November 24, 1980
Subject:
State Departments, Institutions and Agencies; G.S. 143-340; Employee Suggestion System.
Requested By:
Jack Barnes, Director Office of Administrative Analysis North Carolina Department of Administration
Questions:
- May agencies other than the North Carolina Department of Administration promulgate rules and regulations affecting the administration of the Employee Suggestion System without prior approval of the Secretary of Administration?
- Can the Secretary of Administration delegate to other agencies the responsibility of officially communicating decisions on the use of suggestions to the employee who submitted the suggestion?
- At what point in the Employee Suggestion procedure is a contract created?
Conclusions:
- No.
- Yes.
- A contract is created upon official acceptance of a suggestion, however, the contract would be enforceable only to the extent of the award decision.
G.S. 143-340 gives the Secretary of Administration the following power and duty:
To establish a meritorious service award system for State employee suggestions which may include cash awards to be paid from savings resulting from the adoption of employees suggestions, but in no case shall the cash award exceed twenty-five percent (25%) of the savings resulting during the first year following adoption or a maximum of five thousand dollars ($5,000).
This statute places the responsibility for creation of a suggestion system exclusively on the Secretary of Administration. It would therefore follow that the Secretary of Administration would also have exclusive administrative control over the operation of the system.
Pursuant to this statutory authority, the Secretary of Administration has delegated total responsibility for the operation of the Suggestion System to the Administrative Analysis Division of the Department of Administration. Guidelines for the administration of the Suggestion System are published in the North Carolina State Employees Suggestion System Policy and Procedures Manual.
Certain responsibilities concerning the administration of the Suggestion System are carried out by departmental awards committees within the various State agencies. These committees, however, are required to operate in a manner consistent with the rules and regulations of the Administrative Analysis Division. Individual agencies may not promulgate their own rules and regulations without prior approval of the Administrative Analysis Division.
The Secretary of Administration does, however, have the authority to delegate certain responsibilities for the administration of the Suggestion System to individual agencies. This authority may include the delegation of the responsibility for notifying individual employees of decisions as to the acceptance or rejection of their suggestions.
Suggestions by eligible employees are submitted for consideration on a suggestion form which is distributed throughout State government. The submission of a suggestion by an eligible employee does not create a contract between the employee and the State. The suggestion form itself is an invitation to make an offer. When a suggestion is submitted, the employee has, in effect, made an offer to the State. If the suggestion is accepted and given final approval in accordance with applicable procedures, the State will be deemed to have accepted the offer of the suggesting employee. It is at this point that a contract is created between the employee and the State of North Carolina.
It should be noted, however, that such a contract is enforceable only in accordance with the terms of the award. Inasmuch as the amount and nature of each award is based upon a discretionary determination by the Suggestion System Office as to the specific value of that particular suggestion, the State would be liable to the suggesting employee only to the extent of the award and only at such time as the terms of the award are finalized.
Rufus L. Edmisten Attorney General
Grayson G. Kelley Assistant Attorney General