A-44187, MAY 16, 1933, 12 COMP. GEN. 638

A-44187, MAY 16, 1933, 12 COMP. GEN. 638

ECONOMY ACT, AMENDED - PERCENTAGE REDUCTION - EXCEPTION OF ALLOWANCE FOR TRAVEL FROM COMPENSATION TO COME WITHIN THE EXCEPTION OF "ALLOWANCES FOR TRAVEL" APPEARING IN SECTION 1 (B), TITLE II OF THE ACT OF MARCH 20, 1933, 48 STAT. 12, DEFINING "COMPENSATION" WHICH IS SUBJECT TO PERCENTAGE REDUCTION UNDER THE TERMS OF SECTIONS 2 AND 3 OF THE ACT, THE ALLOWANCE MUST BE SPECIFICALLY SEGREGATED OR SUSCEPTIBLE OF IDENTIFICATION AS TRAVELING EXPENSES IN A DEFINITE AMOUNT. THE EXCEPTION DOES NOT APPLY AS IN THE CASE OF AGENTS OF THE BUREAU OF THE CENSUS EMPLOYED IN THE COLLECTION OF COTTON STATISTICS, WHERE THE FACT THAT THE EMPLOYEE WOULD HAVE TO BEAR CERTAIN EXPENSES OF TRANSPORTATION IN GOING ABOUT HIS WORK WAS TAKEN INTO CONSIDERATION IN FIXING THE RATE OF HIS COMPENSATION.

COMPTROLLER GENERAL MCCARL TO THE SECRETARY OF COMMERCE, MAY 16, 1933:

CONSIDERATION HAS BEEN GIVEN TO YOUR LETTER OF MAY 1, 1933, REQUESTING DECISION OF A QUESTION PRESENTED AS FOLLOWS:

ON OCTOBER 24, 1932, THE COMPTROLLER GENERAL GAVE THE SECRETARY OF COMMERCE A DECISION THAT ONLY THOSE AGENTS EMPLOYED IN THE COLLECTION OF STATISTICS OF COTTON WHOSE COMPENSATION AS FIXED IN THE CONTRACT OF EMPLOYMENT WAS IN EXCESS OF $1,000 PER ANNUM WERE SUBJECT TO THE 8 1/3 PERCENT REDUCTION, OR SUCH PORTION THEREOF THAT MIGHT BE NECESSARY TO REDUCE THE COMPENSATION TO $1,000 PER ANNUM. THE EFFECT OF THIS DECISION WAS THAT A SMALL REDUCTION WAS MADE IN THE PAYMENTS TO THREE OF THE COTTON AGENTS, THAT BEING THE ONLY NUMBER WHOSE CONTRACT PRICE WAS IN EXCESS OF $1,000.

THE CONTRACT PRICE PAID FOR THE REPORTS MADE BY THE COTTON AGENTS DOES NOT MERELY COVER THE PAYMENT FOR THE AGENT'S TIME BUT ALSO COVERS THE EXPENSES INCIDENT TO VISITING THE GINNERIES FROM WHICH THE REPORTS ARE SECURED, INCLUDING TRAVEL AND SUBSISTENCE. WHILE IT IS IMPOSSIBLE TO DETERMINE IN EACH CASE WHAT PART OF THE COMPENSATION COVERS SALARY AND WHAT PART OF IT COVERS TRAVEL AND SUBSISTENCE, THE EXPENSE OF MAKING THE CANVASS UNQUESTIONABLY IS MORE THAN 50 PERCENT OF THE TOTAL PAID. INASMUCH AS THE PROVISIONS OF THE ECONOMY ACT DO NOT PROVIDE FOR DEDUCTIONS FROM SUCH AMOUNTS AS ARE PAID AN EMPLOYEE FOR SUBSISTENCE AND TRAVEL, IT WOULD SEEM THAT IT WOULD BE UNJUST TO THE COTTON AGENTS TO MAKE THE SAME DEDUCTION FROM THE ENTIRE AMOUNT OF THEIR CONTRACT PRICE WHEN MORE THAN HALF OF THE CONTRACT PRICE IS BASED UPON SUBSISTENCE AND TRAVEL. * * *

A RECONSIDERATION OF THE DECISION ABOVE REFERRED TO IS RESPECTFULLY REQUESTED IN VIEW OF THESE FACTS.

IF, AFTER REVIEW, IT SHOULD BE DECIDED THAT THE COTTON AGENTS ARE SUBJECT TO THE DEDUCTIONS MADE IN THE ECONOMY ACT, YOUR DECISION IS REQUESTED ON THE FOLLOWING QUESTIONS:

SHOULD THE PRESENT COTTON AGENTS HAVE THEIR COMPENSATION REDUCED 15 PERCENT FOR THE BALANCE OF THE PRESENT FISCAL YEAR BEGINNING APRIL 1, 1933, NOTWITHSTANDING THAT THEY ARE SERVING UNDER THE TERMS OF CONTRACTS ENTERED INTO AS OF JULY 1, 1932? ON JULY 1, 1932, AT THE TIME THE PRESENT CONTRACTS WERE MADE, THE DEPARTMENT DID NOT CONTEMPLATE THAT ANY REDUCTION WOULD BE MADE AS THE RESULT OF THE ECONOMY ACT WHICH WAS THEN IN PROCESS OF ENACTMENT, AND THE RATES WERE FIXED ON THE BASES OF EXISTING ECONOMIC CONDITIONS IN THE VARIOUS COTTON DISTRICTS.

SHOULD THE RATES OF PAY WHICH WILL BE FIXED IN THE CONTRACTS EXECUTED ON JULY 1, 1933, FOR THE FISCAL YEAR 1934 BE REDUCED 15 PERCENT AS THE RESULT OF THE PROVISIONS OF THE ACT OF MARCH 20, 1933?

IN DECISION OF AUGUST 30, 1932, 12 COMP. GEN. 304, AS MODIFIED BY THE DECISION OF OCTOBER 24, 1932, 12 COMP. GEN. 416, IT WAS HELD THAT THESE CENSUS AGENTS WERE OFFICERS OR EMPLOYEES OF THE GOVERNMENT WITHIN THE MEANING OF SECTION 104 (A) OF THE ECONOMY ACT AND THAT THEIR COMPENSATION AS FIXED IN THEIR CONTRACTS OF EMPLOYMENT WAS SUBJECT TO 8 1/3 PERCENT REDUCTION IF THE TOTAL AMOUNT WHICH COULD BE RECEIVED UNDER THE TERMS OF THE CONTRACT IN EACH INDIVIDUAL CASE EXCEEDED $1,000 PER ANNUM.

SECTION 1 (A), TITLE II, OF THE ACT OF MARCH 20, 1933, PUBLIC NO. 2, 48 STAT. 12, CONTAINS, INSOFAR AS APPLICABLE TO THESE CENSUS AGENTS, THE SAME DEFINITION OF THE TERMS "OFFICER" AND ,EMPLOYEE.' THE DEFINITION OF THE TERM "COMPENSATION" IN SECTION 1 (B), TITLE II, OF THE ACT, PROVIDES, IN PART, AS FOLLOWS:

THE TERM "COMPENSATION" MEANS ANY SALARY, PAY, WAGE, ALLOWANCE (EXCEPT ALLOWANCES FOR TRAVEL), OR OTHER EMOLUMENT PAID FOR SERVICES RENDERED IN ANY CIVILIAN OR NONCIVILIAN OFFICE, POSITION, OR EMPLOYMENT; * * *

TO COME WITHIN THE EXCEPTION OF "ALLOWANCES FOR TRAVEL," THE ALLOWANCE MUST BE SPECIFICALLY SEGREGATED OR SUSCEPTIBLE OF IDENTIFICATION AS TRAVELING EXPENSES IN A DEFINITE AMOUNT. THE EXCEPTION DOES NOT APPLY, AS IN THE INSTANT CASE, WHERE THE FACT THAT THE EMPLOYEE WOULD HAVE TO BEAR CERTAIN EXPENSES OF TRANSPORTATION, ETC., IN GOING ABOUT HIS WORK WAS TAKEN INTO CONSIDERATION IN FIXING THE RATE OF HIS COMPENSATION.

SINCE THE ACT OF MARCH 20, 1933, MAKES NO EXCEPTION OF EMPLOYEES RECEIVING COMPENSATION AT THE RATE OF $1,000 OR LESS PER ANNUM, IT MUST BE HELD THAT THE COMPENSATION OF THESE CENSUS AGENTS AS FIXED IN THEIR CONTRACTS OF EMPLOYMENT IS SUBJECT TO 15 PERCENT REDUCTION ON AND AFTER APRIL 1, 1933, THE AMOUNT OF THE DEDUCTION TO BE IMPOUNDED. ACCORDINGLY, BOTH QUESTIONS CONTAINED IN THE LAST TWO PARAGRAPHS OF YOUR LETTER ARE ANSWERED IN THE AFFIRMATIVE.

REFERRING TO THE QUESTION IN YOUR CONCLUDING PARAGRAPH, THE CONTRACT RATE OF COMPENSATION FOR THE FISCAL YEAR 1934 SHOULD REMAIN THE SAME AS FOR THE FISCAL YEAR 1933 AND BE SUBJECT TO SUCH PERCENTAGE REDUCTION AS MAY BE DETERMINED BY EXECUTIVE ORDER ISSUED COVERING THE FISCAL YEAR 1934, PURSUANT TO SECTIONS 2 AND 3 OF THE ACT OF MARCH 20, 1933.