE YOUR LETTER OF JANUARY 23, 1940, AS FOLLOWS:

REFERENCE IS MADE TO SECTION 4 (A) OF THE ANNUAL LEAVE REGULATIONS, EXECUTIVE ORDER NO. 7845, DATED MARCH 21, 1938, WHICH READS AS FOLLOWS:

"UNACCRUED LEAVE SHALL BE GRANTED ONLY WITH THE EXPRESS UNDERSTANDING THAT IF SUCH LEAVE IS NOT LATER EARNED DURING THE CALENDAR YEAR, DEDUCTIONS WILL BE MADE FOR THE UNEARNED PORTION FROM ANY SALARY DUE THE EMPLOYEE, OR FROM ANY DEDUCTIONS IN THE RETIREMENT FUND TO THE CREDIT OF THE EMPLOYEE.'

THIS AGENCY HAS A NUMBER OF EMPLOYEES WHO DID NOT EARN DURING THE CALENDAR YEAR 1939 ALL THE UNACCRUED LEAVE GRANTED THEM, DUE TO THE FACT THAT THEY WERE IN A NONPAY STATUS IN EXCESS OF 30 DAYS DURING THAT YEAR. THE QUESTION IS WHETHER DEDUCTIONS MUST BE MADE FROM THE SALARY OF SAID EMPLOYEES FOR THE UNEARNED PORTION OF LEAVE OR MAY SUCH LEAVE BE CHARGED TO ACCRUALS OF LEAVE AS EARNED IN THE CALENDAR YEAR 1940. IF DEDUCTIONS ARE TO BE MADE FROM THE SALARY OF THE EMPLOYEES CONCERNED, SHOULD DEDUCTIONS BE MADE ON THE BASIS OF ONE DAY'S PAY FOR EACH DAY OF ABSENCE EXCLUSIVE OF SUNDAYS AND HOLIDAYS?

A SPECIFIC CASE IS THAT OF MR. HENRY T. GLYNN, EMPLOYED IN THE PUBLIC BUILDINGS ADMINISTRATION OF THIS AGENCY AS CLERK, CAF-4, AT $2,160 PER ANNUM, WHOSE ANNUAL LEAVE AND LEAVE WITHOUT PAY RECORD FOR THE CALENDAR YEAR 1939 IS AS FOLLOWS:

CHART

DAYS HOURS MINUTES ANNUAL LEAVE:

ACCUMULATED AT BEGINNING OF CALENDAR YEAR

1939 ----------------------------------- 10 10 45

ACCRUED IN 1939 (NET) ------------------- 18 5 26 2/3

USED IN 1939 (1/4-10, INCLUSIVE; 2/6,

2 HOURS; 2/21-25, INCLUSIVE; 2/27,

6 HOURS; AND 2/28-3/15, INCLUSIVE) ---- 23 3 10

UNLIQUIDATED ADVANCED LEAVE AT THE CLOSE OF

12/31/39 ------------------------------- 4 3 48 1/3 LEAVE WITHOUT PAY:

APRIL 16 TO JULY 19, INCLUSIVE;

SEPTEMBER 30, 5 HOURS, TO OCTOBER 4,

INCLUSIVE; NOVEMBER 9, 3 3/4 HOURS;

AND DECEMBER 18 TO 20, INCLUSIVE ------ 103 1 45

THE NUMBER OF WORK HOURS IN A DAY FOR THIS EMPLOYEE IS 7. HE IS A PERMANENT EMPLOYEE AND HAS BEEN EMPLOYED CONTINUOUSLY ABOUT 28 YEARS.

IN THE EVENT THAT THE INDEBTEDNESS IS TO BE LIQUIDATED BY MEANS OF MAKING DEDUCTIONS FROM ANY SALARY DUE THE EMPLOYEE, MUST THE WHOLE AMOUNT BE COLLECTED IMMEDIATELY, OR MAY COLLECTION BE MADE IN PART PAYMENTS OVER A PERIOD OF TIME?

IN THE CASE OF DEATH OF SUCH AN EMPLOYEE IN THE CALENDAR YEAR 1940 BEFORE THE INDEBTEDNESS HAS BEEN LIQUIDATED IN FULL, IS THE BALANCE OF THE INDEBTEDNESS AUTOMATICALLY CANCELED, OR MUST IT BE LIQUIDATED BY SET-OFF AGAINST ANY SALARY DUE THE EMPLOYEE, OR AGAINST ANY DEDUCTIONS IN THE RETIREMENT FUND TO THE CREDIT OF THE EMPLOYEE?

YOUR EARLY DECISION IS REQUESTED IN ORDER THAT THE LEAVE RECORDS OF THESE EMPLOYEES MAY BE ADJUSTED PROMPTLY.

SECTION 4 (B) OF THE ANNUAL LEAVE REGULATIONS, EXECUTIVE ORDER NO. 7845, DATED MARCH 21, 1938, EFFECTIVE JANUARY 1, 1938, READS AS FOLLOWS:

(B) IN CASES OF SEPARATIONS WHERE EMPLOYEES ARE INDEBTED TO THE GOVERNMENT FOR ADVANCED ANNUAL LEAVE SUCH INDEBTEDNESS SHALL BE CHARGED AGAINST THE EMPLOYEE ON THE BASIS OF THE SALARY RATE OBTAINING DURING THE PERIOD OF ADVANCED ANNUAL LEAVE AND ON THE BASIS OF ONE DAY'S PAY FOR EACH DAY OF ABSENCE, EXCLUSIVE OF SUNDAYS AND HOLIDAYS. ABSENCES FOR FRACTIONAL PARTS OF A DAY WILL BE CHARGED PROPORTIONATELY. THIS PROVISION SHALL NOT APPLY IN CASES OF DEATH, RETIREMENT FOR AGE OR DISABILITY, REDUCTION OF FORCE, OR WHEN AN EMPLOYEE WHO IS NOT ELIGIBLE FOR RETIREMENT IS UNABLE TO RETURN TO DUTY BECAUSE OF DISABILITY, EVIDENCE OF WHICH SHALL BE SUPPORTED BY AN ACCEPTABLE CERTIFICATE FROM A REGISTERED PRACTICING PHYSICIAN OR OTHER PRACTITIONER.

SECTION 11 OF THE SICK LEAVE REGULATIONS, EXECUTIVE ORDER NO. 7846, DATED MARCH 21, 1938, EFFECTIVE JANUARY 1, 1938, CONTAINS NO PROVISION CORRESPONDING TO SECTION 4 (A) OF THE ANNUAL LEAVE REGULATIONS QUOTED IN YOUR LETTER, THE SAID SECTION 11 PROVIDING AS FOLLOWS:

IN THE CASE OF VOLUNTARY SEPARATION OR REMOVAL FOR CAUSE OF AN EMPLOYEE TO WHOM SICK LEAVE HAS BEEN ADVANCED IN AN AMOUNT IN EXCESS OF THAT ACCUMULATED, THE EMPLOYEE SHALL REFUND THE AMOUNT PAID HIM FOR THE PERIOD OF SUCH EXCESS, OR DEDUCTION THEREFOR SHALL BE MADE FROM ANY SALARY DUE HIM OR FROM ANY DEDUCTIONS IN THE RETIREMENT FUND TO HIS CREDIT. SUCH INDEBTEDNESS SHALL BE CHARGED AGAINST THE EMPLOYEE ON THE BASIS OF THE SALARY RATE OBTAINING DURING THE PERIOD OF ADVANCED SICK LEAVE, AND ON THE BASIS OF ONE DAY'S PAY FOR EACH DAY OF ABSENCE, INCLUSIVE OF SUNDAYS AND HOLIDAYS. ABSENCES FOR FRACTIONAL PARTS OF A DAY WILL BE CHARGED PROPORTIONATELY. REFUND SHALL NOT BE REQUIRED IN CASES OF DEATH, RETIREMENT FOR AGE OR DISABILITY, REDUCTION OF FORCE, OR WHEN AN EMPLOYEE WHO IS NOT ELIGIBLE FOR RETIREMENT IS UNABLE TO RETURN TO DUTY BECAUSE OF DISABILITY, WHICH SHALL BE EVIDENCED BY AN ACCEPTABLE CERTIFICATE FROM A REGISTERED PRACTICING PHYSICIAN OR OTHER PRACTITIONER.

IN DECISION OF JULY 6, 1938, 18 COMP. GEN. 13, IT WAS STATED, PAGE 16:

THE PROVISIONS OF SECTION 4 OF THE ANNUAL LEAVE REGULATIONS AND SECTION 11 OF THE SICK LEAVE REGULATIONS ARE FOR APPLICATION ONLY UPON THE FINAL SEPARATION OF AN EMPLOYEE FROM THE SERVICE. AT THAT TIME THERE IS FOR CONSIDERATION WHETHER ALL UNEARNED ANNUAL AND SICK LEAVE SHOULD BE CHARGED TO THE EMPLOYEE WHETHER ADVANCED IN ONE OR MORE PERIODS. COMPARE 18 COMP. GEN. 383.

WHILE THE ABOVE-QUOTED STATEMENT FROM 18 COMP. GEN. 13 REFERS, AMONG OTHER THINGS, TO THE PROVISIONS OF "SECTION 4 OF THE ANNUAL LEAVE REGULATIONS," THE RULING THEREIN MADE, SO FAR AS APPLIES TO ANNUAL LEAVE, WAS CLEARLY WITH REFERENCE TO SECTION 4 (B) AND NOT TO THE WHOLE OF SECTION 4 OF THE ANNUAL LEAVE REGULATIONS. THE CONTEXT OF THE DECISION CLEARLY ESTABLISHES THAT TO BE THE FACT--- SUCH FACT BEING READILY APPARENT WHEN VIEWED IN THE LIGHT THAT SAID SECTION 4 (B) OF THE ANNUAL LEAVE REGULATIONS IS THE SECTION CORRESPONDING TO SECTION 11 OF THE SICK LEAVE REGULATIONS AND TO WHICH LATTER SECTION THE RULING IN QUESTION WAS MADE EQUALLY APPLICABLE.

SECTION 4 (A) OF THE ANNUAL LEAVE REGULATIONS CLEARLY REQUIRES DEDUCTIONS FROM COMPENSATION FOR OVERDRAWN ANNUAL LEAVE TO BE MADE ON A CALENDAR OR LEAVE YEAR BASIS AND DOES NOT AUTHORIZE OR PERMIT THE OVERDRAWN LEAVE IN 1 YEAR TO BE CHARGED TO ACCRUALS OF ANNUAL LEAVE AS EARNED IN THE SUCCEEDING YEAR. THE REASON FOR THIS REQUIREMENT AS TO ANNUAL LEAVE, AND NOT AS TO SICK LEAVE, IS THAT ANNUAL LEAVE IS GRANTED BY THE ANNUAL LEAVE ACT OF MARCH 14, 1936, 49 STAT. 1161, UPON A YEARLY BASIS, WHEREAS SICK LEAVE UNDER THE SICK LEAVE ACT OF THE SAME DATE, 49 STAT. 1162, IS GRANTED UPON A MONTHLY BASIS. FURTHERMORE, THE ANNUAL LEAVE ACT DOES NOT AUTHORIZE AN ADVANCE OF ANNUAL LEAVE BEYOND THE AMOUNT THAT MAY BE EARNED DURING THE CALENDAR OR LEAVE YEAR CURRENT WHEN THE ADVANCE IS MADE, WHEREAS THE SICK LEAVE ACT AUTHORIZES ADVANCE OF SICK LEAVE IN THE TOTAL AMOUNT OF 30 DAYS, WHICH IS AN ADVANCE OF ACCRUALS FOR 24 MONTHS, OR 2 YEARS. SEE SECTION 4 OF THE SICK LEAVE REGULATIONS.

WHILE DEDUCTIONS FROM COMPENSATION FOR OVERDRAWN LEAVE REQUIRED BY THE PROVISIONS OF SECTION 4 (B) OF THE ANNUAL LEAVE REGULATIONS IS DIRECTED TO "CASES OF SEPARATIONS," IT IS REASONABLE TO CONCLUDE THAT THE BASIS THEREIN PROVIDED FOR SUCH DEDUCTIONS WAS INTENDED BY THE LEAVE REGULATIONS TO APPLY LIKEWISE TO THE DEDUCTIONS REQUIRED BY THE PROVISIONS OF SECTION 4 (A) AS TO OVERDRAWN ANNUAL LEAVE AT THE END OF EACH CALENDAR YEAR IN THE CASE OF EMPLOYEES WHO CONTINUE TO REMAIN IN THE SERVICE. THAT IS TO SAY, DEDUCTIONS FROM COMPENSATION IN SUCH CASES SHOULD BE MADE UPON THE BASIS OF 1 DAY'S PAY FOR EACH DAY OF ABSENCE AT THE RATE OF COMPENSATION PAID DURING THE PERIOD OF ADVANCED ANNUAL LEAVE, EXCLUSIVE OF SUNDAYS AND HOLIDAYS--- SATURDAY, OF COURSE, TO BE CHARGED AS FOR 4 HOURS. 18 COMP. GEN. 13. IN THE CASE PRESENTED, THE DEDUCTION FOR THE DAYS 3 HOURS AND 48 1/3 MINUTES OF OVERDRAWN ANNUAL LEAVE DURING THE CALENDAR YEAR 1939 SHOULD BE BASED UPON THE RATE OF COMPENSATION APPLICABLE OVER THE LAST PERIOD OF ADVANCED ANNUAL LEAVE GRANTED DURING THE YEAR.

COLLECTIONS FROM EMPLOYEES FOR OVERDRAWN LEAVE IN ANY CALENDAR OR LEAVE YEAR SHOULD BE MADE AS SOON AS POSSIBLE DURING THE NEXT YEAR BY DEDUCTION FROM THE FIRST AND SUBSEQUENT PAYMENTS OF COMPENSATION DUE THE EMPLOYEE FOR SERVICES RENDERED. WHERE IT IS DETERMINED ADMINISTRATIVELY THAT THE FINANCIAL CONDITION OF AN EMPLOYEE CLEARLY JUSTIFIES SUCH ACTION, THE DEDUCTIONS FROM COMPENSATION MAY BE MADE BY INSTALLMENTS NOT TO EXTEND BEYOND THE CURRENT YEAR--- DUE REGARD TO BE GIVEN TO PROTECTING THE INTERESTS OF THE UNITED STATES IN THE EVENT OF POSSIBLE DEATH OR RETIREMENT OF THE EMPLOYEE DURING THE YEAR. NO CHARGE SHOULD BE RAISED IN SUCH CASES AGAINST THE RETIREMENT FUND AS LONG AS THE EMPLOYEE REMAINS IN THE SERVICE.

REFERRING TO THE PENULTIMATE PARAGRAPH OF YOUR LETTER, IN THE CASE OF DEATH OF AN EMPLOYEE DURING THE CALENDAR YEAR, THE BALANCE OF THE INDEBTEDNESS IS AUTOMATICALLY CANCELED UNDER THE LAST SENTENCE OF SECTION 4 (B) OF THE ANNUAL LEAVE REGULATIONS--- SAID LAST SENTENCE APPLY WITH EQUAL FORCE TO THE PROVISIONS OF SECTION 4 (A). IN THE EVENT OF RESIGNATION, OF COURSE, THE BALANCE OF THE INDEBTEDNESS WOULD BE PROPERLY FOR LIQUIDATING BY SET-OFF AGAINST ANY SALARY DUE THE EMPLOYEE, OR AGAINST THE AMOUNT TO THE CREDIT OF THE EMPLOYEE IN THE RETIREMENT FUND.