United States Department of Labor 

Employees’ Compensation Appeals Board 

__________________________________________ 

M.R., Appellant 

and 

U.S. POSTAL SERVICE, POST OFFICE, 

South Gate, CA, Employer 

__________________________________________ 

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Docket No. 14-844 

Issued: November 21, 2014 

Appearances: Case Submitted on the Record

Appellant, pro se 

Office of Solicitor, for the Director 

DECISION AND ORDER 

Before: 

PATRICIA HOWARD FITZGERALD, Judge 

MICHAEL E. GROOM, Alternate Judge 

JAMES A. HAYNES, Alternate Judge 

JURISDICTION 

On March 5, 2014 appellant filed a timely appeal from a December 3, 2013 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 $5,301.84; and 

(2) whether OWCP properly determined appellant was at fault in creating the overpayment. 

 1

 5 U.S.C. § 8101 et seq. 

2

 OWCP issued two decisions on February 24, 2014: (1) a suspension of compensation for failure to attend a 

second opinion examination; and (2) a termination based on refusal of suitable work. Appellant did not request a 

review of these decisions on this appeal and the record indicates that he requested a review of the written record by 

an OWCP hearing representative on both decisions. 
2

FACTUAL HISTORY 

On March 10, 2009 appellant, then a 62-year-old letter carrier, filed an occupational 

claim (Form CA-2) alleging that he sustained a bilateral knee condition as a result of his federal 

employment. OWCP accepted the claim for bilateral knee degenerative joint disease on 

March 17, 2009. On March 24, 2010 it accepted a permanent aggravation of degenerative joint 

disease. Appellant received wage-loss compensation for intermittent disability. On February 7, 

2011 he underwent right knee total arthroplasty surgery. Appellant stopped work and received 

wage-loss compensation on the periodic rolls as of March 3, 2011. 

By letter dated August 5, 2013, the employing establishment offered appellant a lightduty job. Appellant initially indicated that he was accepting the position. In an August 23, 2013 

personnel form, the employing establishment advised that he had elected to retire from federal 

employment. 

On September 21, 2013 appellant received a direct deposit of $3,029.62, representing his 

28-day wage-loss compensation for total disability from August 25 to September 21, 2013. 

According to the record on October 11, 2013, OWCP received a form from the Office of 

Personnel Management (OPM) stating that appellant elected to receive compensation benefits. 

On October 17, 2013 appellant submitted to OWCP an election of benefits form reflecting his 

election of OPM benefits. He elected OPM benefits as of September 1, 2013. With respect to 

wage-loss compensation, on October 19, 2013, a direct deposit of $3,029.62 was made for 

compensation from September 22 to October 19, 2013. 

By letter dated October 23, 2013, OWCP advised appellant of a preliminary 

determination that an overpayment of $5,301.84 had occurred. Appellant had elected OPM 

benefits effective September 1, 2013, therefore $2,272.22 in compensation paid from 

September 1 to 22, 2013 was an overpayment as was the $3,029.62 paid from September 22 to 

October 19, 2013. OWCP made a preliminary determination that appellant was at fault in 

creating the overpayment, as he knew or should have known he could not receive wage-loss 

compensation for the same period as OPM retirement benefits. 

In a letter dated November 6, 2013, OPM advised that retirement payments were made to 

appellant effective September 1, 2013. By decision dated November 25, 2013, OWCP finalized 

its determination that an overpayment of $5,301.84 occurred for which he was at fault. On 

December 3, 2013 it reissued the overpayment decision.3

 

LEGAL PRECEDENT -- ISSUE 1 

Section 8116 of FECA defines the limitations on the right to receive compensation 

benefits. This section provides: 

“While an employee is receiving compensation under this subchapter or if he has 

been paid a lump sum in commutation of installment payments until the 

 3

 The payment instructions now indicated that, if appellant could not send in a payment of $5,301.84, he would 

request OPM to deduct an amount from his annuity payments until the overpayment was recovered. 
3

expiration of the period during which the installment payments would continue, 

he may not receive salary, pay or remuneration of any type from the United 

States, except-- 

(1) in return for service actually performed; 

(2) pension for service in the Army, Navy, or Air Force; 

(3) other benefits administered by the Veterans’ Administration unless 

such benefits are payable for the same injury or the same death; and 

(4) retired pay, retirement pay, retainer pay, or equivalent pay for service 

in the Armed Forces or the uniformed services, subject to the reduction of 

such pay in accordance with section 5532(b) of Title 5, United States 

Code.” 

ANALYSIS -- ISSUE 1 

In the present case, the record establishes that appellant received wage-loss compensation 

commencing March 13, 2011 through October 19, 2013. On October 16, 2013 appellant elected 

OPM retirement benefits effective September 1, 2013. According to OPM, he was paid annuity 

benefits as of September 1, 2013. As noted, appellant cannot receive both compensation under 

FECA and retirement pay from OPM for the same period. Therefore, an overpayment of 

compensation was created from September 1 to October 19, 2013. 

OWCP calculated that appellant was paid $5,301.84 in wage-loss compensation from 

September 1 to October 19, 2013. Appellant received $3,029.62 on September 21, 2013 for the 

period August 25 to September 21, 2013, of which he was entitled to only $757.40. The 

difference of $2,272.22 and the payment of $3,029.62 on October 19, 2013 for the period 

September 22 to October 19, 2013 resulted in the overpayment of $5,301.84. The Board finds an 

overpayment of $5,301.84 was created from September 1 to October 19, 2013. 

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 

conscience.”4

 A claimant who is at fault in creating the overpayment is not entitled to waiver.5 

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.” 

 4

 5 U.S.C. § 8129(b). 

5 See Robert W. O’Brien, 36 ECAB 541, 547 (1985). 
4

ANALYSIS -- ISSUE 2 

OWCP made a finding of fault on the grounds that appellant accepted a payment he knew 

or should have known was incorrect. To support this finding, it makes a general finding that he 

should have known that he could not receive compensation for wage loss and OPM benefits for 

the same period. A proper analysis of the fault issue requires a review of the specific payments 

made to appellant that constitute the overpayment and a clear explanation of what he knew or 

should have known at the time of the acceptance of each payment. 

The record indicates that on September 21, 2013 appellant received a direct deposit into 

his bank account of $3,029.62, representing his wage-loss compensation from August 25 to 

September 21, 2013. As the Board explained in Tammy Craven,6

 when a compensation payment 

is direct deposited into a bank account, the issue of fault is determined at the time of the deposit. 

The issue is whether, at that time, the evidence establishes that the claimant knew or should have 

known the payment was incorrect. 

There is no basis for finding that, on September 21, 2013, appellant knew or should have 

known the payment was incorrect. According to the record, appellant did not elect OPM benefits 

until October 16, 2013 and no evidence was presented that he should have known the 

September 21, 2013 payment was incorrect. As to the October 19, 2013 deposit, this represents 

the first deposit after OPM benefits have been elected. In R.M.,7

 the claimant elected OPM 

benefits on August 22, 2013 effective July 31, 2013. Similar to the present case, OWCP issued a 

direct deposit payment on August 24, 2013, two days after the election of OPM benefits. The 

Board explained that OWCP improperly found that the claimant was at fault, because there was 

no evidence that on August 24, 2013 appellant knew or should have known that the payment was 

incorrect. In the present case, the deposit is three days after the election of OPM benefits and no 

specific evidence was presented that appellant knew or should have known the payment was 

incorrect. 

The Board accordingly finds that the record does not support a finding of fault with 

respect to the overpayment in this case. Since appellant is not at fault in creating the 

overpayment, the waiver issue must be considered.8

 The case will be remanded to OWCP for 

proper findings with respect to waiver of the overpayment. After such further development as is 

deemed necessary, OWCP should issue an appropriate decision. 

CONCLUSION 

The Board finds that an overpayment of $5,301.84 was created. The Board further finds 

that the record does not support a finding of fault in creating the overpayment and the case is 

remanded for consideration of waiver of the overpayment. 

 6

 57 ECAB 689 (2006). 

7

 Docket No. 14-428 (issued June 25, 2014). 

8 Id. 
5

ORDER 

IT IS HEREBY ORDERED THAT the decision of the Office of Workers’ 

Compensation Programs dated December 3, 2013 is affirmed with respect to fact and amount of 

overpayment and set aside and remanded with respect to the finding of fault and denial of 

waiver. 

Issued: November 21, 2014 

Washington, DC 

 

 Patricia Howard Fitzgerald, Judge 

 Employees’ Compensation Appeals Board 

 

 Michael E. Groom, Alternate Judge 

 Employees’ Compensation Appeals Board 

 

 James A. Haynes, Alternate Judge 

 Employees’ Compensation Appeals Board