Court Opinion

ID: 4138345
Source: CourtListenerOpinion
Date Created: 2017-02-18 02:35:18.999697+00
Date Added: 2024-06-11T14:45:16.291067
License: Public Domain

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                                                             R-797
                  rE              ORNEY        GENERAL
                                    a‘EX&3

                                    November   7,   1947.

      Hon.   0.   II.   Cavners     Oplnlon No.. v-427,
      Thet @tate Auditor
      Auatln  11, Texas             lb:    Thb l pplloabl5lty’ of the a
                                           general pxovlrionsIn tb
                                           ourt-ent Departmental Apptio-
                                          ‘jwiatloa Bill to the Texas
                                          Employlueat Comm1ss1bn.

                ‘Ue’refer  to four letter  of September 8,
      1947, in which jou request the opinion of this
      department as to whether or not the Texas BmplOy-~
      ment Conmilsslon~ is now a State Department or Agency
      to the extent that It and its employees come under
      the lavs which regulate generally    other State Depart-
      ments and the General Provisions    of the current
      Departmental Appropriation   Act a
                   In order to fully comprehend the status of
      the Texas Eaploymnt Commission and its relation        tom
      the laws ,which generally     regulate other State Depart-
      mentr and the Genekal Provisions       of the current Depart-
      mental Approprlatlon      Act, IO LB neoeesary to exemlne
      the Irederal Statutes a8 vsll a8 the State Statutes.
      Thlr Is lndllrpensable for the reason      that the unemplof-
      mnt compensation acts bdopted In the several States
      wore rubrtantielly     contemporaneour and were adopted
      purrubnt Go and lm iccord wfth the Irederal SoolU
      58ouri-Q   Aat.    M1. are deri&md to operbt& to@hex’
                                    Meward Hbah. Co. v. Dada,
      ~lbv:~~~ryi%m3~                log A* L a 1eg3* car-
      rloheal ;: 804Ji8 r1) coal 8 c&e co, 361 i. 8. 495
      57 3. Ct. 868,  109 A. t. A, 13273 46 A8. JW. p. &.

                   The Texas limployment Connnissfon 18 a State
      &ency and its employees me State employees.         It vaa
      contemplated ynder this coordinated Federal mad State
      unesplment      compensation system that the admlnlstra-
      tlon thereof would be handled through designated State
      agencies.     The Commlssloti vaa designated b the Legle-
      l..t;;Wa;a   the State Agency to admlnlater t 3:Is sySt8m
                 s
                                                                  -..

Hon. C. If.Civness,            page 2     V-&7

           Under this coordlaated      Federal and State
unemployment compensation eyitem, the Federal <)overn-
Pent usea the taxes that It collect8         to pay the costr
of administering   both the Federal and Nate plan8 and
the amounts collected     bJ Ahe%State8 are used ao161f
la the payment of~benaflt8~to       unemplq~~workerr.
*hi8 mop- uwd to d~~a,;idri8iltruti~'CO8t             i8 sent
t* tb nveral     Sta~e'",bJr:,bb~~l~~t~~,.oi,~:~ TMa8UrJ
upon & certiflcatrcmY~o8~  the -Social: ~Sedurlty Boaql.
we quote fror 432U.zLC.A,, S8&502,:     1a:pwt: aa*~follarr:
              a(a).The:'Board, @hall iron time to :tlm
      certiij.to'the       Secriqxy    of the,Treaeury for
      payment' to,:each:State      "uhich ha8 an ugemploy-

             Section         503 oi Tit16 42 of 0. 8. C. A.
provide?:                                        .'
           “(a) She Board &all make Qe @*&tlfia&
      t&on for p4QJIeat tP &lay etatie llnxess it find8
      that the law oi rodb &ate,      approaed by the
      wbrd uabar $eotia8    1600-1611 Of st1e     26,
      includes       provirioP     for-
             "(1) &ach rithods     of adali#l~atratSo~
      (including     afteln faauary 1, 1940, sethods
      mlatlng     to the establl@ment      Bw *tint*-
      name of personnel afandarda on a arePIt
      basis,    except that the board ehall exerclsq
      no authority vlth Peapeet to the 86leotion,
      tenure Of office,       and oQ8psasbtion Of q
      individual     emplqed in acoordanee vlth saoh
      wthodr)     a8 ~IW f'ou@ by the Board to be
      reasonably caloulatad to insure full payment
      of une8ploy8ent      eorpensation  when due;
             e   .   .   l

             "(8) pffeotivs         July 1, 1941, the 'expendt-
      ture   Of IIll Mw8           rooelvedpbIk'8lllllt t0 BeC-
      tion 502 of this title    solely for the ourposes
      and In the emouat8,found necesa      J bs the Board
      for the proper and ef'ficient    admitiistration
      of such state law. . . ." (mphasia supplied)
P   .

        Hon. C. I?.   Cavness,   page   3'   V-427

                  The remaining provisions in the above quoted
        sectlon provide that in the event the State Agency
        charged with the administration of the State Unemploy-
        ment Compensation Law falls to carry out the require-
        ments of the Bond, the Board shall make no’certiflce-
        tlon for paputs   to the recalcitrant State.
                  The applicable provisions of our State Law
        are found in Article 5221b, R. C. 3,
                  Section 9 thereof contains the following
        provlslone:
             It ,h~;)b~tl,“md;;; ;owerz ;‘,om$~~l~~:
                          h        f th         1
             administer thls Act; and it shall hsve
             power and authority to adopt, amend, or
             rescind such rules and regulations, to
             employ such persons, make such eendi-
             tures, require such reports, make 83
             investigations, and take such other ac-
             tion as it deem necessary OP sultabla to
             that en&:

                                                           ,

             as the Social Security Boar@ mey from time
             to time require, and shall comply with such
             provi8lons as the Doclal Security Board msy
             from time to time find necessary to assure
             the correotness and verlflcstlon of such

                   Section 11 of Article 5221b provides
        as f allows:
                   “(a) Spa1    Fund,: There is hereby
              created in t e mreasurg        a special
              fund to be known ‘as the Unemployment
Hon. C. B. Csvness,   page 4     v-k27

     Com$ensation AdministratIon Fund. All
     moneye which Bpe deposited or paId into
     this fund are hereby appropriated    and
     made available   to the Commission and
     shall be coatlnuousl~   avallable~to  the
     Commieaion for expenditure in accordance
     with the provisions   of this Act and shall
     not 1aDse at am time or be transferred

     appropriated by this State, all ro’n@yr
     received rrom the United States of Amorlob
     or any agency thereof*  including the &&rai
     Qecurlty Board. . . . (Emphasis added)
            The above quoted provisions   reveal an
unrletakablo   intent on the part of Cowrear and the
Texas Legislature    that all moneys received froti tbs
Federal Government under ?Pltle III of the Social
Security Act can be expended only in the amounts
and la accordance with the standtU+ds of the Social
Seourity  Administration   and the rules and regula-
tions adopted by the Commission to meet such etsnd-
arde .
            The Texas Employment Commlasion Is also the
State Agency designated to.admlnlster      the employment
rervlce in cooperation   with the Federal Government.
Article   5221b-10, R. C. 9. This service was taken
away f’rom the States by executive    order during World
War II, and was not returned to the States until
November   16, 1946. The Federal i3overnment,likewlao
furnishes the funds necesrrary to adrainlater     thie
program.    These funds are authorized to be paid to
the States by the Secretary of Labor by ceFtlfyin$
to the Federal Security Administrator      the amount ta
be paid to the State aad the Federal Security Admlnlr-
trator then certifies   this amount to the Secretary of
Treasury in addition to the amount payable under Eec-
tlon 502(a) of Title 42.      This money likewlse   however
must be expended according to the rules and standards
prescribed   by the Federal Agency.    We quote from 29
U.S.C,A.,   Sec. 4gh, as follows:
Hon. C. H. Cavness,     page 5      V-427

             “Each State’ agency cooperating      with
      the United States Employment Service under
      Section8 49-49C, 49d, 49e-49k of this title
       Shall m&e such reports concerning its oper-
      ations ,and expenditures    as shall be prey-
      crlPed by the Federa SecuPltF Adminlstrtior.
      It &ml1 be thwdll       o? the AdmlnlstrPtor       to
      eecertaln   whqther 8 b system o? Pub110 bmplq-
      rent offices   maintained in each Stite is con-
      ducted In accordance w.ith the riij.es and regu-
      lations   and the standards oft efficiency       mes-
      cribed by th6 Administrator      in: ,accordance
      with the Provisions    of said sections.       TAO
      administrator   may revoke any existing       cer-
      tlfiCates   or withhold an further certificate
      provided for in section 5 gf of this title,
      whenever he shall determine, as to any State,
      that the cooperatinn    State wencg has not
                    ended the moneys naid to it or
                                     ,to be apmri,!ated
                                     e with plans a
      added 1
           The States are still     operatin& under the
Wagner-Peyser Act of 1933 which requ.iTea the submls-
sion of a detailed     plan of operation’,by each State
and the strict   adherence   to such plan as well as to
the Pules and r%gulations Promulgated bJ the Director
Q? the United States Employment Llervice and the Secre-
tary of Labor.    It will be noted that the United States
Employment Service Issues statements of policy which
must be adhered to by the States.
          It follows that the moneys allotted   to the
State for employment service purposes by ,the Federal
Government can be expended by the State only in accord-
ance with the plans approved undgr theso sections.
           Under these cooperatU+     e&avors    the several
Federal Agencies give to the!‘iSt&te t,he, Q&ndaxds far the
State to follow in formulating     the nules. ahd regtilations
relative  to variour  lrgstems. After the State, has pre-
Pared ita rules and regulitiont+,,, thpse,. are iubmittsd to
the Federal Agencis8 for approval, ‘and once they ar8
approved they aannot be altered, or changed ,without first
securing the aPpFova1 of the Federal Agencies.
                                                                     -   -

     Hoa. C. H. Cavnees,     page 6     V-427

                  These approved plans,as they a.%%called,
     are very detailed      aud cover every phase of the
     admlnlstratlon      or the &qts and tho e~psad&twes
     that are lnade in oonneatfog therewith.          To deaon-
     strata;    we rerer to the personnel o? the Comalsslon.
     The reoruitlng      or its employees ie done through a
     merit eystem, which sTatem must be operated %iccord-
     ing to the standards prescribed       by the Federal
     Agencies.      75ach employee auat oome within a cer-
     tain, classification      doaignated under a comprehen-
     sive cLaaslfioattoa       plan which prescribes     the title
     of each employee; a description       of’ the duties and
     responaibllitler,      the rinimum requirements of traln-
     lng, experience,      education and other qua)lflcrtlonsO
     Each employee is patd according to a comprehensive
     compensation plan which includes salary schedules
     for the varlous classes of employees, and it is
     definitely     provided that no employee can be paid
     a salary unless It conforms to the plan and la at
     one OS the salary levels established         for the class.
                !Phe tsglalature  of Texas has reoogW?ied
     the necessity   of extensive Oooperation vith the
     Federal &enoy as Is shown by the previously     quoted
,.   strtutrs  and the follolQiag quotation from the Depart-
     mental Appz’opriation   Bill:
                 ‘Al$ Bloneys granted to this State by the
          Federal Gooernment for the admSnistrat5on of
          the Uaemplogaent Compensation Act We hereby
          a propristed     to bs expended for purposes far
          wii ich such moneys were granted.      Ilotwithstand-
          lng any othsr provisions      or this Act, moneys
          granted for travel shall be expended in the
          amounts and in accordance with the standarti
          of the Social Security AdministratSon and
          the United States Bmployment Service of the
          Department of Labor and the rules and regu-
          lations    adopted by the Unemployment Compensr-
          tion CoeeDlsaZon to meet such rtandWds.          out
          or rthtr towel      expenee paid~ solely rroa
          FrdeWl gWitd, and llaade in aiXN&UV3e with
          the Federal 8tbndaPds as being nscssfbary rm
          proper ad&oist.ratSbn      of the Dnemploament
          CompensatSon Act shall not require approval
          by the Attoraey benerrl.
Eon. C. Ii. Cavness,    page 7    V-427

             “Salaries  of the employees of the Unem-
       ployment Compensation Commission and members
       of the Commission shall be paid in accordance
       with agreements made between the Commlsslon
       and the Social Security Administration    and
       the United States Employment Service of the
       Department of Labor, but in no case shall
       such salaries   be less than those authorized
       by the Act creating the Unemployment Compen-
       sation Conxuisslon.
             “It Is specifically   provided that all
       moneys now on deposit to the credit of the
       Unemployment Compensation Fund, and all
       moneys reoelved for the credit of such fund,
       are hereby appropriated   for the payment of
       benefits   and refunds hs authorized by the
       provisions   of the Unemployment Compensation
       Law.” Vol. 6, Vernon’s Texas Session Laws,
       50th Legis.,   1947, P. 930.
           The reason the Legislature has acted in the
manner above set forth becomes apparent when we realize
that all of the funds used in the administration   of
these systems sxe furnished by the Federal Government
and none are furnished by the State.   Under the Federal
enactments, the Federal Oovernment will continue to
furnish such funda only as long as the Commisslon com-
plies with the rules and regulations  of the Federal
Security  Admlnlatrator with Z?egaPQto the expenditure
OS the moneys so furnished,
              The paragraph In the Departmental   Appropria-
tlon   Act,   page 930, which reads:

             “Al.1 the above items appropriated  for
       administration   to the Texas Unemployment
       Compensation Commission shrll be subject          .~
       t0 the SpprOVU Or the Lsglslatlve     Audit
       Committee and none or the funds herein
       provided ahall be spent until   such lpprovaI           .
       shall have been obtained,”
does not change the policy of having the funds supplied
by the Federal government to be ex
with the standards     rescrlbed   by &?~~&~~la~~~~“~Y
Thls provision  appl f es insofar aa it Is not in conflict
with the general provisions      of the Texas Unemployment
Compensation Act and the standards and regulations
approved by the FedoraI Agencies.
                                                                 .   -,-

Hon. C. H. Cavness, page R       V-42?

          As has been previously noted, the employmept
service was taken over by the Federal QovernllSent"during
World War II under Executive Order. This service was
returned to the States effective November 16, 1946, and
the sdmlnistratlonof the service will continue to be
financed solely by Federal Funds at least up to July 1,
1948. As a precautionsPymeasure, the Legislature of
Texas appropriatedout of the General Fund certain items
to be used to match between five and ten per cent of the
Federal Funds used In the administrationof the employ-
ment service in the event Congress re ulres such a match-
ing program subsequent to July 1, 194?i. These Items are
regulated by the general laws of Texas ana have been so
recognized, as is evidenced by an Attorney Qeneral'a
opinion addressed to the Board of Control, dated July 13,
1 9 37   l

          In view of the foregoing it 1s our opinion
that although the Texas Employment Commission Is a State
Agency and lts,employeesare State employees,yet with
respect to Federal Funds expended they are primarily
governed by the standards prescribed by the Social
Security Administratorand the United States Employ-
ment Service of the Department of Labor and the rules
and regulations adopted by the Comm$sslon to meet such
standards. Otherwise the,generalprovisions of the law&
of this State are applicable.

              The Texas Employment Commission IS a State
         Agency and its employees BPB State employees.
         However, Federal Funda expended for admlnistra-
         tion of the agency sre primarily governed by the
         standards prescribed by the Social Security Admin-
         istrator and the United States Employment Service
         of the Department of Labor and the rules and regu-
         i;gr;ddopted    by the Coamlssion to meet such
                     Otherwise, the general provisions of
         the laws bf this State are applicable. 29 U.S.C.)?.,
         Sec. 29h; 42 U,S.C.A., Sections 502, 502(a);  Article
         5221b-Sectionsg(a), 9(i), 10 and 11, R. C, 9.
                              Very truly yours
                              ATTORREY CiEmERALOF TEXAS
                              By 4::. r--z.?&%&-
                                         Robert 0. Koch
                                              Assistant