In the Matter of the Petition by  	) July 9, 1998
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SUSAN K. ISABEL    			)
5356 W. 17th Avenue   			)
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 at     				)
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Lakewood, CO  80214-1730  		) P.S. Docket No. DCA 98-176


APPEARANCE FOR PETITIONER: 		Susan K. Isabel
      					5356 W. 17th Avenue
      					Lakewood, CO 80214-1730

APPEARANCE FOR RESPONDENT: 		Jon P. Inglis
      					Labor Relations Specialist
      					United States Postal Service
      					7500 E. 53rd Place
      					Denver, CO 80266-2249

Petitioner, Susan K. Isabel, filed this Petition after receiving a Notice of Involuntary Administrative Salary Offsets dated March 30, 1998, from the Denver District Finance Office. This Notice stated the Postal Service's intention to withhold $238.52 from Petitioner's salary to recover for shortages in stamp stock for which Petitioner was accountable.

A hearing was held in Denver, Colorado on June 4, 1998. The Postal Service presented testimony from Mr. Trujillo, Petitioner's supervisor, and Mr. Darden, the station manager who performed the audit that disclosed the shortage. Ms. Isabel testified in her own behalf, and also presented testimony from four other clerks, and Ms. Mendrick, her union representative.⁽¹⁾ Both parties also relied on documentary evidence attached to the Petition and Respondent's Answer, and Petitioner presented some additional documents.⁽²⁾ Both parties made an oral summation at the close of the hearing. The following findings of fact are based on the entire record, including observation of the witnesses and their demeanor.

1. Petitioner, Susan Isabel, was a window clerk at the Sunnyside Post Office in Denver, Colorado during the times pertinent to this case. She has been a postal employee for several years and has worked as a window clerk at other post offices.

2. Larry Trujillo came to Sunnyside as the Customer Service Supervisor in November 1996 (Tr. 10, 15). Prior to this time there had been a number of different supervisors for short periods and there had been many shortages in window clerk accounts (Tr. 103, 122). There were also many employee complaints about security in connection with these shortages, and several employees, including Petitioner, filed grievances and were absolved of responsibility for the shortages (Tr. 12-13, 50, 66, 116).

3. Mr. Trujillo's stated intention was to change all the clerks' locks at the time they were audited, in order to cure any security problems that might exist, and thereby forestall any further shortages being excused by claims of poor security (Tr. 11-12, 50). He also informed the clerks that if they had any security problems they should prepare a written memo, sign and date it, and get him or another supervisor to sign it (Tr. 11, 12-13).

4. Petitioner was audited on December 27, 1996, and found to have a shortage of $1,562.02 (Tr. 13, 22, 66). She was issued a Letter of Demand for this amount, but based on a formal grievance citing security problems, management and her union agreed to a settlement on February 10, 1997, that absolved Ms. Isabel of all but $100.00 of this shortage (Tr. 66, 86; Pet. Exs. "E" and "F").

5. On January 8, 1997, Ms. Isabel left a handwritten note on Mr. Trujillo's desk, asking that her locks be changed (Tr. 68; Pet. Ex. "I"). Although she did not follow Mr. Trujillo's instructions (see FOF # 3), and Mr. Trujillo does not recall seeing this note, the Manager of Sunnyside Branch, Mr. Darden, did receive the note (Tr. 56-57).

6. The locks on Petitioner's cash drawer and safe compartment were not changed until February 4, 1997. The lock on her envelope drawer was changed on February 12, 1997. (Tr. 68-69, 104, 111-12).

7. Petitioner was next audited on April 17, 1997, and was found to be $477.03 short (Tr. 49, 66; Rx. 1). She was issued a Letter of Demand for this amount and again filed a grievance. Management and the union agreed to cut the amount in half, but Petitioner declined to accept this and filed her Petition.⁽³⁾

8. In addition to her service as a window clerk at Sunnyside, Petitioner also worked as a window clerk at other stations in Denver, for a total of about seven years (Tr. 78). This included two and one-half years at Terminal Annex Finance Station immediately prior to her service at Sunnyside, and another two months at Terminal Annex in the fall of 1997 after she left Sunnyside. During that time she was audited ten times and was within tolerance (less than $50.00 over or short) all but once.⁽⁴⁾ (Tr. 77-78, 91, 140; Pet. Exs. "V" and "W"). In the opinion of her supervisor at Terminal Annex, Ms. Isabel conducted her window clerk duties responsibly, including safeguarding her stamp stock by always keeping her drawers and safe compartment locked (Tr. 139-40).

The standard for determining an employee's liability in a case such as this provides that employees to whom postal funds and accountable paper are consigned (such as Petitioner) "are held strictly accountable for any loss unless evidence establishes that they followed the postal procedures established when performing their duties." Postal Service Handbook F­1, Post Office Accounting Procedures (November 1996), Section 141. Respondent's burden of proof in a case of unexplained shortage is to show that a loss occurred from an account for which the employee is accountable. Respondent is not required to prove any specific dereliction, or act of negligence, by Petitioner. When a properly conducted inventory, or audit, shows a stock shortage relative to a previously established balance, this constitutes proof of loss unless other evidence raises sufficient doubt about the accuracy of the inventory or the previously established balance, or otherwise suggests that there may have been no actual loss. In this case there is no such evidence, and a loss of $477.03 is established. The burden then shifts to the employee to show that he or she followed established procedures, or to present other evidence that would warrant relieving the employee of liability.

Petitioner does not dispute the fact that she was accountable for the stock in question. She makes two arguments, which she contends should relieve her of liability. First, she argues that management failed in its responsibility to provide a secure environment for maintaining her stamp account. She cites the testimony of the other clerks, Ms. Mendrick and herself as establishing that there were significant security problems involving clerks' keys and locks prior to the changes made by Mr. Trujillo. The fact that she was absolved of a $1,462.02 shortage in December 1996 amounts to an admission by management, she says, that these security problems were real. Therefore, because her locks were not changed until February 1997, she asserts that these same security problems could have caused the shortage discovered in April 1997. Second, she argues that she exercised reasonable care and followed proper procedures throughout her many years as a window clerk.

Respondent acknowledges that there may have been some security problems at Sunnyside before Mr. Trujillo's arrival, but argues that he immediately began correcting them and that Petitioner has failed to prove any likelihood that her shortage was caused by lack of security. Respondent argues that the standard for employee liability creates a presumption, when there is a stock shortage, that the employee has not followed established procedures and that Petitioner in this case has not rebutted that presumption.

As to the security issue, even though Petitioner's evidence on when her locks were changed is more persuasive than that presented by Respondent, it is not at all clear that this was a likely cause of the April 17, 1998 shortage. It is not necessary to resolve that issue, however, as I find that Petitioner has carried her burden of establishing that she followed established procedures in managing her stamp stock. She testified directly that she did so; she was supported in this regard by a former supervisor; and her past audit history at the Terminal Annex Station also supports her to some extent. Respondent presented no evidence to contradict her. The fact that she had a shortage does not, by itself, show that she failed to follow procedures.

The Petition is sustained. Respondent may not collect $477.03 from Petitioner's salary.

     					Bruce R. Houston
      					Chief Administrative Law Judge 

2. These documents are cited herein as “Pet. Ex. _,” and “Rx. _.” Citations to the hearing transcript are “Tr._.”

3. At the hearing, Respondent’s representative stated that it was Respondent’s intention to collect the entire $477.03. The regulation, Employee and Labor Relations Manual (ELM), §462.22c., makes it clear that the Postal Service may do this, but whether they may do it without amending the Notice of Involuntary Administrative Salary Offsets, or in some other way informing the employee of this intention, is not clear. It is not necessary to decide this issue in this case.

4. She was short $55.73 on January 30, 1995.