After the 1986 law moved DHR and Correction educational employees off the State Personnel Act, who sets their salaries, and must those salaries exactly match the public school teacher pay scale?

Plain-English summary

In 1986 the General Assembly changed how teachers and educational employees inside the Department of Human Resources (DHR) and the Department of Correction (DOC) got paid. Before July 1, 1986 these employees (teachers in state institutions for the developmentally disabled, prison school teachers, juvenile justice school staff) were State Personnel Act employees paid on State Personnel Commission salary schedules. The new § 126-5(c3), effective July 1, 1986, exempted these "teaching and related educational" employees from most of Chapter 126 (the State Personnel Act) and required their salaries to be "set in the same manner as corresponding public school employees in accordance with Chapter 115C."

The statute left several implementation questions open. The DHR Secretary and a DOC personnel official asked the AG three of them.

Special Deputy Attorney General Edwin M. Speas, Jr. and Associate Attorney General Gail E. Weis answered:

(1) Who decides whether a particular position is exempt? The statute does not say. § 126-5(h) provides that if there is a dispute over whether an employee is subject to Chapter 126, the State Personnel Office investigates and the dispute is resolved under Chapter 150B Article 3 (administrative appeals). Practically, DHR and DOC make the initial determination whether a position is a teaching/educational position. An employee who disagrees can appeal to the State Personnel Commission.

(2) Who sets the salary schedule? § 126-5(c3) does not identify the agency. The AG looked to § 143B-10(c), which gives the head of each principal department the authority to "change the compensation of existing offices and positions as he deems necessary for the efficient functioning of the department, subject to the State Personnel Act." DHR and DOC are both principal departments under the Executive Organization Act. § 143B-10's general subject-to-SPA limit doesn't reach these positions because they are now exempt from the SPA. So the DHR Secretary sets salaries for DHR educational employees, and the DOC Secretary sets salaries for DOC educational employees.

(3) Must the salary exactly match the public school schedule? § 126-5(c3) requires salaries to be "set in the same manner as set for corresponding public school employees." The AG read this as a directional requirement, not an identity requirement. Where a DHR or DOC position corresponds to a public school position (a regular classroom teacher in a state school for the developmentally disabled corresponds to a regular classroom teacher in a public elementary school), the pay should be identical. Where the position does not correspond (the head of an educational component of DHR may have narrower duties than a public school principal), the pay should "conform as closely as possible" to the public school schedule rather than match it.

The "as closely as possible" middle ground was the AG's reading of legislative intent. If the General Assembly had wanted exact identity, it would have said so. The use of "corresponding" and "in the same manner" signaled an intent to track the public school schedules but allow for differences where the job duties differ.

Currency note

This opinion was issued in 1987. 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. The State Personnel Act was reorganized into the State Human Resources Act in 2013, and § 126-5(c3) and related provisions have been amended. The departmental structure has also shifted (DHR is now DHHS; juvenile justice education has moved between departments). The basic mechanism described by the AG (departmental secretary sets salary, public school schedule as the reference point, allowing for differences in duties) remains the framework, but the citations should be re-verified.

Background and statutory framework

The 1986 amendment to § 126-5(c3) was part of a broader effort to align the working conditions of teachers in state institutions (state schools for the developmentally disabled, prison schools, juvenile correctional schools) with their public school counterparts. State institution teachers had historically been on the State Personnel Act salary schedule, which often paid less than the public school teacher schedule. That created retention problems: a teacher in a state school could leave and earn substantially more in a public school. Moving these teachers to the public school schedule (or close to it) was meant to fix the retention problem.

The implementation question the AG addressed is structural: § 126-5(c3) said the salaries "shall be set" but did not say by whom. The AG fell back on § 143B-10(c), the general compensation-setting authority of principal department heads. That created a coherent administrative scheme: each department sets its own salary structure, with the public school schedule as the reference point.

The third question (exact match versus "as closely as possible") reflects the realities of position-by-position matching. Some state-institution positions have no public-school analog. A prison school principal supervises fewer teachers and a smaller student population than a public elementary school principal, but with much harder discipline challenges. The General Assembly recognized this by using "corresponding" language. The AG's "as closely as possible" formulation gives departmental flexibility while preserving the legislative direction.

The dispute-resolution mechanism in § 126-5(h) is a guarantee against arbitrary exclusion. If DHR decides a particular position is a teaching/educational position (and therefore exempt from the SPA, with potentially different pay), the employee in that position can challenge the classification through the State Personnel Commission and the Chapter 150B appeals process. This protects employees who would prefer to remain under the SPA.

Common questions

What happens to an employee who was on the SPA before July 1, 1986?

The AG opinion does not address grandfathering directly. § 126-5(c3) was a categorical change: positions that fit the "teaching and related educational" definition came out from under the SPA on July 1, 1986. Existing employees in those positions transitioned to the new arrangement. Articles 6 and 7 of Chapter 126 (covering pay continuation and certain leave provisions) and § 126-4(4), (5), (6) policies (benefits, holidays, leave) remained applicable to the exempt employees.

Can DHR pay an educational employee less than the public school schedule?

The opinion permits departures from the public school schedule where the duties of the DHR position do not correspond to a public school position. A less-corresponding position might pay less. The opinion does not authorize across-the-board cuts below the public school schedule for corresponding positions; for those, the schedules should match.

Can DHR pay more than the public school schedule?

The opinion does not address paying more. The "in the same manner" and "corresponding" language is naturally read as tracking the schedule in both directions. A DHR position with materially broader duties than the public school analog might justify higher pay. But the statutory direction is to track public schools, not to leapfrog them.

What about local supplements that public school employees receive from county or city school boards?

The opinion does not address local supplements. Public school teachers in well-funded districts receive county or city supplements on top of the state schedule. DHR and DOC educational employees do not have a comparable local funding source. The state-level base schedule should match the public school state-level base schedule; whether DHR or DOC adopts supplemental pay analogous to local supplements is a discretionary departmental decision.

Who decides if a position is "teaching and related educational" versus regular?

DHR and DOC make the initial classification. An employee in dispute can appeal to the State Personnel Commission under § 126-5(h). The State Personnel Office investigates, and the Commission resolves the dispute through the administrative-appeals process under Chapter 150B Article 3.

Source

• Landing page: https://ncdoj.gov/opinions/authority-to-set-salaries/

Citations

• N.C.G.S. § 126-5(c3) (exemption of DHR and DOC teaching/educational positions)
• N.C.G.S. § 126-5(h) (dispute resolution)
• N.C.G.S. § 126-4(4), (5), (6) (Commission policies still applicable to exempt positions)
• N.C.G.S. Articles 6 and 7 of Chapter 126
• N.C.G.S. § 143B-2(2), (5) (principal departments)
• N.C.G.S. § 143B-10(c) (head of department may change compensation)
• Chapter 115C (public school employee salary schedules)
• Chapter 150B Article 3 (administrative appeals)

Original opinion text

Requested By: Phillip J. Kirk, Jr. Secretary Department of Human Resources

Jeffrey R. Becker Assistant Personnel Director Department of Correction

Questions: (1)

• Does the State Personnel Commission have the authority to determine whether particular educational positions in the Department of Human Resources and the Department of Correction should be classified as exempt from the State Personnel Act?
• (2)
• Do the Department of Human Resources and the Department of Correction have the authority to set salary schedules for their educational personnel exempt from the State Personnel Act under

G.S. 126-5(c3)?

(3) Must the salary schedules established by the Department of Human Resources and the Department of Correction for educational personnel exempt from the State Personnel Act correspond exactly to the salary schedules established by the State Board of Education for public school employees?

Conclusions: (1)

• Yes.
• (2)
• Yes.
• (3)
• The salary schedules must correspond to the salary schedules established by the State Board of Education for public school employees except in cases where the duties of employees do not correspond to the duties of public school employee positions. In such cases the salary schedule should conform as closely as possible to the public school salary schedules.

Prior to July 1, 1986 persons employed by the Departments of Human Resources and Correction in teaching and related educational positions were paid in accordance with a salary schedule established by the State Personnel Commission. The 1986 Session of the General Assembly changed the law in this regard. G.S. 126-5(c3) was amended effective July 1, 1986 to provide as follows:

Except as to the policies, rules, and plans established by the Commission pursuant to G.S. 126-4(4), 126-4(5) and 12-4(6), and except as to the provisions of Articles 6 and 7 of this Chapter, the provisions of this Chapter shall not apply to teaching and related educational classes of employees of the Department of Correction, the Department of Human Resources and any other state department, agency, or institution, whose salaries shall be set in the same manner as corresponding public school employees in accordance with Chapter 115C of the General Statutes.

A number of questions have been raised about the relative authority of the State Personnel Commission, the Department of Human Resources, the Department of Correction, and the State Board of Education to implement the provisions of this statute. The first question concerns the identity of the agency with the authority to determine, in case of a dispute, whether a particular position is or is not a teaching or related educational position exempt from the State Personnel Act. G.S. 126-5(c3) is silent on this point. G.S. 126-5(h), however, provides:

In case of dispute as to whether an employee is subject to the provisions of this Chapter, the question shall be investigated by the State Personnel Office, and the dispute shall be resolved as provided in Article 3 of Chapter 150B.

This statute applies to the question presented. Under this statute the Department of Human Resources and Department of Correction determine initially whether a particular position is a teaching or related education position within the meaning of G.S. 126-5(c3). If an employee disputes that decision, he has a right to appeal to the State Personnel Commission and to have the Commission resolve the dispute.

The second question concerns the identity of the agency with the authority to set salary schedules for persons employed by the Department of Human Resources and the Department of Correction in teaching and related educational positions. Again, G.S. 126-5(c3) is silent on this point. The statute provides that salaries for these employees "shall be set" and generally prescribes the manner in which these salaries will be set, but does not identify the agency that will set these salaries. In our opinion the authority to set these salaries rests with the Secretary of the Department of Human Resources as to employees within the Department of Human Resources and with the Secretary of the Department of Correction as to employees within the Department of Corrrection.

Both the Department of Human Resources and the Department of Correction are "principal departments" under the Executive Organization Act of 1973. G.S. 143B-2(2) and (5). G.S. 143B-10(c) provides, in part, as follows:

The head of each principle state department may . . . change the compensation of existing offices and positions as he deems necessary for the efficient functioning of the department, subject to the State Personnel Act. . . .

It is logical that the power to change salaries includes the power to set salary schedules. While the power of the Secretaries of the Department of Human Resources and the Department of Correction in this regard is made subject to the State Personnel Act by G.S. 143B-10, the positions in question are exempt from the State Personnel Act. Therefore, under authority of G.S.

143B-10 the Secretary of the Department of Human Resources and the Secretary of the Department of Correction have authority to set the salary schedules for persons employed by their departments in teaching and related educational positions exempt from the State Personnel Act by G.S. 126-5(c3).

The third question presented concerns the scope of the discretion of the Secretaries of the Department of Human Resources and the Department of Correction in setting salary schedules for persons employed in teaching and related educational positions. We are advised by the Department of Human Resources and the Department of Correction that most teaching and related educational positions in their Departments correspond to positions in the public school system covered by the salary schedules adopted by the State Board of Education, but that some positions do not. For example, the scope of the duties of a principal of a public school are substantially broader in some cases than the duties of the head of an educational component of the Department of Human Resources or the Department of Correction.

G.S. 126-5(c3) provides that the salaries of persons employed by the Department of Human Resources and the Department of Correction in teaching and related educational positions "shall be set in the same manner as set for corresponding public school employees in accordance with Chapter 115C of the General Statutes." This language does not specifically require that the salary schedules for these employees be identical to the salary schedules of public school employees, but this language certainly indicates an intention on the part of the General Assembly that salaries for those persons correspond to the salaries of corresponding public school employees when possible. Further, by choosing this language rather than language specifically mandating identity of salaries between public school employees and similar employees in the Department of Human Resources and the Department of Correction, it appears that the General Assembly recognized that some educational positions in the Department of Human Resources and Department of Correction would not correspond with positions in the public schools in terms of duties and responsibilities and, accordingly should not be compensated at the same rates. Therefore, based upon the language used by the General Assembly in G.S. 126-5(c3) it is our opinion that the Department of Human Resources and the Department of Correction should set salary schedules for their educational employees that are the same as the salary schedules for public school employees, but that the Departments have the authority in those cases where positions do not correspond with public school positions in terms of duties and responsibilities to recognize and account for those differences in setting salary schedules. Where the duties do not correspond, the salary schedules set by the Departments should conform as closely as possible to the salary schedules adopted by the State Board of Education.

LACY H. THORNBURG Attorney General

Edwin M. Speas, Jr. Special Deputy Attorney General

Gail E. Weis Associate Attorney General