more thorough and accurate piece of work could be done, than by attempting to bring 320,000 positions under the Classification Act immediately.

There are also other advantages in the method of extending the Classification Act through authorization of the President. One is that the initial cost of such extension will be spread over a period of years instead of being concentrated in 1 year. The other is that on the basis of reports rendered to the President by the Commission, the President will be advised of the cost of each extension of the Classification Act that he might desire to make.

Another very distinct advantage, from the standpoint of the Civil Service Commission, is that it will give the Commission time to organize its classification staff in the field service. Obviously, the effective administration of position classification in the field service cannot be carried out through correspondence directed from Washington. Decentralization of activities and direct contact with field positions are essential.

On account of the difference in occupational content between the departmental services and the field service and the wide differences encountered in the field service in respect to the location, terms, and conditions of employment, certain specific provisions must accompany any proposal to extend the Classification Act of 1923. These may be listed as follows:

1. Establishing a procedure, with adequate safeguards, for excluding from the act certain groups of positions which do not lend themselves to pay schedules consisting of uniform services and grades. Also, there is for consideration the question whether Congress desires to make explicit exclusions of those groups for whom statutory pay schedules have heretofore been enacted or wage-board machinery provided. These points are covered or raised satisfactorily in sections 3 (d) and 4 of the bill.

2. Authorizing the President to establish pay differentials, up to a designated maximum percent, for isolation, hazard, or extracontinental location. This point is covered satisfactorily in section 3 (c) of the bill.

3. Authorizing the President to establish additional classification services, within the limits of the existing compensation schedules, as amended, to cover positions which do not fall logically and reasonably within one of the five existing services. This point is covered satisfactorily in section 3 (b).

4. Specifying the procedure by which initial allocations to services, grades, and classes are to be made and by which the initial pay of incumbents is to be adjusted if necessary. This point is covered satisfactorily in section 5.

5. Protecting the salary of an employee to whose position the Classification Act is extended when he is found to be enjoying a salary higher than the maximum rate prescribed for the appropriate grade, and at the same time not affecting the regular application of the Classification Act when his position becomes vacant. This point is covered satisfactorily in section 5 (b).

Accordingly, so far as the provisions of title II are concerned relating to the extension of the Classification Act of 1923, we are glad to report that they meet with our approval.

Our further comment on H. R. 960 has to do with the provisions of section 7. The effect of this section is to grant legislative recognition to boards of review to be established in each department, the functions of which will be to consider and pass upon the merits of employees' efficiency ratings. Employees, as a matter of right, will be entitled to a hearing before the board and a determination of the merits of their efficiency ratings. The board is to be composed of three or more members, the chairman to be designated by the Civil Service Commission and the other members to be designated by the head of the department concerned. It is given the power in the bill to make any adjustments in the employee's efficiency rating that it may find to be proper.

Under the Commission's regulations, respecting the procedure of the efficiency rating system in the departmental service, boards of review appointed entirely by the head of the department concerned have been administratively established. The proposals of H. R. 960 with reference to the membership and authority of the boards of review are not in conflict with the Commission's concept of the proper function of a board of review for efficiency ratings. On the contrary, the provisions of the bill will strengthen this part of the efficiency-rating procedure. Accordingly, on the whole, after examination of this bill, we have an entirely favorable reaction to its proposals.

In accordance with the directions of the President, we submitted this report to the Bureau of the Budget which has advised us that the proposed legislation in its present form would not be in accord with the program of the President, but would not be in conflict therewith if paragraph (c) of section 3 was eliminated

therefrom. This paragraph would authorized the President to establish pay differentials up to a designated maximum percent for isolation, hazard, or extracontinental location. The views of the Bureau of the Budget on this point, we believe, are based on difficulties of administration and the fact that working conditions such as isolation and hazard may be taken into consideration in the allocation of positions to grades, in which event no specific authorization on this point would be necessary. Presumably, also, the Bureau of the Budget desires that the question of pay differentials for extracontinental location should be made the subject of separate consideration and not included in a general classification bill.

In the judgment of the Commission, the question which has thus been raised is not sufficiently important to constitute an issue, and the Commission would agree to the elimination of section 3 (c) of the bill if the retention of that section would endanger the approval of the other provisions.

Sincerely yours,

HARRY B. MITCHELL, President.

Hon, W. J. BULOW,

United States Senate.

UNITED STATES CIVIL SERVICE COMMISSION,
Washington, D. C., March 6, 1940.

DEAR SENATOR BULOW: With reference to your letter of February 16, 1940, we are pleased to report further regarding the provisions of H. R. 960, an act extending the classified civil service of the United States. Title I of H. R. 960 deals with the extension of the Civil Service Act of 1883. Title II of the bill deals with the extension of the Classification Act of 1923, as amended.

These two statutes do not necessarily go together in the sense that all positions covered by one act are also covered by the other. The two statutes are different in purpose, effect, and scope of positions covered. The Civil Service Act governs recruiting, examining, promoting, transferring, and reinstating personnel and deals with the qualifications, rights, and privileges of applicants and employees. The Classification Act calls for the grouping of positions into statutory grades, or salary ranges, on the basis of their duties and responsibilities; and this grouping determines which of the statutory pay scales is applicable to a given position. Many positions which are subject to the Civil Service Act are not under the Classification Act. The converse is also true.

Placing positions under the Civil Service Act, either by legislation or by Executive order, does not place them under the Classification Act. This requires separate action. The President's authority in section 1753 of the Revised Statutes and in the Civil Service Act to cover additional positions within the scope of that act (in the absence of statutory obstacles) does not empower him to take like action with respect to placing the positions under the Classification Act of 1923. To grant him this authority, separate provision to that effect must be found in law. The word "classification" is therefore frequently used in two totally different senses: First, classification under the Civil Service Act; that is, requiring the positions to be filled through the competitive examination procedures prescribed by the Civil Service Act and rules; second, classification under the Classification Act; that is, requiring the allocation of a position to a particular grade and salary range under the Classification Act of 1923. In any consideration of H. R. 960, therefore, it is important that this distinction be kept in view.

The questions in your letter will be discussed in the order in which they are presented.

1. Effect and administrative feasibility of the so-called Keller-Nichols amendment respecting the apportionment law.

The amendment in question reads as follows:

"(b) Notwithstanding any of the provisions of subsection (a), no person shall be covered into the civil service, appointed, transferred, or promoted to, any position covered into the classified civil service under the provisions of section 1 of this act, if such person is from a State whose quota of positions in the classified civil service is more than filled unless and until the quota of all States whose quota of positions in the classified civil service is unfilled has become filled. As used in this section the term 'State' includes a Territory and the District of Columbia."

Probably the most important aspect of this amendment is the fact that it prohibits any person from being appointed, transferred, or promoted to any position

brought within the competitive classified service pursuant to H. R. 960, if such person is a resident of a State which is in excess of its quota of appointments under the apportionment "unless and until the quota of all States has become filled." The problems which this amendment will raise in connection with filling vacancies which may occur in these positions in the future is perhaps even more important than the problems which will arise in conferring a classified status upon the present incumbents of the positions. The classification of incumbents is, of course, merely incidental to the more important consideration of having the positions placed within the purview of the merit system.

It may be pointed out at the outset that under existing law the apportionment clause of the Civil Service Act is not mandatory but operates merely as a preference statute. The Civil Service Act of 1883 confers upon the President authority to promulgate civil service rules and provides: "Among other things, said rules shall provide and declare as nearly as the conditions of good administration will warrant as follows:

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Appointment to the public service aforesaid in the departments at Washington shall be apportioned among the several States and Territories and the District of Columbia upon the basis of population as ascertained at the last preceding census.

*

Pursuant to this mandate of the statute, section 3 of civil service rule VII was promulgated by the President, reading as follows:

"Apportionment.-Certification for appointment in the departments or independent offices at Washington shall be so made as to maintain, as nearly as the conditions of good administration warrant, the apportionment of appointments among the several states and territories and the District of Columbia upon the basis of population, but eligibles who have been granted military preference shall be certified without regard to apportionment, and the appointments of persons covered into the classified service by Executive order or otherwise, or exempted from the restrictions of the quota provision in certification, shall be excluded from the apportionment figures: Provided, That appointments to the following positions shall not be so apportioned:

"(a) In all departments and offices: Apprentice, electric lineman, electric wiremen, engraver, gardener, helper (if approved by the Commission), skilled laborer (female), student, telephone operator, and mechanical trades and allied positions of the noneducational class incumbents of which are retirable at not over 65 years of age.

"(b) In the Government Printing Office, mail equipment shops (now field), local offices in the District of Columbia, field service of the military staff departments, and at Army Headquarters: All positions.

"(c) In the Bureau of Engraving and Printing: Plate printer and skilled helper."

It will be noted, therefore, that the apportionment provision applies only to competitive classified positions in the departments and offices in Washington, and then only as nearly as the conditions of good administration warrant. The law, therefore, cannot be construed as requiring an observance of the apportionment in strict mathematical proportion. As a mater of fact, the apportionment has never been in exact mathematical balance in the entire history of the Civil Service Commission. The matter of the disparity in the apportionment has been made the subject of investigation by Congress on a number of occasions. I am enclosing a pamphlet published by the Commission in which you may be interested which explains in detail the administrative difficulties inherent in maintaining an apportionment of appointments on an exact mathematical basis.

In order to effectuate the apportionment provisions of the civil service law and rules, the Commission gives preference in certification to departmental positions for any particular register to residents of States which are in arrears of their quota under the apportionment. In other words, a particular register is exhausted of eligibles from such States before residents of States which have exceeded their quotas are certified. If, however, there remain on a particular register only the names of eligibles from States which have exceeded their quotas, the Commission, of course, has no alternative to certifying such eligibles for appointment.

With respect to any group of positions which may be included in the classified service by H. R. 960, the Commission is vested with no administrative discretion in the matter of the apportionment. The amendment under consideration operates as an absolute prohibition against the certification, appointment, promo

tion, or transfer to these positions of persons from States which are in excess of their quotas. If only the names of eligible States which have exceeded their quotas appear on a particular register, such eligibles could not be certified and the Commission would be required to hold a new examination in order to recruit eligibles from States which have not received their quotas of appointments. If eligibles from such States did not qualify in sufficient numbers, presumably, the Commission would be required to reannounce the examination over and over again until a sufficient number of such eligibles have qualified. The detriment which would result to the public service from such a situation is obvious.

There is enclosed a copy of the latest statement of the condition of the apportionment as of February 29, 1940. (Chart appears on page 56a.) You will note that 16 States and the District of Columbia have exceeded their quotas, West Virginia, Maine, and Montana being only one appointment in excess, and Vermont having received exactly its share. This means that if the amendment in question is enacted into law appointments to positions which are classified under H. R. 960 will be limited to residents of 31 States, Alaska, the Virgin Islands, Puerto Rico, and Hawaii. As these States reach or exceed their quotas, eligibility for appointment will be further restricted to the residents of fewer and fewer States, so that it is not inconceivable that a point will be reached where there will be encountered serious administrative difficulty in recruiting eligibles to fill vacancies for these positions.

Under the Commission's procedure, apportionment figures are compiled for the guidance of the Certification Division twice a month. During the semimonthly period, a State which is only slightly in arrears of its quota may receive a sufficient number of appointments so that it will be slightly in excess of its quota at the end of the half-month period. Under the apportionment law, such a result is permissible since appointments are required to be apportioned only "in so far as the conditions of good administration will warrant." Under the amendment contained in section 2 (b), however, strict mathematical observance of the apportionment is mandatory and any appointments which would bring a State in excess of its quota would, presumably, be illegal. The Commission would, therefore, be required, in the first place, to maintain its records of the apportionment on a daily basis, a task which is, from an administrative point of view, practically impossible. On an active competitive register, such as that for stenographer and typist, there may, for example, be several eligibles within reach for certification for appointment, all residents of a State which is only one appointment in arrears of its quota. Under the Commission's present procedure all such eligibles will be certified since appointments are not charged to a State's quota until the proposed appointee actually enters on duty. In order to maintain an exact observance of the apportionment, the Commission would be required, at least in so far as the positions affected by H. R. 960 are concerned, to place a charge against a State's quota when eligibles from the State are only certified for appointment. If the number certified completes the quota of the State, no additional eligibles from that State could be certified. If the eligibles certified should decline appointment, or be unable for some reason to report for duty, other eligibles from the same State would thus have been unjustly deprived of opportunities for appointment. Adverting now to the status of incumbents of positions which are brought into the classified service by the so-called "covering in" process, it is believed that a few specific examples will serve to illustrate the administrative problems with which the Commission will be faced. The President, for example, issues an order pursuant to H. R. 960 placing all positions in the Federal Housing Administration in the competitive classified service. There are, let us say, 6 residents of the State of Maine employed in that agency, but on the date of the order the State of Maine is only 1 appointment in arrears of its quota. Which one, if any, of these 6 employees is to be considered for a classified status? Let us assume, also, that the President on the same day issues an order placing the Agricultural Adjustment Administration under the competitive classified service, and this agency also has 6 employees who are residents of the State of Maine. Which one of these 12 employees, if any, and in which agency, is entitled to be considered for a classified status? To illustrate further the administrative complications which may arise, let us suppose that under the circumstances stated a vacancy exists in the position of statistical draftsman in the Agricultural Adjustment Administration which cannot be adequately filled by promotion. Eligible No. 1 on the Commission's competitive register for the position of

statistical draftsman is a resident of the State of Maine. May such an eligible be appointed, thus filling the State's quota, or, under the law, is one of the employees of the Administration from the State of Maine required to be given a classified status noncompetitively, and the State's quota filled in that manner? One other matter regarding the amendment in question should be mentioned. It will be noted that the amendment affects not only the classification of the incumbents of positions, and new appointments to such positions, but is applicable also to transfers and promotions as well. This means that if a vacancy occurs in any position classified pursuant to H. R. 960, and the only persons employed in the particular agency who are qualified for promotion are residents of States which have exceeded their quota of appointments, the promotion of such employees is absolutely prohibited by the law. As a result, the vacant position would be required to be filled by the appointment of some person outside the particular agency. The Commission believes that such a situation would prove a serious obstacle to the efficient administration of personnel. No one thing can be more destructive to the morale of personnel than the knowledge that they are precluded by law from advancement within the organization in which they are employed.

The Commission believes that the amendment in question will bring not only serious administrative complications and injustices in individual cases, but will result in material loss to the efficiency of the public service.

The Commission has made a conscientious and persevering effort to every extent consistent with considerations of good administration to adjust the disparity in the apportionment figures which was caused in large measure by the emergency of the World War period when there was a shortage of personnel and practically every person who qualified in civil-service examinations was appointed without regard to his residence. The Commission's efforts have resulted in a slow but steady decrease in the number of positions held by residents of States in excess of their quotas. The figures given below will show how an adjustment has been effected in the apportionment figures for Maryland, Virginia, and the District of Columbia, the States which are furthest in excess of their quotas:

There is enclosed for your information a statistical statement making a comparison between the condition of the apportionment for each State as of February 28, 1933, and as of January 31, 1940. (Chart appears on p. 28b.

In the absence of any national emergency which would again require the appointment of persons without regard to residence, no reason is seen why further progress along this line should not be made under the existing provisions of the apportionment law. The Commission believes that the amendment contained in section 2 (b) of H. R. 960 is not administratively feasible and earnestly recommends that consideration be given to its deletion from the bill.

2. The amendment added by the committee exempting employees of the Works Progress Administration, and particularly the words "or connected with the Works Progress Administration."