Wednesday, September 10, 2008

Per Diems

Alaska UPDATE BELOW

The Washington Post has a story about Sarah Palin billing the state for per diems while she was living at home.  As a colleague reminded me--don't ask why I needed reminding--there are obviously employment law issues involved with the story.  The basic facts:

Alaska Gov. Sarah Palin has billed taxpayers for 312 nights spent in her own home during her first 19 months in office, charging a "per diem" allowance intended to cover meals and incidental expenses while traveling on state business.

The governor also has charged the state for travel expenses to take her children on official out-of-town missions. And her husband, Todd, has billed the state for expenses and a daily allowance for trips he makes on official business for his wife.

Palin, who earns $125,000 a year, claimed and received $16,951 as her allowance, which officials say was permitted because her official "duty station" is Juneau, according to an analysis of her travel documents by The Washington Post.

The expenses appear to be legal under Alaskan law, but some other issues may arise. The Feminist Law Professor's has an interesting post on the possible tax issues.  Readers of this blog will recognize some questions as well.  For instance, how is her work time and work place defined? Under federal law, her receipt of a per diem suggests that she is working during those days at her Wasilla home--and more importantly that her job required her to do work in Wasilla.  Thus, if she was a federal employee and her official "duty station" is Juneau then she could only get per diems when her job required her to be elsewhere.  Moreover, under the FLSA and Portal-to-Portal act, an employee who voluntarily lives away from work cannot include commuting time as paid work time.  As salaried employee, this isn't directly an issue for Palin, but may say something about reimbursing costs that result from personal choices. 

Ultimately, what this looks like to me is that she's telecommuting.  My wife does this with a federal agency, in part to be with our son, and I'm all for it.  But, there was a period when she had to travel to D.C. once a month and there was no suggestion that we would get any reimbursement--and, trust me, she hasn't gotten a dime of per diem for her time at home.

There are obviously more employment law issues, so feel free to weigh in.

-JH

UPDATE

Because of the large amount of traffic on this post (thank you, Instapundit readers), I thought it would be worth addressing some of the substantive comments.  There are too many to answer directly, so I'm going to try to group the ones from our comment page or that Glenn forwarded to me.  Hopefully, that will cover most everything.  Before I respond, however, I want to make clear that this post wasn't intended to grind any political axes. I applaud some of Gov. Palin's efforts to cut spending, but if I were an Alaskan taxpayer, I wouldn't like her charging per diems in this case.  More important, it's a high-profile issue that intersects with what I teach--just the sort of thing we blog about a lot here.  So if employees of the DNC try to unionize or RNC employees argue there not getting paid overtime, I'm there. 

With that, here  are my responses:

1. "Gov. Palin didn't charge or accept a housing per diem payment for the time she stayed in Wasila and commuted to Anchorage or Juneau.  She took a travel-expense portion."

I was well-aware of the distinction when I wrote my original comments.  "Per diem," by definition, excludes lodging expenses.  For reasons that I explain more below, charging "travel" per diems in this situation would've been unlawful had she been a federal employee and her commuting time from her home would not be included as work time under federal law.

2.  "Gov. Palin is working away from home on an extended work assignment.  Her employer, the state of Alaska, considers Wasilla to be her "residence".  The state capital (which can be reached from Wasilla only by air or sea) is her "duty station".  In the business world in such circumstances, it is not unusual for the business to pay for some expenses that normally would be considered purely personal."

This comment gets to what I view as the major distinction here.  This view--which is shared by many--is that she is basically on temporary assignment to Juneau.  If that's correct, then she should be able to charge per diem expenses while in Juneau, not while in Wasilla (or the nearby office in Anchorage).  Charging per diems that other way around makes no sense under that scenario.  The only way it would make sense is if she had to be in Anchorage/Wasilla temporarily for work--but because she, not her employer, made the choice to work and live there, that's not the case (one reader suggested that she was in Anchorage "supervising," but I've seen no evidence of that and the idea that a governor would have to "supervise" a single state office, and do so that many times, isn't plausible.  I understand that she would need to be in Anchorage some for official business--and if so, charge away--but from everything I've seen she was there mainly because she wanted to be at home not because work required it.). 

A further problem is that classifying the governorship as temporary doesn't pass the smell test. Temporary work assignments refer to assignments that are made at the behest of an employer.  That's not what Palin is doing.  She--not her employer--chose to live away from her duty station.  As I noted in my original post, that's her choice, but most employment laws (and tax, as explained more here) do not view that as something that the employer needs to pay for. 

Moreover, temporary work assignments are, well, "temporary."  That's not what's going on here. Gov. Palin applied/ran for a new job and got it.  The job is full-time (see below for the difference from most legislatures) and has a four-year term, with a two-term limit.  Thus, under normal circumstances, she would hold the job for four to eight years.  That's not close to temporary.  More important, it's not temporary because once her assignment to Juneau is over, she's not going to be reassigned to Wasilla.  She's simply not going to have the job anymore.

To put it another way:  do you think that Pres. Bush should be able to charge per diems for the time he spends in Crawford?

3.  "The legislature in Alaska has considered this issue and has decided that it's in the state's interest for a high level politician to bring their family along for business trips which invariably involve state interests.  Thus, the practice of allowing per diem for families is allowed under state law."

Assuming that it's legal, there's some indication that it's only because of moves that Murkowski made, which isn't a ringing defense. Moreover, as I noted, I'm not writing about this to argue that she actually broke some law.  Rather, for labor and employment geeks like me it's an insteresting issue that we can use to help examine various employment laws. Basically, this is the type of hypothetical question that I use in class all the time (that's a little heads-up for my students reading this).

Also, after checking a bit into Alaska law it looks like the only reason it's legal is that the governor is exempted from the rules that apply to virtually every other state employee (if a reader knows something I missed, please let me know).  Those rules state that a per diem is allowed only "while traveling on official business." Obviously, there may have been times when that applied to Gov. Palin, but I've yet to see anything suggesting that most of the 312 days in Wasilla were for official business.  So again, she didn't appear to violate Alaska law, but she does appear to be doing something that other state employees are prohibited from doing.  For what it's worth, most states don't allow governors to do this, nor does the federal government; U.S. congressional representatives often maintain home residences, but are not allowed per diems while there (although I think they can get some travel expenses).

4.  "Tennessee state legislators do receive a per diem for food, travel, and lodging. My State Rep. . . . lives a stone's throw from the Capitol, but collects the max travel allowance anyway, at nearly $20K per year. Of course, in her case, that's the least of her moral lapses."

This is probably true of most states.  The big difference is that state legislatures are truly temporary jobs; a governorship is full-time.  I don't defend a per diem for a legislator who lives in the same city as the capitol, but paying a per diem for a legislator who is at the capitol for a few weeks when the legislature is in session is far different than a governor choosing to live away from the capitol and seeking a per diem for that, no matter how big the state is.  If she wants to live in Wasilla rather than Juneau, that's fine, but most government employees wouldn't expect to get reimbursed for it.

-JH

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Comments

Let's see, since we all agree that the per diems were legal, we're left with the morality question.

Hmmm. Should she have filed for the per diems? Gee. Compared to Obama who hung out with an unrepentant terrorist who still thinks that he didn't bomb enough.

Ah yes. Apples. Oranges. I can see the moral equivalence meters spinning in the minds of many bored lawyers.

Can't I?

Posted by: Paul A'Barge | Sep 10, 2008 1:05:50 PM

Actually, I don't know for sure that it's legal--I haven't had time to look at it. And even if it is, there's some indication that it's only because of moves that Murkowski made, which isn't a ringing defense. Moreover, if Obama had done this would your reaction have been the same? Mine would. Especially for candidates that talk about their elimination of government waste.

Glenn has forwarded me a few substantive responses, which I'll quote and respond to later tonight.

Posted by: Jeff Hirsch | Sep 10, 2008 1:10:42 PM

I'm confused by this post. The sentence that begins, "Under federal law..." suggests that there are federal standards for all Americans, but the next sentence talks about what would happen "if she was a federal employee".

Are you suggesting Palin may have violated federal law, or that she would have if she had taken the same per diem as a federal employee?

Posted by: bgates | Sep 10, 2008 1:12:50 PM

shes not nor ever has been a federal employee

Posted by: me | Sep 10, 2008 1:15:48 PM

Thus, if she was a federal employee and her official "duty station" is Juneau then she could only get per diems when her job required her to be elsewhere.

But she isn't a federal employee. Why not look up the actual Alaska law rather than wildly speculate?

Posted by: fedkatheconvict | Sep 10, 2008 1:16:21 PM

My understanding is that she has an official office in Anchorage, which is about an hour's drive from Wasilla. So I don't think she's telecommuting; rather, she's working at a satelitte office in Alaska's largest city.

Posted by: Thomas | Sep 10, 2008 1:20:08 PM

I understood that the travel expenses were for the travel from her home in Wasilla to her office in Anchorage, a distance of 45 miles each direction. Is that unusual as she seems to have not gone that extra mile and billed for lodging in her home just the travel or business expenses incurred in Wasilla and the trip to Anchorage. The Alaskan legislature meets for 90 days per year. I guess the question is should the governor be required to live in the state capitol as the state maintains an office for the governor in 2 locations. Residing in New York State I am sure we would never have this problem as we pay our legislators more in salary than the governor of Alaska and about $425.00 per diem when they are in session.

Posted by: Kathy | Sep 10, 2008 1:21:57 PM

Isn't Per Diem taxable income anyway... It is in the civilian world

Posted by: JFH | Sep 10, 2008 1:22:35 PM

I think you're misunderstanding the situation. She was not working out of the family's Wasilla home during the times she claimed per diem. She was staying @ the Wasilla home, however working in Anchorage where the governor maintains an office. She filed for meals and incidental expenses during those days, however she did not file for a travel reimbursement or for a lodging reimbursement (Wasilla is less than 50 miles from Anchorage and she was staying @ her residence in the area rather than a hotel or rented apartment).

Posted by: SFC B | Sep 10, 2008 1:23:38 PM

"charging a "per diem" allowance intended to cover meals"

I can easily imagine that she was in Wassila working outside her home (this is 5th biggest Alaska town after all), and asked for reimboursement for the meals she ate during the day at work.

Anyway, this is small potatoes. It is true that she runs on "clean government", so should be more accurate, but come on! Obama runs on being great speaker, so by this logic we should attack him for "pig & lipstick".

Posted by: DN | Sep 10, 2008 1:25:13 PM

Q: Was it legal?
A: Yes

Q: Was it "moral" or "correct"?
A: I'll start paying atention to that as soon as the blood-suckers in the media start looking into Sen. Biden's and Obama's per diem, dual residency, "official" trips between DC and home, etc. as vigorously as they're investigating Gov. Palin's.

Posted by: submandave | Sep 10, 2008 1:27:03 PM

FWIW I believe it is wrong to make a comparison between, on the one hand, civil service or business co-location, and on the other, legislative or executive co-location. For better or worse (I think better), as a matter of public policy we expect our politicians to maintain roots in their communities. At the same time we don't want representation provided only by people who are independently wealthy and can afford to live in two places, or for that matter, by people who are willing to abandon their families for years on end. The fact that Palin cut those per diem expenditures is more than enough to satisfy me of her good intentions; for me this would be a non-issue even if her reimbursements were 'typical'.

Posted by: bbbeard | Sep 10, 2008 1:41:21 PM

"But she isn't a federal employee. Why not look up the actual Alaska law rather than wildly speculate?"

Why? Because Obama is behind in the polls, that's why.

Posted by: belloscm | Sep 10, 2008 1:41:47 PM

This is from memory, so feel free to double check: Many of 312 days relate to times Gov. Palin worked in Anchorage. (Anchorage is Alaska's largest city and the location of many of the state's offices and most of its employees. She was not telecommuting; she supervising the workings of the state government.) Rather than stay in a hotel in Anchorage, Gov. Palin spent the night in her home in Wasilla. She did not bill the state for the use of her home. She did bill the state for per diems (which cover meals and incidental expenses unrelated to lodging). Note: She worked the day out of her duty station, Juneau, and would have been entitled to per diems had she stayed the night in Anchorage or had flown back to Juneau for the night. Spending the night in Wasilla SAVED the government money (by avoiding hotel or airfare expenses) and does not affect the legality or the morality of claiming earned per diems.

So what's the issue here? If the Governor needs to meet with the mayor of Nome, she's entitled to per diems whether or not her return flight lands in Juneau or Anchorage. If she works a day in Anchorage (because that's the location of the state employees she needs to meet), she's entitled to per diems whether or not she sleeps that night in Anchorage, Wasilla, or Juneau.

Posted by: David Walser | Sep 10, 2008 1:47:18 PM

Prof. Hirsch writes: "Under federal law, her receipt of a per diem suggests that she is working during those days at her Wasilla home--and more importantly that her job required her to do work in Wasilla. ... Ultimately, what this looks like to me is that she's telecommuting."

This is incorrect. A more careful examination of the Washington Post article would have found that she was working during those days at her office in Anchorage (45 minutes from Wasilla). Her main office ("duty station") is in the state capitol in Juneau, but she has a secondary office in Anchorage that she works from when the state legislature is not in session.

That said, the article is unclear. The article states that the per diem is "intended to cover meals and incidental expenses while traveling on state business". But it also states that "Palin rarely sought reimbursement for meals while staying in Anchorage or Wasilla, the reports show." So if the per diem is intended to cover meals, why then is she also entitled to reimbursement for meals (which she rarely sought)?

Posted by: Alex | Sep 10, 2008 1:49:34 PM

It seems to me this issue, like so much of what has been slung Palin's way recently, has much more to do with her opponents' angst over her carpe diem rather than her gubernatorial per diem.

Posted by: edh | Sep 10, 2008 1:51:26 PM

What happens to the numbers after factoring in her voluntary pay cut, the sell off of the jet, the cost savings of staff and utilitites in Juneau and other money she has saved the state and its citizens.

Posted by: Diane | Sep 10, 2008 1:58:54 PM

Gov. Palin's job frequently takes her to Anchorage, the largest city in the state. OK, so I guess some people would rather have Gov. Palin just check into a hotel in Anchorage and bill the public for meals AND lodging rather than spend the night in her own home (Wasilla is essentially a suburb of Anchorage) and just charge for the meals. If anyone else did this, people would be congratulating them for being fiscally responsible.

Posted by: 74 | Sep 10, 2008 2:11:10 PM

Look at a map! Her duty station during the Legislative session is Juneau. When the legislature was not in session she officed in Anchorage, and commuted from her house in Wasilla. Her "home" as governor of Alaska is Juneau. So your "basic facts" are baloney! Should she have billed for the time she spent at the governors residence in Juneau instead?

All the above facts are easy to come by. And as for the family travel, the Alaskans seem to be fine with it (80% approval rating). Since it is much harder to get around Alaska by car than in the lower 48, its not surprising to see some air travel.

Would doing some basic research before going with bogus "basic facts" be too hard?

Posted by: Jack Okie | Sep 10, 2008 2:13:42 PM

Given the unique circumstances for travel that come with Alaska, it isn't surprising that the Alaska legislature allows per diem and traveling expenses that may look, shall we say, excessive, to people living in the lower 48. Especially to those living in much smaller states, where a representative has no more than a few hours drive on interstate highways to reach the state capital. I cannot see how it could be unethical for Governor Palin to claim per diem and traveling expenses that are authorized by the Alaska legislature.
Second guessing why such claims are authorized by the Alaska legislature is another thing entirely, and of course doesn't reflect good or bad on Gov Palin. So that's probably why the issue won't be raised.

Posted by: Diggs | Sep 10, 2008 2:16:22 PM

Whilst - in years past - I was a CA state employee there were many occasions to claim per diem in situations that could have looked ambiguous or suspicious to "others", but in fact were well-justified and - more importantly - entirely lawful. Pre-judging this issue without more knowledge of applicable law speaks more to the "judges" bias than the claimant's supposed excesses, imo. But that could just be me.

Posted by: 49erDweet | Sep 10, 2008 2:22:10 PM

The per diem was not collected for working from home, it was collected for commuting to the Governor's Anchorage office which was about 45 minutes away from her home in Wasilla. It seems perfectly legitimate to collect a per diem for travel and meals, since her offical office was in Juneau and Anchorage was considered a satelite office. There are hundreds of thousands of people of all walks of life that collect a per diem for expenses incurred working at other than their normal place at work, regardless of whether it is closer to their private home than their "official" office.

Take a major league baseball player for the San Franscisco Giants that lives in the off season in Miami. If he goes to Miami for three days to play the Marlins, and he stays in his own home, does he still get the per diem. I'd think so.

Posted by: Kazinski | Sep 10, 2008 2:22:43 PM

Well, the alternative would be that she lives in Juneau year-round, in the Governor's residence, and therefore has all her expenses billed to the state of Alaska. Living in her permanent home and working in Anchorage while the state legislature isn't in session may have actually *saved* the state money.

Most workers don't have a government-provided residence, after all; the comparison between Palin and your wife is inapt in this regard.

Posted by: jaed | Sep 10, 2008 2:28:52 PM

Gee. And during the Clinton years, if it was legal it was moral, and so statements were carefully parsed in advance. My how times have changed.

Or is it just that the party under examination has changed?

Posted by: Paul | Sep 10, 2008 2:46:20 PM

Alaska Statutes Sec. 39.20.060. Exclusion of governor and lieutenant governor from personnel laws.

Notwithstanding the provisions of any other law, the governor and lieutenant governor are not considered employees of the state for the purpose of state personnel laws relating to hours of employment, annual leave, sick leave, overtime, compensatory time, and travel allowances. This section does not deprive the governor and lieutenant governor of the right to participate in the state retirement system or in state group insurance plans.

Before anybody gets too carried away in researching the esoterics of Alaska government travel regs.

Posted by: Brenda | Sep 10, 2008 3:09:22 PM

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