SSR 73-17c: SECTION 218(t) (42 U.S. 418(t)). -- STATE AND LOCAL COVERAGE -- STATUS OF JAIL COOKS OF ALLEN AND VIGO COUNTIES -- INDIANA
20 CFR 404.1275
State of Indiana v. Finch, U.S.D.C., S.D. Ind., No. IP 67-C-57 (6/2/72)
- Administrative decision, affirming assessments made on basis that services performed by jail cooks hired, paid, and supervised by sheriffs of Allen County and Vigo County, Indiana, were performed as employees of the Counties and not as personal employees of the sheriffs, and thus were covered under State agreement for coverage of State and local employees pursuant to section 218 of Social Security Act, affirmed. Further held, judicial function of court is limited to determining whether Secretary's finding that jail cooks were employees of the counties was reasonable.
- (Affirmed SSR 65-57, C.B. 1965, p. 55).
STECKLER, District Judge:
This action was instituted by the State of Indiana against the Secretary of Health, Education and Welfare for a re-determination, pursuant to Section 218(t) of the Social Security Act, 42 U.S.C. § 418(t), of the correctness of an assessment made by the Secretary against the State of Indiana. The assessment was based upon a finding by the Secretary that four cooks working in the jails of Allen and Vigo Counties, Indiana, were employees of the counties and covered for Social Security purposes by an agreement, pursuant to Section 218 of the Act, 42 U.S.C. § 418, between the State and the Secretary.
The State took the position that the cooks were employees of the county sheriffs in their personal capacity and not employees of the counties.
The questions presented were, whether as a matter of law the State had the right to go behind the Secretary's determination, and if so, whether in determining the employment relationship between the cooks and the counties, or the cooks and the county sheriffs, the State would have the right to have a trial by jury in resolving the issues of fact.
The Court concluded that the State was entitled to a judicial review of the Secretary's determination of whether the cooks were employees of the counties, and further, that it was entitled to a jury trial for resolution of the factual issues, or that if the Court elected, it could have the benefit of an advisory jury verdict.
The case was assigned for jury trial and tried to completion.
The facts as brought out by the evidence were substantially undisputed.
The services of the cooks involved were engaged by the county sheriffs of Allen and Vigo Counties to prepare meals for the prisoners in their charge.
Two of the cooks worked full-time and were paid regular salaries, and two of them worked as substitutes and were paid salaries. In each instance the food was prepared in the county jail with the use of cooking utensils and other equipment furnished by the county. Each of the cooks were supervised in the performance of her work by the sheriff or his wife. The food prepared was either supplied or paid for by the sheriff. Both the cooks' salaries and the cost of the food were paid out of funds provided by the county to the sheriff for the feeding of prisoners. The funds were kept in a bank account in the sheriff's name as sheriff. These funds were referred to as "meal money," and were computed on the basis of a fixed amount per meal per prisoner, determined by the State Auditor pursuant to IC 1971, 17-3-12-1, Ind. Ann. Stat. § 49-1323 (Burns Repl. 1964). The cooks were not listed on any county pay roll, although each jail was regularly examined and inspected by county and state officials.
It was undisputed that the cooks were employees and not independent contractors.
At the close of the State's evidence, and again at the close of all the evidence, the Secretary moved for a directed verdict. Pursuant to Fed. R. Civ. P. 50(b), the Court reversed ruling on the legal questions raised by the motion and submitted the case to the jury on special interrogatories pursuant to Fed. R. Civ. P. 49. At the same time that Court announced that the issues of fact would be submitted to the jury, the Court granted counsel for the defendant thirty (30) days from the return of a verdict within which to submit a brief on the questions of law raised by the motion if the jury should find for the State and against the position taken by the Secretary.
Four interrogatories were submitted to the jury for answer, and their special verdict, in substance, was that the cooks were employees of the respective sheriffs in their personal capacities as individuals and not in their official capacity as county sheriffs.
The case is now before the Court for the determination of the legal questions raised by the defendant's motion for directed verdict presented at the close of all the evidence.
Notwithstanding the special verdict of the jury, the issues now before the Court are whether the cooks, as a matter of fact, and in law, were employees of the county, or whether they were employees of the respective sheriffs in their personal capacity; and further, whether the Secretary's determination that the cooks were employees of the county, and thus covered for Social Security purposes by the agreement between the State and the Secretary, is subject to re-determination by judicial review.
The review of administrative agency decisions is limited in scope by certain settled principles of administrative law, and generally the judicial function is exhausted when there is found to be a rational basis for the conclusions approved by the administrative body. See Moog Industries, Inc. v. F.T.C., 355 U.S. 411 (1957); Swift and Co. v. United States, 316 U.S. 216 (1941); Rochester Telephone Corp. v. United States, 307 U.S. 125 (1939).
Plaintiff asserts that this case is not one of normal judicial review of an agency decision where the Court's inquiry is limited to determining whether there was a "rational basis" for the agency decision. Plaintiff urges that it is entitled to a trial de novo and therefore the Court should give no special weight to the Secretary's decision on the facts.
Plaintiff bases its argument exclusively on the language of Sections 418(t) and 405(g) of Title 42. The former provides for "redetermination" of an assessment made by the Secretary of Health, Education and Welfare at the insistence of a state. The latter provides for "review" of a decision of the Secretary in the case of an individual claimant, and states that "the findings of the Secretary as to any fact, if supported by substantial evidence, shall be conclusive . . . ." Plaintiff concludes that the failure of Section 418(t) to make any mention of giving special weight to the Secretary's findings indicates that it was the intent of Congress that where the agency deals with an individual, its decision on the facts is to receive conclusive weight; however, where the agency deals with one of the states, its decision on the facts receives no greater weight than that of the state.
Notwithstanding plaintiff's contentions, nowhere in Section 418(t) are the words "trial de novo" used. The text of Section 418(s) provides, in its pertinent part:
- Where the Secretary has made an assessment of an amount due by a state under an agreement pursuant to this section . . . he shall review such assessment . . . if a written request for such review is filed with him by the state. . . . On the basis of the evidence obtained by or submitted to the Secretary, he shall render a decision affirming, modifying or reversing such assessment. . . . In notifying the state of his decision, the Secretary shall state the basis therefor.
A trial de novo would make the review by the Secretary superfluous and would require this Court to duplicate the function of the administrative agency. To grant such a trial would also ignore the mandate of Section 218(i) of the Act, 42 U.S.C. § 418(i), which provides:
- (i) Regulations of the Secretary of Health, Education, and Welfare to carry out the purposes of this section shall be designed to make the requirements imposed on States pursuant to this section the same, so far as practicable, as those imposed on employers pursuant to this subchapter and subchapter A or E of Chapter 9 of Title 26, Internal Revenue Code of 1939.
Furthermore, a de novo trial would impair the uniform nationwide application of the Social Security Act by promoting potentially different results as to each of the fifty states under Section 218 of the Act, 42 U.S.C. § 418.
When faced with problems of statutory construction, the courts generally show great deference to the interpretation given the statute by the agency charged with its administration and require that the agency decision be sustained if reasonable. See Udall v. Tallman, 380 U.S. 1 (1964); F.H.A. v. The Darlington, Inc., 358 U.S. 84 (1958); Universal Battery Company v. United States, 281 U.S. 580 (1929); Commonwealth of Kentucky, etc. v. Hobby, et al., 209 F.2d 300 (D.C. Cir. 1954).
There appears to be no authority as to whether the above rule would be applicable to agency interpretation of Section 218(t) of the Social Security Act. However, in the absence of any statutory language specifically providing for trial de novo, the Court will apply the general rule to Section 218(t). Therefore, the judicial function of this Court will be limited to determining whether the Secretary's finding that the cooks were employees of the county was reasonable, and if so, the motion for directed verdict must be sustained. In reaching this decision it will be necessary to make a statutory analysis both of the pertinent sections of the Social Security Act and of the Indiana statutes pertaining to the sheriff's office and the keeping of the prisoners in his custody.
Plaintiff contends that the sheriff is not an agent of the county for the purpose of feeding prisoners; that he is both conservator of the peace and keeper of the jail, but in discharging his duty of feeding prisoners as keeper of the jail, he acts as an independent contractor and not as an employee of the county.
The plaintiff bases this theory on "common law indicia." However, this case does not turn on common law indicia. The issue here is whether under the Social Security Act, a federal statute, the sheriff is an employee of the county. Section 218(b)(3) of the Act, 42 U.S.C. § 418(b)(3) reads:
"The term 'employee' includes an officer of a State or political subdivision." Further, Paragraph (a)(2) of Section 218 of the contract between the State of Indiana and the Federal Security Administrator, which is the basic document for Social Security coverage of Indiana state and municipal employees, contains this same definition. In Indiana the sheriff is an officer of the county in which he is elected. See Ind. Const. Art. VI § 2, 11. Although the "common law indicia" may indicate otherwise, for the purposes of this case, the sheriff himself is an employee of the county.
County jails in Indiana are required by State law to be established by the county commissioners, at the expense of the county. IC 1971, 11-5-1-1, Ind. Ann. Stat. § 13-1001 (Burns Repl. 1956) provides:
- There shall be established and kept in every county, by authority of the board of county commissioners, and at the expense of the county, a prison for the safe-keeping of prisoners lawfully committed.
Indiana sheriffs are required by law to keep the jail and the prisoners therein, and to provide proper food and fuel for the prisoners. IC 1971, 11-5-1-3, Ind. Ann. Stat. § 13-1004 (Burns Repl. 1956) provides:
- The sheriff of the county, by himself or deputy, shall keep the jail, and shall be responsible for the manner in which the same is kept. He shall keep separate rooms for the sexes, except where they are lawfully married, and he shall provide proper meat, drink and fuel for prisoners, if they have no other convenient way of supplying themselves.
The sheriff is expressly authorized by Indiana law to appoint such assistants as may be necessary for the discharge of the duties imposed by statute upon him. Therefore the sheriffs herein had the right to employ cooks for the jails over which they were the statutory jailors. In this regard IC 1971 13-3-71-2, Ind. Ann. Stat. § 49-1002 (Burns Repl. 1964), provides:
- The county auditor, the county treasurer, the clerk of the circuit court, the county sheriff, the county recorder, the county assessor, the county surveyor, and the county superintendent of schools, may appoint such number of full time or part time deputies and other assistants as may, in the judgment of the officer, be necessary for the proper discharge of the duties imposed by statute upon each of such public officers: Provided, however, That the number of deputies and other assistants shall, except as otherwise specifically provided herein, be subject to the approval of the board of county commissioners both as to full time and part time employment . . . .
The money to pay the cooks herein was expressly included in the money which Vigo and Allen Counties provided as required by Indiana law to pay for prisoners' meals. IC 1971, 17-3-12-1, Ind. Ann. Stat. § 49-1323 (Burns Repl. 1964), states:
- The sheriff of each and every county of this state having a population of less than three hundred thousand [300,000] according to the last preceding United States census shall be allowed the sum of not to exceed sixty-five cents [65 ] per meal served by such sheriff in feeding the prisoners in his charge. . . . That the exact amount per meal which the sheriff of each county shall be entitled to receive for feeding prisoners, at not to exceed the maximum amount provided for in this act [§§ 49-1323-49-1326], shall be fixed by the state examiner of the state board of accounts on or before the fifteenth day of April of each year. . . . That before any such allowance is paid, the sheriff shall submit to the board of county commissioners an itemized statement, under oath, showing the names of the prisoners and the date that each was imprisoned in the county jail and the number of meals served to each such prisoner.
Applying the pertinent provisions of Federal and State law to the instant case, the Court concludes that the Secretary's decision was correct. The cooks were employed by the sheriffs of Allen and Vigo Counties in the course of performance of their duties as keepers of the county jails. The sheriffs were employees of the county pursuant to Section 218 of the agreement between the State of Indiana and the Secretary. It follows that the cooks were themselves the employees of the respective counties for the purposes of Section 218 of the Act, 42 U.S.C. § 418, and the agreement between the State and the Secretary.
In view of the foregoing, the Court concludes that the motion for directed verdict should be, and it is, hereby granted.