United States Department of Labor

Employees’ Compensation Appeals Board

__________________________________________

B.C., Appellant

and

DEPARTMENT OF THE NAVY, PUGET 

SOUND NAVAL SHIPYARD & 

INTERMEDIATE MAINTENACE FACILITY, 

Bremerton, WA, Employer

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Docket No. 20-0542

Issued: May 17, 2021

Appearances: Case Submitted on the Record

Appellant, pro se

Office of Solicitor, for the Director

DECISION AND ORDER

Before:

ALEC J. KOROMILAS, Chief Judge

PATRICIA H. FITZGERALD, Alternate Judge

VALERIE D. EVANS-HARRELL, Alternate Judge

JURISDICTION

On January 13, 2020 appellant filed a timely appeal from a November 26, 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 $2,385.48 for the period May 27, 2018 through March 2, 2019 for which she was 

without fault, because health and life insurance premiums had not been deducted from her FECA 

compensation; and (2) whether OWCP properly denied waiver of recovery of the overpayment.

 

1 5 U.S.C. § 8101 et seq.
2

FACTUAL HISTORY

On August 14, 2017 appellant, then a 25-year-old dispatcher, filed a traumatic injury claim 

(Form CA-1) alleging that on March 29, 2017 she sustained left wrist injuries when the blade of a 

saw kicked back, causing her left wrist to strike a metal surface in the performance of duty. OWCP 

accepted the claim for disorders of the left wrist synovium, palmar fascial fibromatosis, and other 

left wrist instability. It paid appellant wage-loss compensation on the supplemental rolls from 

March 30, 2017 through June 23, 2018, and then on the periodic rolls, comencing June 24, 2018. 

OWCP again paid her wage-loss compenstion on the supplemental rolls from December 7, 2018

until January 5, 2019, and on the periodic rolls from January 6 through August 17, 2019. 

The record contains a claim for compensation (Form CA-7) dated September 25, 2017,

which indicated that appellant was not enrolled in basic life insurance (BLI), optional life insurance 

(OLI), health insurance under the Federal Employees Health Benefits (FEHB) program, or a 

retirement system.

Notification of Personnel Action (Standard Form (SF)-50) forms dated March 30, 2017 

and March 4, 2018 indicated that appellant was a full-time seasonal employee, and that her tenure 

status was classified as a conditional employee, not a permanent employee. Federal Employees’

Group Life Insurance (FEGLI) coverage was coded “C0” and noted as BLI only.

In a memorandum of telephone call (Form CA-110) dated March 19, 2019, OWCP noted 

that the employing establishment advised that appellant had enrolled in health insurance coverage,

effective January 7, 2018.

On March 21, 2019 the employing establishment provided OWCP with a FEHB notice of 

change in health insurance enrollment (Form 2810), indicating that enrollment code 104, should

have been transferred from the employing establishment to OWCP, effective May 27, 2018. It

subsequently submitted a form electronically signed by appellant on January 3, 2018 noting her 

enrollment in FEHB plan 104 from no prior FEHB enrollment, effective January 7, 2018. 

A compensation payment worksheet dated March 27, 2019 noted that the employing 

establishment had not notified OWCP regarding appellant’s health insurance and BLI elections, 

which should have been deducted, effective May 27, 2018. The form further indicated that, during 

the period May 27, 2018 to March 2, 2019, health insurance premiums should have been deducted 

in the amount of $2,259.48 and BLI premiums should have been deducted in the amount of 

$126.00.

In a Health Benefits Election form dated April 28, 2019, appellant cancelled her federal 

health insurance plan as she elected to be covered under a state health plan.

By notice dated May 7, 2019, OWCP advised appellant of its preliminary overpayment 

determination that she had received an overpayment of compensation in the amount of $2,385.48

because health insurance and BLI premiums had not been properly deducted from her 

compensation payments for the period May 27, 2018 through March 2, 2019. It summarized its 

calculation of the overpayment relating that health insurance premiums should have been deducted 

in the amount of $2,259.48 and BLI premiums should have been deducted in the amount of 
3

$126.00. OWCP advised appellant that she was without fault in the creation of the overpayment. 

It requested that she complete an overpayment recovery questionnaire (Form OWCP-20) and 

submit supporting financial documentation within 30 days. Additionally, OWCP notified 

appellant that, within 30 days, she could request a telephone conference, a final decision based on 

the written evidence, or a prerecoupment hearing.

On May 16, 2019 appellant requested a telephonic prerecoupment hearing before a

representative of OWCP’s Branch of Hearings and Review and attached a Form OWCP-20 dated 

May 16, 2019. She reported total monthly income of $2,072.00 in FECA wage-loss compensation,

total monthly expenses of approximately $2,890.00, and assests of $100.00 in a checking account.

On August 5, 2019 OWCP informed appellant that a precoupment hearing was scheduled 

for September 13, 2019. Appellant testified that she thought the overpayment was based on 

OWCP’s failure to make any deductions for her health insurance premiums and that she did not 

know that BLI deductions were improper and at issue. She further testified regarding her financial 

situation and current health issues.

Appellant submitted an updated Form OWCP-20 dated September 27, 2019.

By decision dated November 26, 2019, OWCP’s hearing representative finalized the 

May 7, 2019 preliminary overpayment determination. She found that the evidence of record was 

sufficient to establish that an overpayment in the amount of $2,385.48 had been created for the 

period May 27, 2018 through March 2, 2019 because premiums for health insurance and BLI were 

not deducted from appellant’s FECA compensation. The hearing representative found appellant 

without fault in the creation of the overpayment, but denied waiver of recovery of the overpayment. 

She related that the overpayment was due and payable in full.

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 his or her duty.2 Under FEHB and/or FEGLI plan, most civilian employees of the 

Federal Government are eligible to participate in BLI and one or more of the options.3 If an 

employee was enrolled in a FEGLI plan at the time he or she became eligible to receive wage-loss 

compensation, deductions for health benefits insurance and/or life insurance premiums will be 

withheld from the employee’s compensation benefits.4 When an overpayment has been made to 

an individual because of an error of fact or law, adjustment shall be made under regulations 

 

2 Supra note 1 at § 8102(a); see G.C., Docket No. 18-1451 (issued May 5, 2020); I.J., Docket No. 19-1672 (issued 

March 10, 2020).

3 Supra note 1 at § 8702(a). See E.J., Docket No. 15-1734 (issued April 12, 2016).

4 Federal (FECA) Procedure Manual, Part 2 -- Claims, Compensation Claims, Chapter 2.901.15 (February 2013).
4

prescribed by the Secretary of Labor by decreasing later payments to which the individual is 

entitled.5

ANALYSIS -- ISSUE 1

The Board finds that OWCP has established that appellant received an overpayment of 

compensation as premiums for health insurance and BLI were not deducted for the period May 27, 

2018 through March 2, 2019 from appellant’s wage-loss compensation.

The record contains a signed election form in which appellant chose plan 104 for health 

insurance effective January 7, 2018. The record reflects that appellant received wage-loss 

compensation for disability during the period May 27, 2018 through March 2, 2019, but OWCP 

did not deduct health insurance premiums from appellant’s wage-loss compensation payments

during this period. 

The record also contains SF-50 forms dated March 30, 2017 and March 4, 2018, indicating

that appellant elected BLI. OWCP, however, did not deduct BLI premiums from her compensation 

payments from May 27, 2018 through March 2, 2019. As OWCP failed to properly deduct 

premiums for BLI from May 27, 2018 through March 2, 2019, appellant received an overpayment 

of compensation.

6

 Therefore, fact of overpayment has been established as OWCP failed to deduct

health insurance and BLI premiums during this time period.7

The Board has reviewed the March 27, 2019 overpayment fiscal worksheet that reflects the 

above-noted overpayment based upon OWCP’s failure to deduct health insurance and BLI 

premiums. OWCP properly summarized its calculation of the overpayment relating that health 

insurance premiums should have been deducted in the amount of $2,259.48 and BLI premiums 

should have been deducted in the amount of $126.00. The Board, therefore, finds that an 

overpayment of compensation in the amount of $2,385.48 was created for the time period in 

question.

8

LEGAL PRECEDENT -- ISSUE 2

Section 8129 of FECA provides that an overpayment in compensation shall be recovered 

by OWCP 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.”

9

 Section 10.438 of OWCP regulations provides that the individual who 

received the overpayment is responsible for providing information about income, expenses, and 

 

5 20 C.F.R. §§ 10.434-10.437.

6 Supra note 1 at § 8707(d); see also R.W., Docket No. 19-0451 (issued August 7, 2019); Keith H. Mapes, 56 ECAB 

130 (2004); James Lloyd Otte, 48 ECAB 334 (1997).

7 See T.M., Docket No. 20-1085 (issued December 31, 2020). 

8 R.M., Docket No. 19-0183 (issued November 18, 2019). 

9 Supra note 1 at § 8129.
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assets as specified by OWCP.10 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. 

Failure to submit the requested information within 30 days of the request shall result in denial of 

waiver.11

The guidelines for determining whether recovery of an overpayment would defeat the 

purpose of FECA or would be against equity and good conscience are set forth in sections 10.434 

to 10.437 of OWCP’s regulations.12

Section 10.436 provides that 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 current 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.13 An individual is 

deemed to need substantially all of his or her current income to meet current ordinary and necessary 

living expenses if monthly income does not exceed monthly expenses by more than $50.00.14

OWCP’s procedures provide that the 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.15 An individual’s liquid assets include, but are not limited to, cash and 

the value of stocks, bonds, saving accounts, mutual funds, and certificates of deposit. Nonliquid 

assets include, but are not limited to, the fair market value of an owner’s equity in property such 

as a camper, boat, second home, furnishings/supplies, vehicle(s) above the two allowed per 

immediate family, retirement account balances (such as Thrift Savings Plan or 401(k)), jewelry, 

and artwork.16

ANALYSIS -- ISSUE 2

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

 

10 Supra note 5 at 10.438.

11 Id.

12 Id. at §§ 10.434-10.437.

13 Id. at § 10.436.

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

6.400.4a(3) (September 2018).

15 Id. at Chapter 6.400.4a(2).

16 Id. at Chapter 6.400.4b(3)(a), (b).
6

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

be considered, and repayment is still required unless adjustment or recovery of the overpayment 

would defeat the purpose of FECA or be against equity and good conscience.17

In order for appellant to establish that recovery of the overpayment would defeat the 

purpose of FECA, she must show that she requires substantially all of her income to meet current 

ordinary and necessary living expenses and that her assets do not exceed the established limit as 

determined by OWCP’s procedures.18 Appellant had the responsibility to provide the appropriate 

financial information to OWCP.19

In its preliminary overpayment determination dated May 7, 2019, OWCP requested that 

appellant provide a completed Form OWCP-20 and supporting financial documentation, including 

copies of income tax returns, bank account statements, bills and canceled checks, pay slips, and 

any other records to support income and expenses. 

Appellant submitted a completed Form OWCP-20 in which she listed FECA income and 

a brief outline of her expenses, without any supporting financial documentation. As a result, 

OWCP did not have the necessary financial information to properly determine whether recovery 

of the overpayment would defeat the purpose of FECA or if recovery would be against equity and 

good conscience. Consequently, as appellant did not submit the financial information required 

under section 10.438 of OWCP’s regulations, which was necessary to determine her eligibility for 

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

compensation in the amount of $ 2,385.48.

20

CONCLUSION

The Board finds that OWCP has established that appellant received an overpayment of 

compensation in the amount of $2,385.48 for the period March 27, 2018 through March 2, 2019, 

for which she was without fault, because health and life insurance premiums had not been deducted 

from her FECA compensation. The Board further finds that OWCP properly denied waiver of 

recovery of the overpayment.

 

17 Supra note 8.

18 Supra note 5 §§ 10.436, 10.437.

19 Id. at 10.438.

20 See E.S., Docket No. 20-0919 (issued February 9, 2021); M.R., Docket No. 20-0427 (issued October 30, 2020); 

R.Q., Docket No. 18-0964 (issued October 8, 2019); E.K., Docket No. 18-0587 (issued October 1, 2018).
7

ORDER

IT IS HEREBY ORDERED THAT the November 26, 2019 decision of the Office of 

Workers’ Compensation Programs is affirmed.

Issued: May 17, 2021

Washington, DC

Alec J. Koromilas, Chief Judge

Employees’ Compensation Appeals Board

Patricia H. Fitzgerald, Alternate Judge

Employees’ Compensation Appeals Board

Valerie D. Evans-Harrell, Alternate Judge

Employees’ Compensation Appeals Board