Could Maryland's Secretary of Personnel cut a state employee's pay without telling the legislature?

Plain-English summary

The Chief Judge of Maryland's Court of Special Appeals, chairing a committee working on a revision of the state's Merit System Law, asked the Attorney General to resolve a tension between two provisions of Article 64A of the Maryland Code. One provision, the "pay plan" statute in §27, let the Secretary of Personnel amend the pay plan for job classifications, subject to a process that included reporting amendments to the General Assembly, which could reject them. A separate provision, §30(a)(2), gave the Secretary broad-sounding authority to "increase or decrease any rates of pay" for all classified and unclassified employees at any time, with the Governor's approval, but without saying anything about reporting to the legislature. The Committee wanted to know whether a pay decrease under §30(a)(2) had to go through the §27 reporting process, or could happen on its own.

The Attorney General concluded that the two statutes were not truly duplicative: the §27 pay plan amendment process, traced back through its legislative history to a 1957 law limiting amendments to "acute emergencies" needed to recruit or retain essential employees, applied only to pay increases, not decreases. Because a decrease in pay was not a "pay plan amendment," the Secretary could cut rates of pay under §30(a)(2) without triggering the §27 reporting duty and without having to notify the General Assembly. But because the more recently enacted portions of §27 (particularly the 1989 creation of an "executive pay plan" for high-salaried executive branch positions) reflected a legislative intent to have increases reported and subject to possible rejection, the opinion concluded that the Secretary's authority to raise pay under §30(a)(2) had been narrowed by implication: raises still had to be reported to the General Assembly, whether made under §27 or §30.

Currency note

This opinion was issued in 1992. Subsequent statutory amendments, court decisions, or later AG opinions may have changed the analysis. Treat this page as historical context, not current legal advice. Verify current law before relying on any specific rule, deadline, or remedy mentioned here. Notably, the opinion's own bound-volume Editor's Note already flags that the specific provisions discussed here were later "amended and recodified," with pay plan authority now found in Title 8 of the State Personnel and Pensions Article rather than Article 64A.

Common questions

Under Maryland's old Merit System Law, could the Secretary of Personnel cut state employee pay rates without notifying the legislature? Yes, according to this opinion. The Attorney General concluded that the General Assembly's pay plan reporting requirement in Article 64A, §27 applied only to increases in pay, not decreases, so the Secretary could decrease rates of pay under §30(a)(2) without reporting the decrease to the General Assembly.

Could the Secretary raise state employee pay without legislative oversight under §30(a)(2)? No. The opinion concluded that the Secretary's authority to increase pay under §30(a)(2) had been narrowed by the later-enacted executive pay plan provisions of §27, so any pay rate increase, whether made under §27 or §30, had to be reported to the General Assembly, which retained the power to reject it.

Why did the Attorney General read a pay decrease as different from a pay plan "amendment"? The opinion traced the pay plan statute's history to a 1957 law that limited pay plan amendments to "acute emergencies" needed to recruit or retain essential employees, and to statutory language stating that if the legislature rejected an amendment, "the appropriate salary reduction shall become effective" afterward. The opinion read this as showing the legislature understood pay plan "amendments" to mean increases, with reductions treated as a separate, unregulated category.

Did a 1991 Maryland high court decision already answer this question? The opinion addressed and distinguished Maryland Classified Employees Association v. Schaefer, 325 Md. 19 (1991), noting that the Court of Appeals in that case only held that a change in the state work week did not reduce salaries within the pay plan, and did not decide whether a salary decrease counts as a pay plan amendment.

Background and statutory framework

The request came from the chairman of Maryland's Code Revision Committee, which was working on revising the Merit System Law, Article 64A of the Maryland Code. The Committee had identified an apparent conflict between §27, which authorized the Secretary of Personnel, with the Governor's approval, to amend the pay plan for specific job classifications (subject to reporting the amendment to the General Assembly, which could reject it), and §30(a)(2), which separately gave the Secretary power "at any time to increase or decrease any rates of pay for all employees in the classified and in the unclassified service," subject to the Governor's approval but with no reporting requirement stated on its face.

The opinion traced the history of both provisions back to the 1939 creation of a Salary Standards Board (later renamed the Standard Salary Board, then reorganized several times through the 1940s and 1950s) tasked with preparing a pay plan for state employees to correct what the opinion described as inequitable, patronage-driven pay practices. The current §30(a)(2) language tracing to a 1947 law giving the Board power to raise or cut pay "at any time" was enacted, according to the opinion, in the middle of a period of fiscal crisis and post-war pay pressure, while the modern §27 pay plan amendment process took shape through a 1957 law that, for the first time, limited amendments to "acute emergencies" necessary to recruit or retain essential employees, and further tightened through 1988 and 1989 amendments that created reporting requirements and, eventually, a separate "executive pay plan" for high-salaried executive branch positions.

Reading this history together, the opinion concluded that the legislature had consistently treated pay plan "amendments" as synonymous with pay increases, both because of the recruit-and-retain rationale that only makes sense for raises and because of statutory language tying legislative rejection of an amendment to a "salary reduction" taking effect afterward, implying amendments and increases were the same thing. On that basis, the opinion held that a pay decrease under §30(a)(2) was not a pay plan "amendment" subject to the §27 reporting process. At the same time, because the 1988 and 1989 amendments to §27 reflected the legislature's most recent word on the subject, and specifically contemplated legislative notice and a chance to reject pay increases, the opinion concluded that those provisions had implicitly narrowed the Secretary's older, seemingly unconditional §30(a)(2) authority to raise pay: increases, unlike decreases, still had to be reported to the General Assembly regardless of which statute was used to make them.

Citations and references

Statutes:

• Article 64A, §27, the Merit System Law's pay plan amendment provision
• Article 64A, §27(a)(1)(i), directing the Secretary to recommend a pay plan to the Governor
• Article 64A, §27(a)(1)(iv), authorizing pay plan amendments for specific classifications to recruit, retain, or adequately compensate employees
• Article 64A, §27(a)(1)(v), requiring pay plan amendments to be reported to the General Assembly, which could reject them
• Article 64A, §27(a)(2)(i), defining which positions fall within the "executive pay plan"
• Article 64A, §27(a)(2)(iv), governing step increases for executive pay plan positions
• Article 64A, §27(a)(2)(v), governing larger salary or grade changes for executive pay plan positions
• Article 64A, §27(a)(2)(vii), subjecting executive pay plan salaries to annual budget bill limitations
• Article 64A, §30(a)(1), directing the Secretary to formulate rules for administering §§27-30
• Article 64A, §30(a)(2), granting the Secretary power to increase or decrease pay rates for classified and unclassified employees
• Article 64A, §10(b), requiring the Secretary's annual reports on "work and proceedings" to the Governor and General Assembly
• State Finance and Procurement Article §7-109, governing budget bill listings of job classifications and salaries
• State Finance and Procurement Article §7-209(d), governing budget amendments affecting salaries, including executive pay plan positions

Cases:

• Morris v. Prince George's County, 319 Md. 597, 573 A.2d 1346 (1990), cited for the principle that statutory construction starts with the statute's language and that related statutes are read together
• State v. Bricker, 321 Md. 86, 581 A.2d 9 (1990), cited for the presumption that the legislature intends related enactments to form a consistent, harmonious body of law
• Farmers & Merchants Bank v. Schlossberg, 306 Md. 48, 507 A.2d 48 (1986), cited for the rule that when two statutes conflict irreconcilably, the more recently enacted provision is presumed to impliedly repeal the conflicting part of the earlier one
• Maryland Classified Employees Association v. Schaefer, 325 Md. 19, 599 A.2d 91 (1991), distinguished as not deciding whether a pay decrease counts as a pay plan amendment

Source

• Landing page: https://oag.maryland.gov/resources-info/Pages/attorney-general%E2%80%99s-opinions.aspx
• Original PDF: https://oag.maryland.gov/resources-info/Documents/pdfs/Opinions/1992/Volume77_1992.pdf (this opinion appears at printed page 134 of the bound annual volume; Maryland's site does not publish a standalone PDF of this opinion)

Original opinion text

Best-effort transcription from a scanned PDF. Minor errors may remain — the linked PDF is authoritative.

PERSONNEL

Modification of Rates of Pay

May 7, 1992

The Honorable Alan M. Wilner
Chief Judge
Court of Special Appeals of Maryland

You have requested our opinion on the authority of the Secretary of Personnel to modify rates of pay of classified and unclassified employees. You make this request in your capacity as chairman of the Code Revision Committee, which presently is working on a revision of the Merit System Law, Article 64A of the Maryland Code.1

The pay plan amendment process set out in Article 64A, §27(a)(1)(v) authorizes the Secretary of Personnel, with the Governor's approval, to amend the pay plan for specific classes of positions. Amendments to the pay plan must be reported to the General Assembly. However, another provision of the Merit System Law, Article 64A, §30(a)(2), authorizes the Secretary at any time to increase or decrease any rates of pay for all employees in the classified and the unclassified service, subject to the Governor's approval but without any requirement that the pay rate change be reported to the General Assembly. The apparent tension between these two provisions has led the Committee to ask whether the Secretary may modify rates of pay pursuant to §30(a)(2) outside of the pay plan amendment process found in §27.

For the reasons stated below, we conclude that the pay plan amendment process established under Article 64A, §27 applies only to increases in rates of pay. Therefore, the Secretary may decrease rates of pay outside of the pay plan amendment process and is not required to notify the General Assembly of decreases in rates of pay undertaken pursuant to §30(a)(2). We also conclude, however, that the Secretary of Personnel does not possess authority under Article 64A, §30(a)(2) to increase rates of pay without also having to report the increase to the General Assembly.

I

Statutory Text

The starting point of any exercise in statutory construction is the language of the provision in question. Morris v. Prince George's County, 319 Md. 597, 603, 573 A.2d 1346 (1990).

The pay plan statute, §27, calls on the Secretary of Personnel "to recommend to the Governor a pay plan for all classified and unclassified positions for which the Secretary has authority to administer pay ..." §27(a)(1)(i). The statute sets out certain factors that the Secretary is to consider and provides that "[t]he pay plan shall take effect when funds for that purpose are available in the budget." §27(a)(1)(ii) and (iii).

Subparagraphs (iv) and (v) of §27(a)(1) deal with pay plan amendments:

(iv) 1. The Secretary, with approval of the Governor, may amend the pay plan for specific classifications of positions in order to recruit or retain competent personnel or to ensure that compensation rates adequately compensate the skills, knowledge, effort, responsibility, and working conditions.

2. An amendment may not take effect unless sufficient funds have been included within the budget for that purpose.

3. Except as provided in paragraph (2) of this subsection, salary adjustments to those executive branch positions listed in the budget bill in accordance with §7-109 of the State Finance and Procurement Article shall be contingent upon the approval of the Board of Public Works.

(v) Amendments to the pay plan shall be reported to the General Assembly by the 15th day of the next regular session. The General Assembly may reject amendments to the pay plan. If an amendment is rejected, the appropriate salary reduction shall become effective in the next fiscal year.

The "rates of pay" statute, §30, calls on the Secretary to "formulate rules" dealing with salary-setting generally, including under the pay plan statute. §30(a)(1).2 Then §30(a)(2) gives the Secretary seemingly sweeping authority to raise or cut rates of pay:

The Secretary shall have the power and authority at any time to increase or decrease any rates of pay for all employees in the classified and in the unclassified service, and said increased or decreased rates of pay shall, after approval by the Governor, apply to all employees in the classification or classifications so affected, including incumbent employees and new employees.

Article 64A, §27 and Article 64A, §30 concern the same subject matter and therefore they must be interpreted together.3 When different statutes deal with the same subject matter, any interpretation of one provision must be made with an awareness of all the relevant enactments. State v. Bricker, 321 Md. 86, 92, 581 A.2d 9 (1990). It is presumed that the Legislature has acted "with full knowledge of prior legislation and intended statutes that affect the same subject matter to blend into a consistent and harmonious body of law." Id. "Therefore, various consistent and related enactments, although made at different times and without reference to one another, nevertheless should be harmonized as much as possible." Id.

Unfortunately, as the Code Revision Committee has found, when §§27 and 30 are read together, their meanings cannot readily be harmonized. The language of §27 suggests that pay plan amendments are synonymous with pay plan increases. Section 27(a)(1)(iv) states that the Secretary of Personnel, with the Governor's approval, may amend the pay plan to recruit or retain competent personnel or to ensure that compensation rates adequately compensate the "skills, knowledge, effort, responsibility, and working conditions" associated with a classification. Plainly, decreases in pay rates cannot be squared with those statutory objectives. Likewise, in §27(a)(1)(v) the General Assembly reserves the right to reject amendments and if an amendment is rejected, "the appropriate salary reduction shall become effective in the next fiscal year." (Emphasis supplied.) That language seems to demonstrate the legislative view that pay plan amendments operate only to increase rates of pay.

Section 30(a)(2) contains an express grant of authority for the Secretary, with the Governor's approval, to decrease rates of pay for all employees in the classified and unclassified services. It also grants the authority to the Secretary to increase rates of pay, a grant of authority which largely coincides with the authority given under §27. Section 27 establishes a pay plan amendment process, but does not define what a pay plan amendment is.

A facial analysis of the language in the two statutes does not readily lead to an understanding of the legislative purposes or goals underlying the statutes, or how the two statutes should be harmonized with one another. Accordingly, we must dig deeper and look at the context within which the different statutory language appears, which includes the legislative history of the statutes. See Morris v. Prince George's County, 319 Md. at 604. Like much else in the Merit System Law, these provisions are best understood when viewed from an historical perspective.

II

Legislative History

The original Merit System Law of 1920 required the Commissioner of Employment and Registration to recommend schedules of compensation for each class. The practical reality, however, was that an employee's pay was a function of non-merit factors such as the closeness of his or her department head to the Governor and the availability of federal or special funds. See John S. Shriver, The History of Administration of State Employees Salaries in Maryland p.28 (1956) ("Shriver").4 In fact, when one employee was replaced by another, the new employee was either paid the predecessor's salary or was hired at a lower wage and the difference was divided among older workers.

Maryland's pay plan statute, Article 64A, §27, was first enacted in 1939 to correct such inequitable and chaotic conditions. As originally enacted by Chapter 385 of the Laws of Maryland 1939, the statute created a "Salary Standards Board" consisting of the Commissioner of State Employment and Registration, the Director of the Budget, and a member appointed by the Governor. The Board was charged with preparing a pay plan for all classes of positions in the classified service to the end that "all positions in the Classified Service involving comparable duties, experience, responsibilities, and authority shall be paid in accordance with the standard salary schedule." The pay plan was to take effect and have the force of law when approved by the Governor and was to be used by the Governor in the preparation and submission of his budget. Article 64A, §13B (1939 Supp.). The Board also was authorized to recommend amendments to the plan, which, if approved by the Governor, were to have the same force of law as if they had been incorporated originally in the salary schedule.

In 1941 the General Assembly renamed the Salary Standards Board as the State Employees Standard Salary Board and increased the membership from three to seven members. The Board also was instructed to include within the pay plan all classes of positions in both the classified and unclassified services. Chapter 395, Laws of Maryland 1941.

During the World War II the Board exercised its functions without much controversy, perhaps due to wartime wage controls. But the inflationary spiral that occurred after the war led to a flood of requests by employees and department heads for pay adjustments and increases in the pay scales. In September 1946 the Governor, with the concurrence of the Board of Public Works, approved a general increase in the salaries of State employees as had been recommended by the Standard Salary Board. See Shriver at 29. Unhappily, the economic forces that required the salary increase also led to increases in other costs to the State, with the result that it became necessary for the General Assembly to meet in a special session on December 27, 1946 for the purpose of making emergency appropriations for the remainder of the fiscal year. See Chapter 2, Laws of Maryland 1946 (Extraordinary Session); the 1946 Senate Journal, Special Session, at 7 (December 26, 1946) (message of Governor Herbert R. O'Conor). Through Chapter 2, the Legislature authorized emergency appropriations from the general surplus fund account.

William Preston Lane, Jr. became Governor in 1946 and inherited the fiscal crisis. On February 19, 1947, Governor Lane delivered a "Message on Additional Revenue Requirements" to the General Assembly and requested that the General Assembly raise taxes in order to meet what he identified as the State's needs, appropriations for which he had been forced to cut in order to present a balanced budget bill. 1947 Senate Journal at

973. One day later Senate Bill 266 was introduced, which amended Article
     64A, former §17 to give the Salary Board "the power and authority at any time to increase or decrease any rates of pay for all employees in the classified and in the unclassified service, and said increased or decreased rates of pay shall, after approval by the Governor, apply to all employees in the classification or classifications so affected, including incumbent employees and new employees."5 That language, now found in §30(a)(2), has existed without substantive change ever since.

     Despite being given the authority to decrease rates of pay, in
     calendar year 1947 the Board continued to process requests for salary increases, with the result that the State's budget became unbalanced. See Shriver at 29-30. The Governor called a special session of the Legislature on May 25, 1948 to appropriate funds to restore the budget to balance and also to grant a 10 percent general salary increase, to be paid from surplus funds. Chapter 37, Laws of Maryland 1948 (Extraordinary Session).

     The next eight years were years of turbulence and discord between
     the Standard Salary Board and the Commissioner of State Employment and Registration (who was renamed the State Commissioner of Personnel in 1953). For example, employees at State mental hospitals were removed from the State classification plan and given new classifications, even though employees in other institutions were performing comparable duties; yet a few years later the employees at mental health institutions were placed back in their former class titles. In 1954 a subcommittee of the Legislative Council found that the Salary Board has been reluctant to grant salary increases for classes containing large numbers of employees and had granted increases only when funds were specifically appropriated, as had been done by general salary increases in 1951 and 1953. Shriver at 33-34. This reluctance to give class-wide salary increases led to requests by department heads that their employees' positions be reclassified, either to an existing higher level classification or to a newly created classification with the salary set at a higher level. Shriver at 34.6

     In 1956 the General Assembly created a new Standard Salary Board,
     chaired by the State Commissioner of Personnel and comprising the Baltimore City Civil Service Commission chairman, two representatives from the general public picked by the Governor, and a member picked by the Governor from a list of three nominees proposed by the Maryland Classified Employees' Association. Chapter 87, Laws of Maryland 1956. In the 1956 budget bill, Chapter 42 of the Laws of Maryland 1956, the Legislature provided a general increase in the salary scales of State employees; provided funds for payments "required as a result of restudy and pay adjustments" pursuant to the pay plan statute; directed the elimination of arbitrary salary differentials; provided for "comparable increases" consistent with revised salary scales; and provided funds to make adjustments for employees changing to a five-day, forty-hour work week. See 42 Opinions of the Attorney General 279 (1957).

     After the adjournment of the 1956 session of the General Assembly
     and prior to the announcement of the results of the State-wide study required by the budget bill, the Standard Salary Board considered the requests of numerous individual agencies for pay changes and approved increases for approximately 180 separate classifications. In the fall of 1956, the Committee on Taxation and Fiscal Matters reviewed the Standard Salary Board's activity and criticized the Board for limiting its salary adjustments to classifications that were unique to a particular agency. See Committee on Taxation and Fiscal Matters, Executive, Legislative, and Judicial Salaries in Maryland, A Report to the Legislative Council and General Assembly of Maryland 8-9 (November 1956). The Committee observed:

       Naturally it was expected that the Salary Board would
       be prepared to receive and act upon emergency
       changes to secure needed recruits or to retain valued
       employees who could not easily be replaced; but it
       never could have been contemplated that the Board
       would proceed to make wholesale changes for special
       groups while the great mass were advised that they
       would have to await the general study and could not
       expect salary adjustments at least until October.
     

(Emphasis in original).

As a result of this controversy over how best to implement pay increases for State employees while simultaneously requiring the Salary Board to restudy the classifications of State employees, the Legislature in 1957 attempted once again to set right the administration of pay for State employees. Toward that end, the General Assembly passed Senate Bill 289 (Chapter 396 of the Laws of Maryland 1957), which for the first time placed a condition on the approval and effectiveness of pay plan amendments. As originally introduced, Senate Bill 289 amended the pay plan statute, then found at §25 of Article 64A, to provide that the pay plan would "take effect" and "have the force and effect of law after approval by the Governor, at the time the next State Budget takes effect, if funds for such pay plan are provided therein." Furthermore, amendments to the pay plan were to have the force of law when approved by the Governor "and so included in the next State budget."

Senate Bill 289 was amended by the House of Delegates at its third reading to add the following language regarding pay plan amendments:

Notwithstanding anything to the contrary hereinbefore, and solely in cases of acute emergency, amendments may be made from time to time in the pay plan to take effect at anytime prior to the effective date of the next State Budget, if the amendment is necessary in order to procure or to retain in the State service essential career administrative employees, performing executive functions, or essential professional or technical employees, and upon approval of the Board of Public Works, after recommendation by the Board, shall have the force of law in the same manner as if they had been originally incorporated in the schedule.

1957 House Journal at 1355-56 (March 21, 1957).

At the same time the House considered related legislation proposed in the Senate, Senate Bill 170, relating to budget amendments under former Article 15A, §8 (now recodified as §7-209 of the State Finance and Procurement Article ("SF" Article)). The House amended the bill by adding a new paragraph (f) to §8:

A budget amendment shall not increase the salary or salaries of any office or position beyond the amount for each such salary which is contained in the most recent State budget, and its supporting documents which specify in detail the salaries of all personnel, whether or not that budget is yet in effect, except for budget amendments to effectuate salary changes authorized in cases of actual emergency in order to procure or to retain in the State service essential professional, technical and administrative personnel as set forth in §25 of Article 64A of the Annotated Code of Maryland (1956 Supp.) as amended from time to time.

1957 House Journal at 1353-54 (March 21, 1957). The Senate concurred in the amendments and the bills were enacted as Chapters 396 and 383 of the Laws of Maryland 1957.

It seems plain from the language added to both bills that the General Assembly viewed the pay plan amendment process as applying only to increases in rates of pay, not to decreases. A contrary reading would lead to the absurd result of the Legislature's having required the Standard Salary Board to demonstrate to the Governor and Board of Public Works the urgent necessity of approving a pay decrease in order to recruit or retain essential employees.

In 1988 the pay plan statute was amended as part of Chapter 543 (House Bill 741) of the Laws of Maryland 1988. As we recounted in an earlier opinion about the effect of the legislation, Chapter 543 "significantly expanded the authority of the Secretary to make pay plan amendments that are effective immediately. No longer are such amendments limited to acute emergencies." 73 Opinions of the Attorney General 43, 44-45 (1988). Instead, the Secretary may now amend the pay plan for specific classifications of positions "in order to recruit or retain competent personnel or to ensure that compensation rates adequately compensate the skills, knowledge, effort, responsibility, and working conditions." Article 64A, §27(a).

However, the Secretary was not given unbridled discretion to make pay plan amendments. First, the Secretary must obtain the approval of the Governor. Second, an amendment cannot take effect unless "sufficient funds [are] included in the budget for that purpose."7 Id. Third, amendments have to be reported to the General Assembly by the 15th day of the next regular session. The General Assembly in that next session can reject the amendment, in which case "the appropriate salary reduction shall become effective the next fiscal year." Id.

In its 1989 session the General Assembly again modified the pay plan statute, this time to create the "Executive Pay Plan." Chapter 831 (House Bill 1475) of the Laws of Maryland 1989 required the Secretary of Personnel to create an executive pay plan that would include high-salaried executive branch employees.8 The statute also sets forth different ways by which a salary can be increased from one salary grade to another or from one step to another within a grade.9 The increases in salaries made in accordance with the executive pay plan provisions are to be made "to retain or recruit competent individuals in positions within the executive pay plan or for any other reasons approved by the Board of Public Works." §27(a)(2)(v)2.

The General Assembly retains the right to exercise control over salaries of positions in the executive pay plan by providing that "the salary grade and the salary paid for a position in the executive pay plan shall be subject to any limitations included in the annual budget bill." §27(a)(2)(vii). Furthermore, SF §7-109(c) was also amended by Chapter 831 to provide that the salary schedule, proposed salary grade, and proposed salary for job classifications shall be subject to the General Assembly's approval.10

SF §7-209 was changed accordingly to permit the Governor to approve an amendment to the budget that increases the salary of a position in the executive pay plan, if the Board of Public Works has approved the increase. SF §7-209(d)(2)(i). However, the budget amendment remains in effect only until the State budget for the next fiscal year becomes effective. SF §7-209(d)(2)(ii). With respect to all graded positions in the regular pay plan, §7-209(d)(1) further provides that a budget amendment "may not increase a salary so that it exceeds the amount set by the most recently enacted State budget."

III

Analysis

The legislative history of Article 64A, §§27 and 30 leads us to conclude that the Legislature regards pay plan amendments to be synonymous with increases in pay. This understanding was made clear in 1957, when the General Assembly limited pay plan amendments to "acute emergencies," where the amendment was necessary to procure or retain essential employees. While the requirements for obtaining a pay plan amendment have been softened significantly since 1957, the underlying rationale of provisions permitting the amendment of the pay plan has been the same: to recruit, retain, and adequately compensate State employees in the pay plan. The 1988 legislation reinforces that conclusion by providing that the General Assembly's rejection of a pay plan amendment results in a salary reduction. Therefore, we conclude that the pay plan amendment provisions of §27 apply only to increases in salary. Accordingly, the Secretary's authority under Article 64A, §30(a)(2) to decrease rates of pay exists independently of her authority to amend the pay plan.

Reductions in pay accomplished pursuant to Article 64A, §30(a)(2) need not be reported to the General Assembly, because a reduction in pay rates is not a pay plan amendment.11 We reach the same conclusion about decreases in pay of positions in the executive pay plan: the duty to report pay adjustments is limited to salary increases. See Article 64A, §§27(a)(2)(iv) and (v). We do not mean to suggest that the Secretary is forbidden from notifying the General Assembly of pay rate decreases. Indeed, such information properly could be included in the Secretary's annual reports to the Governor and General Assembly required by Article 64A, §10(b), which deal with the Secretary's "work and proceedings."

Article 64A, §§27 and 30 overlap to the extent that they both confer authority on the Secretary of Personnel to increase rates of pay. However, even in that respect they are not identical. Section 30(a)(2) gives the Secretary, with the Governor's approval, the authority to increase rates of pay for all employees in the classified and unclassified service. Section 27, on the other hand, authorizes the Secretary to amend the pay plan with the Governor's approval, but it also creates an entirely different process for executive pay plan amendments. Increases in salary steps for positions in the executive pay plan may occur without the Secretary's involvement, requiring instead the Governor's approval of a recommendation by the head of a department, agency, board or commission. Article 64A, §27(a)(2)(iv). Changes in salary grade require the Governor's approval, with the additional approval of the Board of Public Works, but again do not require the intercession of the Secretary. §27(a)(2)(v).

Therefore, §§27 and 30 are not completely consistent with respect to pay increases. To the extent we can harmonize the two statutes, we will do so. See Farmers & Merchants Bank v. Schlossberg, 306 Md. 48, 61, 507 A.2d 48 (1986). Section 30(a)(2), the earlier enacted statute, states that the Secretary has the authority to increase rates of pay for all employees. However, the creation of the executive pay plan divested authority from the Secretary to increase rates of pay for those positions within the executive pay plan.

We reconcile the inconsistency by concluding that the provisions of §27 relating to the executive pay plan have repealed by implication the language of §30(a)(2) giving the Secretary authority to increase rates of pay for all employees.12 Now, the Secretary's authority to increase rates of pay extends only to employees in the regular pay plan. With respect to employees in the regular pay plan, the Secretary is given the same authority by both §§27 and 30 to effect a change in a classification's pay rate. Section 27, whose relevant provisions were most recently enacted, plainly expresses a legislative intent that the General Assembly be notified of pay increases and have the opportunity to reverse them. To conclude that the Secretary could increase rates of pay under §30 and not notify the General Assembly would run counter to the most recently expressed legislative will. Therefore, we harmonize the two statutes by concluding that the Secretary must notify the General Assembly of any increase in the rates of pay or classifications in the regular pay plan.

IV

Conclusion

In summary, it is our opinion that the Secretary has the authority under Article 64A, §30(a)(2) to reduce the rates of pay of all employees, classified and unclassified, under her salary-setting authority. She may, but is not required to, report any such pay rate decreases to the General Assembly. With respect to employees in the regular pay plan, the Secretary must report to the General Assembly any increases to rates of pay that she and the Governor have approved, whether under §27 or §30.13

J. Joseph Curran, Jr.
Attorney General

David R. Durfee, Jr.
Assistant Attorney General

Jack Schwartz
Chief Counsel
Opinions and Advice

Editor's Note:

The provisions discussed in this opinion have been amended and recodified. Provisions on the authority of the Secretary of Budget and Management over pay plans may be found in Title 8 of the State Personnel and Pensions Article.

1
Your request also poses a number of other questions, which we shall address in a later opinion.

2
This provision is as follows:
The Secretary of Personnel shall formulate rules and regulations for the administration of §§27-30, which shall include provisions for automatic increases, from minimum to maximum, of the rates established by the schedule, except that the Secretary shall have the power to establish flat or fixed salaries and wage rates for special classifications or cases, (for a period not to exceed two years) where provision for automatic increases are deemed inadvisable; and such rules shall, after approval by the Governor, have the force of law in the same manner as other conditions herein prescribed.

3
Indeed, §30(a)(1) states that the two statutes are part of the same legislative scheme by giving the Secretary of Personnel rulemaking authority for the administration of "§§27-30."

4
Shriver was Director of the Fiscal Research Bureau. His monograph is reprinted as Appendix II to "Executive, Legislative, and Judicial Salaries in Maryland, A Report to the Legislative Council and General Assembly of Maryland" (November 1956) (Committee on Taxation and Fiscal Matters). See also Twenty- Third Annual Report of the State Employment Commissioner 1-2 (1943).

5
The 1939 statute and its subsequent amendments protected incumbent employees from having to take a reduction in their rates of pay by reason of the Salary Board's establishment of the standard rates of pay. See Chapter 385, Laws of Maryland 1939; Chapter 395, Laws of Maryland 1941; Chapter 9, Laws of Maryland 1945.

6
Political solutions were sought as well. For example, the University of Maryland "Autonomy Act," Chapter 14 of the Laws of Maryland 1952, gave the University pay-setting authority over both its instructional and non-instructional personnel, free of Standard Salary Board rules, regulations, and control. See 41 Opinions of the Attorney General 250 (1956).

7
If a budget amendment was required in order to fund a pay plan amendment, the Board of Public Works still had to approve the pay plan amendment. See SF §7-209(d) (1988 Repl. Vol.); 73 Opinions of the Attorney General 43 at 45 n.4.

8
The defining criteria as to which employees are included are somewhat circular: all permanent positions "with a salary above the lowest salary in the executive pay plan and which are not included in the pay plan for graded State employees" are to be included in the executive pay plan. §27(a)(2)(i).

9
A department head may increase, with the Governor's approval, the salary of an employee by one step based on the employee's performance or two steps for exceptional performance. §27(a)(2)(iv) 2 and 3. Subject to the additional approval of the Board of Public Works, the Governor may approve a salary adjustment of more than two steps within the same grade, a change from the current grade to a different grade, a change from one classification in a series to a different classification in that series, the creation of a new classification or position in the executive pay plan, or "[an]other type of salary increase for a position within the executive pay plan." §27(a)(2)(v)1.

10
Chapter 831 also amended SF §7-109 to require a listing in the budget bill of the job title and salary for each position in the executive pay plan. Additionally, each budget bill has to contain a listing of the job classification of each position with a flat rate of per diem compensation in excess of the minimum salary in the proposed executive pay plan, the number of positions in each of the classifications, and the proposed salary for each of the classifications.

11
It has been suggested that the recent decision of Maryland Classified Employees Association v. Schaefer, 325 Md. 19, 599 A.2d 91 (1991) stands for the proposition that a reduction in pay is an amendment to the pay plan. We do not read the decision so broadly. Instead, the Court of Appeals simply concluded that a change in the work week "did not cause a reduction of any salaries within the pay plan." 325 Md. at 37-38. Therefore, there was no change made in the pay plan. The Court did not address the specific question whether a decrease in salaries is an amendment to the salary plan.

12
If two statutes contain an irreconcilable conflict, it is presumed that the Legislature intended that "the statute whose relevant substantive provisions were enacted most recently be held to have repealed by implication any conflicting provisions of the earlier statute." Farmers & Merchants Bank v. Schlossberg, 306 Md. at 48.

13
While these conclusions represent our best efforts to ascertain and effectuate the legislative objective underlying Article 64A, §§27 and 30, we certainly would encourage the Revisor of Statutes to recommend that the language of the two provisions be clarified.