In the Matter of the Petition
by
WILLIAM H. COLLEY
4614 Lost Lake Lane
at
Spring, TX 77388-3966
P.S. Docket No. DCA 04-98
APPEARANCE FOR PETITIONER:
Albert E. Lum
5240 72nd Place
Maspeth, NY
11378-1516
APPEARANCE FOR RESPONDENT:
Taina Robinson
Labor Relations Specialist
United States Postal Service
600 N. Sam
Houston, TX 77067-9997
FINAL DECISION
UNDER THE DEBT COLLECTION ACT OF 1982
Petitioner, William Colley, filed a Petition for Hearing after receiving a Notice of Involuntary Administrative Salary Offsets from his supervisor, dated June 3, 2004. This Notice stated the Postal Service's intention to withhold $13,680.42 from Petitioner's salary to recover a shortage in an account for which Petitioner was accountable.
A hearing was held in Houston, Texas on September 21, 2004. The Postal Service presented testimony from three other supervisors who worked in, or performed a specific detail in, Petitioner’s post office during the time pertinent to this case, an acting manager of that post office, and an accounting supervisor. Petitioner testified in his own behalf and both sides relied on documents that had previously been filed. Also, Respondent presented one additional document during the hearing. The following findings of fact are based on the entire record.
FINDINGS
OF FACT
1. Petitioner has been a Postal Service employee for many years and completed training to become a supervisor in December 2000. At the time pertinent to this case, Petitioner was Supervisor of Customer Service at the Fairbanks Station Post Office in Houston, Texas. (Tr. 85-86).[1]
2. On December 22, 2000, Ms. Wynne and Petitioner conducted an audit of the unit reserve stock at Fairbanks for the purpose of transferring the unit reserve accountability from Ms. Wynne to Petitioner. Although Ms. Wynne did most of the counting and recording of the results, Petitioner was present throughout and signed a PS Form 3294, Cash and Stamp Stock Count and Summary, indicating that he agreed with the accuracy of the count and that the account was in balance. At that time, Petitioner accepted custody of the unit reserve account. (Tr. 11-13, 20, 87; PS Ex. 15).
3. On
4. Another audit was done by Ms. Hasan and Petitioner on September 9, 2002, this time for the purpose of transferring the unit reserve accountability from Petitioner to Ms. Hasan. This audit showed a $13,680.42 shortage. Petitioner participated in the count and signed a PS Form 3294, Cash and Stamp Stock Count and Summary, indicating that he agreed with the accuracy of the count. He did not ask that the stock be recounted. (Tr. 26-30, 38, 46-47, 94; PS Exs. 1, 3 and 5).
5. Soon after taking over the unit reserve
account, Ms. Hasan noted that the office had no PS Form 3368-P, Accountability Examination Record, a
form that shows the audit history of the account. She then created a Form 3368-P from other
available records. Her entry for the
March 6, 2001 audit shows the opening balance, the actual stock count and the
overage of $2,820.93, plus a notation that the overage was placed in AIC 057,
an accounting code indicating an overage.
(Tr. 39-41, 48; PS Ex. 6).
6. During the time Petitioner was unit reserve custodian, he returned obsolete stamp stock (“redeemed stock”) to the Stamp Distribution Office (SDO)[2] for destruction on several occasions. The procedure for doing this is for the custodian and a witness to count, verify and record on a PS Form 3238 each item being returned, by item number and value. At least two copies of the form go with the shipment, and a copy is retained by the custodian. When Petitioner became the unit reserve custodian, the procedure was that redeemed stock would not be removed from the unit reserve accountability until the Stamp Destruction Committee confirmed the accuracy of the shipment by sending back a date-stamped copy of each Form 3238. At some point since then, the procedure changed and it is now correct to remove the redeemed stock from the unit reserve accountability when it is shipped. No one at the hearing knew when this change was made. (Tr. 18-21, 32, 42, 95-96, 115; PS Ex. 21).
7. The record includes copies of twenty-one PS Forms 3238 showing redeemed stock shipped by Petitioner to the SDO for destruction in September 2001, March 2002, and June 2002. These copies of the forms are also date-stamped in November 2001, April 2002, July 2002 and August 2002, showing they were returned from Accountable Paper to Fairbanks Station on those dates. None of the stamp stock listed on these forms was listed on the unit reserve inventory at the time of the September 2002 audit. (PS Ex. 21).
8. The result of the September 9, 2002 audit was reported to the District Accounting Office as part of routine oversight through the POS computer system. The Accounting Office reviewed records to determine whether there were overages that might offset the shortage, but they found no overages on record for Fairbanks Station. They also contacted the SDO to determine whether there was any redeemed stock from Fairbanks Station that was waiting to be verified and that could be credited to Fairbanks. They were told that there was none. (Tr. 73-77, 80-82).
9. On November 7, 2002, Petitioner’s supervisor issued him a letter of indebtedness, stating that he owed the Postal Service $13,680.42 for the shortage discovered on the September 9, 2002 audit. The Notice of Involuntary Administrative Salary Offsets was issued on June 3, 2004. (Tr. 57-58; PS Exs. 4 and 12).
DECISION
The standard for determining an employee’s liability for a unit reserve shortage 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, §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.
Petitioner makes several arguments. First, he contends that he was not adequately trained to perform the duties of a unit reserve custodian. This argument is without merit. While it may be that Petitioner was not ideally qualified, there is no evidence that he did not know his responsibilities as a stamp stock custodian, that he did not willingly take on those responsibilities, or that any particular lack of training caused the shortage in issue. His general claims of ignorance with regard to procedures for managing his accountability are not a basis for relief from liability.
Next, Petitioner contends that the Postal Service suffered no loss in this case because many of the stamps he shipped to the SDO for destruction were never removed from his unit reserve inventory. As part of his argument, he points to several items listed on the inventory and on the September 2002 audit count records (PS Exs. 3 and 5), and notes that these items were obsolete stamps that normally would have been shipped as redeemed stock. Further, he points out that the audit showed “0” as being the quantity present for several of these items, and that this is consistent with the fact that he actually had shipped them for destruction.
While there is some logic to this argument, two things make it difficult to accept. First, Petitioner was able to produce no records of any such shipments to the SDO, whereas Respondent produced many records of shipments that had been properly recorded and removed from the unit reserve inventory (see Finding #7). Second, Petitioner apparently did nothing from the time of the September 2002 audit, or after receiving the letter of indebtedness in November 2002, to attempt to collect evidence to support this theory or to persuade anyone in his chain of authority that this was the explanation for the shortage. As for Petitioner’s claim that no one told him that the procedures regarding redeemed stock had been changed (see Finding #6), there is no evidence that this change, assuming it occurred before September 2002, affected his accountability.
Finally, Petitioner argues that even if Respondent has proved the alleged loss, he should get credit for the March 2001 overage. While the evidence is very thin as to how this overage was tracked in the POS system, there is evidence that it was placed into a “trust” account soon after it was found, thereby removing it from the unit reserve account (see Finding #5). Once that was done, there is no apparent relationship between the March 2001 overage and the September 2002 shortage. The general rule on offsetting overages against shortages is that an offset is not appropriate unless the evidence establishes a probable relationship between the two. The burden here was on Petitioner to show that relationship and he failed to do so. It is not appropriate to grant an offset based purely on speculation.
Respondent’s evidence is sufficient to prove the alleged loss, and Petitioner has not demonstrated any basis for relief from liability. The Petition is denied. Respondent may collect $13,680.42 from Petitioner’s salary.
Bruce R. Houston
Chief Administrative Law Judge