United States Department of Labor

Employees’ Compensation Appeals Board

__________________________________________

M.S., Appellant

and

U.S. POSTAL SERVICE, JOHN F. KENNEDY 

STATION, Boston, MA, Employer

__________________________________________

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Docket No. 22-0505

Issued: October 18, 2022

Appearances: Case Submitted on the Record

Appellant, pro se

Office of Solicitor, for the Director

DECISION AND ORDER

Before:

ALEC J. KOROMILAS, Chief Judge

JANICE B. ASKIN, Judge

JAMES D. McGINLEY, Alternate Judge

JURISDICTION

On February 7, 2022 appellant filed a timely appeal from November 29, 2021 and 

January 14, 2022 merit decisions 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 forfeited her 

entitlement to compensation for the period December 29, 2016 through March 22, 2021 as she 

knowingly failed to report her employment activities and earnings, pursuant to 5 U.S.C. 

§ 8106(b)(2); (2) whether OWCP properly found that appellant received an overpayment of 

compensation in the amount of $157,249.06 as she forfeited her compensation for the period

February 18, 2017 through March 22, 2021; (3) whether OWCP properly determined that 

appellant was at fault in the creation of the overpayment, thereby precluding waiver of recovery 

1

5 U.S.C. § 8101 et seq.
2

of the overpayment; and (4) whether OWCP properly required recovery of the overpayment by 

deducting $776.29 from appellant’s continuing compensation payments every 28 days.

FACTUAL HISTORY

This case has previously been before the Board.2 The facts and circumstances of the case 

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

are as follows.

On October 21, 2003 appellant, then a 31-year-old letter carrier, filed a traumatic injury 

claim (Form CA-1) alleging that on October 17, 2003 she fractured her right foot when she stepped 

down from a truck while in the performance of duty. She stopped work on October 18, 2003. On 

February 9, 2004 OWCP accepted appellant’s claim for right ankle sprain and fracture of the right 

talas and navicular bone. It paid her wage-loss compensation on the periodic rolls for total 

disability for the period April 22 through October 30, 2004 and on the supplemental rolls for 

intermittent disability for the period October 31 through December 3, 2004. By decision dated 

December 14, 2005, OWCP granted appellant a schedule award for 10 percent loss of use of her 

right upper extremity. In a December 20, 2005 decision, it reduced her wage-earning capacity to

zero as her actual earnings as a modified letter carrier, effective December 20, 2004, fairly and 

reasonably represented her wage-earning capacity. The Board, by decision dated June 8, 2006, 

affirmed the December 15 and 20, 2005 decisions.3 By decision dated November 12, 2015, OWCP 

denied appellant’s claim for a recurrence of disability beginning April 4, 2015. In a May 26, 2017 

decision, it accepted her claim for a recurrence of disability effective February 16, 2017. OWCP 

thereafter paid appellant wage-loss compensation on the supplemental rolls commencing 

February 18, 2017.

On March 29, 2018, March 14, 2019, March 17, 2020, and March 22, 2021 appellant 

signed CA-1032 forms regarding her earnings and employment activity for the preceding 15-

month periods. The form advised that she must report all employment for which she received a 

salary, wages, income, sales commissions, piecework, or any payment of any kind, and that she 

must also report self-employment or involvement in any business enterprise in the past 15 months. 

It further informed appellant that fraudulently concealing or failing to report income could subject 

her to criminal prosecution. On the forms, she marked “No” in response to questions regarding 

whether she worked for an employer or was self-employed or involved in a business enterprise 

during the previous 15-month period.

In a September 16, 2021 report, an employing establishment Office of the Inspector 

General (OIG) agent, A.V., summarized his investigation of appellant. He noted that appellant 

began to receive total disability compensation effective February 18, 2017 and continued to 

receive such benefits at the time of his report following OWCP’s acceptance of her recurrence of 

disability claim. Appellant became an adult foster care provider for AG Adult Foster Care, LLC,

effective March 9, 2018 through October 2019 and was paid $20,500.00 for her services. She also 

2 Docket No. 06-620 (issued June 8, 2006).

3

Id.
3

became an adult foster care provider with Vitra Health, Inc. on September 25, 2019, completed 

training on November 15, 2019, andbegan providing adult foster care services from December 19, 

2019 through April 2021. Appellant was paid $18,614.00 for her services. She received a total of 

$39,114.00 in wages as an adult foster care provider. Appellant did not disclose any employment, 

self-employment, involvement in a business enterprise, and/or volunteer work on the Form CA1032 she completed in 2018, 2019, 2020, or 2021. The OIG agent submitted attachments that 

documented appellant’s employment and earnings as an adult foster care provider and OWCP’s 

wage-loss compensation payments.

OWCP, by decision dated November 29, 2021, found that appellant forfeited her 

entitlement to compensation for the period December 29, 2016 through March 22, 2021 because 

she knowingly failed to disclose her outside earnings and employment, pursuant to section 

8106(b)(2) of FECA.4 It explained that she had knowingly failed to report earnings and 

employment activities when submitting the March 29, 2018, March 14, 2019, March 17, 2020, and 

March 22, 2021 CA-1032 forms, which covered the prior 15 months of activity.

On November 29, 2021 OWCP notified appellant of its preliminary determination that she 

received an overpayment of compensation in the amount of $157,249.06 as she forfeited 

entitlement to compensation from February 18, 2017 through March 22, 2021. It further advised 

her of its preliminary determination that she was at fault in the creation of the overpayment, thereby 

precluding waiver of recovery of the overpayment. OWCP also forwarded an overpayment action 

request form and an overpayment recovery questionnaire (Form OWCP-20) and requested that 

appellant submit supporting financial documentation, including income tax returns, bank account 

statements, bills and cancelled checks, pay slips, and any other records to support her reported 

income and expenses. Additionally, it notified 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 December 29, 2021 overpayment action request form, appellant requested waiver of 

recovery of the overpayment, contending that she was unaware that it was against the law to take 

care of her mother.

OWCP, by decision dated January 14, 2022, finalized its preliminary overpayment 

determination, finding that appellant received an overpayment of compensation in the amount of 

$157,249.06 because she forfeited her compensation from February 18, 2017 through 

March 22, 2021. It found that she was at fault in the creation of the overpayment because she 

failed to report earnings from her employment activities, thereby precluding waiver of recovery of 

the overpayment. OWCP required recovery of the overpayment by deducting $776.29 every 28 

days from appellant’s continuing compensation payments. 

LEGAL PRECEDENT -- ISSUE 1

Section 8106(b) of FECA provides that an employee who fails to make an affidavit or 

report when required or knowingly omits or understates any part of her earnings, forfeits his or her 

4

Supra note 1 at§ 8106(b)(2).
4

right to compensation with respect to any period for which the affidavit or report was required.5 

An employee, however, can only be subjected to the forfeiture provision of 5 U.S.C. § 8106 if he 

or she knowingly failed to report employment or earnings. It is not enough to merely establish 

that there were unreported earnings.6 OWCP’s procedures recognize that forfeiture is a penalty,7

and, as a penalty provision, it must be narrowly construed. 8 The term “knowingly” is defined 

within OWCP’s regulations as with knowledge, consciously, willfully, or intentionally.9

OWCP’s regulations define earnings from employment or self-employment as: (1) gross 

earnings or wages before any deductions and includes the value of subsistence, quarters, 

reimbursed expenses and any offer goods or services received in kind as remuneration; or (2) a 

reasonable estimate of the cost to have someone else perform the duties of an individual who 

accepts no remuneration.10 Neither lack of profits nor the characterization of the duties as a hobby 

removes an unremunerated individual’s responsibility to report the estimated cost to have someone 

else perform his or her duties.11

ANALYSIS -- ISSUE 1

The Board finds that OWCP properly determined that appellant forfeited her entitlement 

to compensation for the period December 29, 2016 through March 22, 2021 as she knowingly 

failed to report her employment activities and earnings, pursuant to 5 U.S.C. § 8106(b)(2).

OWCP found that appellant forfeited her entitlement to compensation from December 29, 

2016 through March 22, 2021 because she failed to report earnings from employment on CA-1032 

forms signed on March 29, 2018, March 14, 2019, March 17, 2020, and March 22, 2021. On the 

forms appellant indicated that she did not perform any work for an employer and was not selfemployed. She listed no earnings from employment or self-employment.

On September 16, 2021 an investigator with the employing establishment’s OIG related 

that appellant was an adult foster care provider for AG Adult Foster Care, LLC, and Vitra Health, 

Inc., during the periods covered by the March 29, 2018, March 14, 2019, March 17, 2020, and 

March 22, 2021 CA-1032 forms. The evidence indicated that appellant was paid $20,500.00 for 

5

Id. at § 8106(b).

6 T.G., Docket No. 19-0051 (issued August 20, 2019);P.H., Docket No. 17-1362 (issued March 13, 2018).

7 Federal (FECA) Procedure Manual, Part 2 -- Claims, Forfeiture,Chapter 2.1402.8 (May 2012). See also M.G., 

Docket No. 20-0735 (issued October 23, 2020); T.P., Docket No. 17-0717 (issued April 11, 2018); ChristineP. 

Burgess, 43 ECAB 449 (1992).

8 Christine P. Burgess, id.

9

20 C.F.R. § 10.5(n); R.A., Docket No. 18-0406 (issued January 28, 2019); I.S., Docket No. 17-0897 (issued 

April 9, 2018); Anthony A. Nobile, 44 ECAB 268 (1992).

10 Id. at § 10.5(g).

11 Id.
5

her services rendered at AG Adult Foster Care LLC and $18,614.00 for her services rendered at

Vitra Health, Inc., totaling $39,114.00.

OWCP’s regulations provide that, if an employee knowingly omits or understates earnings 

or work activity in making a report, he or she shall forfeit the right to compensation with respect 

to any period for which the report was required.12

Appellant can be subject to the forfeiture provision of section 8106(b) only if she 

“knowingly” failed to report earnings or employment. OWCP has the burden of proof to establish 

that a claimant did, either with knowledge, consciously, willfully, or intentionally, fail to report 

earnings from employment.

13

 Appellant completed CA-1032 forms, which advised her that she 

must report both all employment and all earnings from employment and self-employment. The 

form provided that she could be subject to criminal prosecution for false or evasive answers or 

omissions. The factual circumstances of record, including appellant’s signature on the Form 

CA-1032, provide persuasive evidence that she “knowingly” omitted her employment 

information.14

The Board, thus, finds that appellant misrepresented her employment activity and, 

therefore, forfeited her right to all compensation for the period February 18, 2017 through 

March 22, 2021.

LEGAL PRECEDENT -- ISSUE 2

Under 5 U.S.C. § 8106(b), compensation forfeited under this subsection, if already paid, 

shall be recovered under section 8129 of this title, unless recovery is waived under that section. 15

Section 10.529 of OWCP’s implementing regulations provides as follows:

“(a) If an employee knowingly omits or understates any earnings or work activity 

in making a report, he or she shall forfeit the right to compensation with respect to 

any period for which the report was required. A false or evasive statement, 

omission, concealment or misrepresentation with respect to employment activity or 

earnings in a report may also subject an employee to criminal prosecution.

“(b) Where the right to compensation is forfeited, OWCP shall recover any 

compensation already paid for the period of forfeiture pursuant to 5 U.S.C. § 8129 

and other relevant statues.”

16

12 20 C.F.R. § 10.529(b); HaroldF. Franklin, 57 ECAB 287 (2006).

13 Id. at § 10.5(n).

14 See J.H., Docket No. 20-1588 (issued June 16, 2021); G.R., Docket No. 15-1047 (issued July8, 2016).

15 Supra note 9.

16 20 C.F.R. § 10.529;see also J.H., supra note 14; G.G., Docket No. 14-1848 (issued August 4, 2016).
6

ANALYSIS -- ISSUE 2

The Board finds that OWCP properly found that appellant received an overpayment of 

compensation in the amount of $157,249.06 for the period February 18, 2017 through March 22, 

2021, resulting from the forfeiture.

Appellant forfeited her right to compensation for the period February 18, 2017 through 

March 22, 2021. As noted above, OWCP may declare an overpayment of compensation for any 

compensation already paid for the period of a forfeiture of compensation. 17 If a claimant has any 

employment, including self-employment or involvement in a business enterprise, during a period 

covered by a Form CA-1032, which he or she fails to report, a claimant is not entitled to 

compensation for any portion of the period covered by the report, even though he or she may not 

have had earnings during a portion of that period.18 OWCP determined that it paid appellant net 

compensation in the amount of $157,249.06 during the period in question. The Board, 

accordingly, finds that an overpayment of compensation in the amount of $157,249.06 has been 

established.19

LEGAL PRECEDENT -- ISSUE 3

Section 8129(b) of FECA provides that, “[a]djustment 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 this subchapter or would be against 

equity and good conscience.”

20

Section 10.433 of OWCP’s implementing regulations provides that in determining whether 

a claimant is at fault, it will consider all pertinent circumstances. An individual is with fault in the 

creation of an overpayment who:

“(1) Made an incorrect statement as to a material fact which he or she knew or 

should have known to be incorrect; or

“(2) Failed to provide information which he or she knew or should have known to 

be material; or

17 Id.

18 Id.

19 See J.H., supra note 14; J.N., Docket No. 13-1761 (issued July 1, 2014).

20 5 U.S.C. § 8129; see A.S., Docket No. 17-0606 (issued December 21, 2017); LindaE. Padilla, 45 ECAB 

768 (1994).
7

“(3) Accepted a payment which he or she knew or should have known to be 

incorrect.”

21

To determine if an individual was at fault with respect to the creation of an overpayment, 

OWCP examines the circumstances surrounding the overpayment. The degree of care expected 

may vary with the complexity of those circumstances and the individual’s capacity to realize that 

he or she is being overpaid.22

ANALYSIS -- ISSUE 3

OWCP properly determined that appellant was at fault in the creation of the overpayment, 

thereby precluding waiver of recovery of the overpayment.

The record establishes that appellant forfeited her entitlement to compensation benefits 

because she had unreported employment activity during the period February 18, 2017 through 

March 22, 2021 and knowingly failed to furnish this material information to OWCP. Appellant 

acknowledged a certification clause on the Form CA-1032, which advised her that she might be 

subject to civil, administrative, or criminal penalties if she knowingly made a false statement or 

misrepresentation or concealed a fact to obtain compensation. By signing this form, she is deemed 

to have acknowledged her duty to report any employment, self-employment, or involvement in a 

business enterprise. Appellant indicated that she had no employment or earnings from 

employment during the covered periods and, thus, failed to furnish information, which she knew 

or should have known to be material to OWCP.23 The Board, thus, finds that she is at fault in the 

creation of the overpayment and is, thereby, precluded from waiver of recovery.

LEGAL PRECEDENT -- ISSUE 4

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

cases where OWCP seeks recovery from continuing compensation under FECA. 24

Section 10.411 of OWCP’s regulations provides in pertinent part:

“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 

21 20 C.F.R. § 10.433(a); see J.H., supra note 14; K.F., Docket No. 19-1016 (issued February 14, 2020); Sinclair L. 

Taylor, 52 ECAB 227 (2001).

22 Id. at § 10.433(b); J.C., Docket No. 19-0911 (issued March 25, 2021); Duane C. Rawlings, 55 ECAB 366 (2004).

23 See J.H., supra note 14; G.Z.,Docket No. 16-0892 (issued May 19, 2017).

24 20 C.F.R. § 10.441;see M.P., Docket No. 18-0902 (issued October 16, 2018).
8

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

any hardship.”

25

ANALYSIS -- ISSUE 4

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

$776.29 from appellant’s continuing compensation payments every 28 days.

Appellant did not complete a Form OWCP-20 or provide the necessary financial 

information to support her income and expenses. The overpaid individual is responsible for 

providing information about income, expenses, and assets as specified by OWCP. 26 When an 

individual fails to provide requested financial information, OWCP should follow minimum 

collection guidelines designed to collect the debt promptly and in full. 27 OWCP’s procedures 

provide that, in these instances, OWCP should set the rate of recovery at 25 percent of the 28-day 

net compensation amount until the balance of the overpayment is paid in full.28

The record reflects that appellant’s continuing 28-day wage-loss compensation as of 

March 22, 2021 was $3,104.90. Therefore, deducing $776.29 every 28 days from her continuing 

compensation does not exceed the 25 percent repayment rate.29

CONCLUSION

OWCP properly determined that appellant forfeited her entitlement to compensation for 

the period February 18, 2017 through March 22, 2021 as she knowingly failed to report her 

employment activities and earnings, pursuant to 5 U.S.C. § 8106(b)(2). The Board further finds 

that OWCP properly found that appellant received an overpayment of compensation in the amount 

of $157,249.06 as she forfeited her entitlement to compensation for this period and that she was at 

fault in the creation of the overpayment, thereby precluding waiver of recovery of the 

overpayment. Lastly, OWCP properly required recovery of the overpayment by deducting 

$776.29 from appellant’s continuing compensation payments every 28 days.30

25 Id. at § 10.441(a).

26 20 C.F.R. § 10.438; see C.W., Docket No. 18-1557 (issued June 25, 2019); E.K.,Docket No. 18-0587 (issued 

October 1, 2018).

27 C.W. and E.K., id.; Frederick Arters, 53 ECAB 397 (2002); Federal (FECA) Procedure Manual, Part 6 -- Debt 

Management, Debt Liquidation, Chapter 6.500.2 (September 2018).

28 Supra note 27 at Chapter 6.500.8(c)(1) (September 2018); D.H., Docket No. 20-1064 (issued 

December 14, 2020).

29 See S.M., Docket No. 21-0772 (issued November 30, 2021).

30 Appellant also filed a motion requesting relief due to financial hardship. The Board notes, however, that this 

request is not properly before the Board and should be addressed to OWCP.
9

ORDER

IT IS HEREBY ORDERED THAT the November 29, 2021 and January 14, 2022 

decisions of the Office of Workers’ Compensation Programs are affirmed.

Issued: October 18, 2022

Washington, DC

Alec J. Koromilas, Chief Judge

Employees’ Compensation Appeals Board

Janice B. Askin, Judge

Employees’ Compensation Appeals Board

James D. McGinley, Alternate Judge

Employees’ Compensation Appeals Board