STATE OF SOUTH DAKOTA
OFFICE OF
THE ATTORNEY GENERAL
December 22, 1972
Miss Alma Larson
Secretary of State
Secretary to the Board of Finance
Pierre, South Dakota 57501
OFFICIAL OPINION NO. 72-70
Authority of Board of Finance to pass personnel rules.
Dear Ms. Larson:
In your capacity of Secretary to the State Board of Finance, you have asked, on behalf of the Board of Finance, for an official opinion as follows:
Will you please give the Board of Finance your official opinion as to whether each section in the proposed employees' handbook, which is currently under study by the State Board of Finance, complies with the Constitution and statutes of the State of South Dakota?
The State Board of Finance has been delegated the authority, by the Legislature, to enact uniform employee standards in certain specified areas.
Before detailing what topics are covered, it would be well to set forth which departments come under this delegation of authority. All references to the Constitution within this opinion will be to the Constitution as revised by the electorate on November 7, 1972.
JURSIDICTION OVER PERSONS
The authority of the Board of Finance to enact uniform employee standards is granted by SDCL 3-6-16. This statute covers the subject matter of rules which may be passed. It does not cover which departments are subject to those rules. I find that the Board does have the authority to pass rules covering all employees of the state government except as noted below:
EMPLOYEES OF THE LEGISLATURE. Articles II and III of the State constitution give the legislative power to the Legislature. This power necessarily includes plenary control over legislative employees. Chaaf v. South Dakota Rural Credit Board, (1917) 39 S.D. 377, 164 N.W. 964. The Legislature can delegate control over its employees to the State Board of Finance, but such delegation should not be construed unless it is clearly manifest. Anstine v. State, 137 Neb. 148, 288 N.W. 525. Until the Legislature clearly makes its employees subject to the State Board of Finance personnel rules, they should not be considered as being covered thereby. Specific employees thus excluded would be those in the Legislative Research Council, SDCL 2-9-8; the Code Counsel, SDCL 2-9-9; the Auditor General's office (Audits and Accounts), SDCL 4-2-8; and legislative employees, Article III, §9, SDCL 2-5-5 and 2-5-8.
EMPLOYEES OF THE JUDICIAL BRANCH OF GOVERNMENT. Constitutional Article V, §11 places court personnel under the unified judicial system. Again, the judicial department may, if it wishes, allow the Board of Finance to make rules governing its employees, however, such would have to be by specific court rule. See Official Attorney General's Opinion No. 72-56.
EMPLOYEES WORKING FOR THE STATE CEMENT COMMISSION. Article XIII, §10 and 11. SDCL 5-17-10(3) provides that the Commission shall set the compensation, benefits, etc. for these employees. In case of a conflict of statutes, such as this, the special statute will prevail over the general. Canada v. State, 148 Neb. 115, 26 N.W. 2d 509. See also 1943-44 AGR 94.
EMPLOYEES OF THE STATE UNIVERSITY, THE AGRICULTURAL COLLEGE, THE SCHOOL OF MINES AND TECHNOLOGY, THE NORMAL SCHOOLS, THE SCHOOL FOR THE DEAF, THE SCHOOL FOR THE BLIND, AND ALL OTHER EDUCATIONAL INSTITUTIONS, SUSSTAINED WHOLLY OR IN PART BY THE STATE. State Constitution, Art. XIV, §3 provides these " ... shall be under the control of (the Board of Regents)." In construing this constitutional provision, the State Supreme Court in Worzella v. Board of Regents, (1958),77 S.D. 447, 93 N.W. 2d 411, stated the phrase quoted above gave the Board of Regents the constitutional power to employ and dismiss all officers, instructors, and employees at all institutions under its control. Its control cannot be restricted, surrendered, or delegated away. As part of the dictum in the case, the Court inferred that under certain conditions, the Board might: delegate a portion of its power, provided the delegation were carefully circumscribed. In my opinion, this would authorize the Board of Regents to delegate to the Board of Finance certain specified powers to enact rules governing its (Regents') employees, should the Board desire to do so.
EMPLOYEES OF THE PENITENTIARY, HOSPITAL FOR THE MENTALLY ILL, SCHOOL FOR THE MENTALLY INCOMPETENT, AND THE REFORM SCHOOL. These employees are " .... under the control of the State Board of Charities and Corrections." State Constitution, Art. XIV, §2. The constitutional provision is exactly the same as that interpreted by the Court in the Worzella case. Accordingly, it is my opinion that the limitations on the Board of Regents would also apply to the Board of Charities and Corrections.
EMPLOYEES COVERED BY THE STATE POLICE CIVIL SERVICE COMMISSION. To the extent that there is a conflict between the authority to pass rules given to the State Board of Finance and that given to the State Police Civil Service Commission under SDCL Ch. 3-7, the authority of the Commission would take precedence in that it is special, as opposed to general legislation. Canada v. State, supra.
STATUTES v. REGULATIONS: The fact that the Board of Finance cannot pass personnel regulations covering the employees named above should not be construed as meaning that these employees are not subject to personnel statutes passed by the Legislature.
MERIT SYSTEM
EMPLOYEES COVERED BY THE SOUTH DAKOTA MERIT SYSTEM. The South Daokta Merit System was created by an executive order of the Governor, dated April 1, 1942. No copy of that .executive order is known to be in existence. Accordingly, I am unable to give an opinion as to the status of employees covered by the Merit System. However, all executive orders, except those issued pursuant to South Daokta Constitution, Art. IV, §8, pertaining to reorganization of government, are inferior to the laws of the State of South Dakota. It is therefore my opinion that the merit system would not affect the statutory power of the Board of Finance to pass personnel regulations.
SUBJECT MATTER OF RULES
The Director of Employment is authorized to classify work of state employees, SDCL 3-6-2; establish salary scales for certain classified employees, SDCL 3-6-3; classify and fix salaries for new employees, SDCL 3-6-4; maintain personnel records, SDCL 3-6-5; record work hours and absences, SDCL 3-6-11; approve payrolls, SDCL 3-6-12; establish minimum efficiency standards, SDCL 3-6-13; establish efficiency ratings, SDCL 3-6-14; and devise a plan for pooling and transfer of employees between agencies, SDCL 3-6-15. The Director shall present his plan for accomplishing the previous statutory duties to the Board of Finance to approve or revise. SDCL 3-6-16. I find that such a plan is a statement of general applicability that implements, interprets, and prescribes law, policy, procedure, and practice requirements, so as to make it a "rule" as defined within the Administrative Procedures Act. SDCL 1-26-1 (7).
Without going through the proposed plan or employee handbook, section by section, I find that the Director and the Board of Finance do have authority under SDCL 3-6-2 through 16 to establish rules on the following subjects: personnel evaluations, salaries, classifications, leave records, overtime, and personnel records.
I find that the Director and Board do not have authority to make rules governing the following subjects: recruitment, examinations (except for examinations to set classification and salary of new employees, SDCL 3-6-4), minimum or maximum ages of ,employment, members of the same family working within a department, probation periods, outside employment, court and jury leave, and compensatory time.
In the absence of any central authority to pass regulations on the above topics, each individual department has the inherent authority to pass regulations on those topics. 73 CJS, Public Administrative Bodies and Procedures, §16. So, where the Board of Finance does not have the authority to pass a specific regulation, that authority does exist in the individual agencies and departments of the state. Such personnel rules when passed by an individual agency, would be considered as part of the internal management of the agency, and would not have to be passed in accordance with the Administrative Procedures Act.
I find that the Director and the Board do not have the authority to make regulations duplicating statutes. SDCL 1-26-6.1 provides that an agency may not incorporate statutory provisions in their rules. An agency should not pass a rule which either copies, paraphrases, or contains essentially the same material as a statute. The purpose of a regulation is to implement statutory material, so there is no justification for a regulation which duplicates statutory material. However, there is nothing to prevent the Director from preparing an employees' handbook which contains all of the applicable material needed to explain an employee's rights and obligations to him, such as statutes, regulations, the Director's and the Board's policies, and editorial and explanatory material. Before copy-righted statutory material is reprinted, however, care must be taken to get permission from the Code Commission. SDCL 1-26-6.1. The following topics duplicate existing statutes: 40 hour work week, vacation leave, holiday leave, sick leave, leave without pay, transfer of accrued leave, military leave, educational leave, workmen's compensation, insurance benefits, veteran's benefits, retirment benefits, and employee negotiations.
Because of the general nature of this topic and because of the number of special personnel statutes which may be unmanifested in legislation covering unrelated topics, this opinion should not be construed as anything more than a general synopsis of existing law.
In order to clarify this unwieldy topic, I would suggest that the Board of Finance consider recommending legislation which would create a uniform personnel system under a central authority. The need for this will become especially apparent when agencies with conflicting personnel statutes, regulations, and policies are merged under the Governor's reorganization powers.
Respectfully submitted,
Gordon Mydland
Attorney General
