B-143400, JUL. 18, 1960

B-143400, JUL. 18, 1960

TO THE SECRETARY OF THE TREASURY:

ON JUNE 30, 1960, THE ACTING SECRETARY OF THE TREASURY REQUESTED OUR DECISION UPON THE QUESTION WHETHER BACK PAY LEGALLY MAY BE MADE TO A NUMBER OF EMPLOYEES OF THE INTERNAL REVENUE SERVICE WHO HAVE BEEN RESTORED TO DUTY FOLLOWING THEIR OPTIONAL RETIREMENTS OR RESIGNATIONS. THE LETTER SETS FORTH THE CIRCUMSTANCES GIVING RISE TO THE QUESTION, IN PERTINENT PART, AS FOLLOWS:

"IN AUGUST AND SEPTEMBER OF 1959, THE DISTRICT DIRECTOR OF INTERNAL REVENUE, DES MOINES, IOWA, WAS FACED WITH A PROBLEM IN THAT THE NUMBERS OF EMPLOYEES IN CERTAIN OF THE DISTRICT'S FUNCTIONAL ACTIVITIES WERE IN EXCESS OF AUTHORIZED PERSONNEL CEILINGS FOR THOSE ACTIVITIES. IN AN ATTEMPT TO CORRECT THIS STAFFING IMBALANCE, THE DISTRICT DIRECTOR INTERVIEWED A NUMBER OF EMPLOYEES CONCERNING THEIR RETIREMENT PLANS, PERFORMANCE, AND PHYSICAL CONDITION. AS A RESULT OF THESE INTERVIEWS, SOME EMPLOYEES SUBMITTED RESIGNATIONS, SOME FILED FOR OPTIONAL RETIREMENT, SOME WERE RETIRED ON DISABILITY, AND OTHERS TOOK NO ACTION.

"SUBSEQUENTLY, ALLEGATIONS WERE MADE THAT THE RESIGNATIONS AND OPTIONAL RETIREMENTS WERE NOT ENTIRELY VOLUNTARY. THESE ALLEGATIONS WERE INVESTIGATED BY THE EXECUTIVE AND LEGISLATIVE REORGANIZATION SUBCOMMITTEE OF THE HOUSE COMMITTEE ON GOVERNMENT OPERATIONS, AND THE SUBCOMMITTEE CONDUCTED PUBLIC HEARINGS IN DES MOINES ON FEBRUARY 4, AND 5, 1960. NUMBER OF PRESENT AND FORMER EMPLOYEES TESTIFIED AT THE HEARINGS AND THE FORMER EMPLOYEES STATED UNDER OATH THAT THE RETIREMENTS AND RESIGNATIONS HAD NOT BEEN VOLUNTARY.

"THE INTERNAL REVENUE SERVICE HAS REVIEWED THE EVENTS LEADING UP TO THE RESIGNATIONS AND OPTIONAL RETIREMENTS OF THE FORMER DES MOINES DISTRICT EMPLOYEES. UNDER DATE OF JUNE 10, 1960, THE INTERNAL REVENUE SERVICE ASKED THE CIVIL SERVICE COMMISSION, IF THE REVENUE SERVICE MIGHT RESTORE THE FORMER EMPLOYEES RETROACTIVELY IN THE EVENT THE SERVICE SHOULD DETERMINE THAT THE SEPARATIONS, AT LEAST IN THE MINDS OF THE FORMER EMPLOYEES CONCERNED, WERE NOT ENTIRELY INVOLUNTARY. UNDER DATE OF JUNE 17, 1960, THE COMMISSION REPLIED IN THE AFFIRMATIVE, BUT POINTED OUT THAT AN AUTHORITATIVE DECISION WITH RESPECT TO BACK PAY CAN ONLY BE OBTAINED FROM THE GENERAL ACCOUNTING OFFICE.

"THE INTERNAL REVENUE SERVICE HAS NOW DETERMINED THAT A NUMBER OF THE RESIGNATIONS AND OPTIONAL RETIREMENTS WERE UNWARRANTED AND UNJUSTIFIED.

"THE CIVIL SERVICE COMMISSION IN ITS LETTER DATED JUNE 28, 1960,IN RESPONSE TO THE REVENUE SERVICE'S LETTER DATED JUNE 23, 1960, HAS ADVISED THE REVENUE SERVICE, IN EFFECT, THAT RETROACTIVE RESTORATION IS OPTIONAL, AT THE DISCRETION OF THE AGENCY, I.E., SUCH ACTION IS NOT REQUIRED BY LAW OR REGULATION. THE SERVICE IS TAKING IMMEDIATE STEPS TO EFFECT THE REINSTATEMENT OF A NUMBER OF THESE FORMER EMPLOYEES, SPECIFICALLY, THOSE WHO HAVE REQUESTED CORRECTIVE ACTION AND WHO SUBMIT CURRENT WRITTEN REQUESTS TO RETURN TO DUTY. AS A CORRECTIVE MEASURE, THE REINSTATEMENTS WILL, FOR THE TIME BEING, BE REGARDED AS TENTATIVE. THE REINSTATEMENT ACTIONS WILL BE EFFECTED AS OF A CURRENT DATE WITH BREAK IN SERVICE BETWEEN THE DATE OF SEPARATION AND THE DATE OF REINSTATEMENT.

"THE TENTATIVE REINSTATEMENT ACTIONS ARE BEING TAKEN IN ORDER TO PLACE THE EMPLOYEES ON DUTY AND BACK IN PRODUCTION AT THE EARLIEST POSSIBLE DATE. THESE ACTIONS ARE BEING TAKEN WITHOUT PREJUDICE TO ANY OTHER RIGHTS SUCH AS BACK PAY, TO WHICH THE EMPLOYEES MAY BE ENTITLED.'

AS A RESULT OF THE INVESTIGATION AND HEARINGS MENTIONED IN THE SECOND PARAGRAPH QUOTED ABOVE FROM THE ACTING SECRETARY'S LETTER, THE HOUSE COMMITTEE ON GOVERNMENT OPERATIONS HAS RECOMMENDED THAT YOU AND THE CIVIL SERVICE COMMISSION TAKE WHATEVER STEPS ARE REQUIRED TO REINSTATE THE EMPLOYEES "WHO WERE IMPROPERLY SEPARATED.' PAGE 5, HOUSE REPORT NO. 2082, 86TH CONGRESS, SUBMITTED JULY 2, 1960.

THE THREE QUESTIONS PRESENTED BY THE ACTING SECRETARY FOR OUR DECISION CONSTITUTE IN ESSENCE AN INQUIRY WHETHER THE EMPLOYEES ARE ENTITLED TO BACK PAY IN ANY EVENT FOR THE PERIODS OF REMOVAL AND, IF SO, WHETHER THE ENTITLEMENT IS DEPENDENT UPON THEIR BEING RETROACTIVELY RESTORED.

WE ASSUME THAT THE INVOLVED EMPLOYEES WERE IN THE CLASSIFIED CIVIL SERVICE AND, AS SUCH, WERE ENTITLED TO THE PROTECTION OF SECTION 6 (A) OF THE ACT OF AUGUST 24, 1912, AS AMENDED BY THE ACT OF JUNE 10, 1948 (PUBLIC LAW 623), 62 STAT. 355. IF THAT ASSUMPTION BE CORRECT, THEN, SINCE THE EMPLOYEES HAVE BEEN REINSTATED OR RESTORED TO DUTY UPON THE BASIS OF THE ADMINISTRATIVE FINDING THAT THE SEPARATIONS WERE IN FACT REMOVALS WHICH WERE UNJUSTIFIED OR UNWARRANTED, THEY ARE ENTITLED TO BACK PAY UNDER SUBSECTION (B) (1) OF SAID SECTION 6. UNDER THE SPECIFIC TERMS OF SECTION 6 (B) (1), THE EMPLOYEES ARE ENTITLED TO SERVICE CREDIT FOR THE PERIODS OF UNJUSTIFIED OR UNWARRANTED REMOVAL, EXCEPT FOR THE PURPOSE OF ACCUMULATION OF LEAVE, AND, THEREFORE, REGARDLESS OF WHETHER THE EFFECTIVE DATES OF THE RESTORATIONS BE SHOWN ON STANDARD FORM 50 AS THE CURRENT (ACTUAL) DATES OF RESTORATION OR AS DATES RETROACTIVE TO THE DATES OF SEPARATION, THE STATUTE HAS THE EFFECT OF "FILLING IN" THE PERIODS OF REMOVAL TO PREVENT BREAK IN SERVICE. CF. LARUFFA V. UNITED STATES, 129 C.CLS. 25; CORNELIUS KOOY, ET AL. V. UNITED STATES, C.CLS.NO. 299-56, DECIDED FEBRUARY 11, 1959; 33 COMP. GEN. 295.