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## THEATTOIZNEYGENEEZAL OFT'EXAS

November 6, 1963

Honorable John H. Winters Opinion No. c-172 Conunlssloner State Department of Public Re: Whether the State DepartWelfare ment of Public Welfare is Austin, Texas authorized to continue their agreements with the Federal Government as reDearMr. Winters: gards the Merit System.

Your opinion request states that the State Department of Public Welfare, hereinafter referred to as the Department, receives substantial grants-in-aid necessary to its operation from the Federal Government. Asa condition of qualifying for such grants, ,agreements are made with the Federal Governmentwhich include the requirement that the Merit System of Personnel Administration be followed by the Department. You state that:

"Over a period of years the State Department of Public Welfare has officially operated under aMerit System of Personnel Administration as required byTitles I, IV, Section 3of V, X, andXIVof the Federal Social Security Act as authorized by Section 4, Subsection (1Oj %!' the Public Welfare Act of 1941, as amended, being HouseBill No. 611, Acts of the 47th Legislature, Regular Session, 1941, andbeing codified as Article 695~, Vernon's civil Statutes." Your request states that under the above Merit System salary increases are based onwritten satisfactory evaluation of work performed andare not automatic , andtherefore in principle are similar to the Merit Salary Increases provisions in Article V, Section 1, Subsection Lof HouseBill 86, Acts of the 58th Legislature, 1963. However, the provisions of these twoplans are not identical, particularly as to the length of time requlred between merit increases, the initial date that such merit can be recognized, andthe numberof employees eligible for such recognition.

-831-Hon. JohnIi. Winters, Page 2 (C- 172 )

Article V, Section 1 of HouseBill 86 states that, except where otherwl.se speclfically.provided, expenditures for employees* salaries in classified positions shall be governed byeandbe in conformity with the provisions of such Section. However, within the provisions of HouseBill 86relating to the Department, the following appears at page 111-186:

“Salary adjustments andmerit system increases shall be governed by agreements with the Federal Governmentprovided, however, that such agreements donot exceed the provisions in this Act governing the operation’of the State Employees Classlflcation Plan.” You therefore ask our opinion concerning the following question:

“DOthe Statutes andthe Appropriation Act permit a Salary Classification Plan under the Merit SystemRule with abeginning step for each position not above Step 1 of the State Salary Classification Schedule andfor Intermedlate steps to which employees maybe advanced at stated intervals as maybe agreed by the State Department of Public Welfare andthe Federal Agencyso long as the maximumsalary paid does not exceed the maximumfor the group to which the employee Is assigned as provided in the State Classification Salary Schedule under the State Salary Classification Plan?” Theuse of the Merit Systemby the Department was first authorized in 1941 whenthe Le islature enacted Article 695c which provides at Section 4 (107that the Department shall:

“(10) Haveauthority to establish by rule andregulation a Merit Systemfor persons employed by the State Department of Public Welfare in the administration of this Act; and shall provide by rule andregulation for the proper operation andmaintenance of such Merit System on the basis of efficiency andfitness; andmayprovide for the continuance in effect of any andall actions heretofore taken in pursuance of the purposes of this subsection. TheState Department is empoweredand authorized to adopt regulations that maybe necessary

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Hon. John H.Winters, page 

## 3(C472 )

to conform to the Federal Social Security Act approved March 14, 1935, as emended, and shall have the power andauthority to provide for the maintenance of aMerit System in conjunction with anyMerit System applicable to any other State agency or agencies operating under the said Social Security Act as amended. "The Social Security Board shall exercise no authority with respect to the selection, tenure of ,office, and compensation of any individual employed in accordance with such methods." After sometwenty years of operation by the Department under the Merit System Rule, the Legislature such in the !Position Classification Act a ain acknowledged % ",codified as of'19 1, Article 

## 6252-11,

Vernon's Civil Statutes, which recites in Section 

## 5that:

!I

. . . "The preceding twoparagraphs of this Section, however, shall not be construed as abrogating statutory authorizations for certain State agencies to operate under employee merit systems as a condition for qualifying for Federal grants-in-aid; andall such merit systems as have been or mayhereafter be agreed to by the respective State agencies andagencies of the U.S. Government shall be in full force andeffect, subject only to the applicable laws of this State." In addition, it is also observed that while the Department is covered by the classification of employees, Its employees are not fully within the salary schedule accompanying such classification. In nearly every instance maximumsalaries are nohigher than an amount equal to Step 

## 3of the Salary Schedule, and.therefore starting salaries usually fall below that prescribed by Step 1. The only counterbalance to these deficiencies is the Merit Systemwhich allows for the continued andregular recognition of meritorious service.

Aconsideration of all of the foregoing factors leads us to the conclusion that the Legislature waswell aware that the Department's operation is substantially affected by agreements with the Federal Government, andthat it recognized the condition of a Merit System in order to qualify for such grants-in-aid.

-833-- .

Hon. John H. Winters, page 4 (C-172 )

Further, in viewing the Classification System broadly as aplan to place all State employees of a sameclass on an equal basis as far as possible , weare unable to perceive howthe continuation of the agreements with the Federal Governmentwill violate this principle with the fact in mindthat the Department is already at a comparative disadvantage salary-wise.

Therefore, in consideration of all of these factors, it is our opinion that the Department's agreement as set forth in the question presented is authorized andthat a continuation of the Merit System is authorized. SUMMARY Agreements between the State Department of Public Welfare andthe Federal Government, as regards the Merit System, are authorized so long as beginning salaries donot exceed Step 1 and maximumsalaries do not exceed Step 

## 7of the Salary Classification Schedule. Very truly yours, WAGGONER

CARR Attorney General

pp:mkh Assistant APPROVED: OPINIONCOMMITTEE W.V. Geppert, Chairman Pat Bailey Paul Robertson Nicholas Irsfeld George Gray APPROVED

FORTHEATTORNEY

GENERAL BY: Stanton Stone

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