United States Department of Labor 

Employees’ Compensation Appeals Board 

__________________________________________ 

D.M., Appellant 

and 

DEPARTMENT OF HOMELAND SECURITY, 

CUSTOMS & BORDER PATROL, 

San Diego, CA, Employer 

__________________________________________ 

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Docket No. 16-1527 

Issued: July 25, 2017 

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 

COLLEEN DUFFY KIKO, Judge 

JURISDICTION 

On July 22, 2016 appellant filed a timely appeal from a July 7, 2016 merit decision and 

an April 22, 2016 nonmerit 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 appellant’s compensation to reflect 

his wage-earning capacity in a modified position; and (2) whether OWCP properly denied 

appellant’s request for a hearing. 

 1

 5 U.S.C. § 8101 et seq. 
2

FACTUAL HISTORY 

On April 6, 2011 appellant, then a 39-year-old border patrol officer, filed a traumatic 

injury claim (Form CA-1) alleging that he sustained an injury in the performance of duty on 

March 30, 2011. He reported that he was tackling an absconder and fell on his left shoulder. 

OWCP accepted the claim for left shoulder contusion, neck sprain, left shoulder and upper arm 

sprain, and left superior glenoid labrum lesion. Appellant’s pay rate was reported as a General 

Services (GS) 9, Step 1. He worked in a light-duty position and received intermittent wage-loss 

compensation as of August 17, 2011. 

The record indicates that appellant underwent left shoulder arthroscopic surgery on 

September 2, 2011. He returned to a full-time, light-duty position on December 1, 2011, and 

received intermittent wage-loss compensation. A second left shoulder arthroscopic surgery was 

performed on June 8, 2012. Appellant returned to a full-time, light-duty position on 

October 3, 2012. In a report dated February 14, 2013, the attending orthopedic surgeon, 

Dr. Amarpal Arora, reported that appellant should remain on modified duty. By report dated 

April 29, 2013, he again restricted appellant to modified duty, with five pounds lifting, and 

limited pushing, pulling, and grasping with the left arm. Dr. Arora continued work with 

restrictions in a June 13, 2013 report and indicated that appellant should remain on modified 

duty. 

Appellant again underwent left shoulder arthroscopic surgery on July 26, 2013. 

Dr. Arora diagnosed left shoulder labral tear. OWCP paid wage-loss compensation, using a pay 

rate as of July 26, 2013, representing the date-of-recurrence of disability. The record indicates 

that appellant returned to a full-time, light-duty position on November 4, 2013. In a report dated 

March 25, 2014, Dr. Tiffany Shay Alexander, Board-certified in occupational medicine, 

provided permanent work restrictions that included a 40-pound lifting restriction, with no 

overhead work and no reaching with his left arm. She opined that appellant was not able to 

perform the date-of-injury position. 

By letter dated June 24, 2014, the employing establishment offered appellant a permanent 

modified position as a technician. The pay rate was described as a GS-7, Step 10 position, with 

an annual salary of $55,407.00. The employing establishment reviewed appellant’s work 

history, noting that he had been on light duty since his injury having undergone three left 

shoulder surgeries. In addition, appellant now had permanent work restrictions. According to 

the employing establishment, he was currently in the position of officer, at GS-12, but was 

unable to perform the required duties. On July 3, 2014 appellant accepted the position of 

technician. 

On April 3, 2015 OWCP received information from the employing establishment 

regarding appellant’s pay as of July 26, 2013. The employing establishment reported that he 

earned $74,854.00 in annual salary, with $286.95 in holiday pay. In a wage-earning capacity 

form (Form CA-816) dated August 18, 2015, OWCP provided the following calculations for the 

current GS-9, Step 1 pay rate: base salary $52,668.00, Sunday premium $4,203.07, holiday pay 

$1,541.32, and night differential $464.39. The weekly pay rate was therefore $1,132.25 per 

week. The current GS-7, Step 10 for the technician position was $55,956.00, or $1,076.08 per 

week. 
3

In a memo dated June 10, 2015, OWCP determined that the July 26, 2013 date of 

recurrence pay rate for compensation purposes was based on an annual salary of $74,854.00, 

with $286.96 in holiday pay annually. 

By decision dated August 20, 2015, OWCP determined that the technician position fairly 

and reasonably represented appellant’s wage-earning capacity. It reduced his compensation 

benefits and provided its calculations. OWCP found that the current date-of-injury pay rate was 

$1,132.25, current earnings of $1,076.08, for a wage-earning capacity of 95 percent. The 

adjusted wage-earning capacity was $1,372.77, based on 95 percent of the pay rate for 

compensation purposes on July 26, 2013 of $1,145.02. The loss of wage-earning capacity 

(LWEC) was $72.25 ($1,445.02 - $1,372.77). 

On March 22, 2016 appellant submitted a letter postmarked March 19, 2016, requesting 

an oral hearing with an OWCP hearing representative. He argued that his wage-earning capacity 

had been improperly determined. Appellant indicated that he had been working in a GS-12, Step 

2 position, and OWCP should compare his current earnings with a GS-12 position, not a GS-9, 

Step 1 date-of-injury pay rate. He argued that he was being penalized for returning to a lower 

paying job, contrary to OWCP procedures. 

By decision dated April 22, 2016, OWCP denied the request for a hearing, as it found 

that the request was untimely. In addition, it indicated that it had considered the issue and found 

that it could be equally well addressed by requesting reconsideration. 

On May 6, 2016 appellant requested reconsideration. He again argued his LWEC was 

incorrectly calculated. 

By decision dated July 7, 2016, OWCP reviewed the merits and denied modification. It 

found that its calculations were correct with respect to the wage-earning capacity determination. 

LEGAL PRECEDENT -- ISSUE 1 

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 from all gainful 

employment, is considered partially disabled.2 Compensation for partial disability is determined 

under 5 U.S.C. § 8115(a). Wage-earning capacity is determined by the actual wages received by 

an employee if the earnings fairly and reasonably represent his wage-earning capacity.3

 

Generally, wages actually earned are the best measure of a wage-earning capacity and, in the 

absence of evidence showing that they do not fairly and reasonably represent the injured 

employee’s wage-earning capacity, must be accepted as such measure.4

 Compensation payments 

 2

 20 C.F.R. § 10.402. 

3

 5 U.S.C. § 8115(a). 

4 Dennis E. Maddy, 47 ECAB 259 (1995). 
4

are based on the wage-earning capacity determination, and OWCP’s finding remains undisturbed 

until properly modified.5

A light-duty position that fairly and reasonably represents an employee’s ability to earn 

wages may form the basis of an LWEC determination if that light-duty position is a classified 

position to which the injured employee has been formally reassigned.6

 The position must 

conform to the established physical limitations of the injured employee; the employing 

establishment must have a written position description outlining the duties and physical 

requirements; and the position must correlate to the type of appointment held by the injured 

employee at the time of injury.7

 If these circumstances are present, a determination may be made 

that the position constitutes regular federal employment.8

 In the absence of a light-duty position 

as described above, OWCP will assume that the employee was engaged in noncompetitive, 

makeshift, or odd-lot employment.9

With respect to part-time employment, the FECA Procedure Manual provides that: (1) a 

part-time position may form the basis of an LWEC determination if the employee was a parttime worker at the time of injury; and (2) for an employee who was a full-time employee on the 

date of injury, a part-time position may form the basis of an LWEC determination if the 

employee’s stable, established work restrictions limit him or her to part-time work.10 

Reemployment may not be considered representative of the injured employee’s wageearning capacity where the job is temporary and the employee’s date-of-injury job was 

permanent.11 However, if the employee was a temporary employee when injured, a temporary 

position may reasonably represent his or her wage-earning capacity as long as the position will 

last for 90 days or more.12

As long as there is no work stoppage due to the accepted condition(s), a formal LWEC 

determination should be issued following 60 calendar days from the date of return to work.13 If 

the injured employee is no longer working in the alternative position upon which a rating is 

 5 See Katherine T. Kreger, 55 ECAB 633, 635 (2004). 

6

 20 C.F.R. § 10.510. 

7 Id. 

8 Id. 

9 Id. 

10 Federal (FECA) Procedure Manual, Part 2 -- Claims, Determining Wage-Earning Capacity Based on Actual 

Earnings, Chapter 2.815.5(c)(1)(b) (June 2013). 

11 Id. at Chapter 2.815.5(c)(2)(d). A job is considered temporary when expressly stated in the job offer, position 

description, or other supporting documentation. Id. If the language in the job offer is ambiguous, OWCP should ask 

the employing establishment if the position represents temporary work and document the file accordingly. Id. 

12 Id. 

13 Id. at Chapter 2.815.6(a). 
5

being considered, OWCP may consider a retroactive LWEC.14 However, this is rare and should 

only be made where the employee worked in the position for at least 60 days, the employment 

fairly and reasonably represented his or her wage-earning capacity as outlined under FECA 

Chapter 2.815.5, and the subsequent work stoppage or change in the alternative positions(s) did 

not occur because of any change in the employee’s injury-related condition affecting his or her 

ability to work.15

The formula for determining LWEC based on actual earnings, developed in the Albert C. 

Shadrick decision,16 has been codified at 20 C.F.R. § 10.403. OWCP first calculates an 

employee’s wage-earning capacity in terms of percentage by dividing the employee’s earnings 

by the current pay rate for the date-of-injury position.17 

ANALYSIS -- ISSUE 1 

In the present case, appellant, a full-time border patrol officer, sustained left shoulder 

injuries in the performance of duty on March 30, 2011. He accepted a permanent full-time 

position as a technician, beginning work on July 3, 2014. The job was a classified position to 

which appellant was assigned. There was no indication that the job was part-time, makeshift, 

temporary, or otherwise potentially inappropriate for a wage-earning capacity determination. As 

noted, generally wages earned are the best measure of a wage-earning capacity and, in the 

absence of evidence showing that they do not fairly and reasonably represent the injured 

employee’s wage-earning capacity, must be accepted as such measure.18 After 60 days OWCP 

may properly issue a formal LWEC determination. The Board finds that the wages earned in the 

technician position were properly found to fairly and reasonably represent appellant’s wageearning capacity. 

The next issue is whether OWCP properly applied the Shadrick formula in determining 

the LWEC. Under the Shadrick formula, it first calculates an employee’s wage-earning capacity 

in terms of percentage by dividing the employee’s actual earnings by the current or updated pay 

rate for the position held at the time of injury.19 OWCP found that appellant’s earnings in the 

technician position were $1,076.08 per week. For the date-of-injury (March 30, 2011) position, 

appellant was a GS-9, Step 1 employee. OWCP found that, with appropriate premium pay, the 

current date-of-injury earnings were $1,132.25 per week. 

Appellant does not contest the finding that current GS-9, Step 1 earnings were $1,132.25. 

It is his contention that OWCP should not use the current date-of-injury earnings, but those of a 

GS-12 employee. After the March 30, 2011 injury, appellant had worked full-time light-duty 

 14 Id. at Chapter 2.815.7. 

15 Id. 

16 5 ECAB 376 (1953). 

17 20 C.F.R. § 10.403(d). 

18 Supra note 4. 

19 Supra note 16. See also 20 C.F.R. § 10.403. 
6

positions and had received grade increases resulting in an increased salary. The comparison 

under Shadrick is between the current actual earnings in the technician position and the current 

date-of-injury earnings. As explained in Shadrick, the comparison is always to the wages at the 

time of the injury, and the earnings at time of injury must be updated to the date of current 

earnings, because it would be inappropriate to compare actual dollars earned at a later date with 

actual dollars earned at the time of injury.20 The Board noted in Fabian W. Fraser,21 the 

comparison is made to the pay in same step of the grade appellant held on the date of the injury, 

not the wages appellant subsequently earned or would have earned had he continued in the same 

job, as “this includes subsequent within-grade increases or may even include changes in 

classification factors which may not be considered.” The Board has consistently held that grade 

and step increases, promotions, or other increases in earnings after the employment injury are not 

used to determine wage-earning capacity.22 OWCP properly applied Shadrick in this case by 

comparing the technician salary with the current date-of-injury salary, resulting in 95 percent 

wage-earning capacity. 

The next step in the Shadrick formula, however, is to multiply the pay rate for 

compensation purposes, defined in 5 U.S.C. § 8101(4) and 20 C.F.R. § 10.5(a) as the pay rate at 

the time of injury, the time disability begins or the time disability recurs, whichever is greater, by 

the percentage of wage-earning capacity.23 OWCP found that the pay rate for compensation 

purposes was based on a pay rate for a recurrence of disability on July 26, 2013. Such a 

determination is not in accord with 5 U.S.C. § 8101(4) and the evidence of record. 

5 U.S.C. § 8101(4) clearly indicates that using monthly pay when “compensable 

disability recurs” is proper only when “the recurrence begins more than six months after the 

injured employee resumes regular full-time employment with the United States.” There is no 

evidence in the record that appellant ever resumed regular employment after the March 30, 2011 

injury. The employing establishment indicated that he worked only in modified, light-duty 

positions, and the medical evidence continued to provide work restrictions. The Board has held 

that a return to modified duty does not constitute a return to regular full-time employment under 

5 U.S.C. § 8101(4).24

The Board accordingly will remand the case to OWCP for further development with 

respect to the application of the Shadrick formula. OWCP should properly explain its 

calculations in this regard. After such additional development as is deemed necessary, it should 

issue an appropriate decision as to wage-earning capacity. 

 20 Id. 

21 9 ECAB 865 (1958). 

22 See Caroline H. Siemers, Docket No. 02-0352 (issued August 1, 2002) (claimant argued OWCP should not use 

date-of-injury earnings, but earnings from a higher grade position she received after the injury due to a promotion; 

the Board found that the date-of-injury earnings must be used). 

23 See 20 C.F.R. § 10.403(e). 

24 R.G., Docket No. 13-0010 (issued February 4, 2014); G.G., Docket No. 13-0770 (issued July 9, 2013); B.W., 

Docket No. 11-1927 (issued May 3, 2012). 
7

On appeal appellant again indicates his belief that OWCP should use the GS-12 position 

wages to compare with his current wages in the technician position. For the reasons noted, 

OWCP properly applied the Shadrick formula regarding this issue. 

LEGAL PRECEDENT -- ISSUE 2 

The statutory right to a hearing under 5 U.S.C. § 8124(b)(1) follows the initial final merit 

decision of OWCP. Section 8124(b)(1) provides as follows: “Before review under section 

8128(a) of this title, a claimant for compensation not satisfied with a decision of the Secretary 

under subsection (a) of this section is entitled, on request made within 30 days after the date of 

issuance of the decision, to a hearing on his claim before a representative of the Secretary....” 

If the request is not made within 30 days or if it is made after a reconsideration request, a 

claimant is not entitled to a hearing as a matter of right.25 The Board has held that OWCP, in its 

broad discretionary authority in the administration of FECA, has the power to hold hearings in 

certain circumstances where no legal provision was made for such hearings and that OWCP must 

exercise this discretionary authority in deciding whether to grant a hearing.26

ANALYSIS -- ISSUE 2 

The initial merit decision with respect to wage-earning capacity was dated 

August 20, 2015. Appellant did not request a hearing until a letter postmarked March 19, 2016. 

As this was more than 30 days after the August 20, 2015 decision, he was not entitled to a 

hearing as a matter of right.27

As noted, OWCP must exercise its discretion with respect to an untimely hearing request. 

It advised appellant that he could submit additional relevant evidence on the issue through the 

reconsideration process. This is considered a proper exercise of OWCP’s discretionary 

authority.28 The Board finds that OWCP properly denied the hearing request in this case. 

CONCLUSION 

The Board finds that OWCP properly determined that the position of technician 

represented appellant’s wage-earning capacity, but the case is remanded for proper calculation of 

the LWEC. The Board further finds that OWCP properly denied his request for a hearing. 

 25 Claudio Vazquez, 52 ECAB 496 (2001). 

26 Marilyn F. Wilson, 52 ECAB 347 (2001). 

27 Supra note 24. 

28 See Mary E. Hite, 42 ECAB 641, 647 (1991). 
8

ORDER 

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

Compensation Programs dated July 7, 2016 is set aside and the case is remanded for further 

action consistent with this decision of the Board. The decision dated April 22, 2016 is affirmed. 

Issued: July 25, 2017 

Washington, DC 

 

 Christopher J. Godfrey, Chief Judge 

 Employees’ Compensation Appeals Board 

 

 Patricia H. Fitzgerald, Deputy Chief Judge 

 Employees’ Compensation Appeals Board 

 

 Colleen Duffy Kiko, Judge 

 Employees’ Compensation Appeals Board