Untitled Texas Attorney General Opinion

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                                The Attorney General                   of Texas
                                                 Mar91 10, 1986
JIM MAlTOX
Attorney General


Suprema GxWt BUlldlnQ           Honorable Rane A. Gucrra                Opinion   No.   Ju-447
P. 0.80x 1254S                  Criminal District Attorney
~ustm. TX 7871% 2548            Ridalgo County Courthouse               Re: Whether a county may pay em-
51214752501                     Edinburg , Texas  78539                 ployecs injured on the job the differ-
Talea 9101074-1357
1aiecopiar 512l4750286
                                                                        ence between their regular salary and
                                                                        their workers’ compensation benefits

714 Jackson. Suit0 700          Dear Mr. Guerra:
Oaltaa, TX. 75202.4508
214/742+.944
                                      You question    the constitutionality      of a current    practice     in
                                Ridalgo  County o:I paying injured        county employees    the difference
4S24 Alberta Ave.. Suite 180    between their workers’     compensation benefits     and their salary.      You
El Paso. TX. 799052793          also ask whether an injured       employee ma9 receive   accrued sick leave
915/53%34S4                     and vacation    1eaT’c’ in addition    to workers’ compensation     benefits.
                                Your coucern focuses on provisions          of the Texas Constitution     which
 1Wl Texas. suite 700           prohibit  grants OX loans of public money. -See Tex. Const. art. III,
 “ouston. TX. 77002.3111        #551. 52, 53.
 713l223.5888
                                      Counties havlr. only those pavers that are granted expressly          or
                                that  must be implted from the authority      granted or duties imposed by
 808 Broadway, Suite 312
                                the Texas Constltrltion   or statutes.    Canales v. Laughlin,     214 S.W.2d
 Lubbock. TX. 79401-3479
 SOW747.5235                    451. 453 (Tex. 191;8).    Accordingly,   your questions require considera-
                                tion of grants of authority      as veil  as constitutional    limits   on its
                                exercise.    As wil:. be shown, the present constitutional      authority  for
 4309 N. Tenth. Suite 6
                                counties to provide workers’ compensation benefits       was adopted beceuse
 McAllan. TX. 78501-%S5
 5121882.4547                   of the constitutic~moal limits   about which you ask.     A brief background
                                of these provlsiDns      must precede     our response      to your specific
                                questions.
  200 Ma,” Plea, Suite 400
  sari Antonlo. TX. 7S2052797
                                       Article    III,     section    52 of the Texas Constitution         prchibjts
  51212254191
                                counties from makjng grants or loans of money or of any other thing of
                                value.     See also Ift?x. Const. art. III,        551.   Because a county is not
  An Equal OpportunitYl         inherently     liable     ,for injuries   to its employees,     section   52 at one
  Afllrmatlve Action Employer   time prevented         cslntles    from  providing     any workers’     compensation
                                benefits     for its       employees.    See Attorney      General Opinion O-5315
                                (1943).      Section 60 was added to          article    III in 1948 in part to
                                overcome the effect of section 52.

                                       Article   ITI,   section   6C of the Texas Constitution    provides:

                                                WORKPEN’sCOMPENSATIO??
                                                                     INSQTMCE FOR EHPLOYEES
                                             OF COUNTIESAND OTHERPOLITICAL.SUBDIVISIONS. The



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Eonorable   Rene A. Guerra - l?rrge 2        (JM-447)




            Legislature    shell have the power to pass such laws
            as may be necesmry         to enable all counties         and
            other political     eubdivisiona    of this State to pro-
            vide Workman’s Compensation Insurance,            includiog
            the right to pmride        its own insurance risk,        for
            all   amployees o!i the       county or political        sub-
            division    as in its judgment is necessary           or re-
            quired; end the Legislature        shell provide suitable
            laws for the admtinistration        of such insurance in
            the counties      or pollticel      subdivisions    of this
            State and for tt,e payment of the costs,             charges
            sod premiums on t,uch policies        of insurance and the
            benefits    to be pr,id thereunder.

      In 1973 the legislature     made workers’ compensation mandatory for
all political    subdivisions.    See Acts 1973, 63rd Leg., ch. 88. 517, at
198 (codiffed    as V.T.C.S.   &.309h);      Attorney General Optnion E-338
(1974).    Section 2(e) of article    8309h provides:

                 All political     subdlvisioos      of this state shall
             become, either      !self-insurers,       provide   insurance
             under workmao’s compensation            insuraoce   contracts
             or policies,      or anter into interlocal         agreements
             with other political          subdivisions     providing   for
             self-insurance,      clxtending workmen’s compensation
             benefits   to their smployees.

 Ridalgo County presently    grwldes  workers’ compensation insurance for
 its   amployees through the Texas Association      of Counties   Workers’
 Compensation Self-Insurance    Fund.

       Workers’ compeosatioa         benefits     are Intended        to retmburse      an
 employee for loss of earning capacity caused by work-related                 injuries,
 Bullerd v. Universal Undengriters            Insurance Company, 609 S.W.2d 621,
 626 (Ter. Civ. App. - AmarZllo 1980, no writ),              not for loss of salary.
 See El Paso County v. JeE!C!.             699 S.W.2d 375. 377 (Tex. App. - El
 Phso 1985, 00 writ).          Article    8309h and the general workers’ com-
 pensation     statutes   that it makes applicable             to counties,     see 13,
 specify    formulas for deta!rmining the amount of compensationdue                     an
 injured     employee.     These formulas        are based upon the nature and
 duration of the l     mployee’c, injury and upon the employee’s salary.              The
 workers’ compensation stat,utes applicable            to counties do cot authorize
 counties to pay, at thefr        discretion.     additional     compensation for loss
 of earning capacity eausecl by a vork-related             injury.     Because counties
 have    only expressly     grsnctrd or neccsserlly         implied powrrs, we must
 determine vhrther any other           statutes     authorize      the payment of the
 difference     between an aq:loyee’s         worker’s    compensation benefits       and
  salary.




                                     p. 2029
.   .


        Aouorable   Rene A. Cucrrr - :Pcgc 3         (a-447)




                Article 3912k, section       1, V.T.C.S.,      authorizes   the conmissioners
        court    of each county to

                     fix the amour& of compensation,         office   expense,
                     travel  expense,   and all     other     lllovances    for
                     county and prec:inct officials       end employees who
                     are paid wholly from county funds. . . .

        As vi11 be shown, additional        workers'   compensation benefits     could be
        viewed not as workers' cor:pensatlon benefits        per se, but as an element
        of an employees pre-establlshcd,        regular coqansation.     E 1 though   this
        provision   authorizes    the county to "fix     the  aunt   of compensation,"
        it does not authorize         p;byments which are prohibited    by statute       or
        which amount to gifts       or S.rants of public money in violation       of con-
        stitutlonal   prohibitions.

                Authorities     which coosidar    sitilar     types of payments distinguish
         between an ex post facto           decision      to award extra brnefits           and a
         prospective     decision    to mdre certain     extra benefits      a standard part of
         compensation.       See, e.g. :, City of Corpus Chr3cit.i v. Herschbarh,                536
         S.W.Zd 653 (Tex. Clv. App. - Corpus Christi               1976. vrit ref'd      n.r.e.);
         Attorney General Opinion E-51 (1973).                 Your request       l~etter reveals
         that Hidalgo County has followed              an informal       practice     of granting
         extra    compensation      ss jndividusl       injuries     occur and that it now
         proposes    to make this extra compmsation part of a standard policy.
         As will be shown in the discussion             to follov,     the Texas Constitution
         prohibits     a retroactive     award of the differrnce            betveen an injured
         county employee's         workers     compensation       benefits     and his    regular
          salary.

               Attorney General 0p:inion E-51 dealt with the effect           of sections
         51, 52, acd 53 of article     IT1 on retroactive    payments by tbr county cf
         certain benefits   to the beneficiaries      of s deceased county anplopee.
         The opinion determined ttst because the commissioners court lacked the
         constitutional   or statutory     authority    to provide    retroactively     for
         death banoflts.   the  actic'n constituted      an unconstitutional      grant  or
         gift of public money. ‘Ihe issue in Attorney General Opinion E-51 is
         analogous to the instant one.

                Although Attorney     General Opinion B-51 did not rely explicitly
          upon artfcle     III,  sect3on 53, ve believe      that section   53 is par-
          ticularly   relevant    to the case at haod with regard to retroactive
          awards of the benefits      :;n question.  Article   III, section   53 of the
          Texas Constitution    provides:

                          COUNTYOR MUNICIPALAUTHORITIES; EXTRA C@MPEN-
                       SATION; uNAuTalx.IzED    CLAIMS.      The Legislature
                       shall have no power to grant.      or to authorize any
                       county or municipal authority      to grant. any extra
                       compensation.    fee  or   allowarxe     to  a public



                                                    p. 2030
Ronoreble   Rene   A.   Guerre - Page 4        (JM-447)




            officer,   agent,   servant    or  coatrector,  after
            service has been rendered, or a contract has been
            entered into, ml performed in whole or in part;
            nor pay, uor aUth~DTiZe    the payment of, any claim
            created age&et    my county or semicipality    of the
            State,   under my agraenent       or contract,   made
            vithout suthoritl, of lsv.

Consequently,    we believe   that retroactive   payments by the county of
additional    benefits,  vbich are measured by the difference    between an
injured employee’s workers’ compensation benefits       under article   83C9b
and the employee’s salary, are prohibited      by the Texas Constitution.

       You indicate.        however, that the         situation    in Aidalgo    County
requires     consideration     of both retroactive       and prospective   payments of
the    difference     between ao employee’ s workers’ compensation benefits
and regular salary.          The court in City of Corpus Christ1 v. Ferschbach
suggested that the receipt of “extra” workers’ compensation benefitrr,
which are authorized by s’tatute,             might be authorized      as part of the
employee’s      pre-established,       regular compensation.       536 S.W.2d st 657;
 see also El Paso County ‘1 Jeffers,               699 S.W.2d 375 (Tex. App. - El
Paso 1985, DO writ);           Actcrney     General Opinion g-860 (1976).        There-
 fore,     the payments woulti not constitute               “extra   compensation”     in
violation      of article     III. rrectioo 53 of the Texas Constitution.            699
 S.W.2d st 377.        Ntverthelc:ss,      the court suggested,      in dicta,   that a
 1975 amendment, which requires offset             for certain benefits,     to article
 8309h might       prevent suck. payments of extra workers’ compensation
 benefits     after 1975. -Id.

       The legislature amendted section   5 of article   8309h in 1975 to
 provide for offset.   See A,cts 1975. 64th Leg., ch. 404, Il. at 1041.
 Section 5 of the statu=currently     provides, in part:

                  (a)    It is tl,e purpose of this article            that the
             compensation herlein provided               for shall be paid
             from veek to we&k sod as it sccrues and directly
             to     the    persoo      entitled      thereto,      unless    the
             liability      is redeemed as in such cases provided
             elsewhere herein.          Provided further,        however, that
             any and all sums for incapscity               received in accor-
             dance vith Chap& 325, Acts of the 50th Legisla-
             ture,      1947, as-smended         (Article     1269m, Vernon’8
             Texas Civil Stacttes),           and any other statutes now
             in force and ef’iect that provide for payment for
             incapacity       to-- r,ork because of injury on the job
             that     is also co&ed        by this    Act are hereby offset
             ss sgainst the Ikefits             provided under this Act to
              the extent        apr;iicable.       Provided      that wheo an
              employee’s      wag@? is offset         as prescribed       above,
             both the employer and the employee shall pay Into




                                          p.   2031
.   ,

        Honorable   Rene A. Guerrs - 'Page 5          (Jn-447)




                    the pension fuod cm the mount of money by vhich
                    his wage Y(LE offset      end provided    further   that
                    under no circumstances     shell ao employee's pension
                    benefit  be reduccid, 8s a result of his injuries     or
                    any compensation    xeceived    under the provision   of
                    this Act, unless isuch reduction is s result of a
                    pension revision    ,paesed by mjority     vote of the
                    affected   members Iof a pension system.       (Emphasis
                    added).

        V.T.C.S.    art.   8309h.   S5(a).

               The phrase in sectiot      ?(a) vhicb causes concero        is the one which
        requires   offset     of sums received      for izcapaciry      in acccr&nce    with
        “any other statutes       now in force and effect        that provide for payment
        for incapacity     to vork because of injury on the job" vheo that injury
        is also covered by artlclr           83C9h.    Article   3912k wss "in force and
        effect"   at the t1r.e section      S(a) was amended in 1975.         See Acts 1971,
        62nd Leg.,     ch. 622, at 20119. Thus. we must deeern&zhethtr                    the
        payment of additional       benr,f its,   which sre measured by the difference
        between an iojurad wloyr,as             workers'   coqensation     benefits  and the
        employee's    salary,    pursuant to article       3912): falls   b*thin "any other
        statutes"   within the waoinS of article           8X9t.   section 5.

              The bill  analysis        to the anendaent requiring     offset   states   the
         background and purpose        of ,:he amendment as foliovs:

                         Present law 1:; not clear that workmen's coven-
                     sation beoefits       are paid lo lieu of, and not in
                     addition     to,   other   statutory paymeots made for
                     vcrk-related     ioc apscity .

                         This bill  vou1.d insure that payments ,pde        for
                      work-related   locapacity      under other    itatutory
                      plans sre credited    agaiost    amounts due btiuder the
                      Workmen's Cospenmtion     Act.

                          Section 1 ammds Arttcle   83C9b to ensure that
                      vorkmen's   co~ensation payneots are lessened    by
                      amounts paid under other statutory plans.

         Bill    Analysis   to S.B. ND.      828. prepared for Senate Commirtce on
         Economic Development, filr:d. in Eill Pile to S.B. No. 828, Legislative
         Reference     Library.     Psynle.nts of   additional   benefits,   which     are
         measured by the difference       between workers' coqensation     benefits    and
         salary,    that are xnade parsuant       to article    3912k as part       of sn
         employee's pre-establishei;,      regular salary are arguably payTents aade
         for work-related     incapacity   under other statutory plans.




                                                 p.    2032
Ronorable   Rene A. Guerra - :?trge 6        (Jn-447)




      In ~1 Paso Couoty v. Jeffers.          e.        however, the court suggested
that section    5 of article       8309hwas intended to offset            only existing
statutes   which     speciflcaL:Ly       provided       for worker's        coinpensstioi
beneflte.    The court atsted:
                                                                                       .
            [Alo 8309h offsef: aupliee           to funds for incapacity
           deceived pureuanf to-the firemen's              and policexen'b
           civil    service     prEvisiona      'and soy other statutes
           now in force and-effect.'               We have beau cited       to
           no offset      etatut;     applicable     to deputy sheriffs.
           The reauirement t&t deoutv sheriffs                receive their
            *maxi&w salary'        while incapacitated        from Injuries
            received in the course of their duties is provided
            for by the Taxas Coostltucioo.               It is fundamental
            that the Constitution         is the paramount law of the
            state and csnnot 'be altered by legislstive                 smend-
           meats.       [citation      omitted].       On its     face,    the
            statute     cited     12 Appellant       does not apply         to
            deputy sheriffs,        and if It did it would be in con-
            flict with=Texas             Coostitutioo.        The Appellant
            was in error in ~:lsiming an offset               under srticle
            8309h.     (Emphasis added).

699 S.W.2d st 377.       In oth'er vords      the court suggests that section 5
of article     8309h was intended to           require    ooly offset   of specific
workers'   compensation sts1:utes such         as article     1269m. Article 3912k.
in   contrast.     provides   fsor the        general     compensation    of county
employees.

        Workers'  compensation    benefits    reimburse for loss    cf earning
 capacity,   not for loss of isalary.      699 S.W.2d at 377.   Payments uoder
 article    3912k can be dis,tingulshed        ss reimbursement   for loss   of
 salary.    Consequently se&too 5 of article        8309h does not prevent the
 county frompaying     the dif,ference between injured employees' worker's
 compensation'" benefits    acd their      regular  salaries  as part of the
 employees' pra-established,,     overall compensation under article    3912k.

       You also ask whether, sn injured employee may receive              sick leave
 and vacation       leave    in .~dditioo    to vorkers'     compensation    benefits
 without violating       article   6309h or sections     51. 52, and 53 of article
 III of the Texas Constitution.           As indicated,    Attorney General Opinion
 H-51 determined that ret::oactive          payments of death benefirs       were not
 authorized by the Texas C,onstitutioo          or ststutes    and that they there-
 fore constituted        unconstitutional     grants or gifts       of public funds.
 The opinion       distinguishtd      unused vacation     time aod other forms of
 accrued     compensation.        Because these      types   of compensation     were
 authorized     aod had alreod:y been earned, payment of such benefits               to
 survivors     vas not deemed an unconstitutional            grnnt.    The same con-
 siderations     apply to payment for the unused sick leave and vacation
 time that an injured          county employee has already earned; therefore,



                                             p. 2033
.

    Honorable   Rem A. Gucrro - Page 7            (JM-447)




    such payments  do not viola’to  the Texas Corzstitution.   Conaequenriy.
    the county is not prohibp:trd from paying an injured county employee
    accrued  sick  leave   and vacation   leave  in   addition  to workers’
    compensation benefits.

                                         SIJMMARY

                   Hidalgo      Cour.ty may not            make retroactive
                payments     to lnjwed        county employees of extra
                workers’ compenwtion           benefits     measured by the
                difference     betwren      their   workers’     compensation.
                benefit;    under article       8309h. V.T.C.S.,     and their
                salary.     If the (county makes additloul            workers’
                compensation benefits         a part of county employees’
                pre-established,          regular       compensation     under
                article    3912k. the benefits           need not be offset
                against the benefits        provided under article      8309h.
                The county       is   not prohibited         from paying an
                injured employer: accrued sick leave and vacation
                leave     in    add5 t ion     to   workers’     compensation
                benefits.




                                                    Jkh
                                                      Very truly your
                                                             .


                                                      JIM     NATTOX
                                                      Attorney General of Texas

     JACK HIGBTOWRR
     First Assistant Attorney      Central

     MARYKELLER
     Executive Assistant     Attorney     General

     ROBERTGRAY
     Special Assistant     Attorney     General

     RICK GILPIN
     Chairman, Opinion Conunittl;a

     Prepared by Jennifer Rigg:3
     Assistant Attorrey General




                                                  p. 2034