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