United States Department of Labor 

Employees’ Compensation Appeals Board 

__________________________________________ 

T.J., Appellant 

and 

DEPARTMENT OF JUSTICE, BUREAU OF 

ALCOHOL, TOBACCO, FIREARMS & 

EXPLOSIVES, Washington, DC, Employer 

__________________________________________ 

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Docket No. 14-1742 

Issued: April 17, 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 

JAMES A. HAYNES, Alternate Judge 

JURISDICTION 

On August 12, 2014 appellant filed a timely appeal of a July 16, 2014 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 appellant received an overpayment of compensation in the 

amount of $1,839.54 for the period October 9, 2011 through March 8, 2014, for which she was 

not at fault; (2) whether she is entitled to waiver of recovery of the overpayment of 

 1

 5 U.S.C. § 8101 et seq. 

2

 The Board notes that, following the issuance of the July 16, 2014 OWCP decision, 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

compensation; and (3) whether OWCP properly required repayment of the overpayment by 

deducting $183.95 every 28 days from her continuing compensation benefits. 

On appeal, appellant contends that she was not at fault in creating the overpayment. 

FACTUAL HISTORY 

OWCP accepted that appellant, then a 46-year-old criminal investigator, sustained a right 

stress fracture of her tibia or fibula and right lateral epicondylitis during a training exercise in the 

performance of duty. Appellant was placed on the periodic rolls and received appropriate 

compensation benefits. 

In a letter dated March 6, 2014, the Office of Personnel Management (OPM) advised 

OWCP that appellant had elected Federal Employees’ Group Life Insurance (FEGLI) for basic 

life insurance and optional life insurance, option B. 

In an April 8, 2014 manual adjustment form, OWCP calculated the optional life 

insurance premiums for the period October 9, 2011 through March 8, 2014, which resulted in an 

overpayment of $1,839.54. 

OWCP informed appellant in a preliminary determination dated April 14, 2014 that she 

had received an overpayment of compensation in the amount of $1,839.54 because optional life 

insurance premiums were not properly deducted from her compensation payments for the period 

October 9, 2011 through March 8, 2014. It found that she was not at fault in the creation of the 

overpayment. OWCP advised appellant of her right to request a telephone conference, a final 

decision based on the written evidence, or a prerecoupment hearing, if she objected to the 

decision or requested waiver of the recovery of the overpayment. Appellant was advised to 

complete an overpayment recovery questionnaire and submit supporting financial documents. 

On May 5, 2014 appellant requested a telephone conference. She completed an 

overpayment recovery questionnaire indicating that she had no monthly income and total 

monthly expenses of $7,800.00. Appellant listed other funds totaling $100.00. She requested 

waiver of recovery of the overpayment. 

On July 14, 2014 OWCP conducted a telephone conference with appellant regarding her 

overpayment of compensation. 

By decision dated July 16, 2014, OWCP finalized its preliminary determination that 

appellant had received an overpayment of compensation in the amount of $1,839.54 because 

optional life insurance premiums were not properly deducted from her compensation payments 

for the period October 9, 2011 through March 8, 2014. It found that she was not at fault in the 

creation of the overpayment, but that she was not entitled to waiver of recovery as she had failed 

to provide any supporting financial documentation, such as copies of income tax returns, bank 

account statements, bills and canceled checks, pay slips, and any other records supporting the 

income and expenses listed on her overpayment recovery questionnaire. OWCP noted that, 

although appellant indicated on the overpayment recovery questionnaire that she had no monthly 

income, she was in fact in receipt of $6,987.66 every 28 days. It directed recovery by deducting 

$183.95 every 28 days from her continuing compensation benefits. 
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LEGAL PRECEDENT -- ISSUE 1 

FECA provides that the United States shall pay compensation for the disability or death 

of an employee resulting from personal injury sustained while in the performance of his or her 

duty.3 When an overpayment has been made to an individual because of an error of fact or law, 

adjustment shall be made under regulations prescribed by the Secretary of Labor by decreasing 

later payments to which the individual is entitled.4

 

Under FEGLI, most civilian employees of the Federal Government are eligible to 

participate in basic life insurance and one or more of the options.5

 The coverage for basic life 

insurance is effective unless waived6

 and the premiums for basic and optional life coverage are 

withheld from the employee’s pay.7 When an underwithholding of life insurance premiums

occurs, the entire amount is deemed an overpayment because OWCP must pay the full premium 

to OPM upon discovery of the error.8

 

ANALYSIS -- ISSUE 1 

The record reflects that OPM notified OWCP of an underwithholding of optional life 

insurance premiums for the period October 9, 2011 through March 8, 2014. OWCP calculated 

the amount of the underwithholding and resulting overpayment to be $1,839.54. It further found 

that appellant was not at fault in the creation of the resulting overpayment. The Board finds that 

appellant received an overpayment of compensation in the amount of $1,839.54 for the period 

October 9, 2011 through March 8, 2014, for which she was not at fault. 

LEGAL PRECEDENT -- ISSUE 2 

Section 8129(a) of FECA provides that when an overpayment of compensation occurs 

because of an error of fact or law, adjustment or recovery shall be made by decreasing later 

payment to which the individual is entitled.9 The only exception to this requirement that an 

overpayment must be recovered is set forth in section 8129(b). 

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. 

 3

 5 U.S.C. § 8102(a). 

4 Id. at § 8129(a). 

5 Id. at § 8702(a). 

6 Id. at § 8702(b). 

7 Id. at § 8707. 

8

 5 U.S.C. § 8707(d). See Keith H. Mapes, 56 ECAB 130 (2004); James Lloyd Otte, 48 ECAB 334 (1997). 

9 Id. at § 8129(a). 
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Thus, a finding that appellant was without fault is not sufficient, in and of itself, for 

OWCP to waive the overpayment. OWCP must exercise its discretion to determine whether 

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

good conscience, pursuant to the guidelines provided in the implementing federal regulations. 

Section 10.436 of the implementing regulations10 provide that recovery of an 

overpayment will defeat the purpose of FECA if recovery would cause hardship to a currently or 

formerly entitled beneficiary such that: (a) the beneficiary from whom OWCP seeks recovery 

needs substantially all of his or her current income, including compensation benefits, to meet 

current ordinary and necessary living expenses; and (b) the beneficiary’s assets do not exceed the 

resource base of $4,800.00 for an individual.11 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).12 

Recovery of an overpayment is considered to be against equity and good conscience 

when any 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.13 Conversion of the 

overpayment into a different form, such as food, consumer goods, real estate, etc., from which 

the claimant derived some benefit, is not to be considered a loss.14 

The individual who received the overpayment is responsible for providing information 

about income, expenses and assets as specified by OWCP. This information is needed to 

determine whether or not recovery of an overpayment would defeat the purpose of FECA or be 

against equity and good conscience. This information will also be used to determine the 

repayment schedule, if necessary.15 

ANALYSIS -- ISSUE 2 

OWCP found that appellant was not at fault in creating the overpayment of compensation 

and considered whether she was entitled to waiver of recovery. Waiver is only possible if 

recovery would defeat the purpose of FECA or would be against equity and good conscience. In 

order to establish that repayment of the overpayment would defeat the purpose of FECA, 

appellant must show that she requires substantially all of her income to meet current, ordinary, 

 10 20 C.F.R. § 10.436. 

11 Id. Federal (FECA) Procedure Manual, Part 6 -- Debt Management, Initial Overpayment Actions, Chapter 

6.200.6.a(1)(b) (June 2009). 

12 Id. 

13 20 C.F.R. § 10.437(b). 

14 Federal (FECA) Procedure Manual, see supra note 11 at Chapter 6.200.6.b(3) (June 2009). 

15 20 C.F.R. § 10.438(a); Ralph P. Beachum, Sr., 55 ECAB 442 (2004). 
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and necessary living expenses and that her assets do not exceed the established limit as 

determined by OWCP procedures.16 

Appellant provided an overpayment recovery questionnaire indicating that she had no 

monthly income and listed other funds totaling $100.00, but the record reveals that she receives 

of compensation in the amount of $6,987.66 every 28 days. She listed total monthly expenses of 

$7,800.00. However, appellant did not provide any supporting documentation. The evidence of 

record does not demonstrate that repayment of the overpayment would be against equity and 

good conscience. Moreover, appellant submitted no evidence or argument that she relied upon 

the incorrect payments to her detriment or that she would experience severe financial hardship 

attempting to repay the debt. Thus, the Board finds that appellant is not entitled to waiver of 

recovery of the overpayment of compensation as she has not established that recovery would 

either be against equity and good conscience or defeat the purpose of FECA. 

On appeal appellant contends that she was not at fault in creating the overpayment. The 

fact that a claimant is without fault in creating an overpayment does not preclude OWCP from 

recovering all or part of the overpayment.17 Therefore, the Board finds that appellant’s argument 

is not substantiated. 

LEGAL PRECEDENT -- ISSUE 3 

The Board’s jurisdiction over recovery of an overpayment is limited to reviewing those 

cases where OWCP seeks recovery from continuing compensation under FECA. Section 

10.441(a) of OWCP’s regulations provide that 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.18 

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.19 

ANALYSIS -- ISSUE 3 

OWCP reduced appellant’s future compensation benefits by $183.95 per month taking 

into account the amount of the compensation and the financial circumstances of appellant to 

minimize hardship, as well as the factors set forth in section 10.441 of OWCP’s regulations. It 

found that this method of recovery would minimize any resulting hardship on her. The Board 

finds that OWCP properly required repayment of the overpayment of compensation by deducting 

$183.95 every 28 days from her continuing compensation benefits. 

 16 Id. at § 10.436. 

17 See George A. Rodriguez, 57 ECAB 224 (2005); Joyce O. Diaz, 51 ECAB 124 (1999). 

18 20 C.F.R. § 10.441. 

19 Id. 
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CONCLUSION 

The Board finds that appellant received an overpayment of compensation in the amount 

of $1,839.54 for the period October 9, 2011 through March 8, 2014, for which she was not at 

fault. The Board further finds that appellant is not entitled to waiver of recovery of the 

overpayment of compensation and that OWCP properly required repayment of the overpayment 

by deducting $183.95 every 28 days from her continuing compensation benefits. 

ORDER 

IT IS HEREBY ORDERED THAT the July 16, 2014 decision of the Office of 

Workers’ Compensation Programs is affirmed. 

Issued: April 17, 2015 

Washington, DC 

 

 Christopher J. Godfrey, Chief Judge 

 Employees’ Compensation Appeals Board 

 

 Patricia H. Fitzgerald, Deputy Chief Judge 

 Employees’ Compensation Appeals Board 

 

 James A. Haynes, Alternate Judge 

 Employees’ Compensation Appeals Board