United States Department of Labor

Employees’ Compensation Appeals Board

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T.W., Administratrix of the Estate of L.W., 

Appellant

and

DEPARTMENT OF THE NAVY, BASE 

MOTOR TRANSPORT, Camp Lejeune, NC, 

Employer

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Docket No. 19-1266

Issued: September 25, 2020

Appearances: Case Submitted on the Record

George L. Collins, for the appellant1

Office of Solicitor, for the Director

DECISION AND ORDER

Before:

CHRISTOPHER J. GODFREY, Deputy Chief Judge

JANICE B. ASKIN, Judge

VALERIE D. EVANS-HARRELL, Alternate Judge

JURISDICTION

On May 20, 2019 appellant, through her representative, filed a timely appeal from a 

January 9, 2019 merit decision of the Office of Workers’ Compensation Programs (OWCP).

Pursuant to the Federal Employees’ Compensation Act2(FECA) and 20 C.F.R. §§ 501.2(c) and 

501.3, the Board has jurisdiction to consider the merits of this case

ISSUES

The issues are: (1) whether OWCP properly determined that the employee received an 

overpayment of compensation in the amount of $29,130.86 for the period April 2, 1983 through 

 

1

In all cases in which a representative has been authorized in a matter before the Board, no claim for a fee for legal 

or other service performed on appeal before the Board is valid unless approved by the Board. 20 C.F.R. § 501.9(e). 

No contract for a stipulated fee or on a contingent fee basis will be approved by the Board. Id. An attorney or 

representative’s collection of a fee without the Board’s approval may constitute a misdemeanor, subject to fine or 

imprisonment for up to one year or both. Id.; 18 U.S.C. § 292. Demands for payment of fees to a representative, prior 

to approval by the Board, may be reported to appropriate authorities for investigation.

2 5 U.S.C. § 8101 et seq.
2

April 29, 2017, for which he was without fault, because life insurance premiums had not been 

deducted from his FECA compensation; and (2) whether OWCP properly denied waiver of 

recovery of the overpayment.

FACTUAL HISTORY

This case has previously been before the Board.3 The facts and circumstances as set forth 

in the Board’s prior decision are incorporated herein by reference. The relevant facts are as 

follows.

OWCP accepted that on May 19, 1981 the employee, then a 31-year-old automobile 

mechanic, sustained a lumbosacral strain and herniated disc at L4-5 when he changed the

transmission in a bus while in the performance of duty. It paid him wage-loss compensation for 

disability and medical benefits.

In a telephone of call memorandum (CA-110) dated May 30, 2018, the employee’s sister

informed OWCP that the employee passed away on March 8, 2018.

In an August 27, 2018 letter, entitled “life insurance adjustment request,” received on that 

day, the Office of Personal Management (OPM) requested that OWCP refer to an attached OPM

document and make an adjustment, if necessary. In the attached document, OPM advised that the 

employee was insured under the Federal Employees’ Group Life Insurance (FEGLI) plan. It noted 

that he was enrolled in post-retirement basic life insurance (PRBLI) with no reduction, effective 

April 2, 1983, and optional life insurance (OLI) based on coverage for code N1 with the family 

option. OPM further indicated that the employee’s adjusted annual salary on which life insurance 

deductions were based was $22,755.20. 

In a preliminary determination notice dated October 23, 2018, OWCP informed the 

employee’s estate that the employee had received an overpayment of compensation in the amount 

of $29,131.13 because PRBLI and OLI premiums either had been improperly deducted or had not 

been deducted from his FECA compensation payments for the period April 2, 1983 through 

April 29, 2017. It explained that it had deducted insurance premiums for a lower annual base 

salary than that provided by OPM and deducted for Code N1 for the period October 7, 2001 

through October 7, 2004 only. OWCP found that the employee was without fault in the creation 

of the overpayment because he was not aware, nor could he have been reasonably aware that it

had paid compensation incorrectly. It requested that the employee’s estate complete an 

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

documents. Additionally, OWCP informed it that, within 30 days of the date of the letter, it could 

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

hearing.

In an overpayment worksheet dated October 23, 2018, OWCP noted that no deductions 

were made for PRBLI for the period January 1, 1990 to October 6, 2001 and OLI for the period

April 2, 1983 to October 6, 2001. The correct deductions for this period totaled $10,196.47. 

OWCP noted that no deductions were made for the period October 7, 2001 to October 7, 2004 for 

PRBLI and OLI. The correct deductions for this period totaled $2,038.23. OWCP indicated that 

 

3 Docket No. 02-1831 (issued January 23, 2003).
3

no deductions were made for PRBLI and OLI for the period October 8, 2007 to April 29, 2017. 

The correct deductions for this period totaled $16,896.43. OWCP added $10,196.47, $2,038.23, 

and $16,896.43 to calculate a $29,131.13 overpayment.4 Computer printouts revealed that no 

deductions had been made for PRBLI and OLI premiums during the period April 2, 1983 through 

April 29, 2017.

In a November 6, 2018 overpayment action request form, appellant, as administratrix of 

the employee’s estate, requested that OWCP make a decision based on a review of the written 

record. She also requested a waiver of recovery of the overpayment. Appellant contended that 

the deceased employee had no reason to believe that he was being overpaid by the amount 

determined by OWCP. She further contended that there was no evidence to show that he had 

actual knowledge of the inadequate deductions made for his PRBLI and OLI premiums. In an 

accompanying Form OWCP-20, appellant reported that the employee had no monthly income or 

expenses, and no funds.

By decision dated January 9, 2019, OWCP finalized its preliminary overpayment 

determination finding that the employee had received an overpayment of compensation, for which 

he was not at fault, in the amount of $29,130.86 for the period April 2, 1983 through 

April 29, 2017. It denied waiver of recovery of the overpayment as no financial information 

establishing his income or expenses was submitted. OWCP directed repayment of the 

overpayment in full. 

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 duty.5 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.6

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

to participate in BLI and one or more of the options.7 The coverage for BLI is effective unless 

 

4 On the cover of its October 23, 2018 preliminary notice, OWCP indicated that the amount of the overpayment 

was $26,005.36. However, in its calculations and conclusion, discussed infra, it noted that the overpayment amount 

was $29,131.13. The Board notes that OWCP’s calculation of this overpayment contained a mathematical error. 

Adding the overpayment amounts for no deductions for PRBLI from October 8, 2004 to April 29, 2017 yields an 

amount of $8,119.67 rather than $8,119.94 as found by OWCP. Adding $8,119.67 with the overpayment amounts of 

$8,776.49 for OLI deductions not made from October 8, 2004 to April 29, 2017 yields an overpayment amount of 

$16,896.16 rather than $16,896.43 as found by OWCP. Adding the overpayment amount of $16,896.16 with the 

amount of $10,196.47 for PRBLI and OLI not deducted from October 7, 2001 to October 7, 2004 and $2,038.23 for 

PRBLI and OLI not deducted from October 7, 2001 to October 7, 2004 yields an overpayment of $29,130.86. The 

Board deems this error harmless and will modify the amount of the overpayment to $29,130.86. See G.T., Docket No. 

15-1314 (issued September 9, 2016).

5 5 U.S.C. § 8102(a).

6

Id. at § 8129(a).

7

Id. at § 8702(a).
4

waived,8and premiums for BLI and OLI coverage are withheld from the employee’s pay.9 Upon 

retirement or upon separation from the employing establishment or being placed on the FECA 

periodic compensation rolls, an employee may choose to continue BLI and OLI coverage, in which 

case the schedule of deductions made will be used to withhold premiums from his or her annuity 

or compensation payments.10 BLI coverage shall be continued without cost to an employee who 

retired or began receiving compensation on or before December 31, 1989.11 However, the 

employee is responsible for payment of premiums for OLI coverage which is accomplished by 

authorizing withholdings from his or her compensation.12

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: 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).13

Each employee must elect or waive Option A, Option B, and Option C coverage, in a 

manner designated by OPM, within 60 days after becoming eligible unless, during earlier 

employment, he or she filed an election or waiver that remains in effect.14 Any employee who 

does not file a Life Insurance Election with his or her employing office, in a manner designated by 

OPM, specifically electing any type of optional insurance, is considered to have waived it and does 

not have that type of optional insurance.15

 

8

Id. at § 8702(b).

9

Id. at § 8707.

10 Id. at § 8706.

11 Id. at § 8707(b)(2).

12 Id. at § 8706(b)(3)(B); B.B., Docket No. 17-1733 (issued March 26, 2018); S.B., Docket No. 16-1795 (issued 

March 2, 2017).

13 See C.A., Docket No. 18-1284 (issued April 15, 2019); James J. Conway, Docket No. 04-2047 (issued 

May 20, 2005).

14 20 C.F.R. § 870.504(a)(1).

15 Id. at § 870.504(b).
5

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.16

OWCP procedures for recovery from a deceased debtor’s estate provides that, if the 

claimant recently passed away, it should take prompt action because creditors who have not 

properly asserted a claim before the estate is closed are generally precluded from any recovery.17 

Thus, it should refer the debt to FMS for offset of the deceased claimant’s last Federal tax refund 

under the Treasury’s Offset Program (TOP).18 OWCP has a special profile with FMS under TOP 

for the collection of these specific estate debts. The CE should follow the referral procedures set 

forth in PM 6.500.15(e), including sending the complete referral package to the National Office 

for final review and forwarding to the FMS.19

ANALYSIS -- ISSUE 1

The Board finds that OWCP improperly determined that the employee received an 

overpayment of compensation in the amount of $29,130.86 for the period April 2, 1983 through 

April 29, 2017, for which he was without fault.

OWCP found that an overpayment of compensation in the amount of $29,130.86 was 

created because it failed to deduct PRBLI and OLI premiums from the employee’s wage-loss 

compensation for the period April 2, 1983 through April 29, 2017. It reviewed the fiscal record 

and determined that the employee had elected PRBLI and OLI and it explained that premiums had 

not been deducted for the appropriate period. The record includes OPM’s August 27, 2018 letter 

notifying OWCP that the employee had elected PRBLI and OLI. The record also includes 

computer printouts showing that proper life insurance premium deductions were not made between 

April 2, 1983 and April 29, 2017.

The Board finds, however, that OWCP failed to adequately support its determination that 

the employee, now deceased, received a $29,130.86 overpayment due to its failure to properly 

deduct premiums for PRBLI and OLI. While the record includes communications from OPM

regarding the employee’s PRBLI and OLI coverage, the record does not contain evidence that the 

employee affirmatively signed a document electing PRBLI or OLI coverage. The record does not 

contain a signed election form showing which coverage he actually selected or if he actually 

selected coverage. The Board has previously found that OWCP must document whether and when 

a claimant elected life insurance coverage after separation from federal service or retirement in 

 

16 5 U.S.C. § 8707(d); I.J., Docket No. 19-1672 (issued March 10, 2020); D.H., Docket No. 19-0384 (issued 

August 12, 2019).

17 Federal (FECA) Procedure Manual, Part 6 -- Debt Management, Debt Liquidation, Chapter 6.500.15 

(September 2018).

18 31 C.F.R. § 285.2. 

19 Supra note 17 at Chapter 6.500.15(e).
6

order to establish the fact of overpayment of compensation.20 As OWCP has not factually 

established the employee’s election of PRBLI and OLI on the relevant dates, it has not met its 

burden of proof to establish that a $29,130.86 overpayment was created between April 2, 1983 and 

April 29, 2017, as alleged.21

The Board therefore finds that OWCP has not met its burden of proof to establish that an 

overpayment of compensation occurred.22

CONCLUSION

The Board finds that OWCP improperly determined that the employee received an 

overpayment of compensation in the amount of $29,130.86 for the period April 2, 1983 through 

April 29, 2017.

23

ORDER

IT IS HEREBY ORDERED THAT the January 9, 2019 decision of the Office of 

Workers’ Compensation Programs is reversed.

Issued: September 25, 2020

Washington, DC

Christopher J. Godfrey, 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

 

20 J.P., Docket No. 18-1194 (issued April 28, 2020); P.K., Docket No. 18-0913 (issued March 5, 2020); C.P., 

Docket No. 19-0317 (issued July 1, 2019); R.F., Docket No. 18-0739 (issued January 2, 2019); D.T., Docket No. 

17-0901 (issued January 29, 2018).

21 J.P., id.; R.F., id.

22 Id.

23 In light of the Board’s disposition of Issue 1, Issue 2 is rendered moot.