                      The Attorney General of Texas
                                         March   16,   1981
MARK WHITE
Attorney General
                   Honorable John J. Kavananh. M.D.           Ooinion No. NW-305
                   Commissioner
                   Texas Department of Mental Health          Re: Whether the Department         of
                     and Mental Retardation                   Mental Health and Mental Retarda-
                   P. 0. Box 12668                            tion    may    change     classified
                   Austin, Texas 76711                        employees to hourly employees and
                                                              pay them on a semi-monthly basis

                   Dear Dr. Kavanagh:

                         You have asked whether the Texas Department of Mental Health and
                   Mental Retardation has the authority to remove the majority of its salaried
                   employees from the State Position Classification Plan by converting them to
                   hourly employees and, if not, what legal authorization would be required for
                   such a conversion. You ask further whether MH/MR has the authority to pay
                   the majority of its employees on a biweekly basis rather than on a monthly
                   basis if those employees are converted to hourly employees.

                         Section 2 of article 6252-H, V.T.C.S., the Position Classification    Act,
                   provides, in pertinent part, that:

                                   All regular, fulptime salaried employments within
                               the departments and agencies of the State. . . shall
                               conform with the Position Classification Plan. . . and
                               with the salary rates and provisions of the Appropria-
                               tions Act. . . .

                               . . . .

                                    Specifically excepted from the Position Classifi-
                               cation Plan. . . are. . . hourly employees, part-time,
                               and temporary employees; and such other positions in
                               the State Government as have heretofore been or as
                               may hereafter be excluded from such Position Clas-
                               sification Plan by executive order of the Governor or
                               by direction of the Legislature.

                         The General Appropriations Act reflects the fact that a very large
                   number of oersons are emoloved bv the deoartment as full-time, classified
                   employees. ‘See General A’ppiopriations Act, Acts 1979, 66th Leg:, ch. 643,
                   art. 11, S20, a-2556.




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Honorable John J. Kavanagh - Page Two            (MW-305




        An administrative agency has only those powers expressly conferred by statute or
derived from express powers, Railroad Commission v. Red Arrow Freight Lines, 96
S.W. 2d 735 (Tex. Civ. App. - Austin 1936, writ refd). An Appropriations Act rider
applicable   to the department gives it some authority to use appropriations          for
classified positions to pay hourly employees:

                  It is further provided that appropriations   for salaries of
              classified positions may be used to pay the wages of hourly
              workers when the utilization of such personnel is in the best
              interest of an economical and efficient program.

General Appropriations Act, Acts 1979, 66th Leg., ch. 643, art II, S2(4), at 2543. This
larrguage gives the agency some limited authority to shift funds from classified to
hourly positions. We do not believe it empowers the Department of MH/MR to remove
the majority of its salaried employees from the State Position Classification Plan by
converting    them to hourly employees.    In order to exercise such comprehensive
authority the department would need express legislative authorization or an executive
order from the governor.

        Article 6626, V.T.C.S., provides that, “Annual salaries provided for in this title
shall   be paid monthly on warrants drawn by the Comptroller or the Treasurer.” The
word    “title” in article 6626, V.T.C.S., refers to title 117, which concerns the salaries of
state    officers and employees. The General Appropriations Act provides, in pertinent
part,   that:

                 All annual salaries appropriated by this Act are for full-time
              employment unless specifically designated as part-time or other
              and shall be paid in twelve (12) equal monthly installments   ...

Art. V, S2(a). Classified employees are annual employees and thus are subject to this
provision. See General Appropriations Act, Acts 1979, 66th Leg., ch. 643, art. V, .Sla,
at 2892. Wxelieve,     however, that hourly compensation is to be distinguished from sn
annual salary, and that persons receiving hourly salaries are not subject to the above
limitations on annual salaries. They may therefore be paid on some other basis, such
as biweekly payment.

                                        SUMMARY

                  The Texas Department       of Mental Health and Mental
              Retardation does not have the power to remove the majority of
              its salaried employees from the State Classification     Plan by
              converting them to hourly employees. Such authority must be
              specifically granted to the Texas Department of Mental Health
              and Mental Retardation by the legislature or by executive order
              of the governor. The Texas Department of Mental Health and
              Mental Retardation does have the authority to pay employees
              receiving hourly compensation on a biweekly or semi-monthly
              basis.




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.   -



        Honorable John J. Kavanagh     - Pege Three       (MW-305)




                                                        MARK      WHITE
                                                        Attorney General of Texas

        JOHN W. FAINTER, JR.
        First Assistant Attorney General

        RICHARD E. GRAY Ill
        Executive Assistant Attorney   General

        Prepared by Susan Garrison
        Assistant Attorney General

        APPROVED:
        OPINION COMMlTTEE

        Susan L. Garrison, Chairman
        Jon Bible
        Lucius Bunton
        Rick Gilpin




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