March 9, 2001 In the Matter of the Petition by GORDON A. HARDY P. O. Box 39 at Marshallville, GA 31057-0039 P.S. Docket No. DCA 01-5 APPEARANCE FOR PETITIONER: Gordon A. Hardy P.O. Box 39 Marshallville, GA 31057-0039 APPEARANCE FOR RESPONDENT: Daniel Smith Labor Relations Specialist United States Postal Service 451 College Street Macon, GA 31213-9401
FINAL DECISION UNDER THE DEBT COLLECTION ACT OF 1982
Petitioner, Gordon A. Hardy, filed a timely Petition after receiving a Notice of Involuntary Administrative Salary Offsets dated December 26, 2000, from his postmaster. This Notice stated the Postal Service's intention to withhold $119.72 from Petitioner's salary to recover for a shortage in his window clerk account.
A hearing was held in Macon, Georgia on February 15, 2001.1 The Postal Service presented testimony from Fay Slappey, the Perry, Georgia Postmaster at the time pertinent to this case. Petitioner testified in his own behalf, and both parties relied on documents filed with the Petition and the Answer. The following findings of fact are based on the entire record.
FINDINGS OF FACT
1. Petitioner has been a window clerk at the Perry, Georgia Post Office at least since April 1995. (Tr. 52-53; PS Form 3368, attached to Petition).2
2. On September 7, 2000, Petitioner's supervisor, Ms. Slappey, conducted a regular periodic audit of Petitioner's account. Clerk audits are required to be conducted at least every four months.3 Petitioner participated in the audit. On their first count there appeared to be an overage, but they quickly discovered that this was caused by an error Ms. Slappey had made when issuing stock sometime previously. After they made the correction and completed the count, they found Petitioner's account to be short $119.72. Petitioner signed a PS Form 3294, Cash and Stamp Stock Count and Summary, indicating his agreement with the accuracy of the count. (Tr. 10-14, 25, 70; PS Ex. 1).
3. Because it was very unusual for Petitioner to have a shortage outside the $50.00 tolerance level, Ms. Slappey agreed to do a recount after she had counted the other clerks. Ms. Slappey and Petitioner did a recount on September 13, 2000. Some counting errors were made on the first attempt at a recount, but when the recount was completed the shortage was found to be $122.24. On September 14, 2000, Ms. Slappey issued Petitioner a letter of demand for $119.72. She believed she was required to use the figure from the September 7 count because September 7 was within four months of the previous audit, but September 13 was not. (Tr. 14-24; PS Ex. 5; Pet. Exs. 3-5).
4. Petitioner's audit history from April 1995 through January 2000 shows sixteen consecutive audits on which his account was within the $50.00 tolerance level. Eight of these audits showed small overages and eight showed small shortages. On the audit immediately preceding the September 7, 2000 audit, May 10, 2000, he had an overage of $83.77. On the audit immediately following, January 3, 2001, he had an overage of $73.37. (Tr. 26, 57; PS Ex. 5; PS Form 3368, attached to Petition).
5. In order to wait on customers quickly, Petitioner and the other clerks in the Perry office often trade stamp stock among themselves without simultaneously documenting these exchanges, as is prescribed by postal regulations.4 (Tr. 57; Petition).
DECISION
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 "are held strictly accountable for any loss unless evidence establishes that they followed the postal procedures established when performing their duties." Handbook F-1, Post Office Accounting Procedures (November 1996), §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. 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. If Respondent proves a loss, 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.
Respondent's position is simply that the September 7, 2000 audit shows a loss, Petitioner agreed to the accuracy of the count, and Petitioner has shown no relationship between this shortage and his overages on May 10, 2000 and January 3, 2001.
Petitioner makes several arguments. First, he maintains that it is standard practice in other post offices that overages and shortages on consecutive audits automatically be offset against one another. Petitioner's evidence on this point was only his own recitation of what he says other people told him. Although some hearsay evidence is accepted in Debt Collection Act proceedings, this particular evidence is not persuasive in the face of Ms. Slappey's testimony that such offsets are not automatic in the Perry Post Office. This testimony is also consistent with Postal Service regulations on the subject. Handbook F-1, Post Office Accounting Procedures (November 1996), §429.16, although giving postmasters some latitude in exercising judgment, requires that there be a showing of some relationship between an overage and a shortage before there can be an offset. There is no evidence of any relationship in this case.
Petitioner next argues that because Ms. Slappey made several errors in conducting the original count and the recount, the results are of questionable validity. The flaw in this argument is that all the errors he identified were either corrected before the bottom line was reached, or worked to his advantage. In addition, Petitioner did sign the count form, indicating his agreement with the accuracy of the bottom line.5
Petitioner also makes some complaints about Ms. Slappey's management of the office and points to some irregularities in her adherence to rules regarding issuance of stock. The evidence does not show that any of these matters had any effect on the shortage with which Petitioner is charged, however.
Although the issue of whether Petitioner followed established procedures in managing his stock was discussed during a telephone conference on February 1, 2001, in terms of the burden of proof being on the employee, Petitioner did not argue this point, and presented no specific evidence to show that he did follow established procedures. His sustained record of having no previous shortages outside the tolerance level is commendable,
but that alone is not sufficient to relieve him of liability under the quoted standard, particularly when the evidence shows that he did not always follow required procedures in exchanging stock with other clerks.
The Petition is denied. Respondent may collect $119.72 from Petitioner's salary.
Bruce R. Houston Chief Administrative Law Judge
2 References to the hearing transcript are "Tr._." References to documents attached to the Postal Service Answer will be "PS Ex._." References to supplemental documents submitted by Petitioner will be "Pet. Ex._."
3 Handbook F-1, Post Office Accounting Procedures (November 1996), §429.1.
4 Handbook F-1, Post Office Accounting Procedures (November 1996), §422.22.
5 The signatures on the Form 3294 show it being dated on September 7, 2000. Petitioner insists that he and Ms. Slappey did not actually sign the Form 3294 until September 14, 2000, after they did the recount, and that Ms. Slappey used the September 7 date to bring the count within the four-month requirement. It is not necessary to resolve this conflict. I find no merit in Petitioner's argument that the audit was invalid because it was not completed until September 14. The September 7 count satisfied the requirement that the audit be done within four months.