United States Department of Labor 

Employees’ Compensation Appeals Board 

__________________________________________ 

M.O., Appellant 

and 

U.S. POSTAL SERVICE, POST OFFICE, 

Pittsburgh, PA, Employer 

__________________________________________ 

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Docket No. 14-1133 

Issued: September 22, 2014 

Appearances: Case Submitted on the Record

Jeffrey P. Zeelander, Esq., for the appellant 

Office of Solicitor, for the Director 

DECISION AND ORDER 

Before: 

PATRICIA HOWARD FITZGERALD, Judge 

ALEC J. KOROMILAS, Alternate Judge 

MICHAEL E. GROOM, Alternate Judge 

JURISDICTION 

On April 17, 2014 appellant, through his representative, filed a timely appeal from an 

April 9, 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 OWCP properly found an overpayment of $3,456.72 was 

created; (2) whether OWCP properly found that appellant was at fault in creating the 

overpayment; and (3) whether OWCP properly determined the overpayment would be recovered 

from appellant’s schedule award. 

 1

 5 U.S.C. § 8101 et seq. 
2

FACTUAL HISTORY 

The case was before the Board on a prior appeal. By decision dated May 4, 2007, the 

Board affirmed an October 3, 2006 schedule award decision for a nine percent right leg 

impairment.2 The Board noted that the claim had been accepted for a right knee sprain and a 

medial meniscus tear incurred while in the performance of duty on June 4, 2002. The medical 

evidence established that appellant had a nine percent right leg impairment based on reduced 

cartilage interval in the right knee and a partial medial meniscectomy. The history of the case as 

set forth in the Board’s May 4, 2002 decision is incorporated herein by reference.3

On April 16, 2012 appellant underwent arthroscopic surgery on the right knee, performed 

by Dr. Jon Tucker, a Board-certified orthopedic surgeon. He began receiving compensation for 

wage loss as of April 16, 2012. Appellant completed a direct deposit bank form on April 6, 2012 

and the record reflects that his compensation payments were direct deposited into his bank 

account. On July 30, 2012 he underwent patellofemoral joint replacement surgery. Appellant 

underwent additional right knee surgery on August 22, 2012. 

By letter dated July 10, 2012, OWCP advised appellant that he would be receiving 

continuing wage-loss compensation covering a 28-day period. Appellant was advised that he 

must notify OWCP immediately upon his return to work and, if he worked for any portion of the 

period covered by a payment, he must return the payment to OWCP. 

In a memorandum of telephone call (Form CA-110) dated July 26, 2013, appellant 

advised OWCP that he returned to light-duty work on July 26, 2013 at eight hours a day. 

On July 27, 2013 appellant received a deposit of $3,226.27, representing his wage-loss 

compensation from June 30 to July 27, 2013. On August 24, 2013 he received a deposit of 

$3,226.27 for the period July 28 to August 24, 2013. 

By letter dated August 27, 2013, OWCP advised appellant of a preliminary determination 

that an overpayment of $3,456.72 had occurred because he was paid compensation after his 

return to work at full salary. The calculations indicated that an overpayment of $230.45 occurred 

from the July 27, 2013 payment and the entire amount of the August 24, 2013 payment 

constituted an overpayment. OWCP found that appellant was at fault in creating the 

overpayment as he knew or should have known that he could not receive wage-loss 

compensation after his return to work. In addition, it advised him to complete an OWCP-20 

questionnaire and submit supporting financial documents, as this was necessary information on 

the issues of waiver and recovery of the overpayment. 

Appellant requested a prerecoupment hearing before an OWCP hearing representative, 

which was held on February 10, 2014. At the hearing, he noted that he would have paid the 

overpayment amount to OWCP, but he did not agree with the finding that he was at fault. 

 2

 Docket No. 07-82 (issued May 4, 2007). 

3

 The Board notes that appellant has a pending appeal with the Board regarding an April 1, 2014 schedule award 

decision. 
3

By decision dated April 9, 2014, the hearing representative finalized the overpayment 

determinations. The hearing representative found that appellant was paid two electronic transfer 

payments after his return to work on July 26, 2013 and he knew or should have known that 

payments were incorrect as OWCP had advised him that he must return payments if he worked 

for any period covered by the payment. The hearing representative noted that appellant stated at 

the hearing that he could repay the overpayment and found that it should be recovered by 

deducting $3,456.72 from his next two schedule award payments. 

LEGAL PRECEDENT -- ISSUE 1 

5 U.S.C. § 8116 defines the limitations on the right to receive compensation benefits. 

This section of FECA provides that, while an employee is receiving compensation, he or she 

may not receive salary, pay or remuneration of any type from the United States, except in limited 

circumstances.4 20 C.F.R. § 10.500 provides that “compensation for wage loss due to disability 

is available only for any periods during which an employee’s work-related medical condition 

prevents him or her from earning the wages earned before the work-related injury.” A claimant 

is not entitled to receive compensation for temporary total disability and actual earnings for the 

same period.5

 

ANALYSIS -- ISSUE 1 

The record reflects that appellant received wage-loss compensation on the periodic rolls. 

He returned to full-time work on July 26, 2013. As noted, appellant is not entitled to wage-loss 

compensation upon his return to work at full salary. The record establishes that he received 

wage-loss compensation through August 24, 2013. Appellant received a compensation payment 

by direct deposit of $3,226.27 on July 27, 2013, covering the period June 30 to July 27, 2013. 

He received an additional direct deposit payment of $3,226.27 on August 24, 2013 covering the 

period July 28 to August 24, 2013. OWCP determined that appellant was overpaid $230.45 for 

two days in the July 27, 2013 payment, as he had worked July 26 and 27, 2013. 

The resulting overpayment is therefore $230.45 plus $3,226.27 received on August 24, 

2013, for a total overpayment of $3,456.72. On appeal, appellant did not contest the fact or 

amount of the overpayment. The Board finds that an overpayment of $3,456.72 was created in 

this case. 

LEGAL PRECEDENT -- ISSUE 2 

5 U.S.C. § 8129(b) provides: “Adjustment or recovery 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 [FECA] or would be against equity and good 

 4

 5 U.S.C. § 8116(a). 

5 Daniel Renard, 51 ECAB 466, 469 (2000). 
4

consience.”6 A claimant who is at fault in creating the overpayment is not entitled to waiver.7 

On the issue of fault, 20 C.F.R. § 10.433 provides that an individual will be found at fault if he or 

she has done any of the following: “(1) made an incorrect statement as to a material fact which 

he or she knew or should have known to be incorrect; (2) failed to provide information which he 

or she knew or should have known to be material; or (3) accepted a payment which he or she 

knew or should have known was incorrect.” 

ANALYSIS -- ISSUE 2 

OWCP found that appellant was at fault in the creation of the overpayment because he 

accepted payments he knew or should have known to be incorrect. Appellant returned to work 

on July 26, 2013. He received direct deposit payments on July 27 and August 24, 2013 for 

temporary total disability. In reviewing cases regarding whether a claimant receives direct 

deposited wage-loss compensation after a return to work, the Board has drawn a distinction on 

this issue of fault between the first payment received and subsequent payments. The Board has 

held that an employee who receives payments from OWCP in the form of a direct deposit may 

not be at fault for the first incorrect deposit into his or her account since the acceptance of the 

overpayment, at the time of receipt of the direct deposit, lacks the requisite knowledge.8

In D.B.,9

 the claimant returned to work on March 13, 2012 and received a direct deposit 

on April 7, 2012 covering the period March 11 to April 7, 2012. The Board found that OWCP 

improperly found appellant at fault for accepting this payment, as it was direct deposited and he 

was not in a position to be aware of an incorrect payment or decline acceptance at that time. For 

subsequent 28-day wage-loss compensation deposits, however, appellant should have known that 

the payments were incorrect as he could not continue to receive wage loss for total disability 

compensation after his return to work at full salary. 

The Board finds that appellant is not at fault in accepting the July 27, 2013 payment, as 

he was not in a position to be aware that this payment was incorrect. OWCP must consider the 

issue of waiver with respect to the $230.45 overpayment created by the July 27, 2013 payment. 

For the subsequent August 24, 2013 payment, however, appellant is found to be at fault. At that 

point, he knew or should have known that the payment representing total disability following his 

return to work on July 26, 2013 at full salary was incorrect. 

Appellant raised the argument regarding the first payment after return to work and cited 

the case of V.A.10 In that case, the overpayment was based only on a single payment following a 

return to work and the Board found that he was not at fault. To the extent appellant is arguing 

that the entire overpayment in this case should be eligible for waiver, the V.A., case is 

 6

 5 U.S.C. § 8129(b). 

7 See Robert W. O’Brien, 36 ECAB 541, 547 (1985). 

8 See Tammy Craven, 51 ECAB 689 (2006). 

9

 Docket No. 14-397 (issued June 3, 2014). 

10 Docket No. 13-1433 (issued December 13, 2013). 
5

distinguishable from the facts in this appeal. After the first deposit, he may be found at fault for 

subsequent 28-day compensation payments deposited, as discussed. 

LEGAL PRECEDENT -- ISSUE 3 

When an overpayment has been made to an individual who is entitled to further 

payments, the individual shall refund to OWCP the amount of the overpayment as soon as the 

error is discovered or his or her attention is called to same. If no refund is made, OWCP shall 

decrease later payments of compensation, taking into account the probable extent of future 

payments, the rate of compensation, the financial circumstances of the individual and any other 

relevant factors, so as to minimize any hardship.11 

ANALYSIS -- ISSUE 3 

As the discussion regarding fault notes, OWCP must consider waiver with respect to 

$230.45 of the overpayment. On appeal, appellant noted that he is pursuing an increased 

schedule award and therefore OWCP should not collect the overpayment from his current 

schedule award. The issue of a possible increased schedule award does not impact the recovery 

of the overpayment in this case. The Board has held that OWCP may properly collect an 

overpayment from the amount of compensation owed a claimant through a schedule award.12 

Appellant was advised to submit relevant financial evidence in the preliminary determination of 

overpayment, but there is no evidence that he submitted an OWCP-20 or other financial 

documentation. It is his responsibility to submit relevant financial information with respect to 

recovery of the overpayment.13 There was no evidence of any financial hardship from collecting 

the overpayment from two schedule award payments. The Board finds that OWCP properly 

determined that the overpayment could be recovered from the schedule award payments in this 

case. 

CONCLUSION 

The Board finds that OWCP properly found an overpayment of $3,456.72 was created. 

As to fault, OWCP properly found that appellant was at fault with respect to $3,226.27 deposited 

on August 24, 2013. The finding of fault is set aside with respect to an overpayment of $230.45 

deposited on July 27, 2013 and the case remanded for consideration of waiver. The Board 

further finds that OWCP may properly recover the overpayment from schedule award 

compensation. 

 11 20 C.F.R. § 10.441(a). 

12 See D.S., Docket No. 14-378 (issued June 11, 2014). 

13 20 C.F.R. § 10.438. 
6

ORDER 

IT IS HEREBY ORDERED THAT the decision dated April 9, 2014 is affirmed with 

respect to fact and amount of a $3456.72 overpayment, affirmed with respect to a finding of fault 

regarding $3,226.27 of the overpayment, set aside and remanded for consideration for waiver of 

$230.45 and affirmed with respect to recovery of the overpayment. 

Issued: September 22, 2014 

Washington, DC 

 

 Patricia Howard Fitzgerald, Judge 

 Employees’ Compensation Appeals Board 

 

 Alec J. Koromilas, Alternate Judge 

 Employees’ Compensation Appeals Board 

 

 Michael E. Groom, Alternate Judge 

 Employees’ Compensation Appeals Board