United States Department of Labor

Employees’ Compensation Appeals Board

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R.S., Appellant

and

DEPARTMENT OF THE AIR FORCE, 

VANDENBURG AIR FORCE BASE, CA, 

Employer

__________________________________________

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Docket No. 17-1985

Issued: March 23, 2018

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

ALEC J. KOROMILAS, Alternate Judge

VALERIE D. EVANS-HARRELL, Alternate Judge

JURISDICTION

On September 25, 2017 appellant filed a timely appeal from a September 6, 2017 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 to consider the merits of the case.

ISSUES

The issues are: (1) whether appellant has received an overpayment of compensation in the 

amount of $2,000.33 for the period February 21 through March 4, 2017; and (2) whether OWCP 

properly denied waiver of recovery of the overpayment.

On appeal appellant contends that he had no reason to believe that his schedule award 

compensation would expire on February 21, 2017. He claims that an OWCP letter dated 

November 21, 2016 informed him that the expiration date was May 31, 2017. Appellant asserts 

 

1 5 U.S.C. § 8101 et seq.
2

that repayment of the overpayment would cause him severe mental and financial hardship as he 

has obligated personal and family expenses.

FACTUAL HISTORY

On January 15, 1997 appellant, then a 61-year-old supervisory electronics engineer, filed 

a traumatic injury claim (Form CA-1) alleging that, on January 14, 1997, he wrenched his left knee 

when he slipped on a wet sidewalk and twisted his left leg and knee while in the performance of 

his work duties. OWCP accepted his claim for sprain of the left knee and left leg on 

March 3, 1997. On November 29, 2002 it accepted that appellant sustained a recurrence of 

disability on June 10, 2002. 

By decision dated November 28, 2008, OWCP granted appellant a schedule award for 15 

percent permanent impairment of the left leg. The period of the award ran from June 19, 2008 to 

April 17, 2009, totaling 43.2 weeks. 

On May 5, 2011 OWCP expanded acceptance of appellant’s claim to include loose body 

in the left knee. It subsequently authorized a total left knee arthroplasty performed on October 28, 

2013 by Dr. Robert K. Peterson, a Board-certified orthopedic surgeon. 

On October 27, 2014 appellant filed a claim for an increased schedule award (Form CA-7). 

In a decision dated February 6, 2016, OWCP granted appellant a schedule award for an 

additional 21 percent permanent impairment of the left leg, totaling 36 percent permanent 

impairment. The award covered a period of 60.48 weeks from October 29, 2014 to 

February 21, 2017. 

In a June 8, 2017 letter, OWCP advised appellant of its preliminary determination that he 

had received a $2,000.33 overpayment of compensation because it did not terminate his schedule 

award payments on February 21, 2017 and continued to make payments through March 4, 2017 in 

the amount of $2,000.33. It also made a preliminary finding that he was without fault in the 

creation of the overpayment because he was not aware or could have been reasonably expected to 

know that OWCP had incorrectly paid compensation after February 21, 2017. OWCP advised 

appellant that he could submit evidence challenging the fact and amount as well as requesting

waiver of recovery of the overpayment. It informed him that, within 30 days, he could request a 

telephone conference, a final decision based on the written evidence, or a prerecoupment hearing. 

OWCP requested that appellant complete the enclosed overpayment recovery questionnaire (Form 

OWCP-20) and submit supporting financial documents.

On June 27, 2017 appellant requested a decision based on the written evidence. He 

submitted an April 17, 2017 letter informing OWCP that he had not received a schedule award 

compensation check for the period March 17 through April 17, 2017. Appellant related that he

had expected to receive this check based on a November 21, 2016 OWCP letter which indicated

that his schedule award compensation would expire on May 31, 2017. He submitted a completed 

Form OWCP-20. Appellant noted that he did not have any of the incorrectly paid checks in his 

possession. He also noted that he had not transferred by loan, gift, sale, etc., any property or cash. 

Appellant claimed that he had normal financial commitments and obligations which included his 
3

personal and household expenses and expenses related to his former spouse,

2 41-year-old daughter, 

and 19-year-old grandson who he listed as dependents on the Form OWCP-20. He noted that he 

assisted his former spouse with Medicare and health insurance, automobile and home maintenance, 

property tax payments, and provided her with miscellaneous help. Appellant also assisted with 

the payment of school tuition and expenses for his daughter and grandchildren. In addition, he 

was committed and obligated to complete the installation of an “out” building that he started in 

April 2017 and expected to complete it by the end of the summer. Appellant reported total monthly 

income of $7,893.06 and assets totaling $5,172.28. He also described monthly expenses and 

claimed that he had recently refinanced a loan to get cash to pay off credit cards and to restore a 

rental property. Appellant submitted financial information. This included bank statements 

indicating that appellant had a checking account balance of $781.36 and a money market savings 

account balance of $5,127.73 as of June 13, 2017.

By decision dated September 6, 2017, OWCP finalized its preliminary determination that 

appellant received a $2,000.33 overpayment of compensation for the period February 21 through 

March 4, 2017. It explained that the overpayment occurred because it failed to terminate

appellant’s schedule award payments on February 21, 2017 and continued to make additional 

payments through March 4, 2017. OWCP found appellant without fault and that he was not 

entitled to waiver of recovery of the overpayment. It noted that there was no evidence to support 

that recovery would be against good conscious or defeat the purpose of FECA. OWCP calculated 

appellant’s monthly income from OPM retirement benefits and other unspecified income reported, 

for a total monthly income of $7,893.06. For monthly expenses, it calculated $1,598.42 for 

mortgage, $610.11 for food, and $713.72 for utilities. OWCP noted that there was no financial 

documentation to support appellant’s other claimed expenses in the amount of $14,690.88. It 

found that his monthly income exceeded the amount needed to meet ordinary and necessary living 

expenses. OWCP determined that appellant’s assets included a home, rental property, $5,217.52 

in a savings account, and $781.36 in a checking account and exceeded both resource bases of 

$4,800.00 for an individual and $8,000.00 for an individual with dependents. It indicated, 

however, that, although appellant listed his 41-year-old daughter and 19-year-old grandson, who 

both had different addresses from him, as dependents, he did not submit any evidence of their 

financial dependency. Recovery of the overpayment was requested in full.

LEGAL PRECEDENT -- ISSUE 1

The schedule award provisions of FECA3and its implementing regulations4set forth the 

number of weeks of compensation payable to employees sustaining permanent impairment from 

 

2 A March 2, 2002 judgment, from a Superior Court of California, dissolved appellant’s marriage effective 

July 12, 2002. Appellant, in a November 18, 2002 letter, indicated that, based on a court order dated March 7, 2002 

and amended on September 20, 2002, he had to pay his ex-spouse $425.00 monthly until his retirement. He contended 

that, after his retirement, the Civil Service Retirement System (CSRS) under the Office of Personnel Management 

(OPM) would continue to pay his ex-spouse $425.00 a month plus a cost-of-living adjustment (COLA) in dividing his 

annuity. Appellant claimed that, after his death, CSRS would continue to pay his ex-spouse $425.00 a month plus a 

COLA in a survivor annuity.

3 Supra note 1 at § 8107.

4 20 C.F.R. § 10.404.
4

loss or loss of use, of scheduled members or functions of the body. Section 10.404 states that 

compensation is provided for specified periods of time for the permanent loss or loss of use of 

certain members.5

Section 8102(a) of 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.6 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.7

FECA procedures identify various situations when overpayments of compensation may 

occur, including when a claimant receives schedule award compensation after the expiration of the 

award.8

ANALYSIS -- ISSUE 1

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

of compensation in the amount of $2,000.33, for the period February 21 through March 4, 2017. 

OWCP granted appellant a schedule award for 15 percent permanent impairment of the left 

leg on November 28, 2008 for the period June 19, 2008 through April 17, 2009. On February 6, 

2016 it granted him an additional schedule award for 21 percent permanent impairment of the left 

leg, totaling 36 percent permanent impairment that ran from October 29, 2014 through 

February 21, 2017. The evidence of record establishes that appellant continued to receive schedule 

award payments from OWCP after February 21, 2017, the date the award was scheduled to expire, 

until March 4, 2017. Consequently, any concurrent payments appellant received from OWCP 

beginning February 22, 2017 constituted an overpayment of compensation benefits. OWCP 

properly calculated the $2,000.33 overpayment by totaling the amount of compensation checks 

appellant received during the period February 21 through March 4, 2017. The Board affirms its 

finding of fact and amount of overpayment. 

 

5

Id. Effective May 1, 2009, OWCP began using the American Medical Association, Guides to the Evaluation of 

Permanent Impairment (6

th ed. 2009). Federal (FECA) Procedure Manual, Part 3 -- Medical, Schedule Awards, 

Chapter 3.700, Exhibit 1 (January 2010); Federal (FECA) Procedure Manual, Part 2 -- Claims, Schedule Awards and 

Permanent Disability Claims, Chapter 2.808.5a (February 2013). See J.L., Docket No. 14-0898 (issued 

March 26, 2015).

6 Supra note 1 at § 8102(a).

7

Id. at § 8129(a).

8 Federal (FECA) Procedure Manual, Part 6 -- Debt Management, Initial Overpayment Actions, Chapter 6.200.2(c) 

(May 2004); see V.F., Docket No. 10-1394 (issued February 23, 2011).
5

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.9 These statutory guidelines are 

found in section 8129(b) of FECA which provides: “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.”

10

 If OWCP finds a claimant to be without fault 

in the matter of an overpayment, then, in accordance with section 8129(b), it may only recover the 

overpayment if it 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.11 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.12 

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.13

Section 10.438 of OWCP 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. This 

information will also be used to determine the repayment schedule, if necessary. Failure to submit 

 

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

10 Supra note 1 at § 8129(b).

11 Supra note 4 at § 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. 

Desiderio Martinez, 55 ECAB 245 (2004). OWCP procedure provides that 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. Federal (FECA) Procedure Manual, supra note 8 at Chapter 6.200.6(a) (June 2009); B.F., Docket No. 13-

0785 (issued September 20, 2013).

12 Id. at § 10.437(a), (b).

13 Id. at § 10.437(b)(1).
6

the requested information within 30 days of the request shall result in denial of waiver, and no 

further request for waiver shall be considered until the requested information is furnished.14

ANALYSIS -- ISSUE 2

The Board finds that OWCP properly denied waiver of recovery of the overpayment of 

compensation. 

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

be considered. Repayment is still required unless adjustment or recovery of the overpayment 

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

Appellant has not established that recovery of the overpayment would defeat the purpose 

of FECA because his assets exceed the resource base of $4,800.00 for an individual, as provided 

in OWCP’s procedures.15 The Board notes that the applicable resource base is $4,800.00 as the

record establishes that appellant was divorced from his wife on July 12, 2002 and he failed to 

submit any evidence to establish his claimed 41-year-old daughter and 19-year-old grandson as 

dependents. In evaluating appellant’s assets, the Board notes that on the Form OWCP-20 he

completed, and in bank statements he submitted, appellant acknowledged that he had assets in his 

checking and money market savings accounts totaling $5,909.09, which exceeds the resource base 

of $4,800.00.16 Because appellant 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 unnecessary to consider the 

first prong of the test, i.e., whether his monthly income exceeded his monthly ordinary and 

necessary expenses by more than $50.00.17 Appellant did not establish that he was entitled to 

waiver on the basis of defeating the purpose of FECA.18

Appellant also has not established that recovery of the overpayment would be against 

equity and good conscience because he has not shown, for the reasons noted above, that he would 

experience severe financial hardship in attempting to repay the debt or that he relinquished a 

valuable right or changed his position for the worse in reliance on the payment which created the 

overpayment.19

 

14 Id. at § 10.438.

15 Id. at § 10.436.

16 The Board notes that appellant’s rental property is not included in the evaluation of his assets because the value 

of this property is not contained in the case record. The Board furthermore notes that contrary to OWCP’s finding, 

appellant’s primary home cannot be included in his assets. OWCP procedures specifically states that in evaluating 

assets for purpose of a waiver determination, the value of a principal family home shall not be considered. Federal 

(FECA) Procedure Manual, supra note 8 at Chapter 6.200.6.a(4)(b) (June 2009). 

17 Supra note 4 at § 10.436; see M.H., Docket No. 17-0766 (issued July 3, 2017).

18 See K.K., Docket No. 09-0207 (issued October 2, 2009).

19 See William J. Murphy, 41 ECAB 569, 571-72 (1989).
7

Appellant generally contends on appeal that recovery of the overpayment would create a 

financial hardship and thus be against equity and good conscience. As explained, the record does 

not support this contention. Appellant has failed to establish that OWCP abused its discretion by 

refusing to waive recovery of the overpayment.

With respect to recovery of an overpayment, the Board’s jurisdiction is limited to 

reviewing those cases when OWCP seeks recovery from continuing compensation benefits under 

FECA. As appellant is no longer in receipt of compensation benefits, the Board has no jurisdiction 

over the recovery of the overpayment.20

CONCLUSION

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

of $2,000.33 for the period February 21 through March 4, 2017. The Board further finds that 

OWCP properly denied waiver of recovery of the overpayment.

ORDER

IT IS HEREBY ORDERED THAT the September 6, 2017 decision of the Office of 

Workers’ Compensation Programs is affirmed.

Issued: March 23, 2018

Washington, DC

Patricia H. Fitzgerald, Deputy Chief Judge

Employees’ Compensation Appeals Board

Alec J. Koromilas, Alternate Judge

Employees’ Compensation Appeals Board

Valerie D. Evans-Harrell, Alternate Judge

Employees’ Compensation Appeals Board

 

20 See Lewis George, 45 ECAB 144, 154 (1993).