LANGTRY, J.
As authorized by ORS 406.050(3)
Mr. Owen was hired by the city as a fire fighter on August 1, 1967, and was placed on regular status at a “Step 2” pay grade following the successful completion of a six-month probation. On February 9, 1968 he enlisted in the United States Navy and obtained a military leave of absence from the fire department as provided for in ORS 408.240.②
After four years as a “Damage Controlman” (entailing fire control duties) aboard an aircraft carrier, Owen was honorably discharged from military service and applied for restoration to his former position with the Salem Fire Department. On January [74]*7416, 1972 he was reemployed and assigned to the then current rate of pay for salary “Step 2.” Three other fire fighters hired with Owen in 1967 had, by the time of his return in 1972, progressed to the “Step 5” pay level. In April 1973 Owen claimed the city was indebted to him for the difference between the salary he had received since being reemployed and the compensation he would have received during that period at Step 5.
On June 27, 1973 Owen was informed by the city’s personnel director that no supplemental compensation would be forthcoming, in light of his determination that the
“* * * City acted properly in hiring you back on step 2 of our pay plan. As you know, advancement to the top step in our pay plan is based on merit and requires that your performance be evaluated by a superior and a recommendation for a raise must be referred to the Chief. All recommendations for salary increases are approved by this office before the City payroll clerk can change the rate of pay.
This action ensued with Owen’s amended complaint alleging that under ORS 408.240 and 408.270 he had the right to be restored to his former position without loss of seniority or other benefits, that he demanded the city comply with the Oregon statutes, and that his damages were in the form of a monthly loss in salary and the interest thereon every month from January 16, 1972.
The court below held in a letter opinion that because
“* * * the increases under the salary steps in effect during the times in question were not based solely on time in employment, but were based on the gaining of added specific training and know[75]*75ledge for firefighting within [the city’s] area # * # »
Mr. Owen had not been entitled to reemployment at a “Step 5” position. Judgment was entered accordingly.
As amended in 1951 (Oregon Laws 1951, ch 351) OES 408.270 provides in relevant part:
“Upon the termination of any leave granted by OES 408.240, every public employe shall be restored to his position without loss of seniority or other benefits. It is the intention of the Legislative Assembly that such employe shall be restored in such manner as to give him the status in his employment that he would have enjoyed if he had continued in such employment continuously from the time of his entering the Armed Forces until the time of his restoration to such employment * *
The statute is directly parallel to a corresponding section of the Universal Military Training and Service Act — 50 USC App § 459(c) (2) (1971)③ — and represents legislative adoption of the “escalator principle” first enunciated in Fishgold v. Sullivan Corp., 328 US 275, 66 S Ct 1105, 90 L Ed 1230, 167 ALR 110 (1946). In the course of interpreting Section 8 of the Selective Training and Service Act of 1940④ the [76]*76court there noted that a returning veteran was to be
“* * * restored to his former position ‘or to a position of like seniority, status, and pay.’ * * * He is thus protected against receiving a job inferior to that which he had before entering the armed services. * * * He shall be ‘restored without loss of seniority’ and be considered ‘as having been on furlough or leave of absence’ during the period of his service for his country, with all of the insurance and other benefits accruing to employees on furlough or leave of absence. * * * Thus he does not step back on the seniority escalator at the point he stepped off. He steps back on at the precise point he would have occupied had he kept his position continuously during the war * * 328 US at 284-85.
In 1958 the court clarified the impact of 50 USC App § 459 as amended (after Fishgold) saying that
“* * * [Section 459(e)] does not guarantee [77]*77the returning serviceman a perfect reproduction of the civilian employment that might have been his if he had not been called to the colors. Much there is that might have flowed from experience, effort, or chance to which he cannot lay claim under the statute. Section [459(c)] does not assure him that the past with all its possibilities of betterment will be recalled. Its very important but limited purpose is to assure that those changes and advancements in status that would necessarily have occurred simply by virtue of continued employment will not be denied the veteran because of his absence in the military service. The statute manifests no purpose to give to the veteran a status that he could not have attained as of right, within the system of his employment, even if he had not been inducted into the Armed Forces but continued in his civilian employment.
“Thus, on application for re-employment a veteran is not entitled to demand that he be assigned a position higher than that he formerly held when promotion to such a position depends, not simply on seniority or some other form of automatic progression, but on the exercise of discretion on the part of the employer * * McKinney v. Missouri-K.-T. R. Co., 357 US 265, 271-72, 78 S Ct 1222, 2 L Ed 2d 1305 (1958).
The significance, for purposes of determining the extent of a reemployed veteran’s rights under 50 USC App § 459, of this distinction between benefits which become vested by virtue of continued employment alone and those awarded as the result of an employer’s discretionary choice was reiterated by the court in Accardi v. Pennsylvania R. Co., 383 US 225, 86 S Ct 768, 15 L Ed 2d 717 (1966); Brooks v. Missouri P. R. Co., 376 US 182, 84 S Ct 578, 11 L Ed 2d 599 (1964); and Tilton v. Missouri P. R. Co., 376 US 169, 84 S Ct 595, 11 L Ed 2d 590 (1964).
[78]*78The threshold question is, therefore, the factual one of whether periodic pay increases are — in practice as well as in design⑤
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LANGTRY, J.
As authorized by ORS 406.050(3)
Mr. Owen was hired by the city as a fire fighter on August 1, 1967, and was placed on regular status at a “Step 2” pay grade following the successful completion of a six-month probation. On February 9, 1968 he enlisted in the United States Navy and obtained a military leave of absence from the fire department as provided for in ORS 408.240.②
After four years as a “Damage Controlman” (entailing fire control duties) aboard an aircraft carrier, Owen was honorably discharged from military service and applied for restoration to his former position with the Salem Fire Department. On January [74]*7416, 1972 he was reemployed and assigned to the then current rate of pay for salary “Step 2.” Three other fire fighters hired with Owen in 1967 had, by the time of his return in 1972, progressed to the “Step 5” pay level. In April 1973 Owen claimed the city was indebted to him for the difference between the salary he had received since being reemployed and the compensation he would have received during that period at Step 5.
On June 27, 1973 Owen was informed by the city’s personnel director that no supplemental compensation would be forthcoming, in light of his determination that the
“* * * City acted properly in hiring you back on step 2 of our pay plan. As you know, advancement to the top step in our pay plan is based on merit and requires that your performance be evaluated by a superior and a recommendation for a raise must be referred to the Chief. All recommendations for salary increases are approved by this office before the City payroll clerk can change the rate of pay.
This action ensued with Owen’s amended complaint alleging that under ORS 408.240 and 408.270 he had the right to be restored to his former position without loss of seniority or other benefits, that he demanded the city comply with the Oregon statutes, and that his damages were in the form of a monthly loss in salary and the interest thereon every month from January 16, 1972.
The court below held in a letter opinion that because
“* * * the increases under the salary steps in effect during the times in question were not based solely on time in employment, but were based on the gaining of added specific training and know[75]*75ledge for firefighting within [the city’s] area # * # »
Mr. Owen had not been entitled to reemployment at a “Step 5” position. Judgment was entered accordingly.
As amended in 1951 (Oregon Laws 1951, ch 351) OES 408.270 provides in relevant part:
“Upon the termination of any leave granted by OES 408.240, every public employe shall be restored to his position without loss of seniority or other benefits. It is the intention of the Legislative Assembly that such employe shall be restored in such manner as to give him the status in his employment that he would have enjoyed if he had continued in such employment continuously from the time of his entering the Armed Forces until the time of his restoration to such employment * *
The statute is directly parallel to a corresponding section of the Universal Military Training and Service Act — 50 USC App § 459(c) (2) (1971)③ — and represents legislative adoption of the “escalator principle” first enunciated in Fishgold v. Sullivan Corp., 328 US 275, 66 S Ct 1105, 90 L Ed 1230, 167 ALR 110 (1946). In the course of interpreting Section 8 of the Selective Training and Service Act of 1940④ the [76]*76court there noted that a returning veteran was to be
“* * * restored to his former position ‘or to a position of like seniority, status, and pay.’ * * * He is thus protected against receiving a job inferior to that which he had before entering the armed services. * * * He shall be ‘restored without loss of seniority’ and be considered ‘as having been on furlough or leave of absence’ during the period of his service for his country, with all of the insurance and other benefits accruing to employees on furlough or leave of absence. * * * Thus he does not step back on the seniority escalator at the point he stepped off. He steps back on at the precise point he would have occupied had he kept his position continuously during the war * * 328 US at 284-85.
In 1958 the court clarified the impact of 50 USC App § 459 as amended (after Fishgold) saying that
“* * * [Section 459(e)] does not guarantee [77]*77the returning serviceman a perfect reproduction of the civilian employment that might have been his if he had not been called to the colors. Much there is that might have flowed from experience, effort, or chance to which he cannot lay claim under the statute. Section [459(c)] does not assure him that the past with all its possibilities of betterment will be recalled. Its very important but limited purpose is to assure that those changes and advancements in status that would necessarily have occurred simply by virtue of continued employment will not be denied the veteran because of his absence in the military service. The statute manifests no purpose to give to the veteran a status that he could not have attained as of right, within the system of his employment, even if he had not been inducted into the Armed Forces but continued in his civilian employment.
“Thus, on application for re-employment a veteran is not entitled to demand that he be assigned a position higher than that he formerly held when promotion to such a position depends, not simply on seniority or some other form of automatic progression, but on the exercise of discretion on the part of the employer * * McKinney v. Missouri-K.-T. R. Co., 357 US 265, 271-72, 78 S Ct 1222, 2 L Ed 2d 1305 (1958).
The significance, for purposes of determining the extent of a reemployed veteran’s rights under 50 USC App § 459, of this distinction between benefits which become vested by virtue of continued employment alone and those awarded as the result of an employer’s discretionary choice was reiterated by the court in Accardi v. Pennsylvania R. Co., 383 US 225, 86 S Ct 768, 15 L Ed 2d 717 (1966); Brooks v. Missouri P. R. Co., 376 US 182, 84 S Ct 578, 11 L Ed 2d 599 (1964); and Tilton v. Missouri P. R. Co., 376 US 169, 84 S Ct 595, 11 L Ed 2d 590 (1964).
[78]*78The threshold question is, therefore, the factual one of whether periodic pay increases are — in practice as well as in design⑤ — (1) merit increases based upon an evaluation of the employe’s proficiency or productivity, with the employer having' the discretion to grant or deny the increase, or (2) “automatic” in the sense that they are solely the function of continued employment or relate only to the minimal increase in skill or productivity that flows from continued employment.
It is argued that, as a matter of law, the city of Salem does not have a merit pay system. Plaintiff in this case claims the advances in pay were automatic, and points to the facts that all other firemen who started when he did had advanced to Step 5, and that Fire Marshal Putnam testified that he did not remember any time when a merit pay increase had been withheld, or increased. Factual findings rendered by a trial judge in an action at law, however, have all the force and effect of a jury verdict. The circuit court’s finding that
“* * * the increases under the salary steps in effect during the times in question were not based solely on time in employment, but were based on the gaining of added specific training and knowledge for firefighting within [the city’s] area
is conclusive unless that finding is unsupported by “competent and substantial” evidence in the record. Schlatter v. Willson, 270 Or 685, 528 P2d 1349 (1974).
Personnel rules governing the “pay range” of [79]*79all city employes — rules in effect since March 1968⑥ —would appear to create at least an inference that pay increases are to he granted at the city’s discretion based upon its evaluation of an employe’s ability:
“Merit salary increases are not automatic. Department heads shall recommend to the Personnel Officer merit increases only for those employees who have demonstrated appropriate standards of work performance. Merit increases may be to the [80]*80next step of the salary range for the class or may be above or below the next step in five-dollar increments, based on merit.” Rule 4.2(c).⑦
From the city’s evidence it can be inferred that, before an increase has been granted, an individual fire fighter’s performance, attitudes and training are evaluated by officers of the fire department who then recommend an appropriate disposition to the fire chief. Mr. Wacker, personnel labor relations director for the city, testified that as a matter of course his office notified all department heads in advance of an employe’s eligibility for a “merit” increase, leaving each to award an increase — which might exceed that designated in the pay plan- — at his or her discretion based upon the department’s own evaluation of that employe. Chief Baker of the fire department testified that, upon receiving notice of an individual’s eligibility for a merit increase, he requested his battalion chiefs to gather information relating to whether the raise would be justified. Fire Marshal Putnam testified that while holding the position of chief training officer from July 1971 to September 1978 he ordinarily presented to the monthly meetings of battalion chiefs his evaluation of the training and performance history of any fire fighter eligible for a merit increase, specifically noting that this evaluation covered not only basic fire fighting skills such as “ropes and knots,” driver training and fire science and chemistry but also other topics peculiar to fire fighting in the Salem area including an individual’s knowledge of and familiarity with local fire codes and regulations, alarm systems and communications, pumps and apparatus [81]*81used by the department, as well as his participation in “pre-fire planning” for potential fire problems unique to the city.
Both Chief Baker and Fire Marshal Putnam emphasized that the merit increases granted by the department are designed both to reward the individual fire fighter for the development of greater fire fighting skills generally and to reflect the enhanced value of that individual as a member of a company crew specially trained as a team to deal with procedures and problems unique to the Salem Fire Department.
Despite the fact that fire fighters have consistently been awarded merit increases, evidence included in the record before us is nevertheless “competent and substantial” as a basis for the circuit court’s finding that the city’s pay plan is designed to reward employes for something other than or in addition to mere length of service — e.g., increased proficiency and skill as a member of a specially trained fire fighting team —and that the city as employer has retained a significant measure of discretion in the awarding of the “merit” increases provided for in that plan. Having-reviewed the guidelines provided by the Supreme Court and inferior federal courts,⑧ we are further satisfied that as a matter of law progression through such a compensation plan is not a benefit protected by the “escalator principle” embodied in OBS 408.270.
Affirmed.
In addition to his other powers and duties, the director is authorized:
“To act as agent or attorney in fact for any war veteran and the dependents or beneficiaries of any war veteran relating to rights under any federal or state law.” ORS 406.050(3).