United States Department of Labor

Employees’ Compensation Appeals Board

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D.T., Appellant

and

DEPARTMENT OF HOMELAND SECURITY, 

TRANSPORTATION SECURITY 

ADMINISTRATION, MASSACHUSETTS PORT 

AUTHORITY, East Boston, MA, Employer

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Docket No. 20-1482

Issued: September 23, 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

PATRICIA H. FITZGERALD, Deputy Chief Judge

VALERIE D. EVANS-HARRELL, Alternate Judge

JURISDICTION

On August 3, 2020 appellant filed a timely appeal from a July 29, 2020 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.2

1

5 U.S.C. § 8101 et seq.

2 The Board notes that following the July 29, 2020 decision, appellant submitted additional evidence to OWCP.

However, the Board’s Rules of Procedure provides: “The Board’s review of a case is limited to the evidence in the 

case record that was before OWCP at the time of its final decision. Evidence not before OWCP will not be considered 

by the Board for the first time on appeal.” 20 C.F.R. § 501.2(c)(1). Thus, the Board is precluded from reviewing this 

additional evidence for the first time on appeal. Id.
2

ISSUES

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

overpayment of compensation in the amount of $4,180.55 for the period February 2 through 

March 28, 2020 because she continued to receive wage-loss compensation to which she was not 

entitled; (2) whether OWCP properly determined that appellant was at fault in the creation of the 

overpayment, thereby precluding waiver of recovery of the overpayment; and (3) whether OWCP 

properly required recovery of the overpayment by deducting $250.00 every 28 days from 

appellant’s continuing compensation payments.

FACTUAL HISTORY

On April 24, 2012 appellant, then a 37-year-old transportation security officer, filed a 

traumatic injury claim (Form CA-1) alleging that on April 6, 2012 she sustained a back injury 

when she lifted a bag and turned her body and felt a pull while in the performance of duty. OWCP 

accepted her claim for left lumbosacral radiculopathy. It paid appellant wage-loss compensation 

on the supplemental rolls commencing June 15, 2012 and on the periodic rolls commencing 

August 26, 2012.

By decision dated January 21, 2020, OWCP reduced appellant’s wage-loss compensation, 

effective February 2, 2020, based on her capacity to earn wages in the constructed position of 

customer service representative. It found that she was capable of earning $710.80 per week in this 

position. OWCP determined the amount of the reduction in wage-loss compensation by applying 

the Shadrick formula to calculate appellant’s loss of wage-earning capacity, a formula which was 

derived from principles contained in the case of Albert C. Shadrick.

3

 It advised her that, effective 

February 2, 2020, her new net amount of compensation received each four weeks would be 

$582.40.

OWCP issued appellant a paper check on February 29, 2020 for $2,648.40 in wage-loss 

compensation covering the period February 2 through 29, 2020. It also issued her a paper check 

on March 28, 2020 for $2,710.40 in wage-loss compensation covering the period March 1 through 

28, 2020. Each of the checks indicated on its face the respective period of compensation it 

covered.4

On April 20, 2020 OWCP issued a preliminary notice, advisingappellant of its preliminary 

overpayment determination that she received an overpayment of compensation in the amount of 

$4,180.55 for the period February 2 through March 28, 2020. It indicated, “[t]he overpayment 

occurred because [OWCP] failed to administratively adjust the periodic roll disbursement record 

to align with the reduction of compensation as stipulated in the (enclosed) finalized notice of wageearning capacity determination released on [January 21, 2020].” OWCP then calculated the 

overpayment by applying the Shadrick formula to calculate appellant’s loss of wage-earning 

capacity for the period February 2 through March 28, 2020. It indicated that she was only entitled 

to receive $582.40 for the period February 2 through 29, 2020, and $596.40 for the period March 1 

3

5 ECAB 376 (1953); 20 C.F.R. § 10.403(d)-(e).

4

See Order to Complete Record Within 30 Days, Docket No. 20-1482 (issued August 12, 2021).
3

through 28, 2020.

5

 OWCP noted, however, that appellant received a check on February 29, 2020 

for $2,648.40 in wage-loss compensation covering the period February 2 through 29, 2020, as well 

as a check on March 28, 2020 for $2,710.40 in wage-loss compensation covering the period 

March 1 through 28, 2020. It also preliminarily determined that she was at fault in the creation of 

the overpayment as she accepted payments, which she knew or should have known were incorrect.

OWCP provided appellant with an overpayment action request form and notified her that, 

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. It also advised her that she could 

submit evidence challenging the fact, amount, or finding of fault, and request waiver of recovery 

of the overpayment. OWCP requested that appellant complete and return an overpayment 

recovery questionnaire (Form OWCP-20) within 30 days. It also requested that she submit 

supporting financial documentation, including copies of income tax returns, bank account 

statements, bills, pay slips, and any other records to support her reported income and expenses. 

No response was received.

By decision dated July 29, 2020, OWCP finalized its preliminary overpayment

determination that appellant received an overpayment of compensation in the amount of $4,180.55. 

It also finalized its preliminary determination that she was at fault in the creation of the 

overpayment, thereby precluding waiver of recovery of the overpayment. 

OWCP required recovery of the overpayment by deducting $250.00 from appellant’s 

continuing compensation payments every 28 days.

LEGAL PRECEDENT -- ISSUE 1

Section 8102(a) of FECA6 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.7 Section 8129(a) of FECA provides, in pertinent part:

“When an overpayment has been made to an individual under this subchapter 

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 an 

individual is entitled.”

8

5 OWCP indicated that the figure was higher for the latter period due to cost-of-living adjustments.

6

Supra note 1.

7

Id. at § 8102(a).

8

Id. at § 8129(a).
4

ANALYSIS -- ISSUE 1 

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

of compensation in the amount $4,180.55 for the period February 2 through March 28, 2020

because she continued to receive wage-loss compensation to which she was not entitled.

OWCP found that, in accordance with a January 21, 2020 decision, which reduced 

appellant’s wage-loss compensation effective February 2, 2020, she was only entitled to receive 

$582.40 for the period February 2 through 29, 2020, and $596.40 for the period March 1 through 

28, 2020.9 However, appellant received a check on February 29, 2020 for $2,648.40 in wage-loss 

compensation covering the period February 2 through 29, 2020, and another check on March 28, 

2020 for $2,710.40 in wage-loss compensation covering the period March 1 through 28, 2020. 

The difference between the amount of wage-loss compensation appellant received for the period 

February 2 through March 28, 2020, and amount to which she was entitled for this period is 

$4,180.55. For these reasons, the Board finds that appellant received an overpayment of 

compensation in the amount of $4,180.55 for that period. Therefore, fact and amount of 

overpayment have been established.

LEGAL PRECEDENT -- ISSUE 2

Section 8129(a) of FECA provides that where an overpayment of compensation has been 

made “because of an error of fact or law,” adjustment shall be made by decreasing later payments 

to which an individual is entitled.10 The only exception to this requirement is a situation which 

meets the tests set forth as follows in section 8129(b): “[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.”

11

 No waiver of payment is possible if the claimant is not 

“without fault” in helping to create the overpayment.12

In determining whether an individual is not “without fault” or alternatively “at fault” in the 

creation of an overpayment, section 10.433(a) of OWCP’s regulations provides in relevant art:

“A recipient who has done any of the following will be found to be at fault with 

respect to creating an overpayment:

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

knew or should have known to be incorrect; or

9 OWCP indicated that the figure was higher for the latter period due to cost-of-living adjustments.

10 5 U.S.C. § 8129(a).

11 Id. at § 8129(b).

12 L.J., 59 ECAB 264 (2007).
5

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

have known to be material; or

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

to be incorrect....”

13

Section 10.433(b) of OWCP’s regulations provides:

“Whether or not OWCP determines that an individual was at fault with respect to 

the creation of an overpayment depends on 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.”

14

ANALYSIS -- ISSUE 2 

The Board finds that OWCP properly determined that appellant was at fault in the creation 

of the overpayment of compensation, thereby precluding waiver of recovery of the overpayment.

As noted above, OWCP issued appellant a check on February 29, 2020 for $2,648.40 in 

wage-loss compensation covering the period February 2 through 29, 2020. It also issued her a 

check on March 28, 2020 for $2,710.40 in wage-loss compensation covering the period March 1 

through 28, 2020. Given that appellant had received the January 21, 2020 OWCP decision 

explicitly delineating the reduction of her wage-loss compensation effective February 2, 2020, and 

each of the checks indicated on its face the respective period of compensation it covered, appellant

accepted payments which she knew or should have known were incorrect. Thus, OWCP is 

required by law to recover the overpayment.15

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.16 Section 10.441 

of Title 20 of the Code of Federal Regulations provides that if an overpayment of compensation 

has been made to one entitled to future payments, proper adjustment shall be made by decreasing 

subsequent payments of compensation, “taking into account the probable extent of future 

13 20 C.F.R. § 10.433(a).

14 Id. at 10.433(b).

15 Id. at § 10.421(d); see L.J., 50 ECAB 264 (2007).

16 R.W., Docket No. 19-0451 (issued August7, 2019); C.A., Docket No. 18-1284 (issued April15, 2019); Albert 

Pinero, 51 ECAB 310 (2000); Lorenzo Rodriguez, 51 ECAB 295 (2000).
6

payments, the rate of compensation, the financial circumstances of the individual, and any other 

relevant factors, so as to minimize any hardship.”

17

 

ANALYSIS -- ISSUE 3

The Board finds that OWCP improperly required repayment of the overpayment by 

deducting $250.00 every 28 days from appellant’s compensation payments.

While appellant requested waiver of recovery of the overpayment, she did not complete 

the Form OWCP-20 or otherwise provide financial information. OWCP’s regulations provide that 

the overpaid individual is responsible for providing information about income, expenses, and 

assets as specified by OWCP.18

When an individual fails to provide requested financial information, OWCP should follow 

minimum collection guidelines designed to collect the debt promptly and in full. 19 The Federal 

(FECA) Procedure Manual provides 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.

20

 

OWCP advised appellant that her new net FECA wage-loss compensation payments would 

be $582.40, effective February 2, 2020. The Board however notes that 25 percent of $582.40 is 

$145.60. The Board therefore finds that OWCP improperly required recovery of the overpayment 

by deducting $250.00 every 28 days from appellant’s compensation payments.

CONCLUSION

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

of compensation in the amount of $4,180.55 for the period February 2 through March 28, 2020

because she continued to receive wage-loss compensation to which she was not entitled. The 

Board further finds that OWCP properly determined that appellant was at fault in the creation of 

the overpayment of compensation, thereby precluding waiver of recovery of the overpayment. 

However, the Board also finds that OWCP improperly required recovery of the overpayment by 

deducting $250.00 every 28 days from appellant’s compensation payments.

17 20 C.F.R. § 10.441; see A.F., Docket No. 19-0054 (issued June12, 2019); Donald R. Schueler, 39 ECAB 1056, 

1062 (1988).

18 20 C.F.R. § 10.438. See also F.B., Docket No. 21-0680 (issued February 23, 2022); A.F., id.

19 See A.S., Docket No. 19-0171 (issued June 12, 2019); Frederick Arters, 53 ECAB 397(2002).

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

6.500.8c(1) (September 2018); F.B., supra note 18; D.H., Docket No. 20-1064 (issued December 14, 2020); M.S., 

Docket No. 18-0740 (issued February4, 2019).
7

ORDER

IT IS HEREBY ORDERED THAT the July 29, 2020 decision of the Office of Workers’

Compensation Programs is affirmed in part and reversed in part.

Issued: September 23, 2022

Washington, DC

Alec J. Koromilas, Chief Judge

Employees’ Compensation Appeals Board

Patricia H. Fitzgerald, Deputy Chief Judge

Employees’ Compensation Appeals Board

Valerie D. Evans-Harrell, Alternate Judge

Employees’ Compensation Appeals Board