United States Department of Labor

Employees’ Compensation Appeals Board

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C.M., claiming as the representative of the estate 

of M.C., Appellant

and

U.S. POSTAL SERVICE, PROCESSING & 

DISTRIBUTION CENTER, Brockton, MA, 

Employer

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Docket No. 21-0059

Issued: February 23, 2022

Appearances: Case Submitted on the Record

Kenneth J. Goldberg, Esq., for the appellant1

Office of Solicitor, for the Director

DECISION AND ORDER

Before:

ALEC J. KOROMILAS, Chief Judge

JANICE B. ASKIN, Judge

VALERIE D. EVANS-HARRELL, Alternate Judge

JURISDICTION

On October 13, 2020 appellant, through counsel, filed a timely appeal from May 5, 2020 

merit decisions 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 over the merits of this case.

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.; see also 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

ISSUES

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

amount of $14,490.48 for the period October 29, 2005 through March 2, 2019, for which he was 

not at fault, becausepostretirement basic life insurance (PRBLI) premiums were not deducted from 

his FECA compensation; (2) whether the employee received an overpayment of compensation in 

the amount of $12,697.61 for the period April 28, 2015 through March 2, 2019, for which he was 

not at fault, because optional life insurance (OLI) premiums were not deducted from his FECA 

compensation; and (3) whether OWCP properly denied waiver of recovery of the overpayments.

FACTUAL HISTORY

OWCP accepted that on March 23, 2000 the employee, then a 49-year-old mail processor, 

sustained cervical strain, disc herniation at C5-6, cervical spondylosis with myelopathy, and 

cervical intervertebral disc with myelopathy as a result of pushing a cart while in the performance 

of duty. The employee stopped work on the date of injury and did not return.

3

 OWCP paid the 

employee wage-loss compensation on the supplemental and periodic rolls. 

On April 17, 2019 OWCP received a death certificate dated April 3, 2019 indicating that 

the employee had passed awayon March 24, 2019. In a May 6, 2019 letter, the employee’swidow

notified OWCP that she was the employee’s named beneficiary of his estate. 

On July 18, 2019 the Division of Federal Employees’ Compensation (DFEC) National 

Office advised OWCP that according to the Office of Personnel Management (OPM), at retirement 

the employee elected no reduction of his five multiples of OLI options B and C coverage, effective 

April 28, 2015, and no reduction to his PRBLI coverage, effective October 29, 2005. Itstopped 

premium deductions for the employee’s OLI coverage when he turned 65 and did not deduct 

PRBLI premiums. It was noted that the employee passed away in March 2019. OWCP was 

advised to take action as applicable, to collect the overpayment attributed to under-deducted OLI 

and PRBLI premiums from the survivor(s)/estate. 

On July 26, 2019 OWCP notified OPM that an overpayment in the amount of $12,697.61 

had been created because it had failed to deduct OLI premiums from the employee ’s compensation 

during the period April 28, 2015 through March 24, 2019. It further notified OPM that an 

overpayment of $14,490.48 had been created because it had failed to deduct PRBLI premiums 

from the employee’s compensation during the period October 29, 2005 through March 2, 2019. 

OWCP noted that the total overpayment was $27,188.09. It requested that OPM provide whether 

benefits were paid to the employee at the time of his death that may be administratively offset. 

In a preliminary overpayment determination of July 26, 2019, OWCP notified the 

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

of $14,490.48 because PRBLI premiums had not been properly deducted from the employee’s 

FECA compensation for the period October 29, 2005 through March 2, 2019. It also notified her 

that the employee had received an overpayment of compensation in the amount of $12,697.61 

because BLI premiums had not been properly deducted from the employee’s FECA compensation 

for the period April 28, 2015 through March 2, 2019. OWCP calculated the amount of the 

3 The employee was separated from the employing establishment due to his disability, effective June 25, 2004. 
3

overpayments by adding the amount of the PRBLI premiums that should have been deducted from 

the employee’s compensation to find a total overpayment of $14,490.48 and adding the amount of 

the OLI premiums that should have been deducted from the employee’s compensation to find a 

total overpayment of $12,697.61. It further advised the employee’s widow of its preliminary 

overpayment determination that the employee was not at fault in the creation of the overpayment 

and requested that she complete an overpayment action request form and an overpayment recovery 

questionnaire (Form OWCP-20). Additionally, OWCPnotified herthat, within 30 days of the date 

of the letter, she could request a telephone conference, a final decision based on the written 

evidence, or a prerecoupment hearing. 

In a letter of even date issued to the employee’s widow as personal representative of the 

employee’s estate, OWCP referenced its overpayment determination and advised of its intention 

to make a claim against the estate for the amount of the overpayment. It requested the name and 

address of the executor of the estate and the probate court handling the estate. OWCP further 

advised that the estate had the right to inspect OWCP debt records related to the overpayment and 

to request waiver of the overpayment and a prerecoupment hearing.

On August 29, 2019 OWCP received an overpayment action request form, dated 

August 22, 2019, in which the employee’s widow requested a waiver and a prerecoupment hearing 

by telephone. The employee’s widow submitted a completed Form OWCP-20 of even date, 

wherein she indicated that her total monthly income was $1,573.00 and that her total monthly 

expenses were $5,297.00. She further indicated that she had assets of $231,538.00.

In an August 22, 2019 letter, counsel, on behalf of the employee’s widow, requested a 

waiver of recovery of the overpayment because her monthly expenses exceeded her income, 

funeral expenses were excessive as the employee died in Florida and had to be transported to 

Massachusetts, and she had to purchase a new vehicle costing $23,350.00 because she could not 

operate the employee’s leased vehicle. Additionally, he contended that she suffered from severe 

anxiety, depression, and grief for which she was on medication. Counsel asserted that the 

employee’s widow was unable to manage her finances and unemployable. He further asserted that 

a stable financial future was critical for preventing further deterioration of her mental health. 

Counsel concluded that the employee’s widow would suffer undue hardship, be deprived of basic 

income, and recovery of the debt would be against equity and good conscience. 

Counsel submitted an August 21, 2019 letter from Dr. Jane Yu, a Board-certified family 

practitioner. Dr. Yu noted that the employee’s widow had been under her care for the treatment 

of severe anxiety, for which the employee’s widow was on prescription medication. She advised 

that, due to the employee’s widow mental health condition, the employee’s widow was unable to 

manage her finances independently and was also unable to maintain employment. Dr. Yu related 

that the employee’s widow was grieving the recent death of her spouse and needed financial 

support in the form of her spouse’s life insurance benefits to maintain her stable mental health and 

avoid a worsening of her anxiety and depressive symptoms.

The prerecoupment hearing was held on January 8, 2020. Appellant testified about the 

mental condition and inability to handle finances of her mother, the employee’s widow, following 

the death of her father, the employee. She noted that her father paid all of the bills, gave her mother 

money. Appellant further testified, among other things, that her mother feared losing her health 

insurance if she did not repay the overpayment and having to sell her home.
4

Following the prerecoupment hearing, in a February 28, 2020 letter, counsel noted that 

OWCP’s preliminary overpayment determination was addressed to the employee’s widow and not 

to the employee’s estate, which had not been probated. He contended that unless there was a law 

or statute under which a widow or heirs of a deceased employee could be personally responsible 

for an overpayment created during the employee’s lifetime, then the claim against the employee’s 

widow should be dismissed. 

By decision dated March 24, 2020, an OWCP hearing representative set aside the July 26, 

2019 preliminary overpayment determination and remanded the case to OWCP to reissue the

preliminary overpayment determination to the estate of the employee in care of the employee’s 

widow. He found that OWCP failed to follow its procedures as outlined in Chapter 6.500.15

regarding collection of a deceased debtor’s estate.4

On April 1, 2020 OWCP issued a new preliminary overpayment determination, addressed 

to the employee’s estate, finding that an overpayment of compensation in the amount of 

$14,490.48 had been created because PRBLI premiums had not been properly deducted from the 

employee’s FECA compensation for the period October 29, 2005 through March 2, 2019. It 

determined that the employee’s estate was not at fault in the creation of the overpayment and 

requested that the employee’s estate should complete an overpayment action request form and a 

Form OWCP-20. Also, OWCP notified the employee’s estate 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. 

A separate new preliminary overpayment determination of even date was issued by OWCP, 

addressed to the employee’s estate, finding that an overpayment of compensation in the amount of 

$12,697.61 because OLI premiums had not been properly deducted from the employee’s FECA 

compensation for the period April 28, 2015 through March 2, 2019. It further advised the 

employee’s estate of its preliminary determination that the employee’s estate was not at fault in 

the creation of the overpayment and requested that the employee’s estate complete an overpayment 

action request form and a Form OWCP-20. Also, OWCP notified the employee’s estate 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 April 17, 2020 letter, counsel advised that the employee’s estate had not been 

probated and was anticipated that it had no assets. He requested direction on how to proceed with 

waiver of recovery of the overpayment. Alternatively, counsel requested an extension to respond

to the preliminary overpayment determinations until such time when the employee’s estate had 

been probated and its assets had been determined. 

By decision dated May 5, 2020, addressed to the employee’s estate, OWCP finalized that 

the preliminary overpayment determination that the employee had received an overpayment of 

compensation in the amount of $14,490.48 for the period October 29, 2005 through March 2, 2019, 

as it failed to deduct PRBLI premiums from his compensation payments. It denied waiver of 

recovery of the overpayment as no financial evidence had been submitted in response to the 

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

(September 2018).
5

preliminary overpayment determination, as requested. OWCP directed recovery of the 

overpayment in full within 30 days. 

In a separate decision of even date, addressed to the employee’s estate, OWCP finalized 

that the preliminary overpayment determination that the employee had received an overpayment 

of compensation in the amount of $12,697.61 for the period April 28, 2015 through March 2, 2019, 

as it failed to deduct OLI premiums from his compensation payments. It denied waiver of recovery 

of the overpayment as no financial evidence had been submitted in response to the preliminary 

overpayment determination, as requested. OWCP directed recovery of the overpayment in full 

within 30 days. 

LEGAL PRECEDENT -- ISSUES 1 and 2

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. 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 basic life insurance (BLI) and one or more of the options.7 The coverage for BLI 

is effective unless waived8 and 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 periodic FECA 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 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 optional life insurance 

coverage, which is accomplished by authorizing withholdings from his compensation.12

5

5 U.S.C. § 8102(a).

6

Id. at § 8129(a).

7

Id. at § 8702(a).

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); see EdwardJ. Shea, 43 ECAB 1022 (1992) (the Board found that the claimant received 

an overpayment of compensation where he elected PRBLI with no reduction and no premiums had been deducted 

from his compensation from January 3, 1988 to May 6, 1989);see also Glen B. Cox, 42 ECAB 703 (1991) (the Board 

found that an overpayment was created due to no deduction of premiums for optional life insurance for the periods 

July 1983 through November 1989).
6

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. Regulations at 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 2 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 1 

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 remained in effect. 14 An employee who 

does not file a life insurance election form 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

When an under withholding 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’s procedures for recovery from a deceased debtor’s estate provide 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 the financial management system (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 claims 

examiner should follow the referral procedures set forth in Chapter 6.500.12,19 including sending 

the complete referral package to the national office for final review and forwarding to the FMS. 20

13 See D.H., Docket No. 19-0384 (issued August 12, 2019); see V.H., Docket No. 18-1124 (issued 

January 16, 2019). See S.P., Docket No. 17-1888 (issued July 18, 2018).

14 5 C.F.R. § 870.504(a)(1).

15 Id. at § 870.504(b).

16 Id. at § 8707(d);see also D.H. andS.P.,supranote 13; KeithH. Mapes, 56 ECAB 130 (2004).

17 Supra note 4.

18 31 C.F.R. § 285.2;supranote 4 at Chapter 6.500.15(g)(1)-(7) (September 2018). See also D.U., Docket No. 20-

0594 (issuedJune4, 2021); R.B. (J.B.), Docket No. 19-0700 (issued March 16, 2021);W.J. (E.J.), Docket No. 18-1035 

(issued July 9, 2019).

19 Supra note 4 at Chapter 6.500.12 (September 2018).

20 Id. at Chapter 6.500.15(e)(September 2018).
7

ANALYSIS -- ISSUES 1 and 2

The Board finds that this case is not in posture for decision.

In a March 24, 2020 decision, OWCP’s hearing representative set aside OWCP’s July 26, 

2019 preliminary overpayment determination, notifying the employee’s widow that the employee 

had received an overpayment of compensation in the amount of $14,490.48 for the period 

October 29, 2005 through March 2, 2019, for which he was not at fault, because PRBLI premiums 

were not deducted from his FECA compensation, and he had received an overpayment of 

compensation in the amount of $12,697.61 for the period April 28, 2015 through March 2, 2019, 

for which he was not at fault, because OLI premiums were not deducted from his FECA 

compensation. The hearing representative remanded the case to OWCP to reissue the preliminary 

overpayment determination to the estate of the employee in care of the employee’s widowpursuant 

to OWCP’s procedures under Chapter 6.500.15, which provide for recovery from a deceased 

debtor’s estate. 

On remand, OWCP, on April 1, 2020, issued two new preliminary overpayment 

determinations to the employee’s estate, but again failed to fully follow its procedures outlined in

Chapter 6.500.15. The procedures specifically require that, if the claimant recently passed away, 

OWCP should refer the debt to the FMS for offset of the deceased claimant’s last federal tax refund 

under the TOP.21 OWCP has a special profile with FMS under TOP for the collection of these 

specific estate debts. The claims examiner should follow the referral procedures set forth in 

Chapter 6.500.12,22 including sending the complete referral package to the national office for final 

review and forwarding to the FMS.23

The evidence of record does not substantiate that actions OWCP has taken to recover the 

overpayment debt include referral to FMS for appropriate offset under the TOP prior to taking 

overpayment actions against the employee’s estate. Although OWCP has demanded repayment 

of the overpayment in full, the Board cannot make an informed decision regarding the amount of 

overpayment to be collected against the estate.24 The case shall therefore be remanded to OWCP 

to follow all procedures as outlined in Chapter 6.500.15 of its procedures. 25 Following this and 

any other further development as deemed necessary, OWCP shall issue a de novo decision.

CONCLUSION

The Board finds that this case is not in posture for decision.

21 Supra note 18.

22 Supra note 20.

23 Supra note 19.

24 See D.U., R.B. (J.B.), and W.J. (E.J.), supra note 18.

25 Supra note 4.
8

ORDER

IT IS HEREBY ORDERED THAT the May 5, 2020 decisions of the Office of Workers’

Compensation Programs are set aside and the case is remanded for further proceedings consistent 

with this decision of the Board.

Issued: February 23, 2022

Washington, DC

Alec J. Koromilas, Chief Judge

Employees’ Compensation Appeals Board

Janice B. Askin, Judge

Employees’ Compensation Appeals Board

Valerie D. Evans-Harrell, Alternate Judge

Employees’ Compensation Appeals Board