Honorable David Wade, M.D. Opinion NO. M- 1155

Commissioner, Texas Department of Mental Health and Mental Retardation Re: Authority, ifany, P. 0. Box 12668, Capitol Station of Texas Department Austin, Texas 78711 of Mental Health and Mental Retardation tomake payment in cash to its employees who are subject to the federal Fair Labor Standards Act for authorized overtime, and related Dear Dr.Wade: questions.

Inyour recent request for an opinion of this office, you submitted the following questions:

"1. Is the Texas Department of Mental Health and Mental Retardation authorized tomake payment in cash to its employees who are subject to the provisions of the Fair Labor Standards Act for authorized overtime? "2. Is the Texas Department ofMental Health and Mental Retardation authorized tomake payment in cash to the appropriate person for authorized overtime properly accrued to an employee at the time ofhis death or separation from employment with this Department? "3. If the answer to the aforesaid questions is in the affirmative, then from what appropriated funds may such cash payments be made?"

-5635-Honorable David Wade, M.D., page 2, (M-1155)

Your first question isanswered in the affirmative. Article III, Section 44 of the Texas Constitution provides, inpart, that

"TheLegislature shall . . ./InotJ grant, by appropriation or otherwise, any amount of money out of the Treasury of the State, to any individual, on a claim, real orpretended, when the same shall not have been provided forby pre-existing law." Pre-existing law for the payment ofbase salary plus overtime foryour employees covered by theprovisions of the Fair Labor Standards Act is supplied by the 1966 amendments to thatAct. SeeAttorney General's Opinion No. M-341 (1969).

The authority forpaying overtime in cash isprovided inArticle V, Section 2, Subdivision d, of the current General Appropriations Act (S.B. 11,Acts 62nd Leg., R.S. 1971, as amended by S.B. 7, 62nd Leg., 1st C.S., 1971, P.V-32, 3793). Subdivision d reads, inpart, as follows:

II

. . . .Provided, however, that any agency or institution, subject to the Fair Labor Standards Act, as amended, isauthorized to reimburse employees for all authorized overtime by granting compensatory time as specified above or bypaying money from funds appropriated by thisAct at the rate of 1% times the regular rate for the overtime performed." Your second question isanswered in the affirmative. The authority tomake payment in cash isset out in our answer to your question No. 1. Your question asks whether you have authority to include payment for authorized overtime properly accrued at the time of death or separation of the employee from employment with the department.

Overtime pay isnot a separable stipend. It ispart and parcel of the compensation called for inthe employee's

-5636-: Honorable David Wade, M.D., Page 31 (M-1155)

contract, and isproperly payable, if accrued, at the time the base pay ispaid. The employee has avested right in overtime pay themoment itaccrues under his contract of employment.

Your third question brings into consideration Section 6ofArticle VIII of the Texas Constitution. That section provides that nomoney shall be drawn from theTreasury but in pursuance of specific appropriation made by law.

In our opinion thenecessary specific appropriation for overtime pay isprovided by the same appropriation that provides for regular pay of the employee. The designation given this sumwill no doubt vary from institution to institution. Each employee's warrant, including his overtime, should be charged to that fund.

See National Biscuit Co. v. State, 135 S.W.2d 687, page 693 (Tex.Sup. 1940).wherein itwas said:

"As just stated, one of the provisions of Section 6 ofArticle 8of our Constitution requires all appropriations ofmoney out of the State Treasury tobe specific. It is settled that noparticular form ofwords is required :o render an appropriation specific within the meaning of the constitutional provision under discussion. It issufficient if the Legislature authorizes the expenditure by law, and specifies thepurpose forwhich the appropriation is made. . . ." Conceivably an institution which had not planned on paying in cash for overtime might run lowon funds in the item towhich salary and bvertime are charged. There is some measure of relief inArticle II, Section 15, Subdivision c, of the Current General Appropriation Act (S.B. 11,Acts of 62nd Leg., R.S. 1971, as amended by S.B. 7, 62nd Leg., 1st C.S. 1971, P. 11-48, 3489), which reads as follows:

-5637-i’ i:’

I i il
II I !i . .

Honorable David Wade, M.D., page 4, (M-1155)

“C. It is the intent of the Legislature that the appropriations made herein to the Department ofMental Health and Mental Retardation and to institutions and agencies under its jurisdiction shall be expended as nearly aspracticable for the purposes specified; however, upon a finding by the Board of Mental Health and Mental Retardation that any funds inexcess of the needs forwhich they were appropriated could be used more efficiently and effectively for other purposes forwhich appropriations have been made, said Board ishereby authorized to transfer any such excess from one item of appropriation to another. "It isprovided, however, that no such transfer shall be made from appropriations for salaries of classified positions." SUMMARY ------- The Texas Department ofMental Health and Mental Retardation isauthorized tomake payment in cash to its employees who are subject to the provisions of the Fair Labor Standards Act for authorized overtime. The Texas Department of Mental Health and Mental Retardation isauthorized tomake payment incash to the appropriate person for authorized overtime properly accrued to an employee at the time ofhis death or separation from employment with this Department. Payment of overtime shall bemade from the same fund or account towhich appropriation is made forpayment of the employee's base pay.

-5638-Honorable David Wade, M.D., page 5, (M-1155)

truly yours,

eyGeneral ofTexas Prepared by James S. Swearingen Assistant Attorney General APPROVED: OPINION COMMITTEE Kerns Taylor, Chairman W. E.Allen, Co-Chairman John Reeves Michael Stork S. J.Aronson Robert Lemens SAMUEL D. MCDANIEL Staff Legal Assistant ALFRED WALKER Executive Assistant NOLA WHITE First Assistant

-5639-