682 F.2d 944 | Ct. Cl. | 1982
Lead Opinion
delivered the opinion of the court:
In this civilian pay case we are called upon to decide whether the executive branch, pursuant to its anti-inflation program, may limit pay increases of certain prevailing rate employees to the rates of increase imposed on other federal employees by statute. Specifically, we must decide whether the phrase "as nearly as is consistent with the public interest” in the statutory provision for prevailing rate
Plaintiffs here are the National Maritime Union of America, AFL-CIO (NMU),
I.
The mariners in this case are employed by the Government on ships operated by NOAA and MSC. They are prevailing rate employees, which means that their wages are set generally in accordance with wages in comparable private industry jobs in the particular locality, rather than in accordance with a uniform nationwide system like the General Schedule.
As implemented, prior to fiscal year 1979 (beginning October 1, 1978), the effect of section 5348(a) had been that the increases in federal pay equaled those paid by private industry under collective bargaining agreements with NMU. Beginning in fiscal 1979, however, Congress, concerned with the rising rate of inflation, imposed ceilings on the pay of Government employees. Congress enacted these ceilings for the fiscal years 1979,
Nevertheless, in fiscal 1979 and 1980, the President directed the agencies to place a 5.5 percent ceiling on pay increases for, among others, the employees here concerned. The President’s memorandum,
The success of our anti-inflation effort is critical to the economic well-being of the nation. To achieve this success, it is vital that the Government in managing its own affairs, join with the rest of the nation in a positive commitment to reducing inflationary pressures. Accordingly, I have determined that it would be inconsistent with the public interest for any category of Federal pay rates to be increased by more than 5.5 percent during fiscal year 1979.
* * * * *
In the public interest to control inflation, each officer or employee in the executive branch who has administrative authority to set rates of pay for any Federal officers or employees should exercise such authority, to the extent permissible under law, treaty, or international agreement, in such a way as to ensure that no rate of pay for any category of officers or employees is increased more than 5.5 percent during fiscal year 1979. * * *
A similar order, using the same language, was promulgated for fiscal 1980 by the Director of the Office of Personnel Management (OPM), limiting fiscal 1980 pay increases to 7.02 percent.
Plaintiffs have also challenged certain overtime and premium pay practices of NOAA in connection with the pay ceilings. In fiscal 1979 (June 6, 1979) and fiscal 1980 (June 16, 1980), MSC increased premium pay by 7.5 percent and 12.83 percent, respectively (the industry rate), while NOAA did not. MSC also paid overtime at these above-ceiling rates, while NOAA did not. The Government confesses judgment as to the unpaid NOAA premium pay, but
II.
The statutory provision for prevailing rate employees (the prevailing rate system) is found in subchapter IV of chapter 53 of title 5, United States Code, comprising sections 5341 through 5349.
It is the policy of Congress that rates of pay of prevailing rate employees be fixed and adjusted from time to time as nearly as is consistent with the public interest in accordance with prevailing rates and be based on principles that—
(1) there will be equal pay for substantially equal work for all prevailing rate employees who are working under similar conditions of employment in all agencies within the same local wage area;
(2) there will be relative differences in pay within a local wage area when there are substantial or recognizable differences in duties, responsibilities, and qualification requirements among positions;
(3) the level of rates of pay will be maintained in line with prevailing levels for comparable work within a local wage area; and
(4) the level of rates of pay will be maintained so as to attract and retain qualified prevailing rate employees.
The structure of subchapter IV indicates that section 5341 relates generally to the entire subchapter, just as the definitions section (§ 5342) does.
Sections 5343, 5348, and 5349 provide the specific authority for setting wages for different groups of employees. Section 5343 covers the vast majority of prevailing rate employees;
(a) * * * the pay of officers and members of crews of vessels * * * shall be fixed and adjusted from time to time as nearly as is consistent with the public interest in accordance with prevailing rates and practices in the maritime industry.
Both of the sections of particular significance here, 5341 and 5348, contain an identical formula: "fixed and adjusted from time to time as nearly as is consistent with the public interest in accordance with prevailing rates.” These are the operative words of section 5348(a),
A.
The first question to be addressed is whether section 5348(a) permits any agency discretion at all in the setting of wages or whether it simply mandates equivalence between
The language of the key phrase commands such an interpretation. "[A]s nearly as is consistent with the public interest” qualifies or limits the main thrust of the sentence, which is "fixed and adjusted from time to time * * * in accordance with prevailing rates.” We may draw two conclusions from this structure. First, the primary purpose of the statute is to ensure that the pay of these employees will be comparable to those in the private sector.
The existence of the countervailing considerations has been recognized in the three leading cases interpreting section 5348(a) and its predecessors (which use identical language): Blaha v. United States,
We think Congress meant to authorize Government agencies * * * to adopt private industry pay practices * * * subject of course to the "public interest” exception * * *
And the court in Daniels
[T]he stated provision vests the Secretary of the Navy with great discretion in setting wages. It is his administrative responsibility to determine how closely the salaries of the specified personnel can parallel the maritime*66 industry’s rates and still be "consistent with the public interest.”
The question whether the pay shall be fixed in accordance with, or nearly in accordance with, and, if the latter, how nearly to, prevailing rates, depends upon the public interest. The point, summed up in Daigle, is that the phrase "consistent with the public interest” creates discretion in the agency in appropriate circumstances to decline to set federal wages at exactly the same rate as industry wages.
Not only does the 1949 phrase create discretion in the agency by setting up a countervailing consideration to equal pay, but the discretion it creates is broad,
B.
The phrase, "as nearly as is consistent with the public interest,” does not give agencies a great deal of guidance in determining when they may set maritime wages at less than parity with industry. Moreover, the case law by and large does not address this level of the problem; rather, it concentrates on the existence and breadth of discretion.
The Court of Appeals for the District of Columbia Circuit, however, has directly addressed the problem of the content of the public interest in subchapter IV. In National Federation of Federal Employees v. Brown, the court of appeals, over a dissent, held that "the public interest” in section 5343 (structurally cognate to 5348(a)) has no independent meaning beyond the four principles enumerated in section 5341.
The National Federation of Federal Employees case involved nonappropriated fund workers whose salaries, while governed by the prevailing rate statute, are not paid out of appropriated funds. Like plaintiffs, they were not named in the fiscal 1979 pay ceiling, but their fiscal 1979 pay increase was frozen at 5.5 percent pursuant to the President’s memorandum. The district court held that the administration’s anti-inflation policy was a legitimate exercise of the public interest provisions, and, absent any indication that the pay ceiling act specifically required equal pay for nonappropriated fund workers, the administratively imposed pay cap was effective.
The court of appeals reversed. It noted that an important purpose of the 1972 overhaul of the prevailing rate system was to provide guidelines for executive action.
Judge Robb, dissenting, argued that the public interest has the broad meaning the Government would give it.
In my judgment the prevailing rate statute means what it says: the executive has discretion, in the public interest, to deviate from wage schedule figures. So long as he does not abuse his discretion I think he does not exceed his authority. *** He reasonably and properly concluded that the wage schedule rates were inflationary and therefore not "consistent with the public interest.”
The district court also emphasized that the "plain language” of the statute confers broad discretion upon the agency.
The decision of the court of appeals was based exclusively upon its interpretation of section 5341 and its relationship to section 5343. We do not believe that the reasoning of the court of appeals in National Federation is applicable to section 5348(a) for three reasons. First, the principles listed in section 5341 do not eclipse the public interest language even within section 5341, so the four principles cannot completely control section 5348(a). Second, the retention from 1949 of the public interest phrase in section 5348(a) indicates that it, not the four principles, is to be given primary effect in interpreting section 5348(a). Third, section 5348(a) was intended to be a restatement of pre-1972 law, so the principles added in 1972 could not change significantly the meaning of section 5348(a).
1. Even the language of section 5341 itself
This interpretation is not at all inconsistent with the 1972 legislative history to the effect that Congress wanted to supply guidelines for agency discretion.
It has been held by this court that "the public interest” in the 1949 phrase is a limitation on the equal pay policy.
While this produces a tidy system, it unrealistically restricts the scope of the public interest, an expansive concept encompassing a broad range of considerations and discretion to deal with them. We are reluctant to ascribe to Congress the intention to give such an expansive term such a cramped meaning, with no clear indication either in the legislative history (of 1949, 1966, or 1972) or in the statutory language. We would stultify ourselves if we ignored our prior rulings which do recognize the independent vitality of "the public interest,” even if we now disagreed with that view, which we do not. We must conclude, therefore, that the principles enumerated in section 5341 merely add to and perhaps also clarify those inherent in the 1949 phrase.
2. The language of section 5348(a) itself offers no support for the theory that "the public interest” is subsumed into the four (or one) principles in section 5341. In the 1972 revision of subchapter IV, section 5348(a) retained the 1949 phrase and only that phrase.
Section 5348(a) also has an independent and longer lineage than section 5341, as we have seen from its language and position in the subchapter. It would therefore
3. The independent heritage of section 5348(a) is confirmed by its 1972 legislative history which shows, well nigh conclusively, that section 5348(a) cannot be governed entirely by 5341. The legislative history expressly states that section 5348(a) is "a restatement of existing law.”
To recapitulate, we do not hold that section 5341 does not apply to section 5348(a). It does, generally. We do hold that the four principles enumerated in section 5341 do not exhaust the meaning of — and hence the range of discretion provided by — the public interest. We come to this conclusion for three reasons: the legal rules governing section 5348(a) predate the enumerated principles and Congress expressly stated that those rules are not changed by the principles;
Congress affected the prevailing rate system by enacting ceilings on pay increases for the fiscal years 1979,1980, and 1981.
The pay ceilings for fiscal 1979 and 1980 are not, however, wholesale revisions of the prevailing rate system. They only limit, as to particular classes of employees, and only for specific years, the upper end of the agency discretion, which is otherwise undisturbed. The acts do not purport to revise or repeal the prevailing wage system any more than pay ceilings on the General Schedule for the same years repealed the General Schedule system.
The legislative history of the fiscal 1979 and 1980 pay ceilings is sketchy in this regard, but it does indicate that the exercise of administrative discretion to limit pay was not antithetical to the congressional intent. The Senate report
This provision would be applicable to all Federal agencies and is based on the desire that all Federal employees be*73 treated equally as to fiscal year 1979 salary increases. [Emphasis supplied.]
Similarly, the legislative history of the fiscal 1980 pay ceiling specifically notes two exceptions to the pay ceiling— workers earning less than $4.22 per hour
Finally, plaintiffs argue that the sudden inclusion of section 5348 in the fiscal 1981 pay ceiling indicates retroactively that the exclusion of 5348 in fiscal 1979 and 1980 was deliberate. While this reading is plausible, the meaning for fiscal 1979 and 1980 of the fiscal 1981 inclusion is at best informed speculation.
To sum up, the pay ceilings for fiscal years 1979 and 1980 are temporary, narrow limitations on the discretion mandated by the prevailing rate system. Since they do not refer to the mariners covered by section 5348(a), the discretion inherent in that provision remains unchanged.
D.
The final question is whether, given the broad administrative discretion conferred by section 5348(a), it was exercised properly. The public interest factor and the exercise of lawful discretion were expressly invoked by the President and the director of OPM in their fiscal 1979 and 1980 memoranda.
Whether fighting inflation by limiting federal wages is in fact "in the public interest” or "critical to the well-being of the nation” is a question about which the court is not empowered to make a judgment on the merits. It is abundantly clear, however, that such a policy is rational and reasonable in light of a particularly recognized and pervasive crisis, and is not arbitrary or capricious. Such judgments are within the executive competence to make and we are in no position to second-guess them.
Certainly a wage survey was not necessary in order to recognize the existence of the inflationary crisis. Nor does any absence of that crisis in the past combined with a past tradition of adopting prevailing schedules convert this system to one subject entirely to negotiated wages.
There are limits, of course, to the discretion inherent in section 5348(a), and we have had occasion to address them. The fundamental limitation is that the discretion not be exercised so as to frustrate the congressional scheme.
In Blaha we found also that it was arbitrary and capricious for the Commerce Department to have one concept of the public interest and the Navy to have another one, diametrically opposed.
The permissible discretion in setting wages under section 5348(a) is very broad and our scope of review correspondingly narrow.
The secondary issue raised by the parties relates to certain premium and overtime pay. In fiscal 1979 and 1980, MSC did not apply the pay ceiling either to premium or to overtime pay. At the same time, NOAA applied it to both. Claiming entitlement to the industry equivalent for both types of pay from NOAA, plaintiffs invoke the Blaha holding that the difference between MSC and NOAA indicated that NOAA had abused its discretion in limiting pay where MSC practice could not be shown to harm the public interest.
Defendant responds with a general theory for the application of pay ceilings to overtime and premium pay. Defendant suggests that the pay ceilings apply to base pay and, by implication, to all pay calculated from base pay. Thus, the fiscal 1979 and 1980 pay caps applied to overtime pay, which is calculated from base pay, but not to premium pay, which is set independently, based on prevailing rates. Defendant therefore confesses judgment for premium pay not paid by NOAA and reserves the right to make a counterclaim for overtime pay improperly paid by MSC.
This narrows the dispute to NOAA overtime pay. We accept defendant’s confession of judgment as to NOAA premium pay; no counterclaim for MSC overtime pay being presently before us,
The application of the fiscal 1979 and 1980 pay ceilings to MSC and NOAA base pay does not depend upon the express language of the pay ceiling legislation but upon an administrative decision that the pay ceiling acts expressed the public interest by reference to which the agencies were to exercise their discretion.
The Governments position, espoused for the first time in their filing of June 5, 1981,
In Part II of this opinion we emphasized that plaintiffs’ case for base pay did not fit into any of the situations in which we had found abuse of discretion, among them the unjustified difference between agencies in Blaha. It follows that with overtime pay, Blaha commands that we grant plaintiffs relief. To exercise its discretion in the opposite way from MSC to the detriment of its employees, NOAA must show either that the MSC pay was illegal or that it was contrary to the public interest.
IV.
As to plaintiff National Maritime Union of America, AFL-CIO, the petition is dismissed pursuant to Rule 61. We conclude, on the parties’ cross-motions for summary judgment, and after hearing oral argument, that the individual
The original petition filed by NMU only was amended, pursuant to our order dated July 3,1980, to name NMU and 34 specific individuals as plaintiffs. Defendant asserts that NMU is not a real party in interest and should be dismissed pursuant to Rule 61.
See Clark v. United States, 454 U.S. 555 (1982).
5 U.S.C. § 5348(a) (1976).
Treasury, Postal Service, and General Government Appropriations Act, 1979, § 614(a), Pub. L. No. 9^429,92 Stat. 1001,1018 (1978).
Treasury, Postal Service, and General Government Appropriations Act, 1980, § 613(a), Pub. L. No. 96-74,93 Stat. 559,577 (1979).
Joint Resolution of October 1, 1980, § 114(a), Pub. L. No. 96-369, 94 Stat. 1351, 1356.
Memorandum from President Carter, 15 Weekly Comp, op Pres. Doc. 8 (Jan. 4, 1979).
Memorandum from Alan K. Campbell, Director of OPM, Oct. 3,1979.
5 U.S.C. §§ 5341-5349 (1976 & Supp. IV1980.).
The first sentence of § 5343(a) reads: "The pay of prevailing rate employees shall be fixed and adjusted from time to time as nearly as is consistent with the public interest in accordance with prevailing rates.” 5 U.S.C. § 5343(a) (Supp. IV1980).
Blaha v. United States, 206 Ct. Cl. 183, 188, 511 F.2d 1165, 1166 (1975). See also Barratt v. United States, 218 Ct. Cl. 242, 247, 585 F.2d 1041, 1045 (1978) (interpreting § 5349 by reference to § 5348).
Classification Act of 1949, ch. 782, § 202(8), 63 Stat. 954,955, originally codified at 5 U.S.C. § 1082(8). In this context, mariners were being excepted from the general classification and wage-setting, which themselves embodied a principle of comparability with compensation in the private sector, a principle clearly subjected to "public interest” considerations.
Act of Sept. 6,1966, § 1 [5 U.S.C. § 5342(a)], Pub. L. No. 89-554,80 Stat. 378,471. The present § 5348(a) was codified in 1966 at 5 U.S.C. § 5342(a). The basic structure of the subchapter governing prevailing rate employees, however, was set at this time.
Act of Aug. 16,1972, § 1(a) [5 U.S.C. § 5348(a)], Pub. L. No. 92-392, 86 Stat. 564, 572. This revision added some sections to subchapter IV, notably § 5341, and renumbered them all, but the present § 5348(a) was not altered in any substantive way.
H.R. Rep. No. 901,89th Cong., 1st Sess. 3 (1965) (no substantive changes intended by recodification); S. Rep. No. 791,92d Cong., 2d Sess. 6,1972 U.S. Code Cong. & Ad. News 2985 (§ 5348(a) restates existing law).
S. Rep. No. 791,92d Cong., 2d Sess. 3,1972 U.S. Code Cong. & Ad. News 2982.
See H.R. Rep. No. 339 92d Cong., 1st Sess. 7-8,19,25 (1971).
See Blaha, 206 Ct. Cl. at 194, 511 F.2d at 1170; Adams v. United States, 141 Ct. Cl. 133, 134(1958).
Blaha, 206 a. Cl. 183, 511 F.2d 1165.
Daniels v. United States, 187 Ct. Cl. 38, 407 F.2d 1345 (1969).
Daigle v. United States, 217 Ct. Cl. 376 (1978).
Blaha, 206 a. Cl. at 191, 511 F.2d at 1168.
Daniels, 187 Ct. Cl. at 41, 407 F.2d at 1347.
Daigle, 217 Ct. Cl. at 384-85. See also Benevento v. United States, 198 Ct. Cl. 772, 461 F.2d 1316, cert. denied, 409 U.S. 1038 (1972); Beatteay v. United States, 198 Ct. Cl. 989 (1972) (order); Benham v. United States, 198 Ct. Cl. 990 (1972) (order); Ayres v. United States, 186 Ct. Cl. 350 (1968); Amell v. United States, 182 Ct. Cl. 604, 390 F.2d 880, cert. denied, 393 U.S. 852 (1968); Adams, 141 a. Cl. at 143; Barratt, 218 Ct. Cl. 242, 585 F.2d 1041.
118 Cong. Rec. 21017 (1972) (remarks of Sen. McGee, floor manager of the bill).
Ayres, 186 Ct. Cl. at 259-60.
Blaha, 206 Ct. Cl. at 189, 511 F.2d at 1167; Benevento, 198 Ct. Cl. at 777-78, 461 F.2d at 1320.
See United States v. Testan, 424 U.S. 392, 406 (1976); Barratt, 218 Ct. Cl. at 248, 585 F.2d at 1045.
Daigle, 217 Ct. Cl. at 386; Daniels, 187 Ct. Cl. at 41, 407 F.2d at 1347.
Daigle, 217 Ct. Cl. at 387.
National Fed’n of Fed. Employees, Local 1622 v. Brown, 645 F.2d 1017 (D.C. Cir. 1981), rev’g National Fed’n of Fed. Employees v. Brown, 481 F. Supp. 704 (D.D.C. 1979), and American Fed’n of Gov’t Employees v. Brown, 481 F. Supp. 711 (D.D.C. 1979).
National Fed’n of Fed. Employees, 481 F. Supp. at 707-10; American Fed’n of Gov’t Employees, 481 F. Supp. at 716-18.
National Fed’n of Fed. Employees, Local 1622, 645 F.2d at 1023-24.
Id., 645 F.2d at 1024-25.
Id., 645 F.2d at 1027-28 (Robb, J., dissenting).
National Fed’n of Fed. Employees, 481 F. Supp. at 707-09.
See text at note 9, supra.
See notes 12-14, supra.
118 Cong. Rec. 21017 (1972) (remarks by Sen. McGee), cited in National Fed’n of Fed. Employees, Local 1622, 645 F.2d at 1023-24.
Daniels, 187 Ct. Cl. at 41, 407 F.2d at 1347; Blaha, 206 Ct. Cl. at 191, 511 F.2d at 1168; Daigle, 217 Ct. Cl. at 384-85.
5 U.S.C. § 5341(2), (3), (4). In the instant case, as in National Fed’n of Fed. Employees, Local 1622, parity with the collective bargaining agreement would easily meet these three criteria: the private system no doubt has the elementary gradations imposed by § 5341(2); it obviously would be the same as the private sector as required by § 5341(3); and such parity would necessarily tend to attract and retain quality personnel as mandated by § 5341(4).
National Fed’n of Fed. Employees, Local 1622, 645 F.2d at 1024-25. Indeed, the case’s precise holding is that the Government failed to consider and balance the conflict between § 5341(3) and § 5341(1). Id.
Compare 5 U.S.C. § 5348(a) (1976) with Ppb. L. No. 89-554, § 5342(a), 80 Stat. 471 (1966).
Compare American Fed’n of Gov’t Employees v. Campbell, 659 F.2d 157, 163 (D.C. Cir. 1980) ("public interest” in §§ 5341 and 5343 "surely provides agency officials with some flexibility in setting wage increases”).
The statute might have read, for example, "set in accordance with the policy expressed in section 5341 of this title.” However, it does not.
S. Rep. No. 791, 92d Cong., 2d Sess. 6,1972 U.S. Code Cong. & Ad. News 2985.
H.R. Rep. No. 339, 92d Cong., 1st Sess. 18 (1971). See also 117 Cong. Rec. 27685 (1971) (remarks of Rep. Griffin, supporter of the bill).
Blaha, 206 Ct. Cl. at 189, 511 F.2d at 1167; Daigle, 217 Ct. Cl. at 381, 383.
Benevento, supra note 24; Daniels, supra note 20; Ayres, supra note 24; Amell, supra note 24; Adams, supra note 18.
Both Blaha and Daigle relied on Daniels.
It is this aspect of § 5348(a), not present in § 5343, which may well distinguish the instant case from National Fed’n of Fed. Employees, Local 1622. To the extent that § 5343 was changed in 1972, the rule announced by the court of appeals in that case could never be dispositive of the instant one. If that is the case, § 5341 would have a different effect on — indeed, meaning for — § 5343 than on § 5348. While there is no direct authority in the statutory structure or legislative history for such a difference, it is not necessarily an implausible or unworkable result.
See notes 4-6, supra, respectively. Each act will be referred to by the fiscal year in which it was effective: Pub. L. No. 95-429, § 614(a), in fiscal 1979; Pub. L. No. 96-74, § 613(a), in fiscal 1980; and Pub. L. No. 96-369, § 114(a), in fiscal 1981.
Pub. L. Nos. 95-429, § 614(a), and 96-74, § 613(a), covered employees described in § 5342(aX2XA), while Pub. L. No. 96-369, § 114(a), covered both §§ 5342(aX2XA) and 5348.
See, e.g., Treasury, Postal Service, and General Government Appropriations Act, 1979, § 614(a), Pub. L. No. 95-429,92 Stat. 1001,1018 (1978).
S. Rep. No. 939,95th Cong., 2d Sess. 56 (1978).
H.R. Rep. No. 471,96th Cong., 1st Sess. 16 (1979) (conference report).
Id.
The problem is in attempting to determine intent retroactively. Plaintiffs’ argument that § 5348 was to be excluded would be far more compelling if § 5348 had first been included and then dropped.
See notes 7,8, supra.
Daigle, 217 Ct. Cl. at 386-87.
Daniels, 187 Ct. Cl. at 41, 407 F.2d at 1347.
Blaha, 206 a. Cl. at 194, 511 F.2d at 1170.
118 Cong. Rec. 21018 (1972) (remarks of Sen. McGee); 117 Cong. Reo. 27684 (1971) (remarks of Rep. Hanley).
Amell v. United States, 384 U.S. 158, 163 (1966). This, of course, compares with the policy in § 5341(1) of equality among federal employees in a locality. See also Daigle, supra note 21; note 54, supra.
See also Barratt, 218 Ct. Cl. at 250, 585 F.2d at 1046.
Blaha, 206 Ct. Cl. at 195, 511 F.2d at 1170.
Id., 206 Ct. Cl. at 196, 511 F.2d at 1171.
Memorandum from President Carter, supra note 7.
Blaha, 206 Ct. Cl. at 196, 511 F.2d at 1171.
See Daigle, 217 Ct. Cl. at 386-87.
See notes 27, 29, supra.
Daigle, 217 Ct. Cl. at 386.
Daniels, 187 Ct. Cl. at 42, 407 F.2d at 1347.
Blaha, 206 Ct. Cl. at 195, 511 F.2d at 1170-71, considered at notes 65-69, supra.
The Government proposes to seek a waiver from the Comptroller General under 5 U.S.C. § 5584 (1976 & Supp. IV1980) for this amount.
This is the burden of Part II of this opinion.
"Defendant’s Response to Portions of Plaintiffs [sic] Cross-Motion for Summary Judgment and Opposition to Defendant’s Motion for Summary Judgment.”
Blaha, 206 Ct. Cl. at 195, 511 F.2d at 1170.
Id., 206 Ct. Cl. at 193-95, 511 F.2d at 1169-71.
Dissenting Opinion
Dissenting:
With deference, I cannot join in the court’s decision. I am convinced that the Government acted without statutory authority in imposing a cap on plaintiffs’ wages for the fiscal years 1979 and 1980, because in doing so, the Executive Department completely ignored the guidelines set by Congress. As shown in the majority opinion, Congress fixed ceilings on the pay of some Government employees for the fiscal years 1979 and 1980, but no such action was taken with respect to the plaintiffs until Congress enacted the Joint Resolution of October 1, 1980, section 114(a), Pub. L. 96-369, 94 Stat. 1351,1356.
Therefore, the only authority which the Executive Department had to adjust the wages of plaintiffs for the fiscal years 1979 and 1980 were the prevailing rate statutes — 5 U.S.C. §5341, which applies to plaintiffs and to other prevailing rate employees, and 5 U.S.C. §5348, which applies only to plaintiffs. In the latter statute, Congress directed that these employees be compensated as nearly as is consistent with the public interest in accordance with prevailing rates and practices in the maritime industry. The parties have agreed that under this procedure, the pay of plaintiffs employed by both NOAA and MSC is fixed by reference to the current rate schedule contained in the industrywide collective bargaining agreement between Na
HH
In the fiscal years 1979 and 1980, President Carter directed that the agencies place a 5.5 percent ceiling for the employees here concerned. The sole basis for his order was that the action was required in "the public interest to control inflation.” The same action was promulgated for the fiscal year 1980 by the Director of Personnel Management, which limited the fiscal 1980 pay increases for these employees to 7.2 percent. It is agreed that during the fiscal years 1979 and 1980, plaintiffs’ counterparts in private industry received substantially higher increases for those years than the amounts fixed by the Executive Orders. There is no evidence and no contention by the Government that in placing a cap on plaintiffs pay for the years in dispute, the executive agencies gave any consideration to the statutory guidelines set forth in section 5348.
Under the facts stated, the issue to be decided is not whether section 5348 grants "some discretion” to the Executive Department to adjust the wages of plaintiffs, as the majority has stated. Rather, the issue is whether section 5348 grants to the Executive Department such unrestricted and unlimited discretion that it was authorized to ignore completely the statutory guidelines in fixing the pay of plaintiffs for the years 1979 and 1980. This question was recently answered in the negative by the Court of Appeals for the District of Columbia in National Federation of Federal Employees, et al. v. Brown, 645 F.2d 1017 (1981), hereinafter referred to for convenience as "Brown. ”
There, as here, a cap was imposed on the pay of nonappropriated fund employees solely on the basis of President Carter’s memorandum of January 4, 1979, without any statutory authority to impose a ceiling on the pay of these employees. There, as here, the statutory guidelines provided for in section 5341 with respect to these employees were ignored. In reversing the district court’s judgment in favor of the Government the court of appeals declared:
*80 We conclude that the "public interest” clauses do not bear the weight the district court placed on them. Rather, we believe that executive discretion to fix and adjust pay rates for members of the class herein is circumscribed by the principles Congress enumerated in 5 U.S.C. §5341 (1976): (1) equal pay for equal work in all federal agencies within the same locality; (2) differences in pay for substantial differences in duties, responsibilities, and qualification requirements; (3) rates of pay maintained in line with rates paid locally for comparable work in the private sector; (4) rates of pay maintained at a level that attracts and retains qualified employees. If other principles are to augment, modify, or supplant this list, Congress must supply the authorization_(645 F.2d at 1019)
*****
[T]he 5.5% pay cap for nonappropriated fund workers might be justified under the first principle Congress supplied, equal pay for equal work in all federal agencies within the same locality. But the executive action at issue must be tied to a legislative direction giving content to the words "public interest.” Congress did not authorize the executive to go outside its guidelines and attribute to those words any nonarbi-trary meaning the President finds consonant with the nation’s welfare. (645 F.2d at 1019-20)
*****
The sole matter appropriately resolved at this juncture by the court is whether the executive branch has correctly applied the statute that establishes its authority. We hold that it has not. Under the structure of government — the separation of powers — established by the Constitution, the President has no authority to alter policy and principles declared by Congress even if, at the time the President acts, signals from Congress suggest it would approve the President’s action. * * * (645 F.2d at 1025)
*****
We must therefore reject the sole position advanced by the Government in support of the contested executive action — that the President remains free to define the "public interest” in any reasonable manner and without reliance upon the explicit standards Congress set to constrain executive discretion. (645 F.2d at 1025)
*81 We hold that the public interest clauses do not have a life of their own, separate and distinct from the guides Congress enumerated in the prevailing rate statute. We therefore conclude that the defendants acted impermissi-bly in capping the wages of nonappropriated fund workers solely on the basis of the President’s anti-inflation program. * * * (645 F.2d at 1025)
The court has attempted, unsuccessfully I think, to distinguish Brown but a comparison of the two opinions, will show that the ratio decidendi of Brown, is in direct conflict with the reasoning underlying the court’s decision. In reality, Brown provides stronger support for the claims of these plaintiffs than for the nonappropriated fund workers involved there. The reason for this is that the guidelines of section 5341, applicable to the nonappropriated fund workers, allow for an adjustment to their pay equivalent to that paid to other Federal employees working under similar conditions. Not so with these plaintiffs. As this court stated in Blaha v. United States,206 Ct. Cl. 183, 193-94, 511 F.2d 1165, 1169 (1975):
The Congress in enacting § 5348 recognized the unique character of the pay practices in the maritime industry. It saw that the pay practices existing shoreside with respect to Government employees would be a Procrustes bed if applied to Government vessels and to civilians employed as seamen thereon, union members doing the same work as their commercial counterparts. Its solution was to authorize pay practices to conform "as nearly as is consistent with the public interest”, not to Government shoreside practice, but to private industry practice afloat:
The reference to Blaha leads me to the observation that the court’s decision also collides head-on with the basic holding in Blaha. Strangely, the court relies on Blaha despite Judge Nichols’ pronouncement in that case that:
We think the "public interest” exception was written to provide flexibility needed to eliminate anomalies and inequities that might arise from a too literal conformity to industry pay practices. It was not written to authorize a complete frustration of the Congressional scheme. Since Commerce relies so heavily on the imaginary horrible, let us too suggest one: if Commerce can do what it has done with the relatively minor vacation supplement, it can*82 refuse to apply § 5348 in any part, declaring the entire wage scheme resulting from collective bargaining not to be "consistent with the public interest.” (206 Ct. Cl. at 194, 511 F.2d at 1170)
Here we have a complete frustration of the Congressional scheme, because the wages of the plaintiffs for 1979 and 1980 were set by disregarding entirely the guidelines specified by Congress.
As authority for its position, the court cites: Benevento v. United States, 198 Ct. Cl. 772, 461 F.2d 1316, cert. denied, 409 U.S. 1038 (1972); Beatteay v. United States, 198 Ct. Cl. 989 (1972); Benham v. United States, 198 Ct. Cl. 990 (1972) and Daniels v. United States, 187 Ct. Cl. 38, 407 F.2d 1345 (1969). These decisions are inapposite, for as the court stated in Blaha: "These cases *** involved the selection of the segment of the maritime industry to be treated as the model for comparison.” (206 Ct. Cl. at 189, 511 F.2d at 1167) None of them involved a situation where no consideration whatever was given to the statutory guidelines.
The only decision cited by the majority which I think is consistent with its opinion is Daigle v. United States, 217 Ct. Cl. 376 (1978). Admittedly, I cannot reconcile Daigle with the central holding in Blaha with respect to the application of the public interest clause. Nevertheless, I would hold that Brown and Blaha have correctly decided how the public interest clause should be applied in adjusting the wages of employees under the provisions of 5 U.S.C. §§5341 and 5348.
II.
In an effort to buttress its conclusions, the majority has cited a good deal of legislative history. As I read the history, it provides even less support for the court’s decision than the decisional law.
In an apparent effort to show that the guidelines have little significance, the majority quotes the following statement made by Senator McGee: "The guidelines are not extensive. They will not bind the hands of the executive branch too firmly.” This statement was taken out of context from Senator McGee’s statement. He was the floor manager
But the system is not perfect and it is not established under statute as determined by the legislative power of the Government. The President may at his discretion revise the system, and the 650,000 employees in the system do not have the assurance of guidelines established by law. We often, in our rhetoric, brag about our being a nation under law, not under men. Yet, here would seem to be a flagrant denial of that somewhat sacred principle — at least, rhetorically. When we contrast the status in Federal Government, in the inequity that now exists, with the circumstances in other segments of the Nation’s business community, we can appreciate the change that is required. For example, if one is running a small shop on Main Street, the authority to change things around and issue new orders without legislative guidelines may be desirable. That is the way we run our offices, for example. We hire and fire as we please. We pay our employees what we think they are worth, based on individual judgments, or what our sense of compassion and humanitarianism inspires us to provide. But when you are running the biggest business in the world, which is the Government of the United States, you just cannot run a responsible store that way. We do not do it that way for any other Federal employees. There has been a classified system established by law for the civil service for 50 years. There was a classification system established by law for postal workers until the enactment of the Postal Reorganization Act, and that system of classification and pay was carried over into the new, semi-independent postal agency until superseded by collective bargaining. The wage board employees are the only group in the executive branch who do not have either a formal job classification and pay system established by law or collective bargaining options. The time is long overdue for establishing such an orderly statutory system.
In its simplest form, that is what H.R. 9092 does. It says that this is going to be the law when it comes to blue-collar workers. This is what the President and the Civil Service Commission and the various agencies in the executive branch are going to do. It is the function of*84 Congress to declare what the policy of the Government shall be. It is the function of the executive branch to carry out that policy. Guidelines are established in this bill that shall direct the course of administrative action by the Civil Service Commission. The guidelines are not extensive. They will not bind the hands of the executive branch too firmly. But they will assure 650,000 blue-collar workers that — to borrow a phrase — yes, Virginia, there is a Congress of the United States, and there is a policy for blue-collar employment system. (Emphasis added) (118 CONG. REC. 21017 (1972))1
In the debate on the bill, Senator Pell stated:
All too often, the interests of the Government’s blue-collar workers have been sacrificed in pursuit of other goals of the Government. Although the stated goal may be fair treatment, there is in the executive branch an understandable, but nonetheless regrettable, temptation to view blue-collar wages as a weapon in efforts to balance a budget, or to combat inflation. When this happens, equity suffers, and the blue-collar worker bears a burden not shared by his fellow workers in private industry.
Since I have been in the Senate, I have maintained close contact with the thousands of prevailing wage employees in the State of Rhode Island and with their elected spokesmen. I have become intimately familiar with their problems and their grievances. On their behalf, and in the interest of fairness, I have worked and tried to correct some of these inequities — for example, wage survey areas that are defined too narrowly to encompass a true labor market, and result in the payment of substandard wages as a "prevailing” wage. Or, as another example, the arbitrary freezing of blue-collar wages to combat inflation while workers in nongov-ernment jobs were permitted wage increases. (Emphasis added) (118 CONG. REC. 21029-30 (1972))
In the House, the following remarks of Representative Matsunaga are also indicative of the Congressional intent:
There is * * * virtually universal agreement on the need for some legislation in the area covered by the pending bill. Even the administration has submitted a proposal. The approximately 810,000 prevailing-rate employees of the Government, including 11,000 who work in Hawaii, deserve immediate attention. Their pay is determined by administrative regulation subject to change*85 when administrations change, when a different bureaucrat succeeds to a particular job, or when an administration decides to change its policies. The basic thrust of H.R. 9092 is to enact into law the present procedures used to determine and adjust wages for these workers. (117 CONG. REC. 27681 (1971))
In summarizing the legislative history of the 1972 Act, the court of appeals stated in Brown:
Remarks by both supporters and opponents of the 1972 amendments * * * are consistent with Senator McGee’s repeated plain statements that the intent was to "set standards of direction” that would control administrative practices and constrain executive discretion. * * * Given this history, it is clear that Congress meant to set, not merely to recommend, policy and principles, (footnotes omitted) (645) F.2d at 1024)
The court also relies on the following statement from Senate Report 939,95th Cong., 2d Sess. 56 (1978):
This provision would be applicable to all Federal agencies and is based on the desire that all Federal employees be treated equally as to fiscal year 1979 salary increases. (Emphasis added)
The quotation is wide of the mark. In the first place, it is preceded by a sentence which reads as follows:
Sec. 614. By a rollcall vote of 12 yeas and 9 nays, the Committee approved an amendment providing a ceiling on salary increases for wage board workers during fiscal year 1979 to the 5.5 percent ceiling previously announced by the President for general schedule (GS) employees.
Plaintiffs are not wage board employees. The statement was addressed to the bill which became Public Law 95-429, 92 Stat. 1001, which fixed a ceiling for the fiscal year ending September 30, 1979, for prevailing rate employees described in section 5342(a)(2)(A) of title 5. This section is not applicable to plaintiffs. They are specifically excluded from its coverage by section 5342(b)(3) which exempts from the coverage of the subchapter, crews of vessels described in 5 U.S.C.§ 5102(c)(8).
The court also places heavy emphasis on the fact that the public interest clause has been included in the law since
III.
For the reasons stated, I would hold that the 34 persons who have been added to the petition as plaintiffs are entitled to recover the difference between what they were paid during the fiscal years 1979 and 1980, and the pay which their counterparts in private industry received during those years. I concur in the court’s decision that they are also entitled to receive premium pay and overtime pay in those years. I also agree with the court that the petition should be dismissed as to the plaintiff, National Maritime Union of America, AFL-CIO.
The references here are to bound volumes of the Congressional Record.