FINAL DECISION UNDER THE DEBT COLLECTION ACT OF 1982

Petitioner, Jasvinder K. Virk, a window clerk, filed a Petition requesting a hearing under the Debt Collection Act after receiving a Notice of Involuntary Administrative Salary Offsets stating the Postal Service’s intention to make deductions from her salary to recover for a shortage occurring in her accountability.

At Petitioner’s request, an oral hearing was held. The parties, witnesses and court reporter were at Respondent’s Sherman Oaks Post Office in Sherman Oaks, California, and the Hearing Official participated by telephone from the Judicial Officer

Department in Arlington, Virginia. The parties presented documents and testimony of witnesses at the hearing and submitted written briefs thereafter.

An earlier proceeding, P.S. Docket No. DCA 00-282, addressing the same alleged debt, was dismissed to allow the parties to proceed under the grievance process. That process concluded without a resolution, and Petitioner filed a new Petition when Respondent began deductions from her salary on account of the alleged debt. Documents filed in the earlier proceeding were identified as exhibits in this proceeding. The following findings of fact are based on those documents as well as documents submitted in this proceeding and the testimony of the witnesses at the hearing.

FINDINGS OF FACT

1. In 1998, Petitioner became a window clerk at the Sherman Oaks Post Office after working about ten years as a letter carrier (Transcript of Hearing, Pages (“Tr.”) 17, 179; Exhibit (“Exh.”) 23).

2. Petitioner received standard training for window clerks in May of 1998 (Tr. 154; Exh. 12), and during the on-the-job training follow-up at the Sherman Oaks Post Office, her instructor rated her performance as a window clerk to be “Superior”, the highest rating (Tr. 146-147, 163; Exh. 33). She was first assigned a window credit in August 1998 (Tr. 154, 205; Exh. 4).

3. A count of Petitioner’s window credit on May 25, 1999, revealed that it contained stamps and accountable paper totaling $2,117.53 less than should have

been on hand according to the records of the station (Exh. 6). Petitioner stipulated that the count was accurate (Tr. 10; Order dated September 23, 2002).

4. The count of Petitioner’s credit immediately preceding that of May 25 was conducted on April 22, 1999, and reflected an overage of $247.10. That amount was entered in trust, thereby establishing Petitioner’s official accountability as the amount of stock revealed in the count. (Tr. 67, 74; Exh. 4, 5). The count following that of May 25 was conducted on June 18, 1999, and revealed an in-tolerance overage of $24.07 (Tr. 157-158; Exh. 4, 10). Of the eight audits of Petitioner’s accountability conducted between August 1998 and February 2000, besides the audit of May 25, 1999, at issue in this proceeding, all but two or three were within tolerance.[1] (Tr. 19, 80, 155-156, 159-160; Exh. 4, 18).

5. Respondent issued Petitioner a Notice of Involuntary Administrative Salary Offsets on July 12, 2000, stating its intention to collect $2,117.53 from her salary involuntarily due to the May 25, 1999 shortage. Petitioner had been issued a Letter of Demand for the debt on July 1, 1999. (Exh. 1, 3, 22).

6. When exchanging stock with other window clerks, it was Petitioner’s practice always to use a PS Form 17, the established procedure for recording such exchanges (Tr. 193-195; Exh. 34).

7. Postal Service regulations required Petitioner to maintain copies of the records of her daily financial transactions, e.g. 1412s and 17s, at least until her next audit (Postal Service Handbook F-1, Post Office Accounting Procedures (November 1996), Section 221.12 9b). Petitioner did so for the period leading up to the May 25, 1999 audit (Tr. 118, 120, 187-188; contra Tr. 31, 45-46).

8. Petitioner was careful in her work, was very accurate and was one of the best window clerks in the Sherman Oaks Post Office (Tr. 151, 181, 189, 190, 192). The accuracy of her work and knowledge of post office requirements were held in high regard by fellow clerks who had occasion to observe her work (Tr. 101, 128-129, 132-133, 135). She maintained adequate security for her stock and never left her drawer unattended (Tr. 128-129, 132-133). Petitioner has never been told by a supervisor that she was not following required procedures (Tr. 190, 192).

9. Postal Service regulations establish the standard for liability of a window clerk for a loss to her assigned accountability:

“Employees 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), Section 141).

DECISION

On May 25, 1999, Petitioner’s window credit was short by $2,117.53 (Finding 3). Thus, Respondent has met its burden of demonstrating a loss in that amount to an account for which Petitioner was responsible (Findings 2, 3, 9). Accordingly, the burden shifts to Petitioner to show that she followed established procedures, or to present other evidence that would warrant relieving her of liability (Finding 9).

Petitioner presented evidence that she followed established procedures in managing her window credit. She was found to be a superior trainee in her on-the-job window clerk training just a year before the shortage occurred (Finding 2). She followed proper procedures when exchanging stamps with fellow clerks (Finding 6). She was known to be careful and accurate in her work at the window, and she maintained adequate security for her stock (Finding 8). She maintained the daily financial transaction records Postal Service procedures required her to maintain (Finding 7).

Respondent relies on Petitioner’s audit history to support its argument that she did not follow established procedures. However, the two or three out-of-tolerance audits between August 1998 and February 2000 do not overcome Petitioner’s evidence that she followed established procedures.[2]

Respondent argues that the liability provision in Section 141 of the F-1 Handbook (Finding 9) relieves the employee of liability only if she can show that she followed established procedures with respect to the particular loss that occurred and that in this case Petitioner has not done so. However, because it is not known specifically what caused the shortage in Petitioner’s window credit, if the second part of the standard from the F-1 Handbook (Finding 9) is to have any meaning at all, it is

necessary to look at the employee’s general financial management of her credit within the relevant time period. Where, as here, the preponderance of the evidence shows that Petitioner is accurate and careful in her work and that she follows established procedures when recording transactions, exchanging stock with other clerks, securing her stock, etc. (Findings 2, 6, 7, 8), she will be relieved of liability.

Accordingly, Petitioner is not liable for the shortage. The Petition is granted.[3]

Norman D. Menegat

Administrative Judge

[1] Audits of April 7 and April 22, 1999, reflected overages of about the same amount ($270.22 on April 7 and $247.10 on April 22). Although the station’s records indicate the April 7 overage was put into trust, it was not clear from the testimony at the hearing whether this was done. If not, the April 22 overage would be virtually the same overage as that of April 7 instead of a different overage. (Exh. 4).

[2] Respondent argues that even if the April 22 audit is not counted as an out-of-tolerance audit (See Finding 4, note 1), Petitioner’s failure to put the overage from the April 7 audit into trust demonstrates she failed to follow established procedures. Adding that possibility into the mix does not overcome Petitioner’s evidence.

[3] Petitioner argued that she should be relieved of liability because of inadequate security at the Sherman Oaks Post Office. While the evidence submitted did not establish that security was inadequate, in view of the determination that she followed established procedures and was, therefore, not liable for the loss, we need not address those arguments in any detail.