In the Matter of the ) March 21, 1995
Petition by )
)
RAYMOND J. VOISINE )
19277 Canyon Drive )
)
at )
)
Villa Park, CA 92667-2328 ) P.S. Docket No. DCA 95-22
APPEARANCE FOR PETITIONER: Clete Weiser, Esq.
P.O. Box 382774
Germantown, TN 38183-2774
APPEARANCE FOR RESPONDENT: Virginia Y. Malone
Sr. Labor Relations Specialist
United States Postal Service
15421 Gale Avenue
City of Industry, CA 91715-9342
Petitioner, Raymond J. Voisine, filed a Petition for a hearing based solely on written submissions after receiving a Notice of Involuntary Administrative Salary Offsets Under the Debt Collection Act. Petitioner received a retirement incentive payment when he retired from the Postal Service in 1992. His retirement was subsequently invalidated, and Petitioner was reinstated as an employee of the Postal Service. The January 12, 1995 Notice of Involuntary Administrative Salary Offsets asserted the Postal Service's intention to make deductions from Petitioner's salary to recover the amount of the retirement incentive payment.
FINDINGS OF FACT
1. In 1992, Respondent, in order to restructure its workforce, offered each employee who was eligible to retire and did so an incentive payment equal to one-half the employee's annual salary. Also, for a limited period, Respondent reduced the time in service necessary to be eligible to retire.
2. Respondent advised Petitioner that he was eligible to retire under the lower service requirements and apprised him of the conditions of his retirement (Petitioners Exhibit ("PX") B; Respondent's Exhibit ("RX") 9, p. 3). Petitioner had prior military service that was counted toward meeting his federal service requirements. He specifically discussed his military service with Respondent's officials and was assured that his military service plus other federal time was sufficient to qualify him for retirement.
3. Petitioner retired effective November 20, 1992 (RX 9 p. 5 (Form 50)) and received a retirement incentive payment of $18,066.17, which equaled one-half his annual salary net of taxes. Petitioner used the payment to pay off existing debt.
4. On February 12, 1993, Petitioner was advised by Office of Personnel Management that his retirement had been disallowed because he did not meet the time-in-service requirement. Certain of Petitioner's time in the military was not creditable toward his total federal service for retirement purposes, and after that time was deducted he did not have sufficient service to be eligible for the early retirement offer. (PX D; RX 6, 9 pp. 6-8). Petitioner was restored to Postal Service employment effective February 17, 1993, and currently serves as a postmaster.
5. The Postal Service initially awarded Petitioner back pay equal to the annuity payments he had received before he was reinstated. On July 22, 1994, however, Respondent decided to award Petitioner full back pay to the date he was reinstated. The amount of this additional back pay payment was credited against the amount of the retirement incentive payment Petitioner had received, leaving a balance of $14,207.35 claimed by the Postal Service. (PX A; RX 2, 4, 10).
6. Subchapter 437 of the Employee and Labor Relations Manual (Issue 12, 5189)("ELM"), Waiver of Claims for Erroneous Payment of Pay, describes the circumstances under which an employee may apply for and be granted a waiver of repayment of an erroneous payment of pay (RX 7). After review by the employee's managing office, the request is to be forwarded to the Minneapolis Postal Data Center. Section 437.6 of the ELM describes the issues relevant to a waiver request:
"437.6 Action by Postal Data Center (PDC)
The PDC will waive the claim if it can determine from a review
of the file that all of the following conditions are met:
a. The overpayment occurred through administration error of
the USPS. Excluded from consideration for waiver of collection
are overpayments resulting from errors in timekeeping, keypunching,
machine processing of time cards or time credit, coding, and any
typographical errors that are adjusted routinely in the process
of current operations.
b. Everyone having an interest in obtaining a waiver acted
reasonably under the circumstances, without any indication of
fraud, misrepresentation, fault, or lack of good faith.
c. Collection of the claim would be against equity and good
conscience and would not be in the best interest of the USPS."
(RX 7).
7. In July, 1994, Petitioner filed a request that the Postal Service waive repayment of the difference between Petitioner's retirement incentive and the back pay awarded for the period until he was reinstated (RX 10). In his referral of the request to the Minneapolis Postal Data Center, Petitioner's District Manager wrote, "I believe it would be in everyone's best interest to waive the remaining moneys owed by Mr. Voisine." In prior correspondence on the subject, which he included with the July 14 waiver request, the District Manager had stated,
"Due to the obvious hardship caused by Mr. Voisine's retirement
cancellation, I believe that it would be in everyone's best interest
to waive the remaining [] debt. Mr. Voisine is a valued employee,
who 'missed out' on numerous promotion opportunities during his
temporary retirement. Under these circumstances, I feel that
the collection of this debt 'would be against equity and good
conscience and would not be in the best interest of the Postal
Service.'" (PX E; RX 10).
8. In a July 22, 1994 letter, the Manager, Compensation and Benefits, Employee Relations, at Postal Service Headquarters, advised the District Manager that the waiver would not be granted (RX 2).
9. In a July 28, 1994 letter to Petitioner, the Accounting Service Center of the Minneapolis PDC denied his waiver request (RX 11). Petitioner appealed the denial, and, on September 12, 1994, the Accounting Service Center advised Petitioner that his appeal was denied (RX 13). In none of the three responses regarding the waiver did the author address whether "[c]ollection of the claim would be against equity and good conscience and would not be in the best interest of the USPS." Each focussed on Petitioner's receipt of the retirement incentive which he was not entitled to because his retirement was cancelled.
10. After his appeal was denied, Petitioner proposed a repayment schedule that would have resulted in recovery of the indebtedness from his pay over approximately nine years (RX 14). Respondent, on December 9, 1994, advised Petitioner that nine years was too long, and asked Petitioner to submit evidence regarding his financial circumstances to allow Respondent to evaluate the hardship that the repayment schedule it proposed would cause Petitioner (RX 15). Petitioner did not respond.
11. Respondent issued a Notice of Involuntary Administrative Salary Offsets on January 12, 1995, stating Respondent's intention to deduct $250 from each of Petitioner's paychecks, beginning February 18, 1995, until the amount of $14,207.35 was recovered. Respondent estimated full recovery would take just over two years (RX 5). This Petition followed.
DECISION
Petitioner has not argued that the recalculation of his time in service was incorrect or that he was eligible to retire in November of 1992. Because Petitioner was not eligible to retire, he was not entitled under Respondent's retirement incentive program to the bonus payment he received. Petitioner has not challenged the calculation of the back pay award credited against the indebtedness, and Respondent has demonstrated the accuracy of its calculation of the amount claimed. That being the case, Petitioner is indebted to the Postal Service in the amount claimed, $14,207.35. Persons who receive monies erroneously paid by the Postal Service acquire no right to keep the funds. See DiSilvestro v. United States, 405 F.2d 150, 155 (2d Cir. 1968) cert. denied 396 U.S. 964 (1969).
Petitioner has raised the same equitable arguments in this proceeding that he made in support of his request that Respondent waive repayment of the indebtedness. However, this Debt Collection Act proceeding is a process distinct and quite different from the waiver of indebtedness process of the ELM. I have no authority to determine that a debt owed Respondent should be waived. See Karen M. Ennis, P.S. Docket No. DCA-33, August 29, 1989.
Nevertheless, it is appropriate to note that the standards set forth in the ELM for considering waivers were not applied to Petitioner's waiver request. In Petitioner's request for a waiver under the ELM, he and his District Manager argued that Petitioner had acted reasonably throughout the retirement application process, that the errors were made by Respondent's officials, and that the errors, Petitioner's reinstatement and Respondent's collection efforts over the last two years caused Petitioner emotional and financial hardship. However, as reflected in this record, it does not appear that any of those persons considering his waiver request and appeal did more than ascertain that Petitioner received a payment that he was not entitled to. Limiting review to whether Petitioner was entitled to the incentive when his retirement was cancelled misses the point of the waiver process of ELM 437. All waiver requests presumably involve payments that the employee was not entitled to. Under ELM 437.6, the focus should have been on whether requiring Petitioner to repay the retirement incentive "would be against equity and good conscience and would not be in the best interest of the USPS." Respondent may wish to reconsider Petitioner's waiver request.
In late 1994, Petitioner briefly negotiated with Respondent regarding the repayment schedule but failed to submit the financial information Respondent requested to allow it to assess any hardship that might affect Petitioner's ability to meet Respondent's repayment schedule. In this proceeding, Petitioner has not offered an alternate schedule or demonstrated hardship associated with Respondent's schedule, and, therefore, there is no basis for altering the repayment schedule proposed by Respondent in the Notice of Involuntary Administrative Salary Offsets.
The Petition is denied. Petitioner is indebted to Respondent in the amount of $14,207.35.
Norman D. Menegat
Administrative Judge