Request By:
Ms. Dee Maynard, Commissioner
Department of Personnel
Capitol Annex
Frankfort, Kentucky 40601
Opinion
Opinion By: Steven L. Beshear, Attorney General; Stephen L. Frank, Assistant Attorney General
In response to your letter dated June 2, 1982 requesting an opinion of the Attorney General with regard to a number of issues pertaining to House Bill 681, it is our opinion that:
(1) House Bill 681 applies to all employees in the Executive Branch, (except those specifically excluded), part-time and full-time, regardless of the number of hours worked and regardless of status.
House Bill 681 provides us with the following clear definition of the term "employe":
As used in this Act, "employe" means any officer or employe of the Executive Branch of government. The provisions of this Act do not apply to employes of the General Assembly, the Legislative Research Commission, or the Court of Justice, or to any Constitutional Officer.
It is noteworthy that this definition provides no exclusion for part-time employees or employees that work less than 100 hours a month, although said definition does specifically exclude several categories of employees who are paid from the State Treasury. This indicates the legislature's intent to exclude no other groups of employees from the benefits of House Bill 681.
This interpretation of the coverage of House Bill 681 is clearly supported by the language in the related (appropriations) bill No. 295, which specifically provides that:
"It is the intent of the General Assembly that each classified permanent full-time and permanent part-time employe, as defined in KRS 18.110, in the Executive Branch shall receive, at least, an annual five-percent (5%) salary increment each fiscal year, in accordance with the employes regular salary increment schedule." (Emphasis added.) H.B. 295, Part VI, Sec. 16. 1
It is further noteworthy that Section 16 of Part 6 of House Bill 295 makes specific reference to the definition of employee contained in KRS 18.110. The definition of employee contained in that statute, which pertains to the merit system, is totally consistent with the definition of employe contained in House Bill 681 and further supports our interpretation of that bill to include part-time employees and full-time employees working less than 100 hours a month. That definition provides as follows:
"Employe" means a person regularly appointed to a position in the state service for which he is compensated on a full-time or a part-time basis.
This office has previously clarified in OAG 79-435 that the term "employe" in KRS 18.110 covers "any person who receives compensation at any time for his services as distinguished from a person who is strictly a non-paid volunteer." It was also determined in that opinion that the mere taking of an unpaid leave of absence did not change his or her status as an "employe" if the job called for compensation to be paid therefor. That interpretation could leave no doubt that both part-time employees and employees working less than 100 hours a month were contemplated by the term "employe" in House Bill 681.
(2) House Bill 295 requires an annual increment to be granted to all classified employees each fiscal year in accordance with that employee's regular salary increment schedule and to non-classified employees at a comparable interval to be determined by the Department of Personnel.
House Bill 681 provides for an annual increment to be granted to each employee, but fails to specify whether said increment will be given each calendar year, every fiscal year or following each twelve months of service. The language of House Bill 681 provides no answer to this question since the term "annual" refers to the rate of payment and not the timing of the increment. State ex rel. Wingate v. Thompson, 36 Mo. 66 (1865). Thus, we must look to the legislative intent in order to determine what, if any, increment date was intended by the legislature in House Bill 681.
In 1982 when the General Assembly passed House Bill 681, it also passed a provision in its appropriation bill, House Bill 295, that clarified that it was the intent of the General Assembly that the five-percent (5%) salary increments, for classified employees, was to be granted in accordance with the employee's regular salary increment schedule. House Bill 295, Section 16, Part 4. The General Assembly undoubtedly intended this provision in House Bill 295 to influence the interpretation of House Bill 681 with regard to the increment date for classified employees.
Even if the legislature had not clearly indicated their intent that salary increments for classified employees occur in accordance with the employee's regular salary increment schedule, such an interpretation would be the only reasonable, fair and just conclusion in light of the history of annual increments on that date and the inequity that will result to numerous employees if the date is changed at this time. See Wexler v. Dayton, 255 App.Div. 567, 8 NYS2d 391 (1939), a New York case, that pertained to a statute which provided that employees would be entitled to have a yearly increase of $120. The New York court concluded that the reasonable construction of that statute would have to be that the employee is entitled to have said increase commence on the anniversary date of his entrance into the service. "Any other interpretation would lead to inequality or injustice. The courts do not favor an interpretation of the statute which cause hardship or injustice, and if the statute has such an effect, another and more reasonable construction is sought." Wexler v. Dayton, 255 App.Div. 567, 8 NYS2d 391 (1939).
Unlike merit employees, unclassified employees in the Commonwealth of Kentucky have no history of receiving annual increments. Although House Bill 681 clearly provides that this group of employees will now be entitled to this annual increment, that statute provides no indication as to when the legislature intended this benefit to take place. While it may appear that the most equitable date for the receipt of annual increments for unclassified employees would be each employee's anniversary date, (similar to classified employees) that decision should be left to the Department of Personnel who has the authority to promulgate rules for the unclassified service. 101 KAR 1:200; KRS 13.082, KRS 18.220.
(3). There is no statutory authority stated or implied in House Bill 681 for delaying an annual increment if an employee does not work more than half the scheduled work days in a month.
As explained in detailed above, an employee, as defined in House Bill 681 and KRS 18.110, is entitled to a five percent (5%) increment annually, even if that employee has not worked more than half of the scheduled work days in a month. As long as said employee remains in an employment status during the entire 12-month period, no delay in receiving the 5 percent (5%) increment can be authorized.
(4). An annual increment under House Bill 681 may not take an employee's salary beyond the maximum established in KRS 64.640 (the amount provided for compensation to the Governor).
If an employee receives an annual increment of five percent (5%) each year, it is arguable that an employee's salary may exceed the salary of the Governor; this would be contrary to another statute of this state that sets the Governor's salary as the maximum salary for a state employee. One could argue that these two statutes are conflicting and irreconcilable in which case the new statute would control. Tillman v. Whealen-Haven REC Association, Inc., 451 S2d 1211 (4th Cir. 1971). However, it is our opinion that these two statutes are not irreconcilable and that the five percent (5%) increase provided for in House Bill 681 is subject to the maximum provided for in KRS 64.640. In that House Bill 681 provides no express amendment of KRS 64.640, it can be presumed that House Bill 681 was enacted in accord with the legislative policy embodied in KRS 64.640 and said statutes must be construed together. Sanford v. Commissioner of the Internal Revenue, 308 U.S. 39 (1939).
(5) An annual increment under House Bill 681 may take an employee's salary beyond the maximum of the grade assigned to that employee's job classification in the compensation plan established pursuant to KRS 18.190 and 18.210.
While the Personnel Department is authorized by statute to devise compensation plans for employees of the state, said compensation plans must not conflict with any legislative provisions of the Commonwealth of Kentucky. It is possible for the Department of Personnel to fulfill its statutory obligation to devise compensation plans without offending the statutory mandate provided under KRS 64.640 by allowing employees' salaries to exceed a grade maximum only if this occurs as a result of the operation of House Bill 681. This is possible because the maximum of the grade is not established by statute.
(6) An annual increment under House Bill 681 may not take an employee's salary beyond any maximum salary for any classification established by statute.
As discussed above, House Bill 681 can be read to coincide with other statutes which place an absolute limit on the earning power of a state employee. Just as KRS 64.640 provides an upper limit for all employees with regard to their potential salary, including any 5 percent (5%) increases, KRS 161.340 must be read into House Bill 681 to provide an absolute upper salary limit for the Executive Secretary of the Teachers' Retirement System to be the maximum set for commissioners by KRS 64.640(2).
Footnotes
Footnotes
1 We do not purport to deal in this opinion as to the possible constitutional issue arising from the inclusion of material pertaining to statutory interpretation in an appropriations bill. See § 51, Kentucky Constitution.