United States Department of Labor 

Employees’ Compensation Appeals Board 

__________________________________________ 

B.A., Appellant 

and 

U.S. POSTAL SERVICE, POST OFFICE, 

Philadelphia, PA, Employer 

__________________________________________ 

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Docket No. 15-1171 

Issued: December 21, 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 

PATRICIA H. FITZGERALD, Deputy Chief Judge 

COLLEEN DUFFY KIKO, Judge 

JURISDICTION 

On April 28, 2015 appellant filed a timely appeal from an April 10, 2015 nonmerit 

decision and an April 14, 2015 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.2

 

ISSUES 

The issues are: (1) whether OWCP properly found an overpayment of compensation in 

the amount of $1,165.50 for which she was without fault; (2) whether OWCP properly denied 

waiver of recovery of the overpayment; and (3) whether OWCP properly determined that 

appellant had abandoned her request for a prerecoupment hearing. 

                                                             1

 5 U.S.C. § 8101 et seq. 

2

 The Board notes that, following the issuance of the April 14, 2015 OWCP decision and on appeal, appellant 

submitted new evidence. The Board is precluded from reviewing evidence which was not before OWCP at the time 

it issued its final decision. See 20 C.F.R. § 501.2(c)(1). 
2

On appeal appellant contends that she should not be responsible to repay a debt for which 

she was found to be without fault and requests a waiver of recovery, indicating that she is a 

single mother with two dependents and not financially capable of repayment. She argues that 

she is not prepared to pay $100.00 a month from the minimum income that she has each month. 

Appellant further contends that she never received notice of the hearing date and, therefore, 

could not have abandoned her hearing. 

FACTUAL HISTORY 

OWCP accepted that on May 21, 2013 appellant, a 27-year-old city carrier associate, 

sustained a left hip strain on May 21, 2013 while walking in the performance of duty. Appellant 

filed a claim for compensation (Form CA-7) for the period June 29 to September 20, 2013. On 

December 3, 2013 OWCP paid compensation for the period July 8 to September 16, 2013. 

On August 28, 2014 OWCP issued a preliminary determination that appellant received an 

overpayment in compensation in the amount of $1,165.50 for the period July 8 to September 16, 

2013 because she had been incorrectly paid compensation based on a weekly pay rate of $534.33 

when she should have been paid based on a weekly pay rate of $315.57. 

Appellant’s pay rate on the date of injury was calculated to be $534.33 per week. She 

was a transitional employee who worked 38 hours per week for 54 days, 417.09 hours total. 

Appellant had not worked in her position for 11 months prior to the injury. During the year prior 

to the injury, she earned a total of $5,907.45. The position would have afforded employment for 

substantially the whole year but for the injury, but the employing establishment advised that 

there was no other employee with the same or similar appointment. Therefore, it could not 

provide the actual earnings of another employee with the same kind of appointment working in a 

job with the same or similar duties. 

OWCP determined that appellant’s compensation was incorrect because it should have 

been calculated based on the 150 formula which is appropriate for city carrier associates who had 

not worked one year prior to the date of injury. It divided the total amount earned ($5,907.45) by 

the total number of days worked (54) to determine appellant’s average daily wage, then 

multiplied the average daily wage by 150 to determine average annual earnings, and divided that 

number by 52 weeks to find her weekly pay rate ($315.57).3

 

Payment records show that appellant had been paid at the weekly rate of $534.33 and 

received $4,093.84 for this period, but should have been paid at the weekly rate of $315.57 to 

receive $2,928.34. This was an overpayment in the amount of $1,165.50.4

 OWCP found that 

appellant was not at fault in the creation of the overpayment, making her eligible for waiver of 

recovery of the overpayment. On August 28, 2014 appellant was provided an overpayment 

recovery questionnaire and advised that she could request a prerecoupment hearing on the issues 

of fault and possible waiver of the overpayment. Appellant was advised that the overpayment 

                                                             3

 $5,907.54 divided by 54 multiplied by 150 divided by 52 = $315.57. 

4

 $4,093.84 - $2,928.34 = $1,165.50. 
3

action request must be returned to OWCP within 30 days, along with supporting financial 

information, to determine whether she would be eligible for waiver. 

On October 2, 2014 appellant requested a prerecoupment hearing. She submitted an 

overpayment recovery questionnaire (Form OWCP-20) indicating that she had two dependent 

children, a monthly income of $771.00 from supplemental security income payments and state or 

local welfare, and monthly expenses of $1,460.00 for rent or mortgage, food, clothing, utilities, 

and other expenses. Appellant stated that she worked at Open Systems Healthcare earning 

$350.00 per week, had $65.00 cash on hand, and $24.87 in savings. She further submitted a 

television bill for $126.71, a cell phone bill for $50.00, a gas bill for $100.31, a water bill for 

$74.15, an electric bill for $70.34, and a statement from American Heritage Federal Credit Union 

stating a balance of $24.64. 

In a February 18, 2015 notice, OWCP’s Branch of Hearings and Review scheduled a 

prerecoupment hearing for 9:45 a.m. Eastern Standard Time (EST) on March 30, 2015. It 

provided appellant with a toll free number and pass code for the telephone hearing. OWCP 

advised appellant that postponement of the hearing would only be permitted upon receipt of 

documentation showing her nonelective hospitalization or that the death of a spouse, parent, or 

child prevented her attendance. The notice was mailed to appellant’s address of record.5

On March 30, 2015 appellant failed to participate in the telephone prerecoupment 

hearing. 

By decision dated April 10, 2015, an OWCP hearing representative found that appellant 

failed to appear at the prerecoupment hearing and had abandoned her request. The hearing 

representative found no evidence that appellant had contacted OWCP prior to or subsequent to 

the scheduled hearing. 

In an April 14, 2015 decision, OWCP finalized its preliminary overpayment 

determination. It found that appellant had received an overpayment of compensation in the 

amount of $1,165.50, but was not at fault in its creation. OWCP further found that the 

circumstances of the case did not warrant waiver of recovery, as no financial information 

established a basis for waiver. As appellant was not receiving continuing compensation 

payments, OWCP found that she should repay the debt at a rate of $100.00 a month. 

LEGAL PRECEDENT -- ISSUE 1 

FECA provides compensation for the disability of an employee resulting from personal 

injury sustained while in the performance of her duty.6

 

                                                             5

 Appellant had supplied OWCP with a change of address on July 29, 2013. OWCP properly used the revised 

address on all subsequent correspondence. 

6

 5 U.S.C. § 8102(a). 
4

Section 8114(d) of FECA provides four different methods for determining the average 

annual earnings depending on the character and duration of the employment: 

“(1) If the employee worked in the employment in which she was employed at the 

time of her injury during substantially the whole year immediately preceding the 

injury and the employment was in a position for which an annual rate of pay-- 

(A) was fixed, the average annual earnings are the annual rate of pay; or 

(B) was not fixed, the average annual earnings are the product obtained by 

multiplying her daily wage for the particular employment or the average 

thereof if the daily wage has fluctuated, by 300 if she was employed on 

the basis of a 6-day workweek, 280 if employed on the basis of a 51⁄2-day 

week and 260 if employed on the basis of a 5-day week. 

“(2) If the employee did not work in employment in which she was employed at 

the time of her injury during substantially the whole year immediately preceding 

the injury, but the position was one which would have afforded employment for 

substantially a whole year, the average annual earnings are a sum equal to the 

average annual earnings of an employee of the same class working substantially 

the whole immediately preceding year in the same or similar employment by the 

United States in the same or neighboring place, as determined under paragraph 

(1) of this subsection. 

“(3) If either of the foregoing methods of determining the average annual earnings 

cannot be applied reasonably and fairly, the average annual earnings are a sum 

that reasonably represents the annual earning capacity of the injured employee in 

the employment in which she was working at the time of the injury having regard 

to the previous earnings of the employee in [f]ederal employment and of other 

employees of the United States in the same or most similar class working in the 

same or most similar employment in the same or neighboring location, other 

previous employment of the employee or other relevant factors. However, the 

average annual earnings may not be less than 150 times the average daily wage 

the employee earned in the employment during the days employed within [one] 

year immediately preceding her injury.7

 

(4) If the employee served without pay or at nominal pay, paragraphs (1), (2), and 

(3) of the subsection apply as far as practicable, but the average annual earnings 

of the employee may not exceed the minimum rate of basic pay for GS-15. If the 

average annual earnings cannot be determined reasonably and fairly in the manner 

otherwise provided by this section, the average annual earnings shall be 

determined at the reasonable value of the service performed but not in excess of 

$3,600.00 a year.” 

                                                             7 Id. at § 8114(d). 
5

ANALYSIS -- ISSUE 1 

The Board finds that OWCP properly found an overpayment of compensation in the 

amount of $1,165.50 because on an incorrect pay rate for the period July 8 to September 16, 

2013 and properly found appellant without fault. 

Appellant did not work in the employment position in which she was employed at the 

time of her injury during substantially the whole year immediately preceding the injury. The 

position would have afforded employment for substantially the whole year but for the injury. 

The employing establishment advised that there was no other employee with the same or similar 

appointment, therefore, it could not provide the actual earnings of another employee with the 

same kind of appointment working in a similar job with the same or similar duties.8

 

Under the circumstances, the Board finds that OWCP properly determined average 

annual earnings under section 8114(d)(3).9

 OWCP gave due regard to relevant factors and 

properly applied the 150 formula to determine average annual earnings and a weekly pay rate of 

$315.57. It divided the total amount she earned ($5,907.45) by the total number of days worked 

(54) to determine appellant’s average daily wage, then multiplied the average daily wage by 150 

to determine average annual earnings, and divided that number by 52 weeks to find her weekly 

pay rate ($315.57).10 At that pay rate, appellant should have received $2,928.34 for the period 

July 8 to September 16, 2013 rather than the $4,093.84 she did receive. The Board will therefore 

affirm OWCP’s finding of an overpayment of compensation in the amount of $1,165.50.11 

LEGAL PRECEDENT -- ISSUE 2 

According to section 8129(a) of FECA, adjustment or recovery shall be made under 

regulations prescribed by the Secretary of Labor when an overpayment of compensation was 

made because of an error of fact or law.12 The only exception is if the individual is without fault 

in the creation of the overpayment and when adjustment or recovery would defeat the purpose of 

FECA or would be against equity and good conscience.13 Each recipient of compensation 

benefits is responsible for taking all reasonable measures to ensure that payments he or she 

receives from OWCP are proper.14 A recipient is at fault in the creation or acceptance of an 

overpayment 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 

                                                             8 See L.M., Docket No. 12-1423 (issued November 7, 2012). 

9 See 5 U.S.C. § 8114(d)(3). 

10 $5,907.54 divided by 54 multiplied by 150 divided by 52 = $315.57. 

11 $4,093.84 - $2,928.34 = $1,165.50. 

12 5 U.S.C. § 8129(a). 

13 Id. at § 8129(b). 

14 20 C.F.R. § 10.433(a). See K.C., Docket No. 11-1307 (issued January 10, 2012). 
6

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 to be incorrect.15 

Section 10.436 of the implementing federal regulations provide that recovery of an 

overpayment will defeat the purpose of FECA if recovery would cause undue hardship by 

depriving a presently or formerly entitled beneficiary of income and resources needed for 

ordinary and necessary living expenses and outlines the specific financial circumstances under 

which recovery may be considered to defeat the purpose of FECA.16 

Section 10.437 provides that 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.17 To establish a position for the worse, the individual 

must show that he made a decision he otherwise would not have made in reliance on the 

overpaid amounts and that this decision resulted in a loss. Conversion of the overpayment into a 

different form from which the claimant derived some benefit does not constitute loss for this 

purpose.18 

ANALYSIS -- ISSUE 2 

The Board finds that OWCP properly denied waiver of recovery of the overpayment of 

compensation. 

Regarding the $1,165.50 overpayment of compensation, OWCP found that appellant was 

without fault in the creation of the overpayment, but denied waiver of recovery because appellant 

had not provided sufficient evidence to establish the need for waiver or a reasonable monthly 

repayment amount. The record reflects that appellant has a monthly income of $771.00 from 

supplemental security income payments and state or local welfare and an approximate monthly 

income of $1,516.67 from her earnings from Open Systems Healthcare at $350.00 per week, 

totaling $2,287.67 in monthly income.19 She reported monthly expenses of $1,460.00 for rent or 

mortgage, food, clothing, utilities, and other expenses. Accepting these amounts as accurate, her 

monthly income exceeds her monthly expenses by $827.67.20 As appellant’s monthly income 

exceeds her expenses by more than $50.00, appellant is not deemed to need substantially all of 

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

                                                             15 Id. See B.H., Docket No. 09-292 (issued September 1, 2009). 

16 Id. at § 10.436. 

17 Id. at § 10.437. 

18 See Jorge O. Diaz, 51 ECAB 124 (1999). 

19 $350.00 multiplied by 52 weeks divided by 12 = $1,516.67. 

20 $2,287.67 - $1,460.00 = $827.67. 
7

living expenses.21 OWCP properly concluded that recovery of the overpayment would not defeat 

the purpose of FECA, be against equity or good conscience, or cause hardship to appellant. 

Thus, the Board finds that OWCP properly denied waiver of recovery of the overpayment in the 

amount of $1,165.50. 

Appellant contends on appeal that she should not be responsible to repay a debt for which 

she was found to be without fault and requests a waiver of recovery, indicating that she is a 

single mother with two dependents who is not financially capable of repayment. Although 

OWCP found that appellant was without fault in the matter of the overpayment, repayment is 

still required unless adjustment or recovery of the overpayment would defeat the purpose of 

FECA or be against equity and good conscience.22 

On appeal appellant argues that she is not prepared to pay $100.00 a month from the 

minimum income that she has each month. The Board’s jurisdiction to review the collection of 

an overpayment, however, is limited to cases of adjustment, where OWCP decreases later 

payments of compensation to which the individual is entitled.23 Because appellant is no longer 

receiving compensation, collection of the overpayment in this case cannot be made by adjusting 

later payments but must be recovered by other means. The Board therefore lacks jurisdiction to 

review the amount of recovery determined by OWCP to be appropriate. 

LEGAL PRECEDENT -- ISSUE 3 

Under FECA and its implementing regulations, a claimant who has received a final 

adverse decision by OWCP is entitled to receive a hearing upon writing to the address specified 

in the decision within 30 days of the date of the decision for which a hearing is sought.24 Unless 

otherwise directed in writing by the claims examiner, an OWCP hearing representative will mail 

a notice of the time and place of the hearing to the claimant and any representative at least 30 

days before the scheduled date.25 OWCP has the burden of proving that it mailed notice of a 

scheduled hearing to a claimant.26 Section 10.622(f) of OWCP regulations provide that a 

claimant who fails to appear at a scheduled hearing may request in writing within 10 days after 

the date set for the hearing that another hearing be scheduled.27 Where good cause for failure to 

                                                             21 See L.C., Docket No. 14-0725 (issued August 13, 2014); Federal (FECA) Procedure Manual, Part 6 -- Debt 

Management, Initial Overpayment Actions, Chapter 6.0200.6a(1)(b) (June 2009). An individual is deemed to need 

substantially all of his or her current income to meet current ordinary and necessary living expenses if monthly 

income does not exceed monthly expenses by more than $50.00. In other words, the amount of monthly funds 

available for debt repayment is the difference between current income and adjusted living expenses (i.e., ordinary 

and necessary living expenses plus $50.00). 

22 See Wade Baker, 54 ECAB 198 (2002). 

23 5 U.S.C. § 8129; Levon H. Knight, 40 ECAB 658 (1989). 

24 Id. at § 8124(b)(1); 20 C.F.R. § 10.616(a). 

25 20 C.F.R. § 10.617(b). 

26 See M.B., Docket No. 10-1077 (issued March 17, 2011). 

27 20 C.F.R. § 10.622(f). 
8

appear is shown, another hearing will be scheduled and conducted by teleconference. The failure 

of the claimant to request another hearing within 10 days, or the failure of the claimant to appear 

at the second scheduled hearing without good cause shown, shall constitute abandonment of the 

request for a hearing. Where good cause is shown for failure to appear at the second scheduled 

hearing, review of the matter will proceed as a review of the written record.28 Where it has been 

determined that a claimant has abandoned her right to a hearing, OWCP will issue a formal 

decision finding that the claimant has abandoned her request for a hearing.29 

ANALYSIS -- ISSUE 3 

The Board finds that OWCP properly determined that appellant had abandoned her 

request for a prerecoupment hearing. 

Appellant contends on appeal that she never received notice of the hearing date and, 

therefore, could not have abandoned her hearing. The record establishes that on February 18, 

2015, in response to appellant’s timely request for a prerecoupment hearing, the Branch of 

Hearings and Review mailed an appropriate notice of the hearing scheduled to be held on 

March 30, 2015 at 9:45 a.m. EST by telephone. The hearing notice was properly mailed to 

appellant’s last known address of record. As the Board has held, in the absence of evidence to 

the contrary, a letter properly addressed and mailed in the due course of business is presumed to 

have arrived at the mailing address in due course. This is known as the mailbox rule.30 The 

Board finds that the notice was sent more than 30 days prior to the scheduled hearing date of 

March 30, 2015. The record establishes that appellant did not appear at the appointed time. 

Further, she did not request a postponement of the hearing prior to March 30, 2015 or explain her 

failure to appear at the hearing within 10 days of the scheduled hearing. Thus, the Board finds 

that appellant abandoned her request for an oral hearing. 

CONCLUSION 

The Board finds that OWCP properly found an overpayment of compensation in the 

amount of $1,165.50 because an incorrect pay rate had been used for the period July 8 to 

September 16, 2013, and properly found appellant without fault. The Board finds that OWCP 

properly denied waiver of recovery of the overpayment and that appellant abandoned her request 

for a prerecoupment hearing. 

                                                             28 Id. 

29 See N.L., Docket No. 15-0713 (issued July 14, 2015); Federal (FECA) Procedure Manual, Part 2 -- Claims, 

Hearings and Reviews of the Written Record, Chapter 2.1601.6(g) (October 2011). 

30 See R.M., Docket No. 14-1512 (issued October 15, 2014). 
9

ORDER 

IT IS HEREBY ORDERED THAT the April 14 and 10, 2015 decisions of the Office of 

Workers’ Compensation Programs are affirmed. 

Issued: December 21, 2015 

Washington, DC 

 

 Christopher J. Godfrey, Chief Judge 

 Employees’ Compensation Appeals Board 

 

 Patricia H. Fitzgerald, Deputy Chief Judge 

 Employees’ Compensation Appeals Board 

 

 Colleen Duffy Kiko, Judge 

 Employees’ Compensation Appeals Board