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HomeMy WebLinkAbout85-005 NanovicMr. Thomas S. Nanovic, Esquire 57 Broadway Jim Thorpe, PA 18229 -0359 Dear Mr. Nanovic: I. Issue: II. Facts: III. Discussion: STATE ETHICS COMMISSION 308 FINANCE BUILDING HARRISBURG, PENNSYLVANIA 17120 March 20, 1985 OPINION OF THE COMMISSION 85 -005 Re: Life and Health Insurance, Township Supervisor Serving as Part -Time Road Laborer You have inquired into the propriety of a township supervisor receiving township provided life and health insurance coverage when employed as a township road laborer on a part -time basis. Your office serves as legal counsel to Towamensing Township, a township of the second -class in Carbon County, Pennsylvania. The township is governed by a board of supervisors consisting of three supervisors. There are currently numerous township road laborers and one of the three township supervisors also serves as a road laborer. This supervisor works an average of 10.94 hours per week on the township roads. This is less time than other road laborers work. The township currently provides life and health insurance coverage for the road laborers. The township would like to use township funds to provide similar insurance coverage for the supervisor who is serving as a road laborer. You seek an opinion from the State Ethics Commission in relation to this situation. As an elected supervisor within the township, this individual is a "public official" as that term is defined in the State Ethics Act and, as such, his conduct must conform to the requirements of the Ethics Act. 65 P.S. §401 et. seg; See Sowers,, 80 -050. Thomas S. Nanovic, Esq. March 20, 1985 Page 2 As noted in your request letter of January 22, 1985, you are familiar with the ruling of the Commonwealth Court of Pennsylvania in Hoak and McCutcheon v. State Ethics Commission, 77 Pa. Cmwlth. 52.9, 466 A.2d 283, (1983). In that case, as well as in various rulings of the State Ethics Commission, it was held that the purchase of pension /annuity policies by township supervisors for themselves would be a violation of the provisions of the State Ethics Act. 65 P.S. §403(a). Such action, the Court noted, would be using one's public position to obtain financial gain other than compensation provided by law. Additionally, while the compensation of a township supervisor, who also serves as a roadworker or roadmaster, may be increased beyond the statutory limits of one who acts only as a supervisor, such increase must be affirmatively approved by the Board of Township Auditors. See Kiniry, 84 -008. While the foregoing cases were decided specifically in reference to pension /annuity programs, the Commission has, more recently, issued a number of opinions which address the issue of group hospitalization, health and life insurance coverage for township supervisors. These rulings indicate that township provided coverage of this type, for non - working supervisors generally, and for working supervisors if not approved by the board of auditors, would constitute financial gain obtained in violation of the Ethics Act. See Krane, 84 -001, Cowie, 84 -010; Mlakar, 84 -011; Davis, 84 -012. We will not here restate the reasoning employed in reaching this conclusion but will incorporate herein by reference the substance of these opinions. With these concepts in mind, we must now turn to the more difficult question presented by your situation. Specifically, we must decide what, if any, effect does the part -time working status of the supervisor have on the propriety of such coverage. The compensation method for a township supervisor who also serves as a road laborer is specifically set forth in the Second Class Township Code and provides that: The compensation of supervisors, when acting as superintendents, roadmasters or laborers, shall be fixed by the township auditors either per hour, per day, per week, semi- monthly or monthly, which compensation shall not exceed compensation paid in the locality for similar services...53 P.S. §65515 Thomas S. Nanovic, Esq. March 20, 1985 Page 3 The Code further provides that: This section shall not prohibit the township supervisors from being employed as superintendents or roadmaster, or as laborers, if physically able to work on and maintain the roads. In such cases, they shall not employ a superintendent or roadmasters and their compensation shall be fixed as hereinafter provided. 53 P.S. §65514. The above provisions of law allow the Board of Township Auditors to fix the compensation of ''working" supervisors who are able and capable of working. This compensation is not to exceed the compensation paid in the locality for similar services. We believe that a reading of these provisions evidences a legislative intent to insure that compensation is paid for actual work and that the amount of compensation must bear a rational relationship to the work performed. This concept has been set forth in a number of Pennsylvania cases. Early judicial pronouncements have established that supervisors employed as road masters must actually perform work. North Union Township Road Master, 11 Del 47, 1908. As such, municipal employees are not entitled to compensation as an incident to the employment but only for services rendered. Trestrail v. Drewes et. al, 26 D &C 204, (Del., 1936). Indeed, more recently in Hoak and McCutcheon v. State Ethics Commission, 77 Pa. Cmwlth. 529, 466 A.2d 283, (1983), the Commonweatlh Court of Pennsylvania in citing another case stated that the legislative intent of the compensation provisions of the Second Class Township Code was to insure that the position of superintendent or roadmaster would be compensated only for work actually performed and not for the mere intangible aspects of the duties. 466 A 2d. 283; at 286, citing Appeal of D. Lee Sharpnack, 9 Fayette L.J. 214, (1948). In Sharpnack the court specifically noted that if a supervisor works only a part of the day, he is entitled to he paid for the time actually worked. 9 Fayette L.J. 214; at 221. The Commission, of course, will not attempt to nor does it have the authority to usurp the function of the township auditors. That body must fix the salary of supervisors employed as laborers, roadmasters, or superintendents. We believe, however, that the Board of Township Auditors has no authority to fix compensation when no work is performed. As such, any approved compensation must bear a rational and reasonable relationship to the actual services performed. We believe that in the instant matter, the supervisor may, within the purview of the State Ethics Act, receive insurance coverage to the extent approved by the auditors. This coverage, however, should bear a reasonable relationship to the functions performed. Factors to consider in this respect Thomas S. Nanovic, Esq. March 20, 1985 Page 4 may include; the extent of the coverage offered to other employees performing similar functions; the percentage of time actually worked by said supervisor in relation to the other employees; the type and extent of coverage accorded to others under similar cirmcumstances in the locality; the extent of any co -pay requirement to be imposed upon the supervisor; and the limitation of coverage if apportioned in relation to the percentage of time actually worked. While the foregoing only represent some of the factors that may he important in such a decision, they will assist in determining if the supervisor is receiving compensation as provided by law. (i.e. for actually working) The Commission will continue to review situations of this type in light of this decision and in light of the above factors. IV. Conclusion: The township supervisor herein involved may receive, at the township expense, health and life insurance while he remains in the position of road laborer. However, such benefits must be approved by the board of auditors and must bear a rational or reasonable relationship to the amount of time actually worked. Pursuant to Section 7(9)(i), this opinion is a complete defense in any enforcement proceeding initiated by the Commission, and evidence of good faith conduct in any civil or criminal proceeding, providing the requestor has disclosed truthfully all the material facts and committed the acts complained of in reliance of the advice given. Finally, any person may request within 15 days of service of the opinion that the Commission reconsider its opinion. The person requesting reconside- ration should present a detailed explanation setting forth the reasons why the opinion requires reconsideration. JJC /sfd This letter is a public record and will be made available as such. By th- Co mission HERB 'T B. CONNER Cha rman