United States Department of Labor 

Employees’ Compensation Appeals Board 

__________________________________________ 

L.G., Appellant 

and 

U.S. POSTAL SERVICE, POST OFFICE, 

Greensboro, NC, Employer 

__________________________________________ 

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Docket No. 17-0004 

Issued: April 17, 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 

ALEC J. KOROMILAS, Alternate Judge 

JURISDICTION 

On October 3, 2016 appellant filed a timely appeal from an April 7, 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 OWCP properly reduced wage-loss compensation, effective 

October 18, 2016 based on its determination that the constructed position of hospital admitting 

clerk represented appellant’s wage-earning capacity; (2) whether OWCP properly found that 

appellant received an overpayment of compensation in the amount of $2,330.00 for the period 

October 18 to December 12, 2015; and (3) whether OWCP properly found that appellant was at 

fault in the creation of the overpayment, thereby precluding waiver of recovery. 

 1

 5 U.S.C. § 8101 et seq.
2

FACTUAL HISTORY 

On April 15, 2008 appellant, then a 48-year-old mail processor, filed an occupational 

disease claim (Form CA-2) alleging that she sustained pain in her shoulders as a result of 

repetitively extending her arms to case mail at work. She stopped work on April 13, 2008 and 

indicated that she was last exposed to the employment factors she believed contributed to her 

condition on April 12, 2008. OWCP accepted appellant’s claim for bilateral shoulder sprain and 

other affections of bilateral shoulder region. It paid appellant disability compensation beginning 

April 15, 2008 and placed her on the periodic rolls, effective August 31, 2008. 

On July 6, 2009 appellant retired from federal employment due to disability. 

Appellant continued to receive medical treatment for her accepted bilateral shoulder 

injury. In a November 13, 2014 report, Dr. Marcus Duda, a Board-certified orthopedic surgeon, 

related appellant’s complaints of persistent bilateral shoulder pain and provided findings on 

physical examination. He diagnosed persistent impingement symptoms bilaterally. Dr. Duda 

opined that appellant was capable of performing sedentary level work with restrictions of no 

repetitive work, no overhead work, and no lifting greater than 10 pounds. 

OWCP referred appellant for vocational rehabilitation. The vocational rehabilitation 

counselor identified the positions of hospital admitting clerk and receptionist, described in the 

Department of Labor, Dictionary of Occupational Titles (DOT), as being within appellant’s 

physician limitations. Labor market survey reports dated March 18, 2015 indicated that these 

positions were reasonably available within appellant’s commuting area. 

On August 19, 2015 OWCP proposed to reduce appellant’s wage-loss compensation 

based on her capacity to earn wages as a hospital admitting clerk. It applied the principles set 

forth in Albert C. Shadrick,2 as codified in section 10.403 of OWCP’s regulations,3

 to determine 

that appellant’s monthly wage-loss compensation benefits should be reduced by 37 percent. 

Appellant was advised that, if she disagreed with the proposed decision, she had 30 days to 

submit additional evidence or argument regarding her capacity to earn wages. 

On October 6, 2015 OWCP finalized the reduction in appellant’s benefits. It explained 

that it was reducing appellant’s wage-loss compensation, effective October 18, 2015, based on 

her capacity to earn wages as a hospital admitting clerk at the rate of $426.00 per week. 

The proposed letter was sent to appellant’s address, but it was returned to OWCP on 

October 9, 2015 as undeliverable and unable to forward. 

On October 20, 2015 appellant called OWCP regarding the reduction of her wage-loss 

compensation benefits. She asserted that she had not received the letter proposing to reduce her 

wage-loss compensation benefits. Appellant noted that her address had not changed and OWCP 

confirmed that appellant’s address on record was correct. 

 2

 5 ECAB 376 (1953). 

3

 20 C.F.R. § 10.403. 
3

On November 13, 2015 OWCP received appellant’s appeal request form dated 

November 5, 2015, which requested an oral hearing. In an attached narrative statement, 

appellant explained that she had not worked for the employing establishment since April 12, 

2008 due to an on-the-job injury to her shoulders. She related that she continued to seek and 

receive treatment for both shoulders. Appellant contended that the job requirements of a hospital 

admitting clerk exceeded her abilities because the position required repetitive reaching in and 

out, back and forth, and from side to side to give and receive forms for patients to fill out. She 

further contended that the position required the possibility of moving a human body, which 

weighed more than her weight restriction of 10 pounds, and handling a wheelchair to assist 

patients, which weighed more than 10 pounds. She believed the repetitive work using both arms 

and shoulders would put stress, strain, and pressure on her already injured shoulders. Appellant 

noted that although the August 19, 2015 Proposed Notice of Reduction of Benefits was properly 

addressed to her current mailing address, she never received it. She had only received the Final 

Notice of Reduction of Benefits, dated October 6, 2015, which included a copy of the August 19, 

2015 proposed notice. On or around October 15, 2015, appellant received a voice mail from the 

claims examiner concerning a returned letter. She questioned why it took OWCP so long to 

notify her of the returned letter. 

A termination of compensation worksheet dated December 9, 2015 indicated that on 

November 14 and December 12, 2015 OWCP issued checks in the amount of $2,919.84. 

Beginning December 13, 2015 appellant began to receive wage-loss compensation at the 

reduced amount of $1,786.14. 

On February 25, 2016 OWCP issued a preliminary finding of an overpayment of 

compensation in the amount of $2,330.00 for the period October 18 to December 12, 2015 

because she continued to receive compensation at the full rate until December 12, 2015 despite 

the reduction of her wage-loss compensation on October 18, 2015. It determined that appellant 

was at fault in the creation of the overpayment because she accepted payments that she knew or 

reasonably should have known were incorrect. OWCP provided appellant with an attached 

overpayment action request form and financial information questionnaire to complete and submit 

if she challenged the preliminary finding of overpayment. 

In an attached memorandum, OWCP noted that a decision was issued on October 18, 

2015 notifying appellant that her compensation benefits would be reduced, effective 

October 18, 2015. It related that appellant’s compensation benefits were not reduced until 

December 13, 2015, which resulted in an overpayment for the period October 18 through 

December 12, 2015. OWCP calculated that during the period October 18 through December 12, 

2015, appellant received $5,903.47 in compensation benefits, but she should have only received 

$3,573.47 in wage-loss compensation benefits, resulting in an overpayment of compensation in 

the amount of $2,330.00. It attached overpayment worksheets and adjustment forms, which 

confirmed these amounts. OWCP further determined that appellant was at fault in the creation of 

the overpayment because she knew or reasonably should have known that she was not entitled to 

compensation for total wage loss, after October 18, 2015, due to the reduction of benefits. 

According to a Form CA-110, appellant contacted OWCP on February 23, 2016 and 

advised that she had received the CD-ROM of her case file. She referenced the January 29, 2016 
4

preliminary finding of overpayment and reiterated that she had never received that letter. 

Appellant requested that another copy be sent to her. 

OWCP reissued the Notice of Preliminary Finding of Overpayment in a letter dated 

February 25, 2016. 

In a letter dated March 18, 2016 and received by OWCP on March 21, 2016, appellant 

informed OWCP of her new address. 

By decision dated April 7, 2016, OWCP finalized the finding of overpayment in the 

amount of $2,330.00 for the period October 18 to December 12, 2015 because she received 

wage-loss compensation for total disability after receiving a wage-earning capacity decision 

reducing her compensation benefits. It incorporated the February 25, 2016 preliminary 

determination and found that appellant was at fault in the creation of the overpayment because 

she accepted a payment which she knew or should have known was incorrect. 

LEGAL PRECEDENT -- ISSUE 1 

Once OWCP accepts a claim, it has the burden of proving that the disability has ceased or 

lessened in order to justify termination or modification of compensation benefits.4 An injured 

employee who is either unable to return to the position held at the time of injury or unable to 

earn equivalent wages, but who is not totally disabled for all gainful employment, is entitled to 

compensation computed on loss of wage-earning capacity.5 A wage-earning capacity decision is 

a determination that a specific amount of earnings, either actual earnings or earnings from a 

selected position, represents a claimant’s ability to earn wages. Compensation payments are 

based on the wage-earning capacity determination.6

Under section 8115(a) of FECA, wage-earning capacity is determined by the actual 

wages received by an employee if the earnings fairly and reasonably represent his or her wageearning capacity. If the actual earnings do not fairly and reasonably represent wage-earning 

capacity or if the employee has no actual earnings, his or her wage-earning capacity is 

determined with due regards to the nature of the injury, his or her degree of physical impairment, 

his or her usual employment, his or her age, his or her qualifications for other employment, the 

availability of suitable employment and other factors and circumstances which may affect his or 

her wage-earning capacity in his or her disabled condition.7

 

OWCP must initially determine a claimant’s medical condition and work restrictions 

before selecting an appropriate position that reflects his or her wage-earning capacity. The 

 4 James M. Frasher, 53 ECAB 794 (2002); Bettye F. Wade, 37 ECAB 556 (1986); Ella M. Gardner, 36 ECAB 

238 (1984). 

5

 20 C.F.R. §§ 10.402, 10.403; John D. Jackson, 55 ECAB 465 (2004). 

6 See Sharon C. Clement, 55 ECAB 552 (2004). 

7

 5 U.S.C. § 8115(a); 20 C.F.R. § 10.520; see Pope D. Cox, 39 ECAB 143 (1988). 
5

medical evidence relied upon must provide a detailed description of the condition.8

 

Additionally, the Board has held that a wage-earning capacity determination must be based on a 

reasonably current medical evaluation.9

In the absence of evidence to the contrary, a letter properly addressed and mailed in the 

due course of business, such as in the course of OWCP’s daily activities, is presumed to have 

been received at the mailing address in due course. This is known as the mailbox rule.10 

ANALYSIS -- ISSUE 1 

OWCP accepted that appellant sustained bilateral shoulder sprain and other conditions as 

a result of her federal employment. Appellant received disability compensation beginning 

April 15, 2008 and was placed on the periodic rolls, effective August 31, 2008. By decision 

dated October 6, 2015, OWCP reduced her compensation, effective October 18, 2015, based on 

its determination that the full-time position of hospital admitting clerk represented her wageearning capacity. Appellant continued to receive full wage-loss compensation, however, until 

December 12, 2015. OWCP thereafter found an overpayment of compensation in the amount of 

$2,330.00 for which she was found at fault. 

The Board finds that the case is not in posture for a decision regarding the medical and 

vocational suitability of the hospital admitting clerk position as OWCP did not provide appellant 

proper notice of the reduction of her compensation benefits. 

OWCP procedures provide that OWCP should provide a claimant with a Notice of 

Proposed Reduction of the wage-earning capacity determination before a reduction in 

compensation.11 These procedures provide that such notice, in a loss of wage-earning capacity 

situation, should generally contain a brief case summary, attached copies of the medical reports 

upon which the proposed reduction is based, a complete discussion of the job selected and 

explanation as to why the particular position was selected, confirmation that the job position is 

reasonably available, identification of the wage selected, and computation of the proposed 

reduction of compensation.12 The Notice of Proposed Reduction provides the claimant with 30 

days to submit additional evidence.13 In this case, the evidence of record establishes that OWCP 

did not provide appellant with sufficient notice. 

 8 William H. Woods, 51 ECAB 619 (2000). 

9 John D. Jackson, supra note 5. 

10 C.T., Docket No. 8-2160 (issued May 7, 2009); Jeffrey M. Sagrecy, 55 ECAB 724 (2004). 

11 Federal (FECA) Procedure Manual, Part 2 -- Claims, Disability Management: Determining Wage-Earning 

Capacity Based on a Constructed Position, Chapter 2.816.8 (June 2013). 

12 Id. 

13 Federal (FECA) Procedure Manual, supra note 11 at Disallowances, Chapter 2.1400.7 (February 2013). 
6

OWCP’s regulations state that a copy of a decision shall be mailed to the employee’s last 

known address.14 The evidence of record contains an August 19, 2015 Notice of Proposed 

Reduction addressed to appellant’s last known address. According to the mailbox rule, a 

rebuttable presumption exists that a notice properly mailed to an individual in the ordinary 

course of business was received by that individual in the absence of evidence to the contrary.15 

In this case, however, the Board notes that there is direct evidence of nondelivery of the Notice 

of Proposed Reduction to appellant. Although properly addressed to her last known address, the 

August 19, 2015 Notice of Proposed Reduction was returned to OWCP on October 9, 2015 

marked undeliverable and unable to forward. The Board finds that the returned envelope 

constitutes evidence of nondelivery and rebuts the presumption of receipt.16

Because appellant did not receive the August 19, 2015 Proposed Notice of Reduction of 

Benefits she was not afforded an opportunity to present additional argument or evidence 

supporting continued total disability before her compensation was reduced. OWCP, therefore, 

reduced appellant’s compensation effective October 18, 2015 without proper notice.17 

Consequently, its October 6, 2015 reduction of compensation was improper and the decision is 

hereby reversed.18 

CONCLUSION 

The Board finds that OWCP improperly reduced appellant’s compensation effective 

October 18, 2016 based on its determination that the constructed position of hospital admitting 

clerk represented her wage-earning capacity.19

 14 20 C.F.R. § 10.127. 

15 Supra note 10. 

16 See M.U., Docket No. 09-529 (issued September 14, 2009) (the Board found that presumption of receipt of a 

Notice of an Oral Hearing was rebutted when the envelope enclosing the Notice of an Oral Hearing was returned 

and marked “Return to Sender” and remanded the case for reissuance of the Notice of an Oral Hearing). 

17 See Vena Lee Vaird, Docket No. 97-254 (issued February 12, 1999) (the Board reversed OWCP’s loss of wageearning capacity decision dated August 5, 1986 because OWCP’s May 30, 1996 letter did not serve as adequate 

preliminary notice of the proposed reduction of benefits). 

18 David W. Green, 43 ECAB 883 (1992). 

19 As OWCP’s April 7, 2016 overpayment decision was based on the reduction of appellant’s benefits due to her 

wage-earning capacity as a hospital admitting clerk, the Board finds that the issues regarding fact of overpayment 

and recovery of overpayment are moot. 
7

ORDER 

IT IS HEREBY ORDERED THAT the April 7, 2016 decision of the Office of 

Workers’ Compensation Programs is reversed. 

Issued: April 17, 2017 

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