work; and such portion of the transportation, travelling, hotel, and other expenses of officers, engineers and all other employees of the contractor as is actually incurred in connection with the work under this contract."

Our travel procedure for employees traveling in connection with the work under W-ORD-499 was outlined by us and approved by the contracting officer's representative in letter of March 6, 1941. This letter did not cover the company's practice as regards expenses incurred in moving employees, their families, and households to and from the site of the work.

Company practice in this regard is based on the desire that the individual so transported or moved will not be out-of-pocket in connection with transfer, which is being made at company's request. Hence, we ordinarily would reimburse the individual for the following items of expense:

(1) Expenses to and while at the site of the work during the period the employee is still undergoing expense of maintaining his family and household at his usual residence prior to moving to the site. Length of this period is determined by conditions such as availability of housing facilities at new location, situation at home (sickness, children in school, lease provisions, etc.), and other extenuating circumstances. We would expect the employee to exercise due diligence and, ordinarily, to be settled at his new location in four to six weeks, in case he has a family to move; and in less time in case he is single; however, this might be increased or decreased so as to be fair and just to all concerned. We would also expect to pay the employee's expenses in connection with trip back home for moving to new location, in case such is approved by properly authorized superior.

(2) Expenses in connection with moving household goods and family to the site of the work. This would ordinarily include traveling expenses for family and trucking expense of household goods to the site.

(3) Such other expenses as might reasonably be deemed as resulting from the transfer. However, in no case would increased rental, if any, at new location be considered a reimbursable item.

It

In our opinion, it is clear that the above expenses fall within the proper construction of article III-A-1-f. The expenses described above are, obviously, expenses of employees of the contractor not only actually incurred in connection with the work but necessarily incurred. Our interpretation of the paragraph conforms with our understanding at the time the contract was executed. was then recognized that the plant could not be built without the transfer of many employees from other locations to Henderson. This fact is recognized in article III-A-1-g, wherein it is provided, in part, that in transferring men from their regular positions to the plant, salary increases might be necessary. It was unnecessary to make express provision in article III-A-1-g for the expenses incident to moving, because such items were deemed covered in the general language of article III-A-1-f.

If you agree, kindly indicate your approval on green copy attached and return to us.

In response to your request of June 12, 1941, addressed to the constructing quartermaster, for a further explanation and itemization of certain charges made, which request was referred to the contractor for reply, the Atmospheric Nitrogen Corporation in its letter of June 24, 1941, stated:

Reference is made to your letter of June 14, 1941, and to Mr. Utley's letter of June 18, 1941, addressed to our Plant Accountant, referring to expense statements.

We respectfully call your attention to our letter to you of March 6, 1941, in which it was stated that "In order to avoid delay and expedite progress, we propose to follow exactly, in the performance of work under contract No. W-ORD-499, our usual procedure as outlined above, requesting reimbursement from the Government, pursuant to article III-A-1 (f) of transportation and travelling expenses actually incurred in connection with the work on the basis of such procedure." [Italics added.]

In that letter we outlined our usual procedure as follows:

"Travel procedure is not specifically outlined but customary practice is for employees to travel by the most direct route and return in shortest time that

assignment will permit. Expense other than transportation, which in case of rail is that actually incurred and in case of employee's using his own car is $0.06 per mile, is reimbursed as actually incurred in connection with the work involved, keeping in mind the position of the man in the organization and conditions in locality visited. The expenses are detailed in accordance with the attached form, signed by the individual travelling, and approved by a superior. "All trips are to be made as economically as possible, in much the same manner as employees might travel on personal business.

"Under the Company's usual procedure, the officers of the company and the following individuals would be authorized to approve travel and expense accounts in connection therewith :"

You will note that this procedure was approved by you and that your name was signed on the carbon copy of the letter, indicating such approval.

As orally discussed with you, you will also recall that when contract No. W-ORD-499 was being negotiated, the representatives of the United States Government assured us that, in matters of this kind, the Company's usual practice would prevail and that no difficulty regarding reimbursement would be met if that practice was followed.

The purpose of following our usual practice is, in our opinion, very important "in order to avoid delay and expedite progress" in the performance of the work required to be done under contract No. W-ORD-499.

In Mr. Utley's letter of June 18, 1941, there were returned to our plant accountant some twenty expense statements for review and possible further itemization. Some of these statements cover trips taken in April 1941. Under the company's usual procedure, all of the statements have been approved by individuals whose names were listed as authorized to approve such statements in our letter of March 6, 1941. To try to assemble further information required for any further itemization would take a very substantial amount of time of men who are engaging their entire time on work under contract No. W-ORD-499. In fact, in most instances, it would now be impossible to recall any of the expense details of these trips, which we believe have been given in sufficient particularity in the expense statements as handed to you. As an example, we have indicated, in each instance, the point visited.

Consequently, we return herewith the statements referred to in your letter of June 14 and those attached to Mr. Utley's letter of June 18, 1941, and request that you take such steps as you deem fit to obtain for us the reimbursement of these items.

While the voucher in question bears the approval of the representative of the contracting officer, it is stated in his letter of June 10, 1941, to you, that such approval is for the purpose only of obtaining a decision as to whether the expenses covered thereby are reimbursable, and it is evident therefrom that in his opinion the claimed amount represented expenses, the allowance of which are not authorized under the terms of the contract.

Contract No. W-ORD-499, entered into on a cost-plus-a-fixed-fee basis as authorized under the act of July 2, 1940, 54 Stat. 712, provides for the designing, engineering, constructing, equipping, and operating of an ordnance manufacturing plant, in consideration of the reimbursement by the Government of the contractor's expenditures as provided in the contract, plus stipulated fixed fees. Whether a particular item of expense is reimbursable to the contractor as such, or whether it is included in the lump-sum-fixed fees made depends upon the terms of the contract.

By articles I-B-1 and II-A-1 of the contract, the contractor is authorized to do all things necessary for the construction and operation of the plant, including the employment of all persons engaged in

the work under the contract. With respect to reimbursement of the contractor's costs, article III-B-1 of the contract is to the effect that the Government will currently reimburse the contractor for such expenditures made in accordance with article III-A as may be approved or ratified by the contracting officer upon certification to and verification by the said officer. Section 1-f of said article III-A is as follows:

Transportation and travelling expenses to and from the work of the necessary field forces for the economical and successful prosecution of the work; and such portion of the transportation, travelling, hotel and other expenses of officers, engineers and all other employees of the Contractor as is actually incurred in connection with the work under this contract.

It appears to be the contractor's contention that this section of the contract authorizes as an allowable item of cost the traveling and living expenses incurred on behalf of its employees in the transfer of the "employees, their families, and households to and from the site of the work."

It appears that in connection with the performance of the contract, two general types of transportation, traveling, and incidental expenses were contemplated: (1) the cost (transportation and travel expense) of transferring employees, permanently assigned to the performance of the contract work, from some other location to the contract site, and (2) the cost (transportation, travel, hotel, etc., expense) of such occasional travel by employees from their permanent stations as might be necessitated by conditions arising during the performance of the contract. The expenses incurred by the contractor for which reimbursement is claimed on the voucher here under consideration, appear to relate to the first of the types above-mentioned-the transfer of employees from some other location to the contract site. However, in addition to the transportation and other travel expenses of such employees—which if approved and verified by the contracting officer appear to be an allowable item of cost-there are claimed (1) the living expenses of employees at the site of work prior to the arrival of their families, (2) the traveling expenses of the employees in returning to their homes for their family and household effects, and (3) the expenses incurred in moving such families and household goods to the site of the work. None of these three items appear to be traveling or other expenses proper for reimbursement under the terms of the above-quoted section of the contract or any other provision thereof, since the facts now of record do not indicate that the moving of the employees' family and household effects is a service necessarily required or contemplated for the satisfactory performance of the work covered by the contract. Insofar as the living expenses of the employee after arrival at the contract site are concerned, it is believed that a correct interpretation of article III-A-1-f is set forth in letter dated April 30.

1941, from the office of the Chief of Ordnance, to the contracting officer, in pertinent part, as follows:

It would seem that the intent of the above quoted provision is to compensate employees of the Contractor for all expenses incurred with connection to the work when absent from their permanent duty station. Living expenses such as cost of hotel room, garage rent, food, etc., incurred by an employee at his permanent duty station are not such as was contemplated by the provision quoted above, and should not be reimbursed the Contractor.

With reference to the contractor's statement that the payment of such expenses is in accord with its customary practice and that it interpreted the contract at the time of its execution as authorizing reimbursement therefor, it is well settled that usage or practice of the contractor cannot operate to contradict or vary the specific terms of the contract. Moore v. United States, 196 U. S. 157.

Accordingly, the voucher, together with pertinent papers, is returned and you are advised that payment thereon is authorized only as to the items of allowable cost as herein indicated after proper verification and approval thereof as required by the contract.

(B-18863)

LEAVES OF ABSENCE-ANNUAL AND SICK-TEMPORARY EMPLOYEES After the first month of service annual leave may be credited to temporary employees at the beginning of the month in which it accrues but it is to be noted that such employees are not entitled to such leave for a fractional month's service.

Temporary employees within the meaning of the leave regulations paid on an annual or monthly basis and "regular employees" within the meaning of the holiday statute of June 29, 1938, classed as temporary under the civil service rules but not as temporary under the leave regulations are entitled to pay on holidays declared by law, Executive order, or administrative order, and may not be charged annual leave except during a period an office may be closed for administrative reasons and the employees are specifically required by administrative action to take leave.

Temporary employees whose compensation is fixed at a rate per day, per hour. or on a piece-work basis but who may not be classed as "regular employees" within the meaning of the holiday statute approved June 29, 1938, are not entitled to holiday pay and payment may not be made to them for holidays by making a deduction from annual leave to their credit. Continuity of service of temporary employees for annual leave earning purposes is not broken by Sundays not occurring within a regular tour of duty, or holidays or nonwork days established by Federal statute or by Executive or administrative order, nor by furlough without pay for lack of work or funds if such period is administratively permitted to be "bridged over" by accrued annual leave.

Temporary employee transferred from one bureau of War Department to another without break in service may transfer his accrued annual and sick leave. Comptroller General Warren to the Secretary of War, August 5, 1941:

I have your letter of July 14, 1941, as follows:

Attention is invited to the enclosed communication from the Jefferson Proving Ground, Madison, Indiana. Request is made that decisions be given on questions ed, and e, contained herein. Unless otherwise advised, it is contemplated that information in reply to question a and b will be given as follows:

a. Attention is invited to Sec. 14, Public 471, 74th Congress, which reads “after the first month of service such leave may be credited at the beginning of the month in which it accrues." A temporary employee may be granted the leave to his credit at the beginning of the second month of his service.

b. Where a non-work day is ordered by the Commanding Officer of a station, a deduction may be made from annual leave of a temporary employee should he have such leave to his credit; if not, deduction may be made from the pay of such an employee.

The referred-to communication from the Chief Clerk, Jefferson Proving Ground, Madison, Indiana, is dated May 28, 1941, and reads as follows:

Subject: Temporary Employees, paragraph 102, Regulations Governing Civilian Employees, Circular 1-15, page 97-102.

To: War Department, Civilian Personnel Division, Washington, D. C.

1. I would appreciate receiving a reply to the following questions concerning subject matter stated above.

a. Does a temporary employee paid on an annual basis have a right to use 22 days annual leave from the beginning of the first month's service and prior to its accrual?

b. Is there a deduction from annual leave or from the pay of temporary employees where a non-work day is ordered by the commanding officer of a station or in the case of a Federal Holiday?

c. Does a temporary employee transferred from the Quartermaster Department to the Ordnance Department at the Jefferson Proving Ground without break in service have the right to the annual and sick leave he accrued while working for the Quartermaster Department?

d. Does Paragraph 102, Regulations Governing Civilian Employees have the effect of superseding Decision B-6669, dated 11/21/39 of the Comptroller General of the U. S. relating to: Sundays and Holidays-Compensation of Temporary Employees-etc.?

e. Is there a more recent Decision made by the Comptroller General on these points?

In decision of May 28, 1941, 20 Comp. Gen. 827, 830, it was stated:

SECTION 1 of the Annual Leave Act, approved March 14, 1936, 49 Stat. 1161, contains the following sentence: "Temporary employees, except temporary employees engaged on construction work at hourly rates, shall be entitled to 2% days' leave for each month of service." Also, section 2 of the Sick Leave Act of the same date, 49 Stat. 1162, contains a corresponding sentence, as follows: "Temporary employees, except temporary employees engaged on construction work at hourly rates, shall be entitled to 14 days' sick leave for each month of service." Section 14 of the annual leave regulations provides as follows:

"SEC. 14. Temporary employees shall be granted 22 days' leave for each full month of service. After the first month of service such leave may be credited at the beginning of the month in which it accrues. Temporary employees shall be charged with annual leave only for absence on days upon which they would otherwise work and receive pay. No charge shall be made against annual leave for absence on Sundays which do not occur within a regular tour of duty, holidays, and non-work days established by Federal statute or by Executive or administrative order."

There is no corresponding provision in the sick leave regulations, apparently for the reason that the rate of credit per month for permanent and temporary employees is the same.

In decision of May 10, 1937, 16 Comp. Gen. 993, it was stated: "In decision of April 16, 1937, A-84992, 16 Comp. Gen. 934, it was held that temporary employees are entitled to 21⁄2 days' annual leave of absence with pay inclusive of Sundays and holidays for each full month of service. The statutory grant of annual leave to temporary employees is clearly on a monthly basis, that is, 'for each month of service.' Compare this with the terms of the statutory grant of annual leave to permanent employees, to wit, "26 days' annual leave with pay each calendar year, exclusive of Sundays and holidays.' This is not a grant of leave 'for' each year of service but entitles permanent employees to 26 days' annual leave ‘each calendar year.'"