Sec. 49.  Civil service.
   At such time as the Municipality shall become a city, the Council shall by ordinance provide for and establish a Civil Service Commission and a civil service system and shall determine which employees of the City shall be within the classified service and which shall be within the unclassified service and shall provide, to the extent that it deems necessary and in the interests of the Municipality, that appointments and promotions shall be made according to merit and fitness to be ascertained as far as practicable by competitive examinations.
   All persons who have been continuously employed in the service of the Municipality in the same or similar positions included in any classified service established by Council for at least thirty (30) days preceding the effective date of the establishment thereof shall retain their positions without examination until discharged, reduced, promoted or transferred in accordance with any applicable and existing ordinances or rules or regulations established pursuant thereto.