United States Department of Labor

Employees’ Compensation Appeals Board

__________________________________________

K.K., Appellant

and

U.S. POSTAL SERVICE, PROCESSING & 

DISTRIBUTION FACILITY, Abilene, TX, 

Employer

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Docket No. 19-0978

Issued: October 21, 2019

Appearances: Case Submitted on the Record

Appellant, pro se

Office of Solicitor, for the Director

DECISION AND ORDER

Before:

CHRISTOPHER J. GODFREY, Chief Judge

JANICE B. ASKIN, Judge

VALERIE D. EVANS-HARRELL, Alternate Judge

JURISDICTION

On April 2, 2019 appellant filed a timely appeal from a February 13, 2019 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 a 

$4,310.21 overpayment of compensation for the period October 9 through November 10, 2018; 

and (2) whether OWCP properly found that appellant was at fault in the creation of the 

overpayment, thereby precluding waiver of recovery of the overpayment.

 

1

5 U.S.C. § 8101 et seq.
2

FACTUAL HISTORY

On June 4, 2015 appellant, then a 56-year-old mail handler, filed a traumatic injury claim 

(Form CA-1) alleging that she sustained left shoulder strain as a result of pushing a can from a 

dock through a vestibule while in the performance of duty. By decision dated July 20, 2015, 

OWCP accepted the claim for sprain of the shoulder and upper arm with a left superior glenoid 

labrum lesion, disorder of bursae and tendons of the left shoulder region, sprain of the shoulder 

and upper arm, and other affections of the left shoulder region not elsewhere classified. 

On May 25, 2018 appellant underwent an OWCP-approved left shoulder arthroscopy with

Dr. Jeremy B. Britten, an orthopedic surgeon. 

In a form dated June 29, 2018, appellant enrolled in direct deposit for her compensation 

payments. OWCP received her enrollment form for direct deposit on July 17, 2018.

By letter dated July 2, 2018, OWCP advised appellant that she had been placed on the 

periodic rolls, outlined her entitlement to compensation benefits, and advised her of her 

responsibility to return to work in connection with the accepted injury. In an attached EN1049, 

OWCP provided:

“To minimize the possibility of an overpayment of compensation, NOTIFY THIS 

OFFICE IMMEDIATELY WHEN YOU GO BACK TO WORK. If you receive your 

compensation payments via paper check, the payment shows the period for which 

payment is made. If you have worked for any portion of this period, return the 

payment to this office, even if you have already advised OWCP that you are 

working. For payments sent by electronic funds transfer (EFT), a notification of 

the date and amount of payment appears on the statement from your financial 

institution. You are expected to monitor your EFT deposits carefully, at least every 

two weeks. If you have worked for any portion of the period for which a deposit 

was made, advise OWCP immediately so that the overpayment can be collected. ”

(Emphasis in the original.)

In a work status report dated August 29, 2018, Dr. Britten advised that appellant could 

return to work with restrictions of no overhead reaching or carrying more than 20 pounds with the 

left upper extremity. On September 26, 2018 he released she to return to work, as of that date,

without restrictions.

A closure report completed by a registered nurse, dated October 26, 2018, noted that 

appellant had returned to work at full duty on October 9, 2018. The nurse noted that, although 

appellant had been released to return to work on September 26, 2018, she sustained a nonworkrelated wrist fracture, which prevented her from returning to work until she was cleared by her 

personal physician, and that appellant took personal leave.

OWCP continued to pay appellant wage-loss compensation for temporary total disability 

through November 10, 2018. On October 13, 2018 appellant received a direct deposit in the 

amount of $3,657.15 for the period September 16 through October 13, 2018, and on November 10, 
3

2018 she received a direct deposit in the amount of $3,657.15 for the period October 14 through 

November 10, 2018.

In a compensation termination sheet dated November 7, 2018, OWCP indicated that 

appellant had returned to work on October 9, 2018 at full duty. It noted that for the period

October 9 through November 10, 2018, she was overpaid compensation in the amount of 

$4,310.21. OWCP calculated this amount by taking the gross compensation paid from October 9 

through 13, 2018, $682.32, and subtracting $3.32 for basic life insurance (BLI) and $25.94 for 

miscellaneous, which yielded $653.06. For the period October 14 through November 10, 2018, 

appellant’s gross compensation was $3,821.01; subtracting $18.60 for BLI and $145.26 for 

miscellaneous yielded $3,657.15. OWCP calculated the total amount of the overpayment to be 

$4,310.21.

In a November 19, 2018 preliminary determination, OWCP advised appellant that she had 

received an overpayment of compensation in the amount of $4,310.21 for the period October 9

through November 10, 2018 because she had returned to full-time work on October 9, 2018, but 

continued to receive total disability compensation through November 10, 2018. It also determined

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

she knew or reasonably should have known were incorrect. OWCP informed appellant that she 

had the right to submit evidence or argument if she disagreed with its finding. It also informed her 

that she had a right to a prerecoupment hearing before an OWCP hearing representative. OWCP 

instructed appellant to complete an enclosed overpayment recovery questionnaire (Form OWCP20) and submit supporting documentation. 

On December 2, 2018 appellant contested the finding of fault and requested a waiver with 

regard to the overpayment. She responded to the overpayment recovery questionnaire, noting a 

monthly income of $6,500.00. Appellant listed five people she supported either fully or in part, 

including her spouse, a 29-year-old son, and three sons with ages not listed. She listed monthly 

expenses of $5,603.00 and noted that she was in bankruptcy. 

By decision dated February 13, 2019, OWCP finalized the preliminary determination of a 

$4,310.21 overpayment of compensation for the period October 9 through November 10, 2018. It 

determined that appellant was at fault in the creation of the overpayment and therefore she was not 

entitled to waiver of recovery of the overpayment. OWCP required recovery in full within 30 

days.

LEGAL PRECEDENT -- ISSUE 1

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.2

Section 8116(a) of FECA provides that, while an employee is receiving compensation or 

if he or she has been paid a lump sum in commutation of installment payments until the expiration 

of the period during which the installment payments would have continued, the employee may not 

 

2

5 U.S.C. § 8102(a).
4

receive salary, pay, or remuneration of any type from the United States, except in limited specified 

instances.3 Section 10.500 of OWCP’s regulations provides that compensation for wage loss due 

to disability is available only for any periods during which an employee’s work-related medical 

condition prevents him or her from earning the wages earned before the work-related injury.

4

 A 

claimant is not entitled to receive temporary total disability (TTD) benefits and actual earnings for 

the same time period.5 OWCP procedures provide that an overpayment of compensation is created 

when a claimant returns to work, but continues to receive wage-loss compensation for TTD.6

ANALYSIS -- ISSUE 1

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

of compensation in the amount of $4,310.21 for the period October 9 through November 10, 2018.

The record established that appellant returned to work full time at the employing 

establishment on October 9, 2018. However, appellant continued to receive wage-loss 

compensation for total disability through November 10, 2018. As noted above, she was not 

entitled to receive compensation for total disability after she had returned to work.7 Thus, an 

overpayment of compensation was created.

OWCP calculated appellant’s net compensation paid for the period October 9 through 

November 10, 2018 as $4,310.21. Appellant has not contested the fact or amount of the 

overpayment. Thus, the Board finds that she received an overpayment of compensation in the 

amount of $4,310.21 for the period October 9 through November 10, 2018.

LEGAL PRECEDENT -- ISSUE 2

5 U.S.C. § 8129(b) provides that adjustment or recovery 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 FECA or would be against equity and good 

conscience.8 A claimant who is at fault in the creation of the overpayment is not entitled to waiver. 9 

On the issue of fault, 20 C.F.R. § 10.433(a) provides that an individual will be found at fault if he 

or she has done any of the following: (1) made an incorrect statement as to a material fact which 

he or she knew or should have known to be incorrect; (2) failed to provide information which he 

 

3

Id. at § 8116(a).

4

20 C.F.R. § 10.500(a).

5

See C.L., Docket No. 19-0242 (issued August 5, 2019); K.E., Docket No. 18-0687 (issued October 25, 2018); 

M.S., Docket No. 16-0289 (issued April21, 2016); L.S., 59 ECAB 350, 352-53 (2008).

6 C.L., id.; B.H., Docket No. 09-0292 (issued September 1, 2009); Federal (FECA) Procedure Manual, Part 6 --

Debt Management, Initial Determinations in an Overpayment, Chapter 6.300.4(g) (September 2018).

7

See supra notes 3-5.

8

5 U.S.C. § 8129(b).

9

See B.R., Docket No. 18-0339 (issued January 24, 2019); K.E., Docket No. 18-0687 (issued October 25, 2018); 

Gregg B. Manston, 45 ECAB 344, 354 (1994); Robert W. O Brien, 36 ECAB 541, 547 (1985).
5

or she knew or should have known to be material; or (3) accepted a payment which he or she knew 

or should have known was incorrect.

The Board has held that an employee who receives payments from OWCP in the form of 

a direct deposit may not be at fault the first time incorrect funds are deposited into his or her 

account, as the acceptance of the resulting overpayment lacks the requisite knowledge.10 The 

Board has also held in cases involving a series of incorrect payments, where the requisite 

knowledge is established by a letter or telephone call from OWCP, or simply with the passage of 

time and a greater opportunity for discovery, the claimant will be at fault for accepting the 

payments subsequently deposited.11 Previous cases have held that receiving one or two erroneous 

direct deposit payments does not necessarily create the requisite knowledge to find that a claimant 

was at fault in the creation of the overpayment.12

ANALYSIS -- ISSUE 2

The Board finds that appellant was not at fault with regard to OWCP’s first direct deposit 

following her return to work, but she was at fault in the creation of the overpayment resulting from 

the subsequent deposits.

OWCP paid appellant compensation by direct deposit every 28 days. Appellant returned 

to work on October 9, 2018. OWCP paid her compensation for the period October 9 through 

November 10, 2018. There is no documentation or other evidence to demonstrate that appellant 

had clear knowledge at the time the bank received the October 13, 2018 direct deposit that the 

payment was incorrect.13 The Board thus finds that appellant was without fault in accepting the 

initial direct deposit covering the period of the overpayment from October 9 through 13, 2018.

The Board finds that the case is not in posture for decision regarding the issue of waiver of 

recovery of the overpayment for the period October 9 through 13, 2018. The Board will set aside 

the February 13, 2019 decision regarding the issue of fault for that period and remand the case to 

OWCP to determine whether appellant is entitled to waiver of recovery of the overpayment 

covering the period October 9 through 13, 2018.14

The Board further finds that appellant was at fault in the creation of the overpayment 

resulting from the remaining direct deposit payment for the period October 14 through 

November 10, 2018.15

 

10 See Tammy Craven, 57 ECAB 689 (2006).

11 Id. 

12 See D.B., Docket No. 16-0258 (issued February 1, 2016); W.P., 59 ECAB 514 (2008).

13 See C.Y., Docket No. 18-0263 (issued September 14, 2018); see also M.M.,Docket No. 15-0265 (issued May 27, 

2015); Danny E. Haley, 56 ECAB 393 (2005); Federal (FECA) Procedure Manual, supranote 6.

14 See B.R.,supra note 9.

15 See C.Y., supra note 13; D.W., Docket No. 14-0229 (issued April17, 2014).
6

In a July 2, 2018 letter, OWCP notified appellant that, to avoid an overpayment of 

compensation, she must immediately notify it of her return to work. She was required to reimburse 

OWCP for compensation paid during a period which she worked. Although OWCP may have 

been negligent in making incorrect payments, this does not excuse a claimant from accepting

payments he or she knew or should have known to be incorrect.16 In cases involving a series of 

incorrect payments, where the requisite knowledge is established by documentation from OWCP 

or simply with the passage of time and opportunity for discovery, a claimant will be at fault for 

accepting the payments subsequently deposited. By the time of the second payment, appellant 

should have known that she was not entitled to the same amount of wage-loss compensation as she 

had received prior to her return to work on October 9, 2018.17 After her receipt of the first direct 

deposit following her return to work, she was on notice that OWCP began to make payments to 

her in error and knew or should have known that she was not entitled to the benefit of the 

subsequent direct deposit.

CONCLUSION

The Board finds that OWCP properly determined that appellant received a $4,310.21 

overpayment of compensation for the period October 9 through November 10, 2018. The Board 

further finds that she was without fault in the creation of the overpayment for the period October 9 

through 13, 2018, and that she was at fault in the creation of the overpayment for the period 

October 14 through November 10, 2018. The case will be remanded to OWCP to consider waiver 

of recovery of the overpayment for the period October 9 through 13, 2018.

 

16 See C.G., Docket No. 15-0701 (issued December 9, 2015).

17 Id.
7

ORDER

IT IS HEREBY ORDERED THAT the February 13, 2019 decision of the Office of 

Workers’ Compensation Programs is affirmed in part and set aside in part and the case is remanded 

for further action consistent with this decision of the Board.

Issued: October 21, 2019

Washington, DC

Christopher J. Godfrey, Chief Judge

Employees’ Compensation Appeals Board

Janice B. Askin, Judge

Employees’ Compensation Appeals Board

Valerie D. Evans-Harrell, Alternate Judge

Employees’ Compensation Appeals Board