July 21, 2003
In the Matter of the Petition by
SAN HUEI WANG
295 Greenwich Street, Apt. 5J
at
New York, NY 10007-1051
P.S. Docket No. DCA 03-220
APPEARANCE FOR PETITIONER:
Joann McNeill
421 8th Avenue, Room 1045
New York, NY 10199-9998
APPEARANCE FOR RESPONDENT:
Valerie Rooks
Labor Relations Representative
United States Postal Service
421 8th Avenue, Room 3505
New York, NY 10199-9401
FINAL DECISION UNDER THE DEBT COLLECTION ACT OF 1982
Petitioner, San Huei Wang, filed a timely Petition for Hearing after receiving a Notice of Involuntary Administrative Salary Offsets from her supervisor on May 14, 2003. This Notice stated the Postal Service's intention to withhold $448.49 from Petitioner's salary to recover a shortage in an account for which Petitioner was responsible.
A hearing was held in New York City on July 7, 2003.[1] The Postal Service presented testimony from two supervisors, Belinda Hill and Brian Steele. Petitioner testified in her own behalf and both parties relied on documents filed prior to the hearing. The following findings of fact are based on the entire record.
FINDINGS OF FACT
1. Petitioner has been a window clerk since 1994. At the time pertinent to this case, she worked at the James A. Farley Post Office in New York City. (Tr. 9, 78).[2]
2. On March 6, 2001, Petitioner’s supervisor, Mr. Steele, conducted an audit of Petitioner’s account and found it to be short $448.49. Petitioner was present and participated in the count. (Tr. 24, 65-66; PS Exs. 2, 5 and 6).
3. Petitioner’s audit history shows that she had twenty previous audits between November 1995 and March 2001. One of those, in January 1998, shows a shortage in excess of $340, but all others show small shortages within the acceptable tolerance level, or overages, most of which are within the tolerance level. An audit on July 12, 2000 showed a $339.75 overage. After each audit, Petitioner’s account was put back in balance before any additional transactions were entered. (Tr. 35-37, 61; PS Exs. 6 and 7).
4. Mr. Steele issued Petitioner a Letter of Demand for $448.49 on May 18, 2001. It is unclear what, if anything, happened regarding this alleged debt in the meantime, but Ms. Hill issued Petitioner the Notice of Involuntary Administrative Salary Offsets on May 14, 2003. (Tr. 22; PS Exs. 1 and 4).
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. 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. 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 audit was properly conducted and showed a shortage, and that Petitioner has shown no basis for relief from liability.
Petitioner presented several arguments, most of which do not require much discussion. First, Petitioner points to the $339.75 overage found in her account in July 2000 (see Finding of Fact #3), and suggests that this should be offset against the March 2001 shortage. However, Petitioner’s account was put back in balance after the July 2000 audit, and there was an intervening audit in November 2000, at which time the account was very nearly in balance. It is Petitioner’s burden to demonstrate a relationship between her shortage and the previous overage and she has not done so.
Next, Petitioner makes reference to some security problems reported by various other clerks in the Farley Building, and to records showing several other clerk shortages in 1999 and 2000 (Pet. pp. 37-42, 50-51). Petitioner made no showing, however, as to how any of these matters might be related to the shortage that is in issue in this case.
The more difficult issue here is whether Petitioner has met her burden of demonstrating that she followed prescribed postal procedures in performing her duties and should be relieved of liability under that clause of the liability standard quoted from the F-1 Handbook. Petitioner claimed to have no recollection of the March 2001 audit or shortage, and presented no independent evidence that she routinely followed prescribed procedures. However, she testified that she always locked up her stamps and money each night, and that she was very careful in maintaining control of her cash and stamps (Tr. 73).
Petitioner’s testimony is supported to some extent by the testimony of Mr. Steele. Mr. Steele’s position was that a shortage in an employee’s account, without evidence of a security problem or equipment malfunction, leaves no explanation other than that the employee failed to exercise proper care. Nevertheless, he testified that he had no information of any instance when Petitioner had not followed proper procedures (Tr. 53-55). As Petitioner’s supervisor, it is presumed that he would be aware of such information.
As we have said many times, an unexplained shortage, by itself, does not demonstrate that an employee failed to follow procedures or exercise reasonable care. If it did, the last phrase of the standard in the F-1 Handbook would be meaningless. Respondent presented no other evidence to contradict Petitioner’s assertion that she exercised reasonable care,[3] and her audit history does not negate her contention that she was careful in managing her accountability.
Petitioner has met her burden of showing that she should be relieved of liability because she followed established postal procedures in performing her duties. The Petition is granted. Respondent may not collect $448.49 from Petitioner’s salary.
Bruce R. Houston
Chief Administrative Law Judge
[1] The hearing was conducted by the undersigned Administrative Law Judge via speaker telephone from Arlington, Virginia. All other participants, including the court reporter, were present in a conference room at the hearing site.
[2] References to the hearing transcript are “Tr._.” References to documents attached to Respondent’s Answer and two additional documents submitted by Respondent will be “PS Ex._.” References to documents submitted by Petitioner will be referenced by page number, “Pet. p._.”
[3] The current Handbook F-1, quoted above, states that an employee may be relieved of liability if ". . . evidence establishes that they followed the postal procedures . . .." An earlier version of the Handbook F-1 used the phrase "exercised reasonable care," which is also still used in the labor agreement. For purposes of this case, it is assumed that these standards are not different.