OFFICES AND OFFICERS - STATE - HIGHWAY DEPARTMENT - PAYMENT OF ACCRUED VACATION LEAVE TO EMPLOYEES

OFFICES AND OFFICERS - STATE - HIGHWAY DEPARTMENT - PAYMENT OF ACCRUED VACATION LEAVE TO EMPLOYEES.

The department of highways is required to pay accrued vacation leave to employees whose employment has been terminated but may not pay such leave to those who, at the notice of termination, transferred to another agency or another position within the department without such interruption in their employment as would indicate termination of their contract with the state government.  Such employees are entitled only to credit for such accrued vacation leave.  The department may prescribe rules and regulations covering accrued annual leave for those employees who transferred to another position within the department.

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                                                                 January 29, 1960

Honorable W. A. Bugge
Director of Highways
Transportation Building
Olympia, Washington                                                                                           Cite as:  AGO 59-60 No. 99

Dear Sir:

            You have requested the opinion of this office on the following question:

            "May the Department of Highways pay accrued vacation leave to employees whose employment has been terminated as a result of a necessary reduction in force?  We are specifically interested in knowing whether or not such leave may be paid to those employees who, after notice of termination, transferred to another state agency or transferred to another position within the department."

            We conclude that the department is required to pay accrued vacation leave to employees whose employment has been terminated as a result of a necessary reduction in force, but may not pay such leave to those who, after notice of termination, transferred to another agency or another position within the department without such interruption in their employment as would indicate termination of their contract with the state government.  These employees are entitled only to credit for such accrued vacation leave.  The committee on standards has prescribed rules and regulations covering  [[Orig. Op. Page 2]] accrued annual leave in transfers between state agencies and the department may prescribe rules and regulations covering accrued annual leave for those employees who transferred to another position within the department.

                                                                     ANALYSIS

            Chapter 140, Laws of 1955, provides for the payment of vacation leave.  Section 1, chapter 140, Laws of 1955 (RCW 43.01.040) provides in part as follows:

            "Each subordinate officer and employee of the several offices, departments, and institutions of the state government shall be entitled under their contract of employment with the state government to not less than one working day of vacation leave with full pay for each month of employment if said employment is continuous for six months.

            ". . .

            "Each subordinate officer and employee of the several offices, departments and institutions of the state government shall be entitled under his contract of employment with the state government to accrue unused vacation leave not to exceed twenty-five working days.  Officers and employees transferring within the several offices, departments and institutions of the state government shall be entitled to transfer such accrued vacation leave to each succeeding state office, department or institution.  All vacation leave shall be taken at the time convenient to the employing office, department or institution."

            Section 2, chapter 140, Laws of 1955 (RCW 43.01.041) provides as follows:

            "Officers and employees referred to in section 1 of this act whose employment is terminated by their death; reduction in force; resignation; dismissal; or by retirement and who have accrued vacation leave as specified in section 1, shall be paid therefor under their contract of employment, or their estate if they are deceased, or if the employee in case of voluntary resignation has provided adequate notice of termination."

            In AGO 55-57 No. 129, dated August 23, 1955 [[to State Auditor)]], we concluded that the above quoted statute was not in conflict with Article II, § 25, of the constitution, stating:

             [[Orig. Op. Page 3]]

            ". . . we believe the legislature clearly intended to and did make adequate provisions for vacation leave pay to accrue to the employee's benefit in the form of compensation, collectible by the employee or his representative when, as a condition precedent, his employment is terminated in a manner stated in the statute.  There is no conflict with Article II, section 25, of the state constitution, as this is compensation for services rendered in accordance with the contract of employment."

            Section 2, chapter 140, Laws of 1955 (RCW 43.01.041) specifically requires the payment of accrued vacation leave to employees who have been terminated as a result of a reduction in force.  We conclude, therefore, that pursuant to § 2, chapter 140, Laws of 1955 (RCW 43.01.041) the department is required to pay accrued vacation leave to those employees whose employment has been terminated as a result of a reduction in force.

            In AGO 57-58 No. 41, dated March 28, 1957 [[to State Auditor)]], we concluded that under the above quoted provisions of § 1, chapter 140, Laws of 1955 (RCW 43.01.040) a state agency may not pay accrued vacation leave to an employee transferring to another agency without an interruption such as would indicate termination of his contract of employment with the state government, stating:

            "In summary, it is the opinion of this office that a state employee who transfers from one state agency to employment in another agency of the state government, without an interruption such as would indicate termination of his contract of employment with the state government cannot be paid for his accrued vacation leave under the provisions of chapter 140, Laws of 1955.  However, an employee transferring from one state agency of the state government to another is entitled under the provisions of RCW 43.01.040 (1955 Supp.) to credit for his accrued vacation leave with the new employing agency."

            We affirm our previous conclusion that the department may not pay accrued vacation leave to employees transferring to another state agency without an interruption such as would indicate termination of their contract of employment with the state government.  Such employees are only entitled to credit for such accrued vacation leave with the new employing agency.

            Similarly, it is our opinion that the department may not pay accrued vacation leave to those employees who, after notice of termination, transferred to another position within the department without an interruption such as would  [[Orig. Op. Page 4]] indicate termination of their contract of employment with the state government.  These employees are only entitled to retain their leave credit with the department.

            Section 4, chapter 140, Laws of 1955 (RCW 43.01.043) delegated to the various state agencies the power to prescribe supplemental rules and regulations not inconsistent with the above quoted statutes to effectuate the purposes of these statutes.  Section 4, chapter 140, Laws of 1955 (RCW 43.01.043) provides as follows:

            "The several offices, departments and institutions of the state government may prescribe supplemental rules and regulations that are not inconsistent with the provisions of this act with respect to vacation leave of subordinate officers and employees thereof."

            The committee on standards has adopted such rules and regulations covering accrued annual leave in transfers between state agencies.  The department may adopt rules and regulations covering accrued annual leave in transfers within the department.

            It is our opinion that the department of highways is required to pay accrued vacation leave to employees whose employment has been terminated as a result of a necessary reduction in force.  As to those employees who, after notice of termination, transferred to another state agency, the department of highways may not pay them accrued vacation leave if there has been no interruption in their employment such as would indicate termination of their contract with the state government.  Such employees whose employment has not been terminated are entitled only to credit for such leave with the new agency.  As to those employees who, after notice of termination, transferred to another position within the department, the department similarly may not pay them accrued vacation leave if there has been no interruption in their employment such as would indicate termination of their contract with the state government.  These employees are entitled only to retain their leave credit with the department.  The various state agencies, including the department, have been delegated by statute with the power to prescribe supplemental rules and regulations not inconsistent with the foregoing to effectuate the purposes of the leave statutes.  The standards committee has adopted such rules and regulations covering accrued annual leave in transfers between state agencies.  The department may adopt rules and regulations covering accrued annual leave in transfers within the department.

             [[Orig. Op. Page 5]]

            We trust the foregoing will be of assistance to you.

Very truly yours,

JOHN J. O'CONNELL
Attorney General

JAMES R. CUNNINGHAM
Assistant Attorney General