United States Department of Labor 

Employees’ Compensation Appeals Board 

__________________________________________ 

A.R., Appellant 

and 

U.S. POSTAL SERVICE, POST OFFICE, 

Fort Lauderdale, FL, Employer 

__________________________________________ 

) 

) 

) 

) 

) 

) 

) 

) 

Docket No. 15-1095 

Issued: April 25, 2016 

Appearances: Case Submitted on the Record

Martin Kaplan, Esq., for the appellant 

Office of Solicitor, for the Director 

DECISION AND ORDER 

Before: 

PATRICIA H. FITZGERALD, Deputy Chief Judge 

COLLEEN DUFFY KIKO, Judge 

ALEC J. KOROMILAS, Alternate Judge 

JURISDICTION 

On April 17, 2015 appellant, through counsel, filed a timely appeal from a March 25, 

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. 

ISSUES 

The issues are: (1) whether OWCP properly determined that appellant received an 

overpayment of $33,491.34 for the period June 11, 2006 to January 31, 2015; (2) whether 

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

properly determined that the overpayment would be collected by deducting $50.00 from each of 

appellant’s continuing compensation payments. 

On appeal, appellant’s counsel argues that appellant was without fault in the creation of 

the overpayment. He contends that recovery would be against equity and good conscience and 

 1

 5 U.S.C. § 8101 et seq. 
2

would defeat the purpose of FECA as appellant’s entire income is necessary to meet her ordinary 

and necessary living expenses. 

FACTUAL HISTORY 

On May 19, 2005 appellant, then a 49-year-old clerk, filed a traumatic injury claim (Form 

CA-1) alleging that she injured her back when picking up mail that fell on the floor. OWCP 

accepted her claim for aggravation of lumbar spondylolisthesis, sprain/strain of the lumbar 

region, major depression, and panic disorder without agoraphobia. 

On July 6, 2005 appellant filed a claim for compensation (Form CA-7) for the period 

beginning July 7, 2005. In a memorandum to the file dated July 20, 2005, the claims examiner 

noted that the employing establishment reported her base salary as $45,269.00, which equaled 

$870.56 per week. OWCP added to this figure $52.28 for night differential and $43.33 for 

Sunday premium, for a total weekly pay rate of $971.17. Appellant received compensation 

based on this pay rate for wage loss for the period July 4, 2005 through January, 31, 2015. 

However, on June 13, 2006, for some unknown reason, she began receiving compensation based 

on an incorrect pay rate of $1,071.78 per week, and was compensated at this rate for all 

compensation periods from June 11, 2006 to January 31, 2015. 

Effective February 1, 2015, appellant elected to received OPM benefits in lieu of FECA 

benefits. On February 11, 2015 OWCP awarded a schedule award for 21 percent impairment to 

her left leg, which ran from February 1 to 7, 2015. 

On February 5, 2015 OWCP advised appellant of a preliminary determination of an 

overpayment in the amount of $33,491.34. In an accompanying memorandum, it noted that for 

the period June 11, 2006 through January 31, 2015, she should have received a gross amount of 

$322,641.35 based on a weekly pay rate of $971.17.2

 However, appellant received 

 2

 For the period June 11, 2006 through February 28, 2007, appellant’s compensation pay rate should have been 

$647.45 (or approximately $92.49 a day), for a total compensation for 263 days in the amount of $24,325.49. For 

the period March 1, 2007 through February 29, 2008, her compensation rate should have been $663.00 (or 

approximately $94.71 a day), for a total of 366 days in the amount of $34,665.43. For the period March 1, 2008 

through February 28, 2010, appellant’s compensation rate should have been $691.50 (or approximately $98.785 a 

day), for a total of 730 days in the total amount of $72,113.58. For the period March 1, 2010 through February 28, 

2011, her compensation rate should have been $715.00 (or approximately $102.14 a day), for a total of 365 days, or 

a total compensation amount of $37,282.14. For the period March 1, 2011 through February 29, 2012, appellant’s 

compensation rate should have been $727.25 (or approximately $103.89 a day), for a total of 366 days for a 

compensation amount of $38,024.79. For the period March 1, 2012 through February 28, 2013, her compensation 

rate should have been $750.50 (or approximately $107.215 a day), for a total of 365 days, for a compensation 

amount of $39,133.21. For the period March 1, 2013 through February 28, 2014, appellant should have been 

compensated at a rate of $763.25 (or approximately $109.035 a day), for a total of 365 days, for a compensation 

amount of $39,798.03. For the period March 1, 2014 through January 31, 2015, she should have been compensated 

at a rate of $774.75 (or approximately $110.68 a day), for a total of 337 days, for a compensation amount of 

$37,298.68. The total compensation should have been $322,641. 
3

compensation in the amount of $356,132.69 based on a weekly pay rate of $1,071.78.3 OWCP 

made a preliminary determination that she was overpaid $33,491.34, the net difference between 

the $356,132.69 she received and the $322,641.35 that she should have received. It also 

determined that appellant was without fault in creating the overpayment and sent her forms to 

complete to determine eligibility for a waiver of recovery of the overpayment and financial 

forms. 

Appellant responded on February 25, 2015, and listed her monthly income from her 

compensation benefits as $3,116.72, added $130.17 from veterans benefits, for a total monthly 

income of $3,246.89. She listed her rent or mortgage as $1,400.00, food as $500.00, clothing as 

$100.00, utilities as $239.00, and other expenses of $1,535.64. Appellant noted monthly 

payments on her Avant Credit E Loan as $110.00 (total amount owed of $1,100.00) and Great 

Plains E Loan of $235.00 (total amount owed of $1,200.00) for total monthly installments of 

$345.00. She listed other expenses as $16,362.84 for a 2013 Nissan Rogue with Wells Fargo as 

lien holder, $1,851.12 for car insurance, $65.00 for gas, $45.00 for oil change service, $78.00 for 

tag renewal. Appellant noted that she has three cats and spends $5.00 for monthly food and litter 

box and $580.00 for veterinarian. She noted credit card debts of $840.00, $430.00, $530.00, 

$200.00, and $35.00. Appellant also listed $850.00 for attorney fees and $6,000.00 for hospital 

bills and $7,000.00 for a personal care attendant, for a total of $51,789.84. She listed her funds 

on hand as negative $171.00 0 cash on hand, and $171.00 overdraft in her checking ($136.00) 

and savings ($35.00) accounts. Appellant denied that she had an overpayment. She also noted 

that as she was getting older, insurance costs were going up and she also had periodontal bills, 

and the last estimate to correct her dental condition was $7,000.00 which she could not afford. 

On March 4, 2015 appellant, through counsel, requested a telephone conference. 

By letter to appellant dated March 6, 2015, OWCP requested supporting documentation 

on various expenses and assets. On March 23, 2015 it received from her copies of bills from 

Capitol One, Great Plains Lending, Geico, Target, Avanti Credit, Wells Fargo, and Holy Cross 

Hospital. Appellant also submitted copies of her Bank of America checking account monthly 

statements. These statements note cash withdrawals of over $1,000.00 on the following dates: 

December 16, 2014 ($1,000.00); December 30, 2014 ($1,070.00); January 9, 2015 ($1,600.00); 

 3

 Appellant received incorrect compensation for the period June 11, 2006 through February 28, 2007 as follows. 

For the period June 11, 2006 through February 28, 2007, she had a compensation pay rate $714.52 (or 

approximately $102.07 a day) for 263 days lost or a compensation amount of $26,845.54. For the period March 1, 

2007 through February 29, 2008, appellant received compensation at a rate of $731.75 (or approximately $104.535 a 

day) for a total of 366 days lost, or a compensation amount of $38,260.07. For the period March 1, 2008 through 

February 28, 2010, she received compensation in the amount of $763.25 (or approximately $109.035 a day) for 730 

days lost, or a total of $79,596.08. For the period from March 1, 2010 through February 28, 2011, appellant was 

paid at a rate of $789.25 (or approximately $112.75 a day), for a total of 365 days lost, or a total compensation 

amount of $41,153.75. For the period March 1, 2011 through February 29, 2012, appellant had a compensation rate 

of 802.75 (or approximately $114.68 a day) for 366 days or a total of $41,972.36. For the period from March 1, 

2012 through February 28, 2013, appellant had a compensation rate of $828.50 (or approximately $120.357 a day), 

for a total of 365 days lost or a total of $43,200.36. For the period from March 1, 2013 through February 28, 2014, 

she had a compensation rate of $842.50 (or $120.357 a day) (or approximately, for a total of 365 days lost, for a 

total compensation amount of $43,930.35. For a period from March 1, 2014 through January 31, 2015, appellant 

had a compensation rate of $855.25 (or approximately $122.18 a day), for a total of 337 days lost or a compensation 

amount of $41,174.18. The total compensation she received for this period was $356,132.69. 
4

and March 6, 2015 ($1,390.00). Appellant also submitted a revised household budget noting a 

monthly income of $3,487.00. She listed her monthly expenses of $3,801.00, noting rent 

$1,400.00, electricity $408.00, telephone $43.00, groceries $300.00, clothing $50.00, vehicle 

payments $365.00, fuel $65.00, health expenses of $21.00, automobile insurance $463.00, 

$200.00 pet food and monthly payment of loans of $420.00. Appellant listed total amounts owed 

to creditors as $16,362.00 for Wells Fargo Car Loan, $840.00 for Capital One charge card, 

$430.00 for 1st Premier Gold charge card; $530.00 for 1st premier Platinum charge card, $200.00 

for Target card, $1,365.00 for attorney fees, $9,273.00 for Holy Cross Hospital for a total of 

$29,000.00. She alleged that, when her expenses were subtracted from her income, she has a 

loss of $313.83. On March 25, 2015 OWCP received a note dated March 20, 2015 wherein 

Robert Nogavero indicated that appellant had been living with him since December 2013, and 

that she pays him $1,400.00 in rent and also pays electric. Mr. Nogavero provided a telephone 

number in the event that OWCP had any questions. 

In a memorandum of conference dated March 25, 2015, the hearing representative 

discussed appellant’s financial records, and determined that appellant had a monthly net income 

of $3,234.42 and monthly expenses of $1,875.37. He utilized appellant’s financial records and 

receipts and adjusted numerous allowances for expenses. The hearing representative listed her 

expenses as food $198.88, clothing $82.18, utilities (water) $110.99, electricity $230.42, 

cellphone $43.00, automobile $364.86, gas $66.78, car insurance $457.80, medical expenses 

$61.64, and internet $24.95. He listed monthly liabilities as Avant $110.48, Great Plains 

$233.87, Capital One $25.00, Target Red $25.00, First Premium Gold $34.94, and First Premium 

Platinum $35.00. In addition to other smaller changes the hearing representative made in 

appellant’s expenses, he did not allow her $1,400.00 in rent, as he found that her support of that 

amount was not adequate. He noted that she advised that she has a deal with her landlord and 

pays sporadically, and noted that her bank account supports occasional withdrawals of 

$1,390.00, $1,600.00, and $1,070.00. However, the hearing representative stated that the 

evidence he received to support the amount of appellant’s rent was only a written letter from an 

unknown person advising that she pays rent in the amount of $1,400.00. He noted that the 

evidence of record failed to support at least a contract for the amount in question. The hearing 

representative found that appellant had a monthly surplus of $1,359.05, and determined that 

$50.00 would be deducted from each of her continuing compensation benefits. 

By decision dated March 25, 2015, OWCP finalized its determination that appellant had 

received an overpayment of $33,491.34 and that she was not at fault in the creation of the 

overpayment, however, OWCP determined that she had not provided sufficient justification for 

OWCP to waive recovery of the overpayment, and that OWCP would deduct $50.00 from future 

compensation payments. 

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 duty.4 

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

 4

 5 U.S.C. § 8102(a). 
5

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

later payments to which the individual is entitled. 

ANALYSIS -- ISSUE 1 

For the period June 11, 2006 through January 31, 2015, appellant should have received a 

gross amount of $322,641.35 based on a weekly pay rate of $971.17. However, she received 

compensation based on a weekly pay rate of $1,071.78 for a total of $356,132.69. Accordingly, 

appellant received an overpayment in the amount of $33,491.34, the difference between the two 

amounts. The Board affirms this determination as it is supported by financial records from 

OWCP. 

LEGAL PRECEDENT -- ISSUE 2 

If OWCP finds that the recipient of an overpayment was not at fault, repayment will still 

be required unless: (1) adjustment or recovery of the overpayment would defeat the purpose of 

FECA; or (2) adjustment or recovery of the overpayment would be against equity and good 

conscience.5

Recovery will defeat the purpose of FECA if both: (a) the individual from whom 

recovery is sought needs substantially all of his current income (including periodic benefits 

under FECA) to meet current ordinary and necessary living expenses; and (b) the individual’s 

assets do not exceed the resource base (including but not limited to cash, the value of stocks, 

bonds, savings accounts, mutual funds) of $4,800.00 for an individual or $8,000.00 for an 

individual with a spouse or one dependent, plus $960.00 for each additional dependent. The first 

$4,800.00 or more, depending on the number of claimant’s dependents, is also exempted from 

recoupment as a necessary emergency resource. If an individual has current income or assets in 

excess of the allowable amount, a reasonable repayment schedule can be established over a 

reasonable, specified period of time. It is the individual’s burden to submit evidence to show 

that recovery of the overpayment would cause the degree of financial hardship sufficient to 

justify waiver.6 An individual is deemed to need substantially all of his or her income to meet 

current ordinary and necessary living expenses if monthly income does not exceed monthly 

expenses by more than $50.00.7

 

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

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

in attempting to repay the debt.8 Recovery of an overpayment is also considered to be against 

 5

 20 C.F.R. § 10.434. See 5 U.S.C. § 8129(b). 

6

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

6.200.6(a) (October 2004). See Miguel A. Muniz, 54 ECAB 217 (2002); 20 C.F.R. §§ 10.436, 10.437. 

7 Sherry A. Hunt, 49 ECAB 467, 473 (1998). 

8

 20 C.F.R. § 10.437(a). 
6

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 her position for the worse.9

 

Section 10.438 of the regulations provide that 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. 

Failure to submit the requested information within 30 days of the request shall result in the denial 

of waiver and no further request for waiver shall be considered until the requested information is 

furnished.10

ANALYSIS -- ISSUE 2 

As OWCP found appellant without fault in the creation of the overpayment, waiver must 

be considered and repayment is still required unless adjustment or recovery of the overpayment 

would defeat the purpose of FECA or be against equity and good conscience.11 

The hearing representative determined that, as appellant’s income greatly exceeded his 

expenses, he was not entitled to waiver of the overpayment. He noted some discrepancies in her 

financial information. Most significantly, the hearing representative noted that appellant had not 

submitted sufficient evidence to support that she paid $1,400.00 in rent. He noted that, although 

she submitted a note from an individual supporting the $1,400.00 monthly amount, her checking 

account did not show regular payments of rent and there was no rental contract. Accordingly, 

the hearing representative determined that appellant’s income exceeded her expenses by 

$1,359.05, and she thus did not need substantially all her income to meet her current ordinary 

and necessary expenses.12

The Board finds that OWCP properly concluded that recovery of the overpayment would 

not cause financial hardship to appellant and thus defeat the purpose of FECA. The hearing 

representative carefully reviewed her monthly budget, bank statement, and bills and determined 

that her income greatly exceeded her expenses. Moreover, as appellant made no argument that 

she gave up a valuable right or changed her position for the worse in reliance of the overpaid 

compensation, OWCP properly determined that recovery would not be against equity and good 

conscience. OWCP properly denied waiver of the overpayment. 

LEGAL PRECEDENT -- ISSUE 3 

Section 10.441 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 

 9 Id. at § 10.437(b). 

10 Id. at § 10.438; Linda Hilton, 52 ECAB 476 (2001). 

11 Id. 

12 See R.M., Docket No. 07-1066 (issued February 6, 2009). 
7

to the 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 hardship.13

ANALYSIS -- ISSUE 3 

The record reflects that appellant continues to receive compensation from OWCP. The 

hearing representative determined that her expenses exceeded her income by $1,359.05. He 

found that appellant was capable of repaying the debt with deductions of $50.00 every 28 days 

from her continuing compensation benefits. The Board finds that OWCP reasonably required 

deductions in this amount from her continuing compensation payments.14

CONCLUSION 

The Board finds that OWCP properly determined that appellant received an overpayment 

of $33,491.34; properly denied waiver of the recovery of the overpayment; and properly 

determined that the overpayment would be collected by deducting $50.00 from each of 

appellant’s continuing compensation payments. 

 13 The Board has jurisdiction to review the issue of recovery of an overpayment in those cases where OWCP 

seeks recovery from continuing compensation benefits. See Desiderio Martinez, 55 ECAB 245, 251 (2004); see 

also J.M., Docket No. 10-1913 (issued July 11, 2011). 

14 B.P., Docket No. 14-2017 (issued March 19, 2015). 
8

ORDER 

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

Compensation Programs dated March 25, 2015 is affirmed. 

Issued: April 25, 2016 

Washington, DC 

 

 Patricia H. Fitzgerald, Deputy Chief Judge 

 Employees’ Compensation Appeals Board 

 

 Colleen Duffy Kiko, Judge 

 Employees’ Compensation Appeals Board 

 

 Alec J. Koromilas, Alternate Judge 

 Employees’ Compensation Appeals Board