good morning everyone the panel have were a total of five pieces to the movie submitted later today just of the brief without oral argument those are those cases our appeal eleven twenty five from two thousand and nine in r finally in third position loosened technology versus gateway so mistreatment good morning welcome to the court the floor is yours so we'd like to hear your argument this is an appeal thirty different form of compensation that can count as basic pay do you agree that if the transcript related income that these court reporters like your client receive is not on the list of a through age that we then have to conclude it doesn't count as basic no if you don't agree with it now we do you think that list is not an exclusive list it's just a partial list it does not list every single form paid in federal employee can receive but the issue here no no no that's not the quick the question is that what counts as basic pay looks to me like when you read the statute basic pay includes everything listed in a through each but the list stops at age so if there's a form of compensation not on the list it seems like you then have to conclude that such compensation does not meet the definition of basic pay and therefore can't count toward a new a calculation when you read the list a through age doesn't include salary doesn't include the basic concept of the person works for the job and the job is described by law and that that law carries compensation along with that so one item that's missing from that entire list is the notion that a person is compensated for the official duties of the job that they perform the the list that in addition to the face for no we would argue that the transcript pay as found by the united states and in the midnights it's america versus the city of pittsburgh case which is it seven five seven f second forty three the third circuit c appeals found that the fact that the reporters are paid by a third party does not change the character of their service the collection of fees has been a traditional means of compensation for services rendered by public officials or employees in their official capacity the third circuit further found that repairing transcripts cripps the court reporter is an officer of the court and an employee of the united states was was was the court educating would count as basic  that's my point is the difference between compensation and basic pay the annuity use limited the basic pay there can be other forms of compensation and this to marie points out that's exactly what each talks about certain forms of compensation do not count as received under five c f r five fifty point one zero three the basic pays included to prefer to is explain to include the monies that a person receives for performing the basic functions of the person job and stats defined by law when you look to twenty a u s c seven fifty three d in he defined by law includes performing the transcript work in addition to sitting in the courtroom and the well the problem with that argument is that if for example the agency is doing it incorrectly and unlawfully then everything flows from that ultimate first decision our position is that the agency here in the united states ultimately elevated it to a level of gathering a group of ten federal court orders from the northern district of illinois and filing a declaratory judgment action in federal court regarding the method of compensation because if the method of compensation were not correct and they should not have been ten ninety nine income and everything flows therefrom if the monies had been paid and collected by the government in the way that they are collected when someone files a complaint when someone pays for any other service then the money would have been paid to the court reporter through a w two and pain pension benefits would have automatically been deducted from those dollars the only reason that the pension benefits in the pension contributions are not deducted is because the money is diverted through a process that we believe is unlawful and the difficulty here is that there really isn't any place to go in order to challenge that mr wilson he's gone to the i r s and sought a refund which was granted based on law that applies to every company in this country which is that you cannot an employee and an independent contractor working at the same time when the government controls every aspect of the employee points such as the size of the paper the font when the paper transcripts have to be due how much the reporter can charge the i r s considers that person to be an employee eat so this mechanism that they've set in place which is that the public and even the federal government pays the court reporter directly has the third circuit found doesn't change the nature of the compensation it simply means that the court reporter is collecting the funds for the federal government now under the pension laws if the federal government erred in failing to collect those pension monies the file government would be responsible for making those contributions and could wretch you know reclaiming that money is it your position that you are entitled to prevail here because of the third circuit case the third circuit case amongst other recent third circuit case is this you and that issue in that case was whether or not texas could be collected from the government and from a cork orders based on compensation whether this transcript income was part of the official duties that the court reporters were performing so that the tax could be imposed by the by pittsburgh and the woods wasn't a pension no would be since no one one of the difficulties is actually getting some place to hear the pension annuity case basic pay then i don't see how the third circuit decision helps you at all simply not relevant we start with the premise that basic pay means well monies that a person receives for performing the actual communities that that person is assign and spics by employer right and the third circuit that's where the third circuit decision is helpful because it finds that the fact that the court reporters are collecting the monies for the federal government doesn't change the fact that that money is compensation with some sort of tax contents well it was actually the first step of the case was to determine that it was compensation before they could determine whether or not the tax could be imposed as a form of on a form of compensation that seems so obvious as a form of compensation it may not be so obvious that it it fits the definition of basic separate pieces of compensation but the corporate position is that they should not be paid on the ten ninety nine this money should be paid to them in conjunction with the regular monies that they earn find it a little distracting to be talking about the tax assets of this compensation we're just trying to decide whether it counts as basic pay in there for is part of the a nudie calculation we're not out for tax purposes seem those separate and distinct manner fair enough we we would cite your honor the federal regulation which states that basic pay is defined based on whether or not the pay is paid for the official duties of the separate enterprise they're for doing the job that that government employees required to do but nevertheless the congress makes a distinction between those forms of pay that count as basic pay and other forms of pay were fishel dut which a person is paid for is included and is part of the person's salary and if this money had been paid as salary we would be having this debate but it's only because of the mechanism set up by the court system that the court reporter privately collects it must report back to the government and then must receive a ten ninety nine for their earnings that takes it out of salary if the federal government paid this money consistent with the way every other profession in the country is required to pay its employees and we would not be having this debate it would come to the federal court orders a salary the pension deductions would be made it wouldn't be in basic pay that's the difficulty with this case you start with step one which is a mis characterization of the earnings they're not independent contractor worried about how the administr is what congress seems to have commanded in the statute when it says certain things count as basic and certain other kinds of don't count as basic whatever the opinion is of the a o or o p m or the m s p be we have to follow  congress has commanded so i'm trying to get help from you how do we get around what appears to be congress command that these kinds of collateral peo call mother a technical term don't count as basic because that's these employee s sure but i left we create this whole problem if the federal government decided that they're going to start paying the department of justice lawyers a salary and then in addition they're going to require the justice department lawyers to kill each the agency for a brief collect the money from the brief that in many of the cases of the that are cited in the o p s brief the agency is due deference because the individual retirement record or the i r r was filled out by the employer agency and the dispute is over whether or not it was done that argument and we do not believe you're stuck with the o p m ruling on this because as a matter of law and as a matter of suggesting we're stuck with the o p m ruling i'm trying to identify with the opium ruling isn't that looks to me like that's correct with respect to the opium yes it was on part of the m s p be then found that it couldn't look at anything other than the i r r m e m s it isn't our isn't our question affectively was o p m correct wouldn't be somewhat logical to say that courts like this court should pay some respect maybe even defer so the presume pay the expertise of the o p m interpret ng be that this court has de novo authority to review that decision and the issues that are out in here are not issues relating to whether a person and their employment on a particular day there are legal issues relating to the stat question it's a legal issue no question it's the no to review the only question the judge moore raise and i'm trying to get a sense of what your real response is is whether because of its extreme familiarity with paid ministr to take that the o p m would have the expertise but in this case we're dealing with complicated legal issues concerning the treatment of this pay and whether or not a single act which is the act of diverting the monies from salary caused this entire pension dilemma and there is no agency that's well by as a matter of law to or to determine whether or not it was lawful to divert these monies from s and so the entire argument stands on the question of step one was to take the transcript income and to pull it out of salary if it had not been pulled out of salary we would not be here any different than if the department of justice starts maybe you should start with whether the construction by o p m of the statute creating basic pain from non basic pay was correct and why write a p m s position is that it does not fall within the definition  basic pay with the section eighty three thirty one which specifically includes among other numerated items paid given in addition to the base pay of the position of as fixed by law or regulation o p m interpreted transcript and which was paid based upon request by third parties in most cases paid to mr lawson t directly by third parties which are buried based upon those requests the length of court proceeding is the net the gross and the net amount of which vary depending on the cost of supplies and services for cured by mr law sonti personally is not the base pay of the position as fixed by law or regulation because it's a variable because not simply because it's variable there's types of pay that might and the rationalize with all of this the fact that what the court reporters do in the transcripts is their job whereas the eight items that are explicitly listed are extra things that are by definition not included there's nothing extra for me producing transcripts there are only thing that's different is that the pay comes from the recipient of the transcript but this is the job of the court reporter rather than some peripheral extra activity and this really is the focus of most appeal is it not when the search it was changed to make the court reporters employees it didn't also go back to this other list who collar later these duties becomes now all of a sudden there is a full time employee who gets a significant amount of compensation what changed was that he was placed on the leave and that reduced his ability or eliminated his ability to engage an outside reporting activities other than his official reporting duties it's not that he was not an employee prior to that time and it's not that all court reporters were not subject to maximum rates established by the judicial conference for official reporting duties prior to that time but it did a limb and ate his ability to engage him outside reporting when he was  into newman's central point which is that producing transcripts is the core function of a court reporter it's not some separate duty it's the core function whether the recipient is the court that requested it or a private party well still the core function of the report again that's not how basic pay is defined by the statute though whether it's a core or non core function it's whether it's th the position as set by law or regulation when you're performing overtime duties you're performing the requirements of your job when you are when you receive a uniform allowance you you need that uniform to perform your work but that's not basic pay under section eight thirty eighty three thirty one so it's not that everything that you do in the course of your job is necessarily basic pay as defined by the statu but what about the other section that mr friedman cited other than eighty three thirty one she cites i believe it's only five fifty a court a favorite federal regulation section addressing the purposes of distinguishing basic pay from congress specifically in section twenty eight u s c seven fifty three as it says that they collect these fees from the parties not from their employer to the extent that that's not a law that the court reporters like that's a challenge to something better raised with congress not o p m because that is precisely what the law provides is their system of pay well i'm not sure i'm following you seven fifty three in your view specifically makes their basic exclude transcript fees no no no to the extent that mr list antti alleges that the problem is that he is being paid by complaining about how it's counted with respect to annuities but our understanding was that he was actually claiming that was improperly calculated with respect to annuities because it was paid by third parties and it should not have been paid by third parties and that is required by the statute the fact that paid by parties other than is is not excluded it is included well again it goes it doesn't you're correct that it doesn't specifically say that transcript income per se is not included but it does say it doesn't include pay given in addition to the base pay of the position  by law or regulation and o p m has interpreted that to be this transcript and comma so to the extent that there is any ambiguity and the statute of congress hasn't spoken to this question it's a question of whether o p m s lucidly limited to taxation of manners which opium doesn't have any authority over it doesn't define basic pay for retirement purposes again it seems to have the court in that case instead have concluded that it's loose and going to pay that don't count as basic and we all agree that transcript is not on that list of things excluded from basic then you must be taking the view that the list in each of sting's excluded from basic is an incomplete list and some other things not listed there are also excluded from basic pay right now our view is that if that are the words transcript income are not listed there it pay given in addition to the base pay of the position as fixed by law regulation and that that has that has been interpreted that part there has been interpreted by o p m not to include this type of transcript that would suggest that every form of that's not defined as the base pay elsewhere is excluded from  just because it isn't included in the statute setting the pay of the position which appears elsewhere than the eighty three thirty one the note would be that that i mean to the extent that that basic pay is a certain significantly lower level because it was always understood the transcript pay would go directly to the reporters there are always controls sincerely and all  difference here that in this case for the court reporters they receive pay from this other source for doing their standard activity that activity for which they are employed by the government legislative history or anything in the record specifically supporting us out the question i don't think that was challenge that the reporters pay from the feds was lower because it was well understood that they would receive transcript pay from the parties i mean that may that may be a logical assumption we don't agree that their pay was we certainly dispute in our brief that they're paying with that artificially low because they as the record shows at least saying that now but you didn't question is where does some of the money come from rome has his salary is set i believe that his last year of a limit at seventy five thousand dollars a year and that was his salary from his employing agency the administrative office of the corps and then in addition to that he earned a certain amount of transcript income and then kicking back each for the third camp year you seem to be saying on the one hand that by its plain terms  bars transcript from being considered as basic but a new other hand you seem to be saying well the statute isn't clear but it's been interpreted by o p m as barring the transcript ambiguous as to what at in compas at that point there would be a question of know but if so so you're reading the critical language is what does not include bonuses come allowances over time they come up military pay come up given an addition to base pay so you're reading it as if it said but that's not include bonuses an allowance of overtime a military pay or any other kind of pay given in addition to the base  thank you i'd like to turn back to h and focus on the part of h that says it given in addition to the base pay of the position as fixed by well more regulation and the corp orders do argue that the based pay of the position as fixed by law well regulation set forth in twenty us c seven fifty three d e and f which includes both components of the pay both the transcript income as well as the salary income so the poor reporters do take the position that the words as fixed by law or regulation include all monies that congress has stated that they are to be paid for performing the basic function of their job because of seven fifty three and seven twenty eight u s c seven fifty three d has two components to it it expressly sets forth but of the salary portion of the physician as well as the right to collect the transcript income and of course it was contemplated that what the government was doing was buying out from the private industry these court reporters and to do so they would have to pay a market rate which included both the salary as well as the he has for two years and not received any pension on those monies and this wasn't he also not on the federal taxpayers the transcripts so he was paid for the transcripts he was paid for the transcripts that is correct and there was no deduction by the government there is a section that's not part of the c s r s but is part of the first which states that where the federal government fails to collect the money and that's found at title five hundred forty one point five zero five and it delineate s sub paragraphs that explains how a refund is sought firstly pension is paid by the federal government for the failure to collect the monies and then after that takes place the employee will be asked  to provide recompense to the federal government for the failure to short the shorting of the pension but the to deny mr t and his colleagues a pension that would be equivalent to the pension that every other federal employee in the country receives based on the fact that the government failed to collect seems to be putting the issue of the remedy before the issue of the liability and so we would urge that the court find that the tension should have been awarded to all of these federal court reporters for precisely the reason his judgment you question is that these these people provide valuable service to the court and that service includes preparing these transcripts as well duties that they perform for which they get paid their salary that is the total of their base pay and pension contributions should have been allowed from those monies not disallowed and they should receive a pension consistent with the law that  doesn't involve large number or additional number of other former or present court reporters there is an appeal of the denial of the class certification as well your b to engage in class action litigation yes that there is a process that set forth when you make the request for class and we complied with the request and it was a ruling in this case denying seedings right i don't think anybody can deny that that it would be helpful to have it classified ruling this library decision but that doesn't mean it's authorized by law that there actually was a provision that we were following  apologize for not having it in front of me i didn't know that it would be a dentist it might be an issue but it actually allowed for at a certain place in the proceedings a request to be made for a class certification and there actually was a ruling that was issued by the m s p b extra time i think we have a pretty full exposition of the arguments so we thank you both will take the appeal under advisement and thank you very much