Request for Waiver of Overpayment

An employee of the Department of the Army appealed a decision which partially denied his request for waiver of an overpayment. The previous decision allowed waiver of an amount representing the value of compensatory leave taken by the employee that caused his aggregate rate of pay, for the pay periods in which it was earned, to exceed the maximum rate for his pay grade under the limitation on receipt of premium pay. The decision disallowed an amount which the employee received as payment for unused compensatory leave with which he was improperly credited for overtime work in excess of the same limitation on receipt of premium pay. The employee claimed that the Government was in the process of raising the maximum rate at the time of payment, and that he had no reason to believe that the payment was erroneous. It was held that since the payment was made over 2 months before the pay raise became effective, the employee had reason to know that any additional pay would cause his pay to exceed the statutory maximum. Consequently, the disallowance was sustained.