B-40602, MARCH 24, 1944, 23 COMP. GEN. 721

B-40602, MARCH 24, 1944, 23 COMP. GEN. 721

COMPENSATION - OVERTIME - CONTRACT EMPLOYEES - RETROACTIVE PAYMENTS SECTION 1 OF THE OVERTIME AND ADDITIONAL COMPENSATION ACT OF DECEMBER 22, 1942, EFFECTIVE DECEMBER 1, 1942 TO APRIL 30, 1943, DOES NOT EXCEPT CONTRACT EMPLOYEES FROM THE BENEFITS OF THE ACT, AND, THEREFORE, CONTRACT EMPLOYEES OF THE WAR SHIPPING ADMINISTRATION ARE ENTITLED TO PAYMENT OF OVERTIME COMPENSATION UNDER THE SAID ACT, RETROACTIVELY EFFECTIVE TO DECEMBER 1, 1942, EVEN THOUGH THE CONTRACT OF EMPLOYMENT EXPRESSLY STATES THAT THEY ARE NOT ENTITLED TO OVERTIME COMPENSATION. AN ADMINISTRATIVE OFFICE MAY PROCESS SHORT PAYMENTS OF COMPENSATION, RESULTING FROM ADMINISTRATIVE ERROR IN DENYING ITS CONTRACT EMPLOYEES THE BENEFITS OF THE OVERTIME AND ADDITIONAL COMPENSATION ACT OF DECEMBER 22, 1942, AND THE WAR OVERTIME PAY ACT OF 1943, RETROACTIVELY EFFECTIVE TO DECEMBER 1, 1942, TO EMPLOYEES WHO ARE NOW IN THE SERVICE, PROVIDED THERE IS AN APPROPRIATION FROM WHICH THE PAYMENTS MAY BE MADE, BUT NO PAYMENTS MAY BE MADE TO EMPLOYEES NOT NOW IN THE SERVICE WHO HAVE FILED NO CLAIM THEREFOR.

COMPTROLLER GENERAL WARREN TO THE WAR SHIPPING ADMINISTRATOR, MARCH 24, 1944:

I HAVE YOUR LETTER OF MARCH 2, 1944, AS FOLLOWS:

REFERENCE IS MADE TO YOUR DECISIONS OF JULY 12, 1943 ( NO. B-35339) AND NOVEMBER 30, 1943 ( NO. B-38185) REGARDING THE PAYMENT OF OVERTIME PAY UNDER THE WAR OVERTIME PAY ACT OF 1943 ( PUBLIC LAW 49--- 78TH CONGRESS). PURSUANT TO THESE DECISIONS, STEPS HAVE BEEN TAKEN BY THE WAR SHIPPING ADMINISTRATION TO MAKE PAYMENT OF OVERTIME, RETROACTIVE TO MAY 1, 1943, TO PERSONS WHOSE SERVICES WERE ENGAGED ON A COMPENSATION BASIS UNDER CONTRACT AND WHO ARE AT PRESENT PERFORMING SERVICES FOR THE WAR SHIPPING ADMINISTRATION.

A QUESTION HAS BEEN RAISED AS TO WHETHER OR NOT THESE PERSONS ARE ENTITLED TO OVERTIME PAY FOR THE PERIOD OF DECEMBER 1, 1942, TO MAY 1, 1943, UNDER THE ACT APPROVED DECEMBER 22, 1942 ( PUBLIC LAW 821--- 77TH CONGRESS) AND EXECUTIVE ORDER 9289 DATED DECEMBER 26, 1942. IN COMPLIANCE WITH PUBLIC LAW 821, THE ADMINISTRATION, UNDER DATE OF JANUARY 19, 1942, FURNISHED THE INFORMATION REQUIRED BY SECTION 2 OF SUCH LAW TO THE DIRECTOR OF THE BUREAU OF THE BUDGET. PAYMENT OF OVERTIME WAS NOT MADE TO PERSONS WHOSE SERVICES WERE ENGAGED UNDER CONTRACT DURING THIS PERIOD. VIEW OF YOUR DECISIONS UNDER THE WAR OVERTIME PAY ACT OF 1943, IT APPEARS THAT THEY MAY BE ENTITLED TO PAYMENT. BECAUSE, HOWEVER, OF THE DIFFERENCE IN LANGUAGE BETWEEN THE TWO OVERTIME ACTS, IT IS NOT CLEAR WHETHER YOUR DECISION UNDER PUBLIC LAW 49 IS APPLICABLE WITH LIKE FORCE TO PUBLIC LAW 821 AND EXECUTIVE ORDER 9289.

THE SERVICES OF THE PERSONS IN QUESTION WERE ENGAGED UNDER TWO TYPES OF CONTRACT CONTAINING LANGUAGE SUBSTANTIALLY IDENTICAL TO THE TWO FOLLOWING EXAMPLES:

(1) " YOU WILL BE PAID COMPENSATION ON THE BASIS OF $ PER

ANNUM OR $ PER MONTH, IT BEING UNDERSTOOD THAT YOUR SERVICES

SHALL INCLUDE FULL TIME EMPLOYMENT ON ALL WORKING DAYS, EXCLUSIVE

OF SUNDAYS AND HOLIDAYS, AND THAT NO ADDITIONAL COMPENSATION WILL BE

PAID TO YOU FOR WORK, IF ANY, PERFORMED ON SUNDAYS OR HOLIDAYS.'

(2) " YOU WILL BE PAID COMPENSATION ON THE BASIS OF $ PER

DAY WHILE ACTUALLY ENGAGED IN THE PERFORMANCE OF YOUR DUTIES

HEREUNDER.'

IT IS OUR DESIRE TO ASCERTAIN WHETHER OR NOT WAR SHIPPING ADMINISTRATION IS AUTHORIZED TO MAKE PAYMENT OF OVERTIME OR ADDITIONAL COMPENSATION FOR THE PERIOD DECEMBER 1, 1942, TO MAY 1, 1943, TO SUCH PERSONS, PROVIDED THEIR AGGREGATE RATE OF COMPENSATION FOR THE PERIOD INVOLVED IS NOT INCREASED ABOVE $5,000.00 PER ANNUM, UNDER THE FOLLOWING CIRCUMSTANCES:

(1) WHERE SUCH PERSONS ARE STILL RENDERING SERVICES FOR THE WAR

SHIPPING ADMINISTRATION.

(2) WHERE THEY ARE NOT RENDERING SERVICES AND HAVE MADE NO CLAIM FOR

SUCH PAYMENT.

(3) WHERE THEY ARE NOT RENDERING SERVICES BUT HAVE SUBMITTED VOUCHERS

CLAIMING SUCH PAYMENT.

(4)WHERE THEY HAVE CEASED TO RENDER SERVICES BUT ARE LATER RE ENGAGED.

(5) WHERE THE PERSON IS NOT RENDERING SERVICES BY REASON OF HIS

HAVING GONE INTO THE MILITARY SERVICE.

(6) WHERE, IN ADDITION TO THE ABOVE QUOTED LANGUAGE IN THE CONTRACT,

THE CONTRACT CONTAINS LANGUAGE EXPRESSLY STATING THAT THEY ARE

NOT ENTITLED TO OVERTIME.

YOUR ADVICE ON THE ABOVE MATTERS IS RESPECTFULLY REQUESTED.

IN THE DECISION OF NOVEMBER 30, 1943 (B-38185), 23 COMP. GEN. 398, 400, ONE OF THE DECISIONS CITED IN YOUR LETTER, WHEREIN WERE CONSIDERED AND APPLIED THE PROVISIONS OF SECTION 1 OF THE WAR OVERTIME PAY ACT OF 1943, PUBLIC LAW 49, EFFECTIVE MAY 1, 1943, IT WAS STATED:

YOU HAVE INTERPRETED CORRECTLY THE PROVISIONS OF THE WAR OVERTIME PAY ACT OF 1943, APPROVED MAY 7, 1943, 57 STAT. 75, 76, PUBLIC LAW 49, AND THE RULE STATED IN THE CITED DECISIONS. IN OTHER WORDS, IT MAY BE STATED THAT UNLESS AN OFFICER OR EMPLOYEE IN OR UNDER THE UNITED STATES GOVERNMENT BE EXPRESSLY EXCEPTED FROM THE TERMS OF THE ACT HE MUST BE REGARDED AS INCLUDED WITHIN ITS PROVISIONS NOTWITHSTANDING THAT HE MAY BE EMPLOYED ON A CONTRACT BASIS. CONTRACT OFFICERS OR EMPLOYEES, AS DISTINGUISHED FROM CONTRACTORS EMPLOYED ON OTHER THAN A PERSONAL SERVICE BASIS--- GENERALLY THOSE WHO DO NOT PERFORM THEIR WORK UNDER THE SUPERVISION AND CONTROL OF THE GOVERNMENT--- ARE NOT EXCLUDED BY ANY OF THE PROVISIONS OF THE ACT. ACCORDINGLY, IT MUST BE CONCLUDED THAT EMPLOYEES OF THE CLASSES REFERRED TO IN YOUR LETTER COME WITHIN THE PURVIEW OF THE OVERTIME LAW AND ARE ENTITLED TO THE ADDITIONAL COMPENSATION SOLELY BY OPERATION OF THAT STATUTE.

REFERRING TO THE FIRST PARAGRAPH OF YOUR LETTER, IT IS UNDERSTOOD THAT THE CONTRACT EMPLOYEES OF THE WAR SHIPPING ADMINISTRATION TO WHOM IT IS PROPOSED TO MAKE PAYMENTS OF OVERTIME COMPENSATION RETROACTIVELY TO MAY 1, 1943, UNDER THE WAR OVERTIME PAY ACT OF 1943, DO NOT FALL WITHIN THE PURVIEW OF SUBSECTION (H) OF SECTION 1 OF THAT STATUTE EXPRESSLY EXCLUDING

* * * INDIVIDUALS TO WHOM THE PROVISIONS OF SECTION 1 (A) OF THE ACT ENTITLED " AN ACT TO AMEND AND CLARIFY CERTAIN PROVISIONS OF LAW RELATING TO FUNCTIONS OF THE WAR SHIPPING ADMINISTRATION, AND FOR OTHER PURPOSES," APPROVED MARCH 24, 1943 ( PUBLIC LAW NUMBERED 17, SEVENTY-EIGHTH CONGRESS), ARE APPLICABLE. * * *

THE RULE RELATIVE TO PAYMENT OF OVERTIME COMPENSATION TO CONTRACT EMPLOYEES STATED IN THE CITED DECISIONS UNDER THE WAR OVERTIME PAY ACT OF 1943, IS APPLICABLE, ALSO, TO AUTHORIZED PAYMENT OF OVERTIME COMPENSATION UNDER JOINT RESOLUTION OF DECEMBER 22, 1942, 56 STAT. 1068, RETROACTIVELY EFFECTIVE TO DECEMBER 1, 1942, 56 STAT. 1068, RETROACTIVELY PROVISION OF SECTION 1 OF THAT STATUTE EXCEPTS CONTRACT EMPLOYEES.

ACCORDINGLY, IT IS PROPER FOR THE ADMINISTRATIVE OFFICE TO PROCESS PAYMENT OF OVERTIME COMPENSATION RETROACTIVELY EFFECTIVE TO DECEMBER 1, 1942, TO CONTRACT EMPLOYEES QUALIFYING UNDER THE CIRCUMSTANCES STATED IN YOUR LETTER NUMBERED (1), (3), (4) AND (6), PROVIDING, AS TO (6), THAT THE EMPLOYEES ARE NOW IN THE SERVICE OR HAVE FILED CLAIMS. WITH REFERENCE TO CIRCUMSTANCES NUMBERED 6 REGARDING THE EFFECT OF LANGUAGE IN A CONTRACT "EXPRESSLY STATING THAT THEY ARE NOT ENTITLED TO OVERTIME," I INVITE YOUR ATTENTION TO THE STATEMENT MADE IN THE DECISION OF NOVEMBER 30, 1943, 23 COMP. GEN. 398, AT PAGE 400, AS FOLLOWS:

* * * SINCE THE OVERTIME COMPENSATION IS PAYABLE BY OPERATION OF LAW AND OPERATES UPON THE BASIC COMPENSATION, A PROVISION IN A CONTRACT FOR PERSONAL SERVICES TO EXCLUDE PAYMENT OF THE ADDITIONAL COMPENSATION WOULD BE NONEFFECTIVE, WHILE A PROVISION THEREIN TO INCLUDE PAYMENT OF THE OVERTIME COMPENSATION PROVIDED BY LAW WOULD CONSTITUTE MERE SURPLUSAGE. REFERRING TO CIRCUMSTANCES (2) AND (5) NO PAYMENTS SHOULD BE MADE TO AN EMPLOYEE NOT NOW IN THE SERVICE, WHO HAS FILED NO CLAIM. OF COURSE, NO PAYMENT SHOULD BE MADE UNLESS THERE BE AN APPROPRIATION FROM WHICH THE PAYMENTS MAY BE MADE.