B-66617, JULY 31, 1947, 27 COMP. GEN. 46

B-66617, JULY 31, 1947, 27 COMP. GEN. 46

AGGREGATE COMPENSATION LIMITATION; APPLICABILITY OF MAXIMUM COMPENSATION LIMITATION OF ACT OF AUGUST 2, 1946, TO APPOINTIVE CONSULTANTS THE PROHIBITION IN SECTION 603 (B) OF THE FEDERAL EMPLOYEES PAY ACT OF 1945, AS AMENDED BY SECTION 7 OF THE FEDERAL EMPLOYEES PAY ACT OF 1946, AGAINST THE PAYMENT OF COMPENSATION AT A RATE IN EXCESS OF $10,000 PER ANNUM IS FOR CONSIDERATION ONLY WHERE, EXCEPT FOR THE PROVISIONS OF SUCH SECTION, THE APPLICATION OF OTHER PROVISIONS OF THE PAY ACTS WOULD RESULT IN PROVIDING COMPENSATION AT A RATE IN EXCESS OF $10,000 PER ANNUM, SO THAT SUCH PROHIBITION WOULD NOT APPLY WHERE THE COMPENSATION PAYABLE IN EXCESS OF SUCH LIMITATION ARISES BY STATUTE INDEPENDENTLY OF SUCH ACTS. THE MAXIMUM COMPENSATION PRESCRIBED BY SECTION 15 OF THE ADMINISTRATIVE EXPENSE STATUTE OF AUGUST 2, 1946, THAT AGENCIES SUBJECT TO THE CLASSIFICATION ACT MAY PAY FOR TEMPORARY OR INTERMITTENT SERVICES OF EXPERTS OR CONSULTANTS UNDER CONTRACT APPLIES TO ALL TEMPORARY OR INTERMITTENT SERVICES OF A PURELY PERSONAL NATURE RENDERED BY EXPERTS OR CONSULTANTS, WHETHER THE EMPLOYMENT BE BY APPOINTMENT OR BY FORMAL CONTRACT.

COMPTROLLER GENERAL WARREN TO R. L. HARLOW, FEDERAL SECURITY AGENCY, JULY 31, 1947:

REFERENCE IS MADE TO YOUR LETTER OF MAY 23, 1947, AS FOLLOWS:

THE ENCLOSED PAY ROLL FOR $115.40 IN FAVOR OF SPECIAL CONSULTANT CHARLES E. DANIEL HAS BEEN SUBMITTED TO ME FOR CERTIFICATION AS AN AUTHORIZED CERTIFYING OFFICER. ALTHOUGH STATED AS A PAY ROLL, IT REPRESENTS AMOUNTS ADMINISTRATIVELY DEDUCTED FROM MR. DANIEL'S PER DIEM COMPENSATION FOR APRIL 7, 8, 9, 10, 11, 14, 15, 16, 17, 18, 1947, TO COVER ALLEGED OVERPAYMENT OF PER DIEM COMPENSATION FOR JUNE 19, 20, 21, 24, 25, 26, 27, 28, AUGUST 20, 21, 1946.

MR. DANIEL WAS APPOINTED SPECIAL CONSULTANT IN THE PUBLIC HEALTH SERVICE, EFFECTIVE DECEMBER 15, 1945, AT $50.00 PER DAY WHEN ACTUALLY EMPLOYED. SECTION 208 (C) OF PUBLIC LAW 410, 78TH CONGRESS (58 STAT. 682) WAS RELIED ON AS AUTHORITY FOR HIS APPOINTMENT. HE PERFORMED NO SERVICES UNTIL JUNE 19, 1946. HE WAS PAID AT THE RATE OF $50.00 PER DAY FOR WORK DURING THE MONTHS OF JUNE AND AUGUST 1946 ON THE DAYS MENTIONED IN THE FIRST PARAGRAPH OF THIS LETTER.

SUBSEQUENTLY, ADMINISTRATIVE OFFICIALS OF THE PUBLIC HEALTH SERVICE BECAME DOUBTFUL OF THEIR AUTHORITY TO PAY CONSULTANTS A PER DIEM RATE IN EXCESS OF $10,000 PER ANNUM. ACCORDINGLY, ON FEBRUARY 24, 1947, A PERSONNEL ACTION WAS PROCESSED PURPORTING TO AMEND THE ORIGINAL APPOINTMENT OF MR. DANIEL AND TO PROVIDE THAT HIS PER DIEM COMPENSATION SHOULD BE $38.46, EFFECTIVE DECEMBER 15, 1945. A COPY OF THIS PERSONNEL ACTION IS ENCLOSED. SINCE THE DATE THIS ACTION WAS TAKEN HE HAS BEEN PAID $38.46 PER DAY WHEN ACTUALLY EMPLOYED, AND BEGINNING WITH THE PAY PERIOD ENDING APRIL 18, 1947, DEDUCTIONS OF $11.54 PER DAY HAVE BEEN MADE TO COVER ALLEGED OVERPAYMENTS FOR PRIOR PERIODS.

MR. DANIEL HAS PROTESTED THIS ACTION ON THE GROUND THAT HIS ORIGINAL APPOINTMENT AND SUBSEQUENT EXTENSIONS PRIOR TO FEBRUARY 24, 1947 PROVIDED THAT THE PER DIEM COMPENSATION WOULD BE $50.00 PER DAY AND WERE ACCEPTED ONLY BECAUSE OF THIS PROVISION AND HAS REQUESTED REFUND OF THE DEDUCTIONS MADE.

IT SEEMS TO ME THAT PROVISIONS OF LAW WHICH MAY HAVE SOME BEARING ON THIS CASE ARE SECTION 603 (B) OF THE FEDERAL EMPLOYEES PAY ACT OF 1945, SECTION 7 OF THE FEDERAL EMPLOYEES PAY ACT OF 1946, SECTION 15 OF PUBLIC LAW 600, 79TH CONGRESS, AND SECTION 208 (C) OF PUBLIC LAW 410, 78TH CONGRESS. THE APPLICABILITY OF PUBLIC LAW 600, 79TH CONGRESS, IS NOT CLEAR TO ME SINCE IT DEALS WITH CONTRACT CONSULTANTS, NOR IS IT CLEAR TO ME THAT THE CITED PROVISIONS OF THE PAY ACTS OF 1945 AND 1946 SPECIAL CONSULTANTS AND TO FIX THEIR COMPENSATION WITHOUT REGARD TO THE CLASSIFICATION ACT OF 1923, AS AMENDED.

YOUR DECISION ON THE ENCLOSED PAY ROLL IS REQUESTED.

SECTION 208 (C) OF THE PUBLIC LAW 410, APPROVED JULY 1, 1944, 58 STAT. 686, PROVIDES:

IN ACCORDANCE WITH REGULATIONS, SPECIAL CONSULTANTS MAY BE EMPLOYED TO ASSIST AND ADVISE IN THE OPERATIONS OF THE SERVICE. SUCH CONSULTANTS MAY BE APPOINTED WITHOUT REGARD TO THE CIVIL-SERVICE LAWS AND THEIR COMPENSATION MAY BE FIXED WITHOUT REGARD TO THE CLASSIFICATION ACT OF 1923, AS AMENDED.

EXCEPT TO THE EXTENT THAT SUCH SECTION MAY OTHERWISE BE LIMITED BY LAW, IT WOULD APPEAR TO CONTAIN AMPLE AUTHORITY TO EMPLOY A CONSULTANT AT THE RATE PROVIDED IN MR. DANIEL'S ORIGINAL APPOINTMENT.

SECTION 603 (B) OF THE FEDERAL EMPLOYEES PAY ACT OF 1945, 59 STAT. 303, AND SECTION 7 OF THE FEDERAL EMPLOYEES PAY ACT OF 1946, 60 STAT. 218, PROVIDE:

SEC. 603. (B) NOTWITHSTANDING ANY OTHER PROVISION OF THIS ACT, NO OFFICER OR EMPLOYEE SHALL, BY REASON OF THE ENACTMENT OF THIS ACT, BE PAID, WITH RESPECT TO ANY PAY PERIOD, BASIC COMPENSATION, OR BASIC COMPENSATION PLUS ANY ADDITIONAL COMPENSATION PROVIDED BY THIS ACT, AT A RATE IN EXCESS OF $10,000 PER ANNUM, EXCEPT THAT (1) ANY OFFICER OR EMPLOYEE WHO WAS RECEIVING OVERTIME COMPENSATION ON JUNE 30, 1945, AND WHOSE AGGREGATE RATE OF COMPENSATION ON SUCH DATE WAS IN EXCESS OF $10,000 PER ANNUM MAY RECEIVE OVERTIME COMPENSATION AT SUCH RATE AS WILL NOT CAUSE HIS AGGREGATE RATE OF COMPENSATION FOR ANY PAY PERIOD TO EXCEED THE AGGREGATE RATE OF COMPENSATION HE WAS RECEIVING ON JUNE 30, 1945, UNTIL HE CEASES TO OCCUPY THE OFFICE OR POSITION HE OCCUPIED ON SUCH DATE OR UNTIL THE OVERTIME HOURS OF WORK IN HIS ADMINISTRATIVE WORKWEEK ARE REDUCED BY ACTION OF THE HEAD OF HIS DEPARTMENT OR INDEPENDENT ESTABLISHMENT OR AGENCY, OR GOVERNMENT-OWNED OR CONTROLLED CORPORATION, AND WHEN SUCH OVERTIME HOURS ARE REDUCED SUCH RATE OF OVERTIME COMPENSATION SHALL BE REDUCED PROPORTIONATELY, AND (2) ANY OFFICER OR EMPLOYEE WHO, BECAUSE OF THE RECEIPT OF ADDITIONAL COMPENSATION IN LIEU OF OVERTIME COMPENSATION, WAS RECEIVING AGGREGATE COMPENSATION AT A RATE IN EXCESS OF $10,000 PER ANNUM ON JUNE 30, 1945, MAY CONTINUE TO RECEIVE SUCH RATE OF AGGREGATE COMPENSATION SO LONG AS HE CONTINUES TO OCCUPY THE OFFICE OR POSITION HE OCCUPIED ON SUCH DATE BUT IN NO CASE BEYOND JUNE 30, 1947. ( ITALICS SUPPLIED.)

SEC. 7 (A) SECTION 603 (B) OF THE FEDERAL EMPLOYEES PAY ACT OF 1945 IS AMENDED BY INSERTING AFTER THE WORDS "BY REASON OF THE ENACTMENT OF THIS ACT" THE WORDS "OR ANY AMENDMENT THERETO.'

(B) NOTWITHSTANDING ANY OTHER PROVISION OF THIS ACT, NO OFFICER OR EMPLOYEE SHALL, BY REASON OF THE ENACTMENT OF THIS ACT, BE PAID WITH RESPECT TO ANY PAY PERIOD, BASIC COMPENSATION, OR BASIC COMPENSATION PLUS ANY ADDITIONAL COMPENSATION PROVIDED BY THE FEDERAL EMPLOYEES PAY ACT OF 1945, AS AMENDED, AT A RATE IN EXCESS OF $10,000 PER ANNUM. (ITALICS SUPPLIED.)

THE PROHIBITION AGAINST PAYMENT AT A RATE IN EXCESS OF $10,000 PER ANNUM CONTAINED IN THOSE SECTIONS PRIMARILY IS FOR CONSIDERATION WHERE, EXCEPT FOR THE PROVISIONS OF THOSE SECTIONS, THE APPLICATION OF OTHER PROVISIONS OF THE SAME ACTS WOULD RESULT IN PROVIDING COMPENSATION AT A RATE IN EXCESS OF $10,000 PER ANNUM. THAT PROHIBITION DOES NOT EXTEND TO A SITUATION WHERE, AS HERE, THE COMPENSATION PAYABLE DOES NOT ARISE ON ACCOUNT OF THE ENACTMENT OF THE ACTS CONTAINING THOSE SECTIONS.

SECTION 15 OF PUBLIC LAW 600, 60 STAT. 810, PROVIDES:

THE HEAD OF ANY DEPARTMENT, WHEN AUTHORIZED IN AN APPROPRIATION OR OTHER ACT, MAY PROCURE THE TEMPORARY (NOT IN EXCESS OF ONE YEAR) OR INTERMITTENT SERVICES OF EXPERTS OR CONSULTANTS OR ORGANIZATIONS THEREOF, INCLUDING STENOGRAPHIC REPORTING SERVICES, BY CONTRACT, AND IN SUCH CASES SUCH SERVICE SHALL BE WITHOUT REGARD TO THE CIVIL SERVICE AND CLASSIFICATION LAWS (BUT AS TO AGENCIES SUBJECT TO THE CLASSIFICATION ACT AT RATES NOT IN EXCESS OF THE PER DIEM EQUIVALENT OF THE HIGHEST RATE PAYABLE UNDER THE CLASSIFICATION ACT, UNLESS OTHER RATES ARE SPECIFICALLY PROVIDED IN THE APPROPRIATION OR OTHER LAW) AND, EXCEPT IN THE CASE OF STENOGRAPHIC REPORTING SERVICES BY ORGANIZATIONS, WITHOUT REGARD TO SECTION 3709, REVISED STATUTES, AS AMENDED BY THIS ACT.

I FIND NOTHING IN THAT SECTION, OR IN ITS LEGISLATIVE HISTORY, WHICH WOULD WARRANT A CONCLUSION THAT THE WORDS "BY CONTRACT" APPEARING IN THAT SECTION ARE USED IN ANY RESTRICTED OR LIMITED SENSE. IT SEEMS MORE REASONABLE TO CONCLUDE THAT THOSE WORDS WHEN USED IN CONNECTION WITH THE AUTHORITY TO PROCURE SERVICES "WITHOUT REGARD TO THE CIVIL SERVICE AND CLASSIFICATION LAWS" ARE USED IN THE SENSE OF AN EMPLOYMENT AGREEMENT WITHOUT INTENDING TO DISTINGUISH BETWEEN AN EMPLOYMENT AGREEMENT IN THE FORM OF AN APPOINTMENT AND AN EMPLOYMENT AGREEMENT IN THE FORM OF A FORMAL CONTRACT. HENCE, IT IS CONCLUDED THAT THE RESTRICTION, APPLICABLE TO AGENCIES SUBJECT TO THE CLASSIFICATION ACT, AGAINST PAYMENT AT RATES IN EXCESS OF THE PER DIEM EQUIVALENT OF THE HIGHEST RATE PAYABLE UNDER THE CLASSIFICATION ACT, IN THE ABSENCE OF OTHER RATES SPECIFICALLY PROVIDED IN THE APPROPRIATION OR OTHER ACT AUTHORIZING THE PROCUREMENT OF SUCH SERVICES, IS INTENDED TO APPLY TO ALL TEMPORARY OR INTERMITTENT EMPLOYMENTS OF THE INDIVIDUAL SERVICES OF A PURELY PERSONAL NATURE OF EXPERTS OR CONSULTANTS, WHETHER SUCH EMPLOYMENTS BE BY APPOINTMENTS OR BY FORMAL CONTRACT.

IT IS UNDERSTOOD THAT THE UNITED STATES PUBLIC HEALTH SERVICE, AS WELL AS THE FEDERAL SECURITY AGENCY, IS AN AGENCY SUBJECT TO THE CLASSIFICATION ACT. ACCORDINGLY, AND SINCE NO OTHER RATE SPECIFICALLY IS PROVIDED IN SECTION 208 (C) OF PUBLIC LAW 410, 78TH CONGRESS, 58 STAT. 686, IT IS DETERMINED THAT, IN ACCORDANCE WITH THE PROVISIONS OF SECTION 15 OF PUBLIC LAW 600, SUPRA, MR. DANIEL WAS NOT AND IS NOT ENTITLED TO BE COMPENSATED FOR THE SERVICES PERFORMED BY HIM ON AUGUST 20 AND 21, 1946, AT A RATE IN EXCESS OF THE PER DIEM EQUIVALENT OF THE HIGHEST RATE PAYABLE UNDER THE CLASSIFICATION ACT.

IN VIEW OF THE FOREGOING, AND OF THE STATEMENT THAT MR. DANIEL'S ORIGINAL APPOINTMENT AND SUBSEQUENT EXTENSION OF THAT APPOINTMENT PRIOR TO FEBRUARY 24, 1947, PROVIDED FOR A PER DIEM COMPENSATION AT THE RATE OF $50 PER DAY, THE ATTACHED VOUCHER MAY BE CERTIFIED FOR PAYMENT IN THE AMOUNT OF $92.32, REPRESENTING 8 DAYS AT $11.54, THE DIFFERENCE BETWEEN $50 AND $38.46, WHICH HAD BEEN COLLECTED FROM MR. DANIEL FOR THE DAYS, JUNE 19, 20, 21, 24, 25, 26 AND 28, 1946.