Can a South Dakota county pay its highway department employees the same monthly amount year-round, even though they actually work 50 hours per week in summer and 40 hours in winter? And can the county pay them every two weeks instead of monthly?
Plain-English summary
Brown County's highway department employees and the county were working out an employment contract. The union proposal had a clever twist: a five-day, fifty-hour workweek during the busy May-to-September road-work season and a forty-hour week the rest of the year. To avoid swings in take-home pay, the contract would compute total annual hours, multiply by the hourly rate (with overtime where applicable), and divide by twelve. The employees would get twelve equal monthly paychecks.
Secretary Dennis Finch of the Department of Labor asked AG Janklow whether the averaging proposal was lawful and, separately, whether the county could pay highway employees every two weeks instead of monthly.
Janklow's analysis worked through three statutory clusters. First, SDCL chapter 3-8 (the state treasury compensation rules) did not apply because county highway employees are paid from county general funds, not the state treasury. Second, SDCL 7-7-15 and 7-7-20 (salary-fixing for specific county officers like auditor, treasurer, register of deeds, coroner) did not apply because they don't reach county highway employees. So neither statutory cluster directly answered the question.
But SDCL 7-22-1 did. That statute requires anyone presenting a claim against the county to verify that the services charged for "were actually rendered" before the claim is allowed. Janklow's predecessors had ruled in 1925-26 and 1931-32 that salaries of county officers and employees are subject to the SDCL 7-22-1 verification requirement.
The implication was fatal to the averaging proposal. An employee who started March 1 could only be paid for hours actually worked by the end of the first pay period. He could not be paid an averaged amount that exceeded actual hours. Likewise, an employee who terminated during the low-hour winter portion of the year could not be required to repay overpayments from the summer high-hour months because the implementation of any such recoupment scheme was, in Janklow's phrase, "incomprehensible." SDCL 7-22-1's pay-for-services-actually-rendered rule blocked the averaging contract structure.
Janklow's suggestion was a workaround: convert the highway employees to fixed annual salary rather than hourly wages. A salaried employee gets paid for the job, not the hour, and the work-as-needed pattern (more hours in summer, fewer in winter) doesn't trigger SDCL 7-22-1 in the same way. The model is the elected county official, who is paid an annual salary in monthly installments regardless of hours actually worked. If Brown County wanted equal monthly paychecks, the route was to make the employees salaried.
On the bi-weekly pay question, Janklow's answer was yes. No statute specifies the pay period for county highway employees. SDCL 31-11-3 et seq. put highway employees under the supervision of the county highway superintendent, who serves under the county commissioners. SDCL 7-8-20 gives the commissioners broad authority over county fiscal affairs and "such other duties and acts as are required." Setting pay periods falls within that discretion. The commissioners could go bi-weekly (26 paychecks per year) without violating state law.
Currency note
This opinion was issued in 1976. 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 county claim verification statute (SDCL 7-22-1), the county commissioner authority statutes, and the highway department supervision provisions have all been amended over the decades. Federal Fair Labor Standards Act regulations, modern wage and hour laws, and South Dakota's modern wage payment statutes may now provide additional requirements not addressed in this 1976 framework.
What the opinion meant at the time
For Brown County and other counties negotiating with highway employee unions, the opinion narrowed the bargaining options. The "average it out across twelve months" structure that unions liked (predictable take-home pay all year) could not work as an overlay on hourly wages. The contract had to either: pay hourly wages in pay periods matched to hours actually worked, or convert the employees to fixed annual salary.
For county auditors and treasurers processing payroll, the opinion reinforced the SDCL 7-22-1 verification chain. Every claim, including wage claims, had to be tied to services actually rendered. Averaging schemes that produced paychecks larger than actual hours in a pay period would not survive the verification.
For state-level labor administrators, the opinion clarified the line between county and state employee compensation rules. SDCL chapter 3-8 governs state treasury-funded employees; county-funded employees have their own framework anchored in SDCL 7-22-1, 7-8-20, and the specific officer statutes in chapter 7-7.
For county highway employee unions, the opinion suggested the bargaining move forward was to push for salary structures rather than hourly-with-averaging. A fixed annual salary in 12 or 24 equal installments achieves the same take-home pay smoothing without colliding with SDCL 7-22-1.
Background and statutory framework
SDCL 7-22-1 is one of the oldest provisions in the South Dakota county-government framework. It dates to the territorial period and reflects a basic anti-fraud principle: the county pays only for goods, services, or labor actually delivered. The verification (the claimant swears that the services were actually rendered) is the protective layer.
The 1925-26 and 1931-32 AG opinions Janklow cited applied SDCL 7-22-1 to officer and employee salaries. That brought wage claims squarely into the verification chain. An hourly employee submits a time sheet; the time sheet is the evidence of services actually rendered; the claim is paid based on that evidence.
The fixed-salary workaround Janklow suggested works because a salaried employee's pay is not directly tied to hours. The salary is consideration for the role and the responsibilities, not for the count of hours. The county's verification under SDCL 7-22-1 in a salaried-employee scenario is satisfied by confirming that the person was in the role during the pay period, not by counting hours.
The bi-weekly pay authority in SDCL 7-8-20 reflects a broader pattern in county government law. Where the Legislature has not specified, the county commission's general fiscal authority fills the gap. The commissioners can adopt any pay period that suits county business operations, subject to consistency and compliance with other applicable law.
Citations
- SDCL 7-22-1 (county claim verification)
- SDCL 7-8-20 (county commission fiscal authority)
- SDCL 31-11-3 et seq. (highway superintendent supervision)
- SDCL chapter 7-7 (county officer compensation generally)
- SDCL chapter 3-8 (state treasury employee compensation; not applicable here)
- 1925-26 AGR 254; 1931-32 AGR 643 (applying SDCL 7-22-1 to county officer salaries)
Source
Original opinion text
October 22, 1976
Mr. Dennis Finch, Secretary
Department of Labor
Joe Foss Building
Pierre, South Dakota 57501
OFFICIAL OPINION NO. 76-102
Employment contract for county highway employees
Dear Mr. Finch:
You have requested an opinion based on the following factual situation:
FACTS:
The Brown County Highway employees are presently negotiating for an employment contract. One of their proposals is substantially as follows: The employees agree to work a five day/fifty hour week during the months of May through September and forty hours per week the remainder of the year. However, the per month pay of the employees would be computed by multiplying the total hours worked per year by the hourly rate (plus overtime when applicable) and dividing that sum by twelve. Therefore, the employees would receive twelve equal pay checks even though in some months they would have actually earned more than the average figure while in others they would have earned less.
QUESTIONS:
-
Would the above proposal and method of payment be authorized under South Dakota law?
-
May the county highway employees be paid every two weeks or a total of twenty-six times per year rather than on a monthly basis?
My research fails to disclose any statutes which directly address the questions you have asked. SDCL 3-8 deals with time and manner of compensation for employees, but specifically refers to "compensation of officers and employees payable out of the state treasury." (SDCL 2-8-62.) Thus, since county highway employees are paid from county general funds, said statutes are inapplicable. Likewise, SDCL 7-7-15 and 20 specifically refer only to compensation in the office of county auditor, treasurer, register of deeds and coroner and not employees of the county highway department.
IN RE QUESTION NO. 1:
However, with regard to Question No. 1, I refer you to SDCL 7-22-1 which provides, in part:
7-22-1. Before any account, claim, or demand against any county for any obligation, property, or services for which such county shall be liable shall be allowed, the person having such account, claim, or demand, either by himself or agent, shall reduce the same to writing, and shall verify the same to the effect that such account is just and true; that the money therein charged was actually paid for the purposes therein stated; that the property therein charged for was actually delivered or used for the purposes therein stated, and was of the value therein charged; and that the services therein charged for were actually rendered and of the value as charged, or in case such services were official, for which fees are prescribed by law, that the fees and amounts charged therefor are such as are allowed by law; and that no part of such account, claim, or demand has been paid.
My predecessors have ruled on several occasions that salaries of county officers and employees are subject to this provision. (1925-26 AGR 254, 1931-32 AGR 643.) In keeping with these decisions, it is my opinion that wages must be earned prior to submission of a voucher and signing of the warrant.
Therefore, for example, an employee commencing employment March 1, would only be entitled to be paid at the end of the first pay period for hours actually worked. He would be prohibited from receiving an amount on the basis of an average number of hours per pay period if said amount exceeded what was actually earned. Implementation of a feasible plan pursuant to the proposal in your factual situation which could guarantee compliance with SDCL 7-22-1 is incomprehensible to me. The additional practical problem of recovering overpayment from an employee who, for example, terminated after employment during that part of the year when only forty hours per week are worked further leads me to the conclusion that SDCL 7-22-1 was intended to be applicable to claim for wages. The answer to your Question No. 1 is NO.
By way of suggestion, however, it is my opinion that SDCL 7-22-1 would not prohibit the county and the highway employees from entering into an employment contract whereby said employees would receive a fixed annual salary payable in "X" number of equal installments. The employees' pay would then be similar to the method of compensation for elected county officials (i.e. - based on the performance of a job rather than a per hour or per day labor basis).
IN RE QUESTION NO. 2:
County highway employees are under the direction and supervision of the county highway superintendent subject to the general supervisory control of the board of county commissioners. (SDCL 31-11-3 et seq.; 1919-20 AGR 281.) In the absence of specific statutory guidance as to the manner and time of compensation, it is my opinion that the county commissioners, in cooperation with the county highway superintendent, must exercise their discretion in establishing pay periods and amounts of compensation for county highway employees. SDCL 7-8-20 vests county commissioners with the power to superintend county fiscal affairs and perform such other duties and acts as are required.
Therefore, in my opinion, the answer to your Question No. 2 is YES. Payment of county highway employees' wages on a bi-weekly basis would not violate State law.
Respectfully submitted,
William J. Janklow
Attorney General
WJJ:LLV:rw