Untitled Texas Attorney General Opinion ( 2005 )

ATTORNEY GENERAL OF TEXAS
GREG ABBOTT
October 21,2005
The Honorable Norma Chavez, Chair Opinion No. GA-0368
Committee on Border and International Affairs
Texas House of Representatives Re: Whether a civil service commission
Post Office Box 2910 may authorize retroactive salary increases
Austin, Texas 78768 for municipal employees (RQ-0339-GA)
Dear Representative Chavez:
You have asked whether the Socorro Civil Service Commission may grant a retroactive pay
rate increase to municipal employees effective from the date of their last evaluation.’ An opinion
from the Interim City Attorney of Socorro attached to your letter concludes that the pay increases
would be impermissible under the Texas Constitution.
Article III, section 53 of the Texas Constitution states:
The Legislature shall have no power to grant, or to authorize any
county or municipal authority to grant, any extra compensation, fee
or allowance to a public officer, agent, servant or contractor, after
service has been rendered, or a contract has been entered into, and
performed in whole or in part . . . .
TEX. CONST. art. III, $ 53. The purpose of this provision (“section 53”) is to prevent “counties or
municipalities from freely giving away the public moneys for services previously rendered or for
which no valid legal authorization existed for which the public would receive no return.” Id. interp.
commentary (Vernon 1997). Section 53 prohibits local governments from granting retroactive pay
raises to employees. Fausett v. King, 470 S.W.2d 770,774 (Tex. Civ. App.-El Paso 1971, no writ)
(holding that a salary increase delayed for one month in order to meet a public hearing requirement
could not be made retroactive); Pierson v. Galveston County, 13 1 S.W.2d 27, 29 (Tex. Civ.
App.-Austin 1939, no writ) (commissioners court could not “retrospectively” approve a salary
increase for a deputy employed by a justice of the peace); Tex. Att’y Gen. Op. No. JM-1113 (1989)
at 2 (county may not make salary increases for county employees retroactive).
‘See Letter from Honorable Norma Chhvez, Chair, Committee on Border and International Affairs, Texas House
of Representatives, to Honorable Greg Abbott, Texas Attorney General, at 1 (April 25, 2005) (on file with Opinion
Committee, also available at http://www.oag.state.tx.us) [hereinafter Request Letter].
The Honorable Norma Chkvez - Page 2 (GA-0368)
However, section 53 prohibits only the granting of “extra compensation” to an employee.
Compensation is “extra” if it is “in addition to that allowed by law or contract.” Dallas County v.
Lively, 167 S.W. 219,220 (Tex. 1914); Tex. Att’y Gen. Op. No. GA-0322 (2005) at 5. For example,
section 53 does not prohibit the award of back pay where a city pays civil service employees less
than required by statute. See City of Wichita Falls v. Cox, 300 S.W.2d 3 17, 321 (Tex. Civ.
App.-Fort Worth 1957, writ ref d n.r.e.). Similarly, where compensation under an employment
contract is reduced due to emergency spending cuts, the restoration of those cuts is not extra
compensation. See Taxpayers ‘Ass ‘n v. Houston hdep. Sch. Dist., 8 1 S.W.2d 8 15, 819 (Tex. Civ.
App.-Galveston 1935, writ dism’d). More important for our purposes, section 53 does not prohibit
terms of employment that tie compensation to performance. For instance, bonuses are permissible
where a bonus plan has been approved as part of compensation before the rendering of services.
See Tex. Att’y Gen. Op. No. JC-0376 (2001) at 2 (citing Tex. Att’y Gen. Op. No. JM-1253 (1990)
at 2-3).
A city policy could authorize pay raises in the event of a high evaluation - for example, over
a certain score - and provide that the increases start from the evaluation date. The raises would not
be “extra compensation” because they would be a term of employee compensation in place before
the employee rendered services. This does not appear to be the case in the present situation,
however. We are informed by the interim city attorney that an evaluation constitutes only a
“recommendation” for a pay rate increase. It “is not to be considered as the granting” of a pay raise.
Request Letter, supra note 1, at 4. He further states that the “only authority that may grant a pay
raise is the City Council.” Id. at 4; see also SOCORRO, TEX.,CITY CHARTER, art. XI, 6 11.4-4 (2001)
(“[mlerit increases shall be subject to the availability of funds under the City Budget”). We defer
to the interim city attorney’s authority as a city officer to construe the charter. See Tex. Att’y Gen.
Op. Nos. GA-0226 (2004) at 3; GA-0130 (2003) at 3; JM-846 (1988) at 1.
Certainly, the Socorro Civil Service Con-mission may recommend pay raises for meritorious
employees to be applied prospectively. Section 53 does not prevent the adjustment of salaries or
benefits at any time, as long as the changes are applied to future services rendered. See Tex. Att’y.
Gen. Op. No. JM-1160 (1990) at l-2 (grant of additional sick leave does not violate section 53
because compensation for county employees may be set at any time). The raises would need to be
approved by the City Council to become effective. We have further noted that section 53 would not
prohibit the restructuring of employment to tie compensation to performance, perhaps through a
bonus.
In conclusion, the City of Socorro may not grant a retroactive pay rate increase to municipal
employees without violating article III, section 53 of the Texas Constitution.
The Honorable Norma Chivez - Page 3 (GA-0368)
SUMMARY
Article III, section 53 of the Texas Constitution prohibits the
Socorro Civil Service Commission from granting a pay increase to
municipal employees effective from the date of their last evaluation,
unless a policy for such pay increase was already in existence prior to
the evaluation.
Attorney General of Texas
BARRY R. MCBEE
First Assistant Attorney General
NANCY S. FULLER
Chair, Opinion Committee
Susan L. Garrison
Assistant Attorney General, Opinion Committee