                    fUJSTXN..TEXAR       78711

                              September 29, 1976


The Honorable Bob Bullock                  Opinion No. S-883
Comptroller of Public Accounts
L.B.J. State Office Building               Re: Disposition of
,Austin, Texas 78774                       compensatory time accrued
                                           by state employees while
                                           the constitutionality of
                                           the~l974 amendments to
                                           the Fair Labor Standards
                                           Act was being litigated.
Dear Mr. Bullock:

     You have requested our opinion regarding the disposition
of compensatory time accrued by state employees during the
pendency of the litigation attacking the constitutionality
of the 1974 amendments to the Fair Labor Standards Act. In
1974, Congress enacted legislation, effective January 1,
1975, which applied the overtime provisions of the Fair Labor
Standards Act to all state employees not previously covered
thereby. 29 U.S.C. S 201, et se
Chief Justice Burger issued- an+SerE
operation of this-legislation. National League of Cities,
Inc. 5 Brennan, 419 U.S. 1321 (-Such         order was continued
bye    fmreme       Court on January 13, 1975, 419 U.S. 1100
(1975), and remained in effect until the Court's decision
on the merits on June 24, 1976. In that decision, National
League of Cities v. User   49 L.Ed.Zd 245 (19761, the Supreme
Courthxd            Y#-'
           unconsntut  onal those portions of the Fair Labor
Standards Act which required states to pay their employees
premium rates for overtime work. You first inquire as to
whether the State of Texas may pay its employees for overtime
accrued during the period of the stay order, January 1, 1975
to June 24, 1976.




                                     p. 37i9
The Honorable Bob Bullock - page 2    w-883)



     The current General Appropriations Act provides, in
section 2e of article V:
         In order to reimburse employees for work
         performed in excess of the working hours
         required by Acts, 1963, 59th Legislature,
         page 184, Chapter 104 (codified as Article,
         5165a, V.A.C.S.), it is required that
         compensatory time be granted at the rate of
         1 l/2 times the overtime performed within
         the same month (pay period) that said
         overtime was accrued. . . .[A]ny agency or
         institution subject to the Fair Labor
         Standards Act, as amended, is authorized
         to reimburse employees for all authorized
         overtime by granting compensatory time as
         specified or by paying money from funds
         appropriated by this Act at the rate of
         1 l/2 times the regular rate for the
         overtime performed. Acts 1975, 64th Leg.,
         ch. 743 at 2946.
The language of the rider permits "any agency or institution
subject to the Fair Labor Standards Act . . . to reimburse
its empl=eZ?   either by a grant of compensatory time or by
direct payment of money. In our opinion, howeve,r,this
language does not apply to any state agency covered by Chief
Justice Burger's stay order of December 31, 1974, since those
agencies were never subject to the Act. We conclude, therefore,
that the State may not pay its employees for overtime accrued
during the period between January 1, 1975 and June 24, 1976.
       you also ask whether compensatory time must be granted
during the same pay period in which it is accrued, and if so,
how this requirement should be applied for the period of the
Supreme Court's stay order. The rider requires that "compensatory
time be granted at the rate of 1 l/2 times the overtime
performed within the same month (pay period) that said
overtime   was accrued." This provision is independent of
whether an employee is subject to the Fair Labor Standards
Act. Furthermore, it permits no discretion to the employing
agency. It is required that employees who perform work in
excess of normal working hours be granted compensatory time.




                            p. 3720
The Honorable Bob Bullock - page 3   w-883)


     If the rider is interpreted according
                                  .         to its literal
language, compensatory time must be granted, witnout exception,
within the same pay period as it is accrued. See Attorney
General Opinion H-382 (1974). In our opinion,Twever,     this
requirement should be read as a general guideline for the
grant of compensatory time and not as an inflexible rule
admitting of no exception. For example, an employee might
be required to perform overtime work on the last day of a
pay period. Unless the rule is sufficiently flexible to
permit the employee to be granted compensatory time during
the following pay period, he will not be compensated at all
for the overtime performed , a result which the rider prohibits.
Nor do we believe that the Legislature intended such an
inequitable result. As we noted in Attorney General Opinion
Ii-687 (1975), the Texas Supreme Court considers that the
"paramount rule" in construing a statute is to ascertain and
give effect to the intention of the Legislature, even when
such a result requires a departure from the literal language
of a statute. See Mason 3 West Texas Utilities Co., 237
S.W.Zd 273, 27aTesUp.       lm;mn        v. Walker79   S.W.2d
695, 697 (Tex. Sup. 1932); Texas State BGrdental
Examiners v. Fenlaw, 357 S.W.2d 185, 189 (Tex7Civ.p.      --
Dallas 1§6z -writ).      It is thus our view that, while an
agency should, whenever it is reasonably possible to do so,
grant compensatory time to its employees in the same pay
period as that in which it is accrued, it should also be
mindful that the Legislature has directed that employees be
compensated for overtime performed. If it is not possible
to award such compensation during the same pay period, we
believe that the agency may grant it for some subsequent pay
period.
     As to the period from January 1, 1975 to June 24, 1976,
it is apparent that compensatory time should not ordinarily
be taken by an employee so long after it has been accrued.
We believe however, that, we should not hold as a matter of
inflexible law that an agency could not grant compensatory
time for overtime performed during this period. -See Attorney
General Opinion H-245 (1974).
     You also ask about the disposition of compensatory time
accrued by state employees who have transferred to another
state agency. The General Appropriations Act permits inter-
agency transfer of vacation and sick leave credit. Acts 1975,




                              p. 3721
The Honorable Bob Bullock - page 4       (H-883)



64th Leg., ch. 743, art. V, 8 7e at 2846. However, we are
unable to locate any authority which would authorize the
interagency transfer of compensatory time, and it is thus
our opinion that it cannot be transferred.
     Finally, you inquire about compensatory time accrued
during the period of the stay order by former state employees
who have since terminated. It is obvious that such persons
may not now be granted compensatory time, It is clear,
however, as we have noted previously, that the rider prohibits
payment for overtime accrued, since state employees covered
by the stay order were never subject to the Fair Labor Standards
Act. Thus, we conclude that persons who have been separated
from state employment are not entitled to payment for overtime
performed during the period between January 1, 1975, and
June 24, 1976.
                     SUMMARY

         Persons who earned compensatory time during the
         period of the stay order of the United States
         Supreme Court pending its decision in National
         League of Cities v. User were not necessarily
         requirehtz       -T+-
                          sue compensatory time during
         the month in which it was earned. There is no
         provision for the transfer of compensatory
         time between agencies when an employee
         transfers from one agency to another. Persons
         who terminated state employment without
         exhausting compensatory time are not now
         entitled to be paid for it.

                               Very truly yours,




                               p. 3722
     The Honorable Bob Bullock - page 5 ,(H-883)


    APPROVED:
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