The D.C. City Council yesterday adopted a bill that would limit the city's authority to reduce the salaries of retired military employes who work for the city and are violating a District law by receiving a government pension as well as a full city government salary.

Under the District's four-year-old merit personnel act, District employes receiving government pensions are supposed to be paid an amount equal to the difference between their pension and a full city salary.

The city, however, had not enforced the law until several months ago, when some employes suddenly saw their paychecks slashed. The city later eased up on enforcement, but said it would apply the law to all affected workers beginning next week.

During yesterday's council meeting, council member H.R. Crawford (D-Ward 7) convinced the council during a regular meeting to declare an emergency and adopt temporary legislation to prevent the city from reducing the salaries of persons who retired from the military, unless the worker's salary and pension combined exceed $51,058 -- the amount paid to a DS-15 employe.

Crawford told the council that the legislation applies to 50 city employes, many of whom would resign if the city began enforcing its law. A Crawford assistant said that one city employe receiving a salary of $31,000 a year would have taken a pay cut to $8,000 a year if the council had not passed the temporary legislation, which will be in effect for six months.

The legislation passed by a vote of 9 to 4 after a lengthy debate.

Council member Hilda Mason (Statehood-At Large), who voted against the bill, said she was not convinced that there was an emergency. She told the council that as a teacher she worked in schools where she had to take guns and knives from students and that she, like former military employes, should qualify as a worker who had given extra service to her country.

Council members Nadine P. Winter (D-Ward 6), Frank Smith (D-Ward 1) and Betty Ann Kane (D-At Large) also voted against the bill.

However, some council members argued that anyone who serves in the military long enough to retire -- at least 20 years -- deserves special treatment.

Bernard Demczuk, legislative representative for the American Federation of Government Employees, said he was pleased by the council's action.

"It is a step in the right direction but the union won't rest until military retirees are permanently protected," Demczuk said.

In a separate hearing on the city's fiscal 1985 budget, some council members accused the D.C. Retirement Board, which manages pension trust funds for the city's police officers, firefighters, teachers and judges, of not looking after the best interests of retirees.

Representatives from the board told the council that it plans to return $1.9 million to the city each year for the next two years because the city had agreed to pay the board too much.

Earl Johnson, the board's executive director, testifed that the board's actuary had overestimated the amount that the city owed. But even after returning the $1.9 million to the city, Johnson told the council, the city would still owe the board $8.5 million.

Council member John Wilson (D-Ward 2) accused the board of not acting in good faith because it could earn more for the retirement fund by keeping the money. Instead, he said, the board was doing what the mayor's staff wanted it to do.

Council member Mason said that she was disturbed by the board's action. "I'm afraid if you're going to be making mistakes like that, I should draw my retirement," the former teacher said.