United States Department of Labor

Employees’ Compensation Appeals Board

__________________________________________

D.M., Appellant

and

DEPARTMENT OF TRANSPORTATION, 

FEDERAL AVIATION ADMINISTRATION, 

Teterboro, NJ, Employer

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Docket No. 19-1311

Issued: February 4, 2020

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

JANICE B. ASKIN, Judge

VALERIE D. EVANS-HARRELL, Alternate Judge

JURISDICTION

On May 28, 2019 appellant filed a timely appeal from a May 16, 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 appellant received an overpayment of compensation in the 

amount of $16,327.55 for the period March 7, 2014 through March 2, 2019, for which he was 

without fault; (2) whether OWCP properly denied waiver of recovery of the overpayment; and 

(3) whether OWCP properly required recovery of the overpayment by deducting $1,662.14 from 

appellant’s continuing compensation payments, every 28 days.

 

1 5 U.S.C. § 8101 et seq.
2

FACTUAL HISTORY

On November 20, 2009 appellant, then a 55-year-old supervisory air traffic control 

specialist, filed an occupational disease claim (Form CA-2) alleging that he sustained stress 

causally related to factors of his federal employment. OWCP accepted the claim for post-traumatic 

stress disorder and paid appellant wage-loss compensation for total disability on the supplemental 

rolls beginning August 18, 2010.

In a letter dated September 21, 2011, OWCP notified appellant that it was placing him on 

the periodic compensation rolls effective August 15, 2011. It advised that it was deducting basic 

life insurance (BLI) and optional life insurance (OLI) premiums from his compensation payments.

On February 14, 2019 the Office of Personnel Management (OPM) informed OWCP that 

appellant, as a compensationer, was eligible to continue coverage under the Federal Employees’

Group Life Insurance (FEGLI) Program. It further notified OWCP that he had elected 

postretirement basic life insurance (PRBLI), BLI, and OLI with no reduction. OPM provided the 

FEGLI form completed by appellant on June 7, 2013 and his Option B and Option C election form 

freezing his OLI at no reduction at the age of 65. It indicated that the effective date of appellant’s 

postretirement deductions was March 7, 2014 and that his final base salary was $127,721.00. 

In a worksheet dated April 8, 2019, OWCP specified the amounts that it should have 

deducted for PRBLI premiums from appellant’s continuing compensation payments. It found that 

it should have deducted $3,271.50 for the period March 7, 2014 to March 6, 2015, $3,096.78 for 

the period March 7, 2015 to March 6, 2016, $3,331.93 for the period March 9, 2016 to March 6, 

2017, and $6,627.34 for the period March 7, 2017 to March 7, 2019, for a total under deduction of 

PRBLI of $16,327.55.

By notice dated April 15, 2019, OWCP advised appellant of its preliminary determination 

that he had received an overpayment of compensation in the amount of $16,327.55 because it had 

failed to deduct PRBLI premiums from his compensation payments for the period March 7, 2014 

through March 2, 2019.2 It further notified him of its preliminary determination that he was 

without fault in the creation of the overpayment. OWCP requested that appellant complete the 

enclosed overpayment recovery questionnaire (Form OWCP-20) and submit supporting financial 

documentation. Additionally, it notified him that, within 30 days of the date of the letter, he could 

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

hearing, if he objected to the preliminary notification findings or requested waiver of recovery of 

the overpayment.

On April 24, 2019 appellant provided an overpayment action request form requesting a 

decision based on the written evidence. He submitted a completed overpayment recovery 

questionnaire advising that he had assets of $29,156.07. Appellant further indicated that he had 

monthly income of $10,863.18 and monthly expenses of $11,164.00. He provided supporting 

financial documentation.

 

2 OWCP noted that it had also not deducted premiums for OLI, but advised that it was only currently addressing 

the overpayment based on its failure to deduct premiums for PRBLI.
3

By decision dated May 16, 2019, OWCP finalized the preliminary determination that 

appellant had received an overpayment of compensation in the amount of $16,327.55 for the period 

Mach 7, 2013 through March 2, 2019. It found that he was without fault in the creation of the 

overpayment, but was not entitled to waiver of recovery of the overpayment as his assets exceeded 

the allotted resource base. OWCP further determined that appellant’s monthly income exceeded 

his minimum monthly living expenses and that he had failed to fully document his monthly 

expenses.3 It advised that it would recovery the overpayment by deducting $1,662.14 every 28 

days from his continuing compensation payments.

LEGAL PRECEDENT -- ISSUE 1

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 his or her duty.4 

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.5

Under the FEGLI Program, most civilian employees of the Federal Government are eligible 

to participate in basic life insurance and one or more of the options.6 The coverage for basic life 

insurance is effective unless waived,7and premiums for basic and optional life coverage are 

withheld from the employee’s pay.8

A 1980 amendment of 5 U.S.C. § 8706(b)(2) provided that an employee receiving 

compensation under FECA could elect continuous withholdings from his or her compensation, so 

that his or her life insurance coverage could be continued without reduction. 5 C.F.R. § 870.701 

(December 5, 1980) provided that an eligible employee had the option of choosing no life 

insurance; Option A -- basic coverage (at no additional cost) subject to continuous withholdings 

from compensation payments that would be reduced by two percent a month after age 65 with a 

maximum reduction of 75 percent; Option B -- basic coverage (at an additional premium) subject

to continuous withholdings from compensation payments that would be reduced by one percent a 

month after age 65 with a maximum reduction of 50 percent; or Option C -- basic coverage subject 

to continuous withholdings from compensation payments with no reductions after age 65 (at a 

greater premium).9

 

3 OWCP used the minimum monthly payments on appellant’s credit cards to determine his monthly expenses. It 

further accepted the remaining expenses listed, even those that he had failed to adequately document.

4 5 U.S.C. § 8102(a).

5

Id. at § 8129(a).

6

Id. at § 8702(a).

7

Id. at § 8702(b).

8

Id. at § 8707.

9 See C.A., Docket No. 18-1284 (issued April 15, 2019); V.H., Docket No. 18-1124 (issued January 16, 2019).
4

When an underwithholding of life insurance premiums occurs, the entire amount is deemed 

an overpayment of compensation because OWCP must pay the full premium to OPM upon 

discovery of the error.10

ANALYSIS -- ISSUE 1

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

of compensation in the amount of $16,327.55 for the period March 7, 2014 through March 2, 2019.

OPM notified OWCP that appellant had elected PRBLI coverage with no reduction 

effective March 7, 2014. OWCP, however, did not deduct premiums for PRBLI from appellant’s 

wage-loss compensation from March 7, 2014 through March 2, 2019. It calculated the amount of 

the resulting overpayment as $16,327.55 and provided a worksheet explaining its calculations. 

As noted, when an underwithholding of life insurance premiums occurs, the entire amount 

is deemed an overpayment of compensation because OWCP must pay the full premium to OPM 

upon discovery of the error.11

The Board finds that OWCP properly calculated the amount of the overpayment and 

provided a clear and detailed explanation of the fact and amount of the overpayment. As OWCP 

failed to properly deduct PRBLI premiums from March 7, 2014 through March 2, 2019, appellant 

received an overpayment of compensation in the amount of $16,327.55 during this period.12

LEGAL PRECEDENT -- ISSUE 2

Section 8129 of FECA13 provides that an overpayment must be recovered unless 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. Thus, a 

finding that appellant was without fault does not automatically result in waiver of the overpayment. 

OWCP must exercise its discretion to determine whether recovery of the overpayment would 

defeat the purpose of FECA or would be against equity and good conscience.14

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 

 

10 5 U.S.C. § 8707(d); D.H., Docket No. 19-0384 (issued August 12, 2019).

11 Id.

12 See D.H., supra note 10; R.W., Docket No. 19-0451 (issued August 7, 2019).

13 5 U.S.C. § 8129(a)-(b); A.C., Docket No. 18-1550 (issued February 21, 2019).

14 G.L., Docket No. 19-0297 (issued October 23, 2019).
5

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.15

Section 10.437 provides that 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 

her position for the worse.16

ANALYSIS -- ISSUE 2

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

OWCP found that appellant was without fault in the creation of the overpayment of 

compensation. The fact that a claimant is without fault in creating an overpayment does not 

preclude OWCP from recovering the overpayment.17 Waiver is only possible if recovery would 

defeat the purpose of FECA or be against equity and good conscience.18 In order to establish that 

repayment of the overpayment would defeat the purpose of FECA, appellant must show that he 

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

that his assets do not exceed the established limit as determined by OWCP procedures.19

The Board finds that OWCP properly determined that appellant’s assets exceeded the limit 

established by OWCP procedures. In his April 24, 2019 overpayment recovery form, appellant

indicated that he had assets of $29,156.07, which exceeds the allowed resource base of $10,300.00 

for a claimant with a dependent as set forth in OWCP procedures.20 OWCP further determined 

that, even if it accepted undocumented expenses, appellant’s minimum monthly expenses totaled 

$8,659.44 and his monthly income was $10,979.45, a difference of $2,320.01, which also exceeded 

the allowed resource base of $50.00.21

Additionally, the evidence of record does not demonstrate that recovery of the overpayment 

would be against equity and good conscience. Appellant did not submit any evidence that he relied 

upon the incorrect payments to his detriment or that he would experience severe financial hardship 

 

15 20 C.F.R. § 10.436. OWCP procedures provide that assets must not exceed a resource base of $6,200.00 for an 

individual or $10,300.00 for an individual with a spouse or dependent plus $1,200.00 for each additional dependent. 

Federal (FECA) Procedure Manual, Part 6 -- Debt Management, Final Overpayment Determinations, Chapter 

6.400.4(a)(2) (September 2018).

16 20 C.F.R. § 10.437(b)(1).

17 D.H., supra note 10.

18 20 C.F.R § 10.436; J.C., Docket No. 19-0122 (issued June 11, 2019).

19 Supra note 15.

20 Id.

21 G.L., supra note 14; Federal (FECA) Procedure Manual, supra note 15 at Chapter 6.400.4(a)(3) 

(September 2018).
6

attempting to repay the debt.22 Consequently, OWCP properly denied waiver of recovery of the 

overpayment.

LEGAL PRECEDENT -- ISSUE 3

The Board’s jurisdiction over recovery of an overpayment is limited to reviewing those 

cases where OWCP seeks recovery from continuing compensation under FECA.23 Section 

10.441(a) of the regulation provides:

“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 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 financial 

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

any hardship.”

24

ANALYSIS -- ISSUE 3

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

$1,662.14 from appellant’s continuing compensation payments, every 28 days. 

The record reflects that appellant continues to receive wage-loss compensation from 

OWCP. In setting the rate of recovery, OWCP found that he could repay $1,622.14 from his 

continuing compensation payments every 28 days.25 As appellant’s monthly income exceeded his 

ordinary and necessary living expenses by more than $50.00, OWCP did not abuse its discretion 

in requiring repayment by deducing $1,622.14 every 28 days from his continuing compensation 

payments.26

CONCLUSION

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

$16,327.55 for the period March 7, 2014 through March 2, 2019. The Board further finds that 

 

22 Supra note 20; see also G.L., supra note 14.

23 C.A., supra note 9; Lorenzo Rodriguez, 51 ECAB 295 (2000).

24 20 C.F.R. § 10.441(a).

25 OWCP advised that it was deducting 25 percent from appellant’s continuing compensation to repay the debt in 

accordance with its procedures. OWCP’s procedures provide that, if it receives no response to the preliminary 

overpayment determination, and the overpaid individual is receiving compensation benefits on the periodic rolls, the 

rate of repayment should be set at 25 percent of the 28-day net compensation amount. Federal (FECA) Procedure 

Manual, supra note 15 at Chapter 6.400.3(a)(2) (September 2018). Appellant responded to the preliminary 

overpayment determination. However, OWCP properly set the rate of recovery as his assets and monthly income 

demonstrated that repaying $1,662.14 from continuing compensation would minimize hardship. See generally E.B., 

Docket No. 19-1443 (issued December 12, 2019).

26 See G.L., supra note 14.
7

OWCP properly denied waiver of recovery of the overpayment and properly determined that it 

would recover the overpayment by deducting $1,662.14 from his continuing compensation 

payments, every 28 days.

ORDER

IT IS HEREBY ORDERED THAT the May 16, 2019 decision of the Office of Workers’

Compensation Programs is affirmed.

Issued: February 4, 2020

Washington, DC

Patricia H. Fitzgerald, Deputy Chief Judge

Employees’ Compensation Appeals Board

Janice B. Askin, Judge

Employees’ Compensation Appeals Board

Valerie D. Evans-Harrell, Alternate Judge

Employees’ Compensation Appeals Board