United States Department of Labor 

Employees’ Compensation Appeals Board 

__________________________________________ 

C.H., Appellant 

and 

DEPARTMENT OF THE ARMY, JOINT 

MUNITIONS & LETHALITY COMMAND, 

Richmond, KY, Employer 

__________________________________________ 

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Docket No. 15-0799 

Issued: June 19, 2015 

Appearances: Case Submitted on the Record

Appellant, pro se 

Office of Solicitor, for the Director 

DECISION AND ORDER 

Before: 

CHRISTOPHER J. GODFREY, Chief Judge 

ALEC J. KOROMILAS, Alternate Judge 

JAMES A. HAYNES, Alternate Judge 

JURISDICTION 

On February 27, 2015 appellant filed a timely appeal from the November 25, 2014 merit 

decision of the Office of Workers’ Compensation Programs (OWCP). Pursuant to the Federal 

Employees’ Compensation Act1 (FECA) and 20 C.F.R. §§ 501.2(c) and 501.3, the Board has 

jurisdiction over the merits of this case. 

ISSUES 

 The issues are: (1) whether appellant received a $5,199.75 overpayment of 

compensation; and (2) whether OWCP abused its discretion by refusing to waive recovery of the 

overpayment. 

FACTUAL HISTORY 

OWCP accepted that on February 25, 2010 appellant, then a 63-year-old explosives 

operator, sustained a right shoulder sprain with superior glenoid labrum lesion due to a fall at 

 1

 5 U.S.C. §§ 8101-8193. 
2

work. On August 24, 2010 appellant underwent OWCP-authorized right shoulder arthroscopy 

and rotator cuff repair. He received disability compensation on the daily rolls beginning 

August 24, 2010 and was later placed on the periodic rolls. Appellant began performing 

modified work for the employing establishment on November 15, 2010 and underwent additional 

OWCP-authorized right shoulder surgery on July 5, 2011. 

On August 22, 2011 appellant began working as a modified office automation clerk for 

the employing establishment on a full-time basis. By decision dated September 11, 2012, 

OWCP reduced his compensation effective August 22, 2011 based on its determination that his 

actual wages as a modified office automation clerk fairly and reasonably represented his 

wage-earning capacity. 

OWCP requested and received documentation from the Social Security Administration 

(SSA) showing that, for the period January 1, 2013 to September 20, 2014, appellant received 

dual benefit payments from OWCP and SSA without an offset of FECA benefits being made by 

SSA benefits attributable to employment under the Federal Employees’ Retirement System 

(FERS). This documentation included information regarding appellant’s applicable SSA rates 

and their effective dates. OWCP provided a computer worksheet showing the amounts of 

prohibited dual payments appellant received for the period January 1, 2013 to 

September 20, 2014. 

In a September 26, 2014 notice, OWCP advised appellant of its preliminary 

determination that he received a $5,199.75 overpayment of compensation for the period 

January 1, 2013 to September 20, 2014 because he received prohibited dual FECA and SSA 

benefits during this period. It also made a preliminary determination that he was not at fault in 

the creation of the overpayment. OWCP advised appellant that he could submit evidence 

challenging the fact, amount, or finding of fault and request waiver of the overpayment. It 

requested that he complete and return an enclosed financial information questionnaire (Form 

OWCP-20) within 30 days even if he was not requesting waiver of the overpayment. 

In a Form OWCP-20 completed on October 20, 2014, appellant indicated that he had 

$3,977.41 in monthly income, $1,350.00 in monthly expenses, and $135,136.16 in assets, 

comprised of $80,000.00 in land and $55,136.16 in cash on hand and checking and saving 

account balances. He noted that he was married and did not have any dependents. In an attached 

statement, appellant argued that his FECA payments should not have been offset and he 

requested waiver of the recovery of the overpayment. 

 In a November 25, 2014 decision, OWCP determined that appellant received a $5,199.75 

overpayment of compensation. It found that he was not at fault in the creation of the 

overpayment, but that the overpayment was not subject to waiver because his monthly income 

exceeded his monthly ordinary and necessary living expenses by more than $50.00 and because 
3

his assets exceeded the allowable resource base. OWCP indicated that the overpayment would 

be recovered in a single payment of $5,199.75.2 

LEGAL PRECEDENT -- ISSUE 1 

Section 8116(d) of FECA requires that compensation benefits be reduced by the portion 

of SSA benefits that are attributable to federal service and that, if an employee receives SSA 

benefits based on federal service, his or her compensation benefits shall be reduced by the 

amount of SSA benefits attributable to his or her federal service.3

OWCP procedures provide that, while SSA benefits are payable concurrently with FECA 

benefits, the following restrictions apply: in disability cases, FECA benefits will be reduced by 

SSA benefits paid on the basis of age and attributable to the employee’s federal service.4

 The 

offset of FECA benefits by SSA benefits attributable to employment under FERS is calculated as 

follows: where a claimant has received SSA benefits, OWCP will obtain information from SSA 

on the amount of the claimant’s benefits beginning with the date of eligibility to FECA benefits. 

SSA will provide the actual amount of SSA benefits received by the claimant/beneficiary. SSA 

will also provide a hypothetical SSA benefit computed without the FERS covered earnings. 

OWCP will then deduct the hypothetical benefit from the actual benefit to determine the amount 

of benefits which are attributable to federal service and that amount will be deducted from FECA 

benefits to obtain the amount of compensation payable.5

ANALYSIS -- ISSUE 1 

 Appellant received both wage-loss compensation under FECA and benefits under SSA 

for the period January 1, 2013 to September 20, 2014. The portion of the SSA benefits appellant 

received as a federal employee as part of his FERS retirement package concurrently with the 

benefits he received under FECA is a prohibited dual benefit.6 OWCP requested and SSA 

provided information regarding appellant’s applicable SSA rates and their effective dates. Based 

on these rates, it determined that the prohibited dual benefits appellant received from January 1, 

 2

 With respect to the recovery of an overpayment, the Board’s jurisdiction is limited to those cases where OWCP 

seeks recovery from continuing compensation benefits. D.R., 59 ECAB 148 (2007). As appellant was not in receipt 

of continuing compensation at the time of OWCP’s November 25, 2014 overpayment determination, the Board does 

not have jurisdiction over the method of recovery of the overpayment in this case. See 20 C.F.R. § 10.441. 

3

 5 U.S.C. § 8116(d). See D.S., Docket No. 12-689 (issued October 10, 2012). 

4

 Federal (FECA) Procedure Manual, Part 2 -- Claims, Dual Benefits, Chapter 2.1000.4(a) (February 1995); 

Chapter 2.1000(e)(2) (February 1995). OWCP does not require an election between FECA benefits and SSA 

benefits except when they are attributable to the employee’s federal service. See R.C., Docket No. 09-2131 (issued 

April 2, 2010). 

5

 FECA Bulletin No. 97-09 (issued February 3, 1997); E.C., Docket No. 14-1743 (issued December 4, 2014). 

6 See P.G., Docket No. 13-589 (issued July 9, 2013). 
4

2013 to September 20, 2014 created an overpayment of compensation in the amount of 

$5,199.75.7

 The Board has reviewed OWCP’s calculations of benefits appellant received for the 

period January 1, 2013 to September 20, 2014 and finds that OWCP properly determined that an 

overpayment in the amount of $5,199.75 was created. 

LEGAL PRECEDENT -- ISSUE 2 

The waiver or refusal to waive an overpayment of compensation by OWCP is a matter 

that rests within OWCP’s discretion pursuant to statutory guidelines.8

 These statutory guidelines 

are found in section 8129(b) of FECA which states: “Adjustment or recovery [of an 

overpayment] by the United States may not be made when incorrect payment has been made to 

an individual who is without fault and when adjustment or recovery would defeat the purpose of 

this subchapter or would be against equity and good conscience.”9

 If OWCP finds a claimant to 

be without fault in the matter of an overpayment, then, in accordance with section 8129(b), 

OWCP may only recover the overpayment if it determined that recovery of the overpayment 

would neither defeat the purpose of FECA nor be against equity and good conscience. 

According to 20 C.F.R. § 10.436, recovery of an overpayment would defeat the purpose 

of FECA if recovery would cause hardship because the beneficiary needs substantially all of his 

income (including compensation benefits) to meet current ordinary and necessary living 

expenses, and also, if the beneficiary’s assets do not exceed a specified amount as determined by 

OWCP from data provided by the Bureau of Labor Statistics.10 According to 20 C.F.R. 

§ 10.437, recovery of an overpayment is considered to be against equity and good conscience 

when an individual who received an overpayment would experience severe financial hardship 

attempting to repay the debt and when an individual, in reliance on such payments or on notice 

that such payments would be made, gives up a valuable right or changes his or her position for 

the worse.11 To establish that a valuable right has been relinquished, it must be shown that the 

right was in fact valuable, that it cannot be regained and that the action was based chiefly or 

solely in reliance on the payments or on the notice of payment.12

 7

 Appellant argued that his FECA payments should not have been offset, but he did not provide an explanation for 

this argument. 

8 See Robert Atchison, 41 ECAB 83 (1989). 

9

 5 U.S.C. § 8129(b). 

10 20 C.F.R. § 10.436. An individual is deemed to need substantially all of his or her monthly income to meet 

current and ordinary living expenses if monthly income does not exceed monthly expenses by more than $50.00. 

Assets must not exceed a resource base of $4,800.00 for an individual or $8,000.00 for an individual with a spouse 

or dependent plus $960.00 for each additional dependent. See Federal (FECA) Procedure Manual, Part 6 -- Debt 

Management, Initial Overpayment Actions, Chapter 6.200.6(a) (June 2009); B.F., Docket No. 13-785 (issued 

September 20, 2013). 

11 Id. at § 10.437(a), (b). 

12 Id. at § 10.437(b)(1). 
5

ANALYSIS -- ISSUE 2 

 Appellant has not established that recovery of the overpayment would defeat the purpose 

of FECA because he has not shown both that he needs substantially all of his current income to 

meet ordinary and necessary living expenses and that his assets do not exceed the allowable 

resource base. As noted above, he reported assets of $135,136.16 and the Board notes that these 

assets greatly exceed the allowable resource base of $8,000.00 for a married claimant without 

dependents. Because appellant has not met the second prong of the two-prong test of whether 

recovery of the overpayment would defeat the purpose of FECA, it is not necessary for OWCP to 

consider the first prong of the test, i.e., whether his monthly income exceeds his monthly 

ordinary and necessary living expenses by more than $50.00. 

 Appellant also has not established that recovery of the overpayment would be against 

equity and good conscience because he has not shown, for the reasons noted above, that he 

would experience severe financial hardship in attempting to repay the debt or that he 

relinquished a valuable right or changed his position for the worse in reliance on the payment 

which created the overpayment.13

 On appeal, appellant argued that he was not at fault in the creation of the $5,199.75 

overpayment. However, OWCP found that he was not at fault in the creation of the overpayment 

and properly considered his financial circumstances in reaching its decision to deny his request 

for waiver of recovery of the overpayment. Because appellant has failed to establish that 

recovery of the overpayment would defeat the purpose of FECA or be against equity and good 

conscience, he has failed to establish that OWCP abused its discretion by refusing to waive the 

overpayment. 

CONCLUSION 

The Board finds that appellant received a $5,199.75 overpayment of compensation. The 

Board further finds that OWCP did not abuse its discretion by refusing to waive recovery of the 

overpayment. 

 13 See William J. Murphy, 41 ECAB 569 (1989). 
6

ORDER 

IT IS HEREBY ORDERED THAT the November 25, 2014 decision of the Office of 

Workers’ Compensation Programs is affirmed. 

Issued: June 19, 2015 

Washington, DC 

 

 Christopher J. Godfrey, Chief Judge 

 Employees’ Compensation Appeals Board 

 

 Alec J. Koromilas, Alternate Judge 

 Employees’ Compensation Appeals Board 

 

 James A. Haynes, Alternate Judge 

 Employees’ Compensation Appeals Board