The CHAIRMAN. I am going to ask the members of the committee to stay after this hearing, with the idea of securing some uniform action by this committee on just that question. It affects five departments, I believe.

Mr. SHREVE. You understand that we have not settled anything yet, but it is there before us for our consideration.

The CHAIRMAN. I thought the entire committee had better settle this, if that is possible.

Mr. WooD. Upon what basis did they recommend this increase of these five positions from $10,000 to $12,000? Do they get that under the Welch bill?

Mr. MOFFETT. No.

STATUS OF SALARY SITUATION

The CHAIRMAN. What is the status of the salary situation in the Government service to-day in consideration of the Welch bill, the classification act, the comptroller's decision, the departmental action under that decision, and is the purpose originally sought by the classification act of 1923, uniform pay for the same kind of work in the different departments, nearer to realization or further from it? Mr. MOFFETT. Of course, prior to the passage of the Welch Act, the ideal of uniform pay, so far as the departmental service in particular was concerned and to a very great extent in the field service through the administrative action of the departments themselves, was very much nearer realization than it had ever been before. But with the introduction of the Welch Act and with the action taken, the result of the interpretation placed upon the Welch Act, the situation has been very much confused, I should say, and is less satisfactory than it was before.

APPROPRIATIONS TO MEET CLASSIFICATION APPEALS

The CHAIRMAN. What would happen, Mr. Moffett, if at the time an appeal was allowed-and there is a considerable number of appeals pending before your board-the appropriation were not sufficient to pay the salaries at the new rate?

Mr. MOFFETT. Under the ruling of the Comptroller General on that point, it would be necessary for the department head to pay the salary according to the new allocation and make such adjustments in his personnel as would be necessary in order to recover that amount of money.

The CHAIRMAN. Suppose there is not sufficient money in the current year's appropriation?

Mr. MOFFETT. In that case it would be necessary to dismiss some of them. That, of course, would be a very rare occurrence, because usually there are people resigning or leaving the service for one cause or another, and all that is necessary ordinarily is to keep a place or two vacant in order to recover enough money to meet that contingency.

The CHAIRMAN. Would it be a safeguard if a provision were inserted in the appropriation act providing that no appeal for an increase in salary, which was granted, should be effective in the year

in which the appeal is acted upon, unless you had the money to do it? That would save the bill, would it not?

Mr. MOFFETT. I do not believe I would be in favor of that, because the time required for actually getting money in an appropriation act to meet the additional cost of an appeal would be so far removed from the date of the action.

Mr. CRAMTON. In connection with that, Mr. Chairman, I think it might be of interest to insert at this point an extract from a statement by Governor Spry before our subcommittee. Governor Spry is the Commissioner of the General Land Office, and he raises that very question. I will not take the time to read this statement nowit is a brief statement, however-further than to say this: That Governor Spry urges upon our committee that the actual experience of his office leads him to believe that that very thing will seriously interfere with the morale of his office; that a number of such appeals have been allowed during the current year, and that a number of others are pending, and he assumes that a good percentage of those pending are likely to be allowed; that if those appeals are allowed, after Congress has adjourned, there is no opportunity for a deficiency and that increased charge on his appropriation which is practically all taken up now with appeals that have been allowed would result in there not being sufficient to meet those increases from the new decisions.

The result of that would be that he would either have to dismiss or furlough without pay some of his employees, and the effect of that, he sets forth, is destructive of the morale of the service as well as an interference with the work that his service has to perform.

Furthermore, it is not generally understood, and the employees think that the service should have guarded their interests in the matter, although at the time his officials go before the Budget and before our committee they have no information with which they can protect themselves.

If there was a provision by which these increased salaries resulting from reallocations would be paid if there were money available, and if there were not money available in the appropriation, they should not become effective until there was money, that could be brought to the attention of the Congress at the next session, and the morale of the service in the meantime would not be destroyed. It would not be a matter of more than six to nine months, probably a year, in any case that they would have to defer the effectiveness of such an increased salary.

I will insert this statement in the record.

(The statement referred to is as follows:)

While we are discussing this matter of salaries allow me to set forth some of the conditions with which we are confronted-not this bureau alone but all bureaus and establishments in the Government service.

The Personnel Classification Board, composed of a representative of the Bureau of the Budget, a representative of the Civil Service Commission, and a representative of the Bureau of Efficiency, is clothed with authority to allocate all positions held by employees in the departmental service in the District of Columbia.

On the other hand, the head of the bureau is charged with responsibility for the conduct of his bureau. That is, his problem is to render maximum service to the public with the force at his command and the funds granted to him for that purpose.

Responsibility and authority which should be united are divorced. Let us see how this works.

Based on preliminary, then detailed, and later final approved estimates considered in the summer of 1927 by the Bureau of the Budget and in the fall of that year by Congress, we were allowed a certain amount for the fiscal year which began July 1, 1928, and which will not end until June 30, 1929, and we have laid our plans accordingly.

However, any employee has the right to address an appeal to the Personnel Classification Board for a higher allocation. The bureau transmits the appeal to the office of the Secretary with a memorandum report. Later the department transmits the appeal to the Personnel Classification Board with an official report thereon. The Personnel Classification Board refers the appeal to one of its investigators for report. If the employee requests it he is granted an oral hearing. Appeals are constantly being filed by employees in all departments of the Government service. Some are meritorious and others are without merit. The task of the Personnel Classification Board is, I must conclude, a most difficult one. The bureau or office to which an employee is assigned is, in my opinion, because of its intimate contact with the employee, best qualified to consider the requirements and responsibilities of his position.

Suppose the appellants in a number of cases are reallocated to a higher grade. The Comptroller General has ruled that they must be paid in accordance with the new allocation whether or not there are funds available to meet the additional expense. If not, he has suggested that the force be reduced to meet the pay expense of those that remain. The result can also be attained by furloughing all employees in rotation, but they must be paid their full salary rates for the period of service actually performed. In other words, he has decided that there can be no horizontal percentage reduction in salary to come within available funds. This creates an embarrassing situation. The head of the bureau is charged with responsibility for conducting his bureau with the means at his disposal, but another agency has authority over the grade allocations of his employees and can place an additional charge upon his pay roll, and a third agency has ruled that he must pay employees 100 per cent of their salaries, minus retirement deductions. To extricate the bureau from the dilemma the head thereof is compelled to reduce his force by dismissals or resort to furloughs, both highly destructive of the morale and likely to incur the criticism that the bureau has not been able to function within its means or that it has been negligent in securing adequate funds.

For instance, on October 10. 1928, this bureau was advised through the department of the amount of the approved estimates therefor. Three days later the bureau was notified that nine employees had been reallocated to a higher grade on appeal, as of October 1. Later several other reallocations on appeal were allowed. These reallocations increase the pay roll $2,700 per annum and the cost for the remaining months of this fiscal year is $2,008. There are still a number of appeals pending before the Personnel Classification Board and, while we believe that some will be denied, we are fairly certain that several others (including several members of the law division and two employees of the division of surveys whose appeals for reallocation from professional 3 to the new vacant professional 4 have received favorable indorsement) will be allowed. Some of the recent reallocations involving employees in the mineral division will no doubt lead to appeals by employees in other divisions of the bureau, perhaps to the number of about 40.

If any considerable number of reallocations are made in addition to those recently received, and they are made, say, for instance, on March 5, effective as of March 1 according to the practice, there is no tribunal to which the bureau can submit a deficiency estimate, Congress having adjourned. It can not incur a deficit to be met by an appropriation the following winter and it is faced with the necessity of resorting to dismissals or furloughs. As a business proposition the rendition of adequate service to the public would suggest the maintenance of the force at existing salaries rather than the reduction of the force in order to pay those remaining higher rates of pay.

There is an erroneous impression among the employees that a reallocation carrying a higher rate of pay automatically brings about a deficiency appropriation if there are insufficient funds to meet the added expense. Other employees who do not entertain that misconception are reported to entertain the belief that the bureau is negligent in securing funds adequate to meet such emergencies, little realizing that the bureau at every opportunity endeavors to secure adequate appropriations.

I am venturing these few remarks not by way of criticism of any other agency of the Government but merely to emphasize the need for a little leeway to take care of the financial embarrassment that results by reason of the fact that another agency can create an additional charge upon our appropriations. The matter is one which sooner or later will require attention, not only as concerns our bureau but other bureaus and offices throughout the Government service.

The CHAIRMAN. Mr. Moffett, if we adopted the suggested limitations made a while ago in the appropriation bills this year, to the effect that no reallocations would be permitted under the act other than approved by the board, what would be the effect of that? Would it prevent reallocations being made this year?

Mr. MOFFETT. No, sir.

Mr. COLLINS. Would it have the effect of permitting the board to go beyond the law and allow an increase in excess of the amount set forth in the Welch Act?

Mr. MOFFETT. Of course, if the board does not properly perform its functions it may do that in any case.

Mr. OLIVER. This is a question that should be taken into consideration. You are dealing with substantive law, and if it is held that the comptroller under action of the departments establishes a scale of pay for these employees to which they are entitled, then a mere limitation on the expenditure of the appropriation would not in itself be sufficient to change the pay to which they were entitled. It might suspend the payment to them, but it would justify them in bringing a suit for any difference that they could establish was due them from the Government under this substantive law.

Mr. BYRNS. That is assuming that the Comptroller General were correct in his decision, and that is disputed, as I understand it.

Mr. WOOD. I think that that is also assuming that this committee has not any right to reduce the salary. I think in spite of the Welch Act, and in spite of any other act, this committee has the right to put a limitation upon the appropriation, the result of which would be the reduction of the salaries.

Mr. OLIVER. The trouble about it is that it depends upon how the limitation is drawn. If the limitation is so drawn as to affect only the expenditure of the money then it would be subject to the objection that I make. If the limitation is drawn so as to work in contradiction to the substantive law, it is questionable whether or not a point of order might not be made.

The CHAIRMAN. If we went farther than the current year's appropriation it might be subject to a point of order.

EFFECT OF DUAL LEGISLATIVE POLICY ON SALARY SITUATION

Mr. WOOD. Mr. Moffett, we have some more mix-ups here by reason of some dual legislation, and I want to ask you this: While the classification act of 1923 was amended by the Welch Act affecting the very great proportion of the employees in the District of Columbia and the field services, two other acts were also passed about the same time, one increasing the pay of a number of employees in the Customs Service, and another increasing the pay of the inspectors in the Immigration Service. The effect of these two separate acts was to take a number of the employees in these two services out from under the Welch bill and place them under the special bills, result

ing in these two services having a number of their employees under one pay act and another portion of them under another pay act. What will be the result of this mixed legislative policy in dealing with salaries?

Mr. MOFFETT. Of course, under the Welch Act the Congress placed upon the classification board the duty of making a survey of the field services and of recommending a scale of compensation for all of these field services. That survey would necessarily include positions in the customs service, the pay of which now is fixed by special act, and positions in the Immigration Service, the pay of which is now fixed by special act, as well as of all this other group of positions, the pay of which is now adjusted by the heads of the departments to conform, as nearly as practicable, to the scale in the classification act. In making that recommendation, it will be incumbent upon the board to make a recommendation that will bring about a uniformity in scale for positions involving duties and responsibilities which in the view of the board are similar.

Now, that may result in recommending a scale for positions in other services that the board believes are comparable in difficulty and importance to the positions in the customs and the immigration services, that is the same as that now in effect in customs and immigration; or it may, on the other hand, result in the board recommending a lower or higher scale for customs and immigration than that contained in these special acts.

Mr. WOOD. The Bacharach bill fixed the salaries of certain of customs employees by providing arbitrarily what the advance should be-that is, the clerks and the laborers, as I understand it.

STATUS OF FIELD SURVEY BEING UNDERTAKEN BY PERSONNEL
CLASSIFICATION BOARD

How nearly have you completed that survey of the field services? Mr. MOFFETT. Mr. McReynolds, I think, can tell you more definitely in detail about than than I.

Mr. WOOD. With reference to customs, how nearly have you completed that field service?

Mr. McREYNOLDS. The customs sheets are not in. They have had considerable difficulty in getting them in shape to suit themselves. I say that they are not in-New York is not in, and of course that is the most of the customs service. The rest of the sheets are in the Customs Bureau, but not yet submitted.

Mr. WOOD. You can not arrive at any conclusion until you get them all in?

Mr. McREYNOLDS. We can not, with respect to the customs service. Mr. WooD. Let me ask you this further question, Mr. Moffett. In the field survey that is being made are the services now under these special bills being included in the survey, and should not all departments except the Postal, Foreign Service, and wage board employees be under the same law?

Mr. MOFFETT. I think so. They are being included in the same

survey.

The CHAIRMAN. How far along have you gotten with this field survey for which Congress appropriated $75,000, Mr. Moffett?

Mr. MOFFETT. Mr. McReynolds is in charge of that survey, acting for the board and he is in closer touch with it than I am, but I may