United States Department of Labor 

Employees’ Compensation Appeals Board 

__________________________________________ 

C.S., Appellant 

and 

DEPARTMENT OF VETERANS AFFAIRS, 

VETERANS HEALTH ADMINISTRATION, 

Minneapolis, MN, Employer 

__________________________________________ 

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Docket No. 16-1150 

Issued: February 3, 2017 

Appearances: Case Submitted on the Record

Appellant, pro se 

Office of Solicitor, for the Director 

DECISION AND ORDER 

Before: 

PATRICIA H. FITZGERALD, Deputy Chief Judge 

COLLEEN DUFFY KIKO, Judge 

VALERIE D. EVANS-HARRELL, Alternate Judge 

JURISDICTION 

On May 6, 2016 appellant filed a timely appeal from a March 31, 2016 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 appellant received an overpayment of compensation in the 

amount of $5,820.50; (2) whether OWCP abused its discretion by refusing to waive recovery of 

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

deducting $230.00 from appellant’s compensation payments every 28 days. 

 1

 5 U.S.C. § 8101 et seq. 
2

FACTUAL HISTORY 

In October 2013, OWCP accepted that appellant, then a 37-year-old nurse, sustained a 

small disc herniation at C6-7 due to performing her work duties on April 29, 2013. It later 

updated the accepted conditions to include central disc herniation with instability at C4-5.2 

Appellant stopped work on April 30, 2013 and received disability compensation on the daily 

rolls beginning June 13, 2013 and on the periodic rolls beginning September 21, 2014. She 

received compensation at the augmented rate of 75 percent because she had a dependent within 

the meaning of FECA.3

In an August 23, 2013 letter received by OWCP on the same date, appellant advised that 

effective June 13, 2013 her spouse and child were no longer living with her. She noted, “There 

is no child support or alimony orders on my part.” 

In a February 24, 2015 notice, OWCP advised appellant of its preliminary determination 

that she received an overpayment of compensation in the amount of $5,820.50 because she was 

paid at the augmented rate from June 13, 2013 to October 18, 2014 despite not having a 

qualifying dependent within the meaning of FECA for this period.4

 It also made a preliminary 

determination that she was not at fault in the creation of the overpayment. OWCP advised 

appellant that she could submit evidence challenging the fact and amount of the overpayment, as 

well as request waiver of the overpayment. It requested that appellant complete and return an 

enclosed financial information questionnaire (Form OWCP-20) within 30 days even if she was 

not requesting waiver of recovery of the overpayment.5

Appellant submitted a copy of the Form OWCP-20 financial information questionnaire 

which she completed on March 16, 2015 along with supporting documentation. She listed 

figures for monthly income and monthly expenses, and indicated that she had $11,900.00 in 

assets comprised of $3,900.00 in checking account monies and $8,000.00 in saving account 

monies. Appellant checked a box requesting a telephone conference with OWCP and requested 

waiver of recovery of the overpayment. 

On April 23, 2015 appellant participated in a telephone conference with an OWCP claims 

examiner during which she further discussed her financial situation, including her monthly 

income and monthly expenses. She reported that she had assets of $11,900.00 ($3,900.00 in her 

checking account and $8,000.00 in her savings account), but that she was saving this money for 

when she needed new hearing aids. Appellant indicated that her insurance company covered 

hearing aids but that she did not know the extent of the coverage. 

 2

 OWCP previously accepted that appellant sustained work injuries on August 30, 2011 and April 7, 2012. 

3 See infra notes 6 through 10. 

4

 The record contains OWCP documentation showing that appellant received $61,515.10 in compensation for the 

period June 13, 2013 to October 18, 2014, but that she should have received only $55,694.60 based on the 

applicable basic rate of 66 2/3 percent. 

5

 In a March 23, 2015 letter, OWCP advised appellant that it had made a preliminary determination that she 

received an $845.74 overpayment of compensation. The evidence of record reveals that appellant repaid this 

overpayment in full in mid-2015. The record does not contain a final decision of OWCP concerning this 

preliminary overpayment determination and the matter is not presently before the Board. See 20 C.F.R. § 501.2(c). 
3

In a March 31, 2016 decision, OWCP determined that appellant received an overpayment 

in the amount of $5,820.50. It found that she was not at fault in the creation of the overpayment, 

but that the overpayment was not subject to waiver because her assets of $11,900.00 exceeded 

the applicable resource base. OWCP required repayment of the overpayment by deducting 

$230.00 from appellant’s compensation payments every 28 days. 

LEGAL PRECEDENT -- ISSUE 1 

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

of an employee resulting from a personal injury sustained while in the performance of duty.6

 If 

the disability is total, the United States shall pay the employee during the period of total 

disability the basic compensation rate of 66 2/3 percent of her monthly pay. A disabled 

employee is entitled to an augmented compensation rate of 75 percent if he or she has one or 

more dependents.7

A dependent includes an unmarried child who, while living with the employee or 

receiving regular contributions from the employee toward his or her support, is either under 18 

years of age or over 18 years of age and incapable of self-support due to physical or mental 

disability.8

 A child is also considered a dependent if he or she is an unmarried student under 23 

years of age who has not completed four years of education beyond the high school level and is 

currently pursuing a full-time course of study at a qualifying college, university, or training 

program.9

If a claimant received compensation at the augmented rate during a period when he or she 

did not have an eligible dependent, the difference between the compensation that was disbursed 

at the 75 percent augmented rate and the compensation that should have been disbursed at the 

66 2/3 percent basic rate constitutes an overpayment of compensation.10

ANALYSIS -- ISSUE 1 

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

of $5,820.50. In the present case, appellant received compensation at the augmented rate of 75 

percent for the period June 13, 2013 to October 18, 2014 despite that fact that she did not have 

any qualifying dependents under FECA. The record contains evidence which shows that she 

received $61,515.10 in compensation for the period June 13, 2013 to October 18, 2014 at the 

improper augmented rate. OWCP calculated that appellant was only entitled to receive 

$55,694.60 at the basic rate of 66 2/3 percent during this period. Therefore, the record 

establishes that appellant received a $5,820.50 overpayment of compensation. 

 6

 5 U.S.C. § 8102(a). 

7 See O.R., 59 ECAB 432, 436 (2008). See also 5 U.S.C. §§ 8105(a) and 8110(b). 

8

 5 U.S.C. § 8110(a). 

9 See E.G., 59 ECAB 599, 603 (2008). 

10 See Ralph P. Beachum, Sr., 55 ECAB 442, 445 (2004). 
4

LEGAL PRECEDENT -- ISSUE 2 

The waiver or refusal to waive an overpayment of compensation by OWCP is a matter 

that rests within OWCP’s discretion pursuant to statutory guidelines.11 These statutory 

guidelines are found in section 8129(b) of FECA which states: “Adjustment or recovery [of an 

overpayment] 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 

this subchapter or would be against equity and good conscience.”12 If OWCP finds a claimant to 

be without fault in the matter of an overpayment, then, in accordance with section 8129(b), 

OWCP may only recover the overpayment if it has determined that recovery of the overpayment 

would neither defeat the purpose of FECA nor be against equity and good conscience. 

According to 20 C.F.R. § 10.436, recovery of an overpayment would defeat the purpose 

of FECA if recovery would cause hardship because the beneficiary needs substantially all of his 

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

expenses, and also, if the beneficiary’s assets do not exceed a specified amount as determined by 

OWCP from data provided by the Bureau of Labor Statistics.13 According to 20 C.F.R. 

§ 10.437, 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.14 To establish that a valuable right has been relinquished, it must be shown that the 

right was in fact valuable, that it cannot be regained, and that the action was based chiefly or 

solely in reliance on the payments or on the notice of payment.15

ANALYSIS -- ISSUE 2 

 In its March 31, 2016 final overpayment decision, OWCP determined that recovery of the 

overpayment was proper under FECA because appellant had not shown both that she needs 

substantially all of her current income to meet current ordinary and necessary living expenses 

and that her assets did not exceed the allowable resource base. It noted that appellant’s assets of 

$11,900.00 (checking and savings account monies) exceeded the allowable resource base of 

$4,800.00 for an individual, like appellant, who did not have a qualifying dependent. 

 11 See Robert Atchison, 41 ECAB 83, 87 (1989). 

12 5 U.S.C. § 8129(b). 

13 20 C.F.R. § 10.436. An individual is deemed to need substantially all of his or her monthly income to meet 

current and ordinary living expenses if monthly income does not exceed monthly expenses by more than $50.00. 

Assets must not exceed a resource base of $4,800.00 for an individual or $8,000.00 for an individual with a spouse 

or dependent plus $960.00 for each additional dependent. See Federal (FECA) Procedure Manual, Part 6 -- Debt 

Management, Initial Overpayment Actions, Chapter 6.200.6(a) (October 2004); B.F., Docket No. 13-785 (issued 

September 20, 2013). 

14 Id. at § 10.437(a), (b). 

15 Id. at § 10.437(b)(1). 
5

 The Board finds that appellant has not established that recovery of the overpayment 

would defeat the purpose of FECA. As noted above, appellant’s assets of $11,900.00 exceeded 

the allowable resource base of $4,800.00 for an individual, like appellant, who did not have a 

qualifying dependent.16 Because she has not met the second prong of the two-prong test of 

whether recovery of the overpayment would defeat the purpose of FECA, it is not necessary for 

OWCP to consider the first prong of the test, i.e., whether appellant has shown that she needs 

substantially all of her current income to meet current ordinary and necessary living expenses.17

 The Board further finds that appellant has not established that recovery of the 

overpayment would be against equity and good conscience. Appellant has not shown, for the 

reasons noted above, that she would experience severe financial hardship in attempting to repay 

the debt or that she relinquished a valuable right or changed her position for the worse in reliance 

on the payment which created the overpayment.18

 Because appellant has failed to establish that recovery of the overpayment would defeat 

the purpose of FECA or be against equity and good conscience, she has failed to show that 

OWCP properly refused to waive recovery of the overpayment. 

 On appeal appellant argues that the assets in her savings and checking account she 

reported in March 2015 were a “snapshot of that day, that time” and that the amount reported 

does not constitute what is currently available to her. As explained above, the evidence of record 

at the time of OWCP’s March 31, 2016 decision was insufficient to establish that recovery of the 

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

financial information appellant provided in March 2015 did not show that she needs substantially 

all of her current income to meet ordinary and necessary living expenses and that her assets did 

not exceed the allowable resource base. The financial information provided also did not show 

that she would experience severe financial hardship in attempting to repay the debt or that she 

had relinquished a valuable right or changed her position for the worse in reliance on the 

payment which created the overpayment. Other than to argue that her financial situation had 

changed, appellant provided no evidence to establish that allegation. Thus, OWCP’s decision to 

deny her request for waiver of recovery of the overpayment was proper. 

LEGAL PRECEDENT -- ISSUE 3 

 Section 10.441 of Title 20 of the Code of Federal Regulations provides in pertinent part: 

“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 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 

 16 See supra note 13. 

17 See id. 

18 See William J. Murphy, 41 ECAB 569, 571-72 (1989). 
6

financial circumstances of the individual, and any other relevant factors, so as to 

minimize any hardship.”19

ANALYSIS -- ISSUE 3 

 The record supports that, in requiring repayment of the overpayment by deducting 

$230.00 from appellant’s compensation payments every 28 days, OWCP took into consideration 

the financial information submitted by appellant as well as the factors set forth in section 10.441 

and found that this method of recovery would minimize any resulting hardship on appellant.20 

Therefore, OWCP properly required recovery of the overpayment by deducting $230.00 from 

appellant’s compensation payments every 28 days. 

CONCLUSION 

The Board finds that appellant received a $5,820.50 overpayment of compensation and 

that OWCP did not abuse its discretion by refusing to waive recovery of the overpayment. The 

Board further finds that OWCP properly required recovery of the overpayment by deducting 

$230.00 from appellant’s compensation payments every 28 days. 

 19 20 C.F.R. § 10.441(a); see Donald R. Schueler, 39 ECAB 1056 (1988). 

20 At the time OWCP issued its final overpayment determination, appellant was receiving $694.00 in wage-loss 

compensation benefits every 28 days. 
7

ORDER 

IT IS HEREBY ORDERED THAT the March 31, 2016 decision of the Office of 

Workers’ Compensation Programs is affirmed. 

Issued: February 3, 2017 

Washington, DC 

 

 Patricia H. Fitzgerald, Deputy Chief Judge 

 Employees’ Compensation Appeals Board 

 

 Colleen Duffy Kiko, Judge 

 Employees’ Compensation Appeals Board 

 

 Valerie D. Evans-Harrell, Alternate Judge 

 Employees’ Compensation Appeals Board