B-162265, JAN 20, 1972, 51 COMP GEN 419

B-162265: Jan 20, 1972

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THE HEAD OF AN AGENCY OR HIS DELEGATED REPRESENTATIVE IS AUTHORIZED TO WAIVE RECOVERY OF TRAINING COSTS EXTENDED UNDER 5 U.S.C. 4108 WHEN AN EMPLOYEE TRANSFERS TO ANOTHER AGENCY OR ORGANIZATION IN ANY BRANCH OF THE GOVERNMENT PRIOR TO COMPLETION OF AN AGREED PERIOD OF SERVICES AND GIVES NOTICE OF AT LEAST 10 WORKDAYS OF HIS INTENT TO TRANSFER. THE INSTRUCTIONS MAY BE APPLIED RETROACTIVELY WHERE THE GAINING AGENCY BENEFITS BY THE EMPLOYEE'S TRAINING AND THE WAIVER IS CONDITIONED ON COMPLETION OF THE EMPLOYEE'S OBLIGATED SERVICE BY CONTINUED EMPLOYMENT WITH HIS NEW AGENCY. SINCE THE WAIVER IS IN THE PUBLIC INTEREST AND. THE RETROACTIVE APPLICATION OF THE INSTRUCTIONS IS IMMATERIAL. WHICH WERE COLLECTED FROM EMPLOYEES WHO TRANSFERRED TO OTHER GOVERNMENT AGENCIES OR ORGANIZATIONS.

B-162265, JAN 20, 1972, 51 COMP GEN 419

OFFICERS AND EMPLOYEES - TRAINING - SERVICE REQUIREMENT - TRANSFER TO ANOTHER GOVERNMENT AGENCY - WAIVER OF TRAINING COSTS WITH THE AMENDMENT OF THE FEDERAL PERSONNEL MANUAL BY LETTER NO. 410-8, THE HEAD OF AN AGENCY OR HIS DELEGATED REPRESENTATIVE IS AUTHORIZED TO WAIVE RECOVERY OF TRAINING COSTS EXTENDED UNDER 5 U.S.C. 4108 WHEN AN EMPLOYEE TRANSFERS TO ANOTHER AGENCY OR ORGANIZATION IN ANY BRANCH OF THE GOVERNMENT PRIOR TO COMPLETION OF AN AGREED PERIOD OF SERVICES AND GIVES NOTICE OF AT LEAST 10 WORKDAYS OF HIS INTENT TO TRANSFER, AND THE LOSING AGENCY DETERMINES COLLECTION OF THE TRAINING COSTS WOULD BE AGAINST EQUITY AND GOOD CONSCIENCE OR AGAINST THE PUBLIC INTEREST, AND THE INSTRUCTIONS MAY BE APPLIED RETROACTIVELY WHERE THE GAINING AGENCY BENEFITS BY THE EMPLOYEE'S TRAINING AND THE WAIVER IS CONDITIONED ON COMPLETION OF THE EMPLOYEE'S OBLIGATED SERVICE BY CONTINUED EMPLOYMENT WITH HIS NEW AGENCY, SINCE THE WAIVER IS IN THE PUBLIC INTEREST AND, THEREFORE, THE RETROACTIVE APPLICATION OF THE INSTRUCTIONS IS IMMATERIAL. OFFICERS AND EMPLOYEES - TRAINING - FAILURE TO FULFILL OBLIGATED SERVICE - INDEBTEDNESS OF EMPLOYEE THE TRAINING COSTS PROVIDED UNDER 5 U.S.C. 4108, WHICH WERE COLLECTED FROM EMPLOYEES WHO TRANSFERRED TO OTHER GOVERNMENT AGENCIES OR ORGANIZATIONS, WITHOUT DISCHARGING THEIR SERVICE COMMITMENT, PRIOR TO THE ISSUANCE OF FEDERAL PERSONNEL MANUAL LETTER NO. 410-8, AUTHORIZING WAIVER OF THE REPAYMENT OF TRAINING COSTS IF RECOVERY WOULD BE AGAINST EQUITY AND GOOD CONSCIENCE OR AGAINST PUBLIC INTEREST, MAY NOT BE REIMBURSED TO THE EMPLOYEES, NOTWITHSTANDING THE COMPLETION OF A PERIOD OF TIME BY THE EMPLOYEE WITH THE GAINING AGENCY AT LEAST EQUAL TO THE SERVICE COMMITMENT TO THE LOSING AGENCY, AS THE WAIVER AUTHORITY EXTENDS ONLY TO THE WAIVER OF THE RIGHT TO RECOVER AND, THEREFORE, SINCE THE DEBT FOR THE TRAINING COSTS HAS BEEN EXTINGUISHED, NO RIGHT OF RECOVERY REMAINS. OFFICERS AND EMPLOYEES - TRAINING - SERVICE REQUIREMENT - TRANSFER TO ANOTHER GOVERNMENT AGENCY - ASSUMPTION OF TRAINING COSTS BY ACQUIRING AGENCY IRRESPECTIVE OF WHETHER A DETERMINATION IS MADE THAT RECOVERY IS REQUIRED OF TRAINING COSTS PROVIDED AN EMPLOYEE UNDER 5 U.S.C. 4108 AT THE TIME OF HIS TRANSFER TO ANOTHER GOVERNMENT AGENCY OR ORGANIZATION, OR WHETHER AN EMPLOYEE'S OBLIGATIONS UNDER A SERVICE AGREEMENT ARE SATISFIED BY SERVICE WITH ANOTHER AGENCY OR ORGANIZATION, THERE IS NO AUTHORITY FOR THE ASSESSMENT OF TRAINING COSTS AGAINST THE AGENCY TO WHICH AN EMPLOYEE TRANSFERS NOTWITHSTANDING THE BENEFIT OF THE EMPLOYEE'S TRAINING PAID FOR BY THE LOSING AGENCY INURES TO THE GAINING AGENCY.

TO THE SECRETARY OF DEFENSE, JANUARY 20, 1972:

THIS IS IN REFERENCE TO LETTER DATED AUGUST 6, 1971, AND ENCLOSURES, FROM THE ASSISTANT SECRETARY OF DEFENSE (COMPTROLLER) SUBMITTING FOR OUR CONSIDERATION CERTAIN QUESTIONS IN REGARD TO REPAYMENT OF COSTS INCURED FOR TRAINING PURSUANT TO 5 U.S.C. 4108 BY MR. ROOSEVELT JONES, FORMERLY EMPLOYED BY THE DEFENSE SUPPLY AGENCY (DSA). HIS LIABILITY FOR REPAYMENT AROSE BY REASON OF HIS TRANSFERRING SHORTLY AFTER COMPLETION OF TRAINING TO THE DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT (HUD) AND PRIOR TO HIS COMPLETION OF THE AGREED PERIOD OF SERVICE WITH YOUR DEPARTMENT. ADDITION TO THE SPECIFIC QUESTION CONCERNING MR. JONES, ANCILLARY QUESTIONS HAVE BEEN SUBMITTED FOR OUR DECISION.

THE PERTINENT FACTS IN REGARD TO MR. JONES ARE THAT HE COMPLETED HIS TRAINING AT GOVERNMENT EXPENSE IN JUNE 1970 AND LEFT THE DSA IN SEPTEMBER 1970 FOR A POSITION WITH HUD. THIS WAS IN VIOLATION OF HIS 3 YEAR SERVICE AGREEMENT. HE WAS ADVISED PRIOR TO HIS TRANSFER THAT HE WOULD BE HELD LIABLE FOR THE COSTS OF TRAINING WHICH AMOUNTED TO $11,382.17. AS OF THIS DATE REIMBURSEMENT HAS NOT BEEN MADE AND REQUESTS FOR WAIVER HAVE BEEN DENIED ON TWO OCCASIONS BY THE DIRECTOR, DSA.

THE QUESTIONS PRESENTED IN THE SUBMISSION WILL BE STATED AND ANSWERED IN THE ORDER PRESENTED:

(1) ASSUMING THAT THE PROVISIONS OF THE AMENDMENT TO THE FEDERAL PERSONNEL MANUAL ISSUED BY THE CIVIL SERVICE COMMISSION IN FEDERAL PERSONNEL MANUAL LETTER NO. 410-8 OF DECEMBER 17, 1970, PROVIDING FOR THE TRANSFER OF AN EMPLOYEE'S SERVICE OBLIGATIONS TO THE GAINING GOVERNMENT AGENCY OR ORGANIZATION, UNDER CERTAIN CONDITIONS, ARE AUTHORIZED UNDER THE CITED STATUTE AND COMPORT WITH THE VIEWS EXPRESSED IN YOUR LETTERS TO THE DIRECTOR OF OFFICE OF MANAGEMENT AND BUDGET, BOTH NUMBERED B-162265 DATED SEPTEMBER 21, 1970, MAY THE PROVISIONS OF THE AMENDMENT BE CONSIDERED APPLICABLE TO THIS CASE SINCE THE EMPLOYMENT OF MR. JONES BY THE DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT WAS EFFECTED IN SEPTEMBER, 1970, SOME THREE MONTHS PRIOR TO THE ISSUANCE OF THE AMENDMENT? IN THIS CONNECTION, IT APPEARS THAT IT IS THE VIEW OF THE GENERAL COUNCIL OF THE CIVIL SERVICE COMMISSION THAT THE AMENDMENT IS NOT RETROACTIVE (SEE LETTER OF FEBRUARY 11, 1971 TO THE DEFENSE SUPPLY AGENCY, COPY ENCLOSED). HOWEVER, SINCE THE REGULATION AS INITIALLY ISSUED WAS SILENT WITH RESPECT TO THE PERTINENT MATTER INCLUDED IN THE AMENDMENT, IT COULD BE ARGUED THAT THE AMENDMENT IS IN EFFECT NO MORE THAN A RECOGNITION OF A REQUIREMENT OF THE STATUTE AS IT WAS ORIGINALLY ENACTED, MAY THE AMENDMENT BE CONSIDERED AS EFFECTIVE FROM THE DATE OF ENACTMENT?

THE REGULATIONS ARE SET FORTH IN 5 CFR 410.509, REVISED AS OF JANUARY 1, 1970, AND PROVIDE IN PERTINENT PART AS FOLLOWS:

SEC 410.509 FAILURE TO FULFILL AGREEMENTS TO CONTINUE IN SERVICE.

(A)(1) EACH WRITTEN AGREEMENT UNDER SECTION 4108(A) OF TITLE 5, U.S.C. SHALL PROVIDE THAT THE EMPLOYEE COVERED THEREBY GIVE HIS AGENCY A NOTICE OF AT LEAST 10 WORKDAYS IF HE INTENDS TO ENTER THE SERVICE OF ANOTHER AGENCY OR ORGANIZATION IN ANY BRANCH OF THE GOVERNMENT BEFORE THE EXPIRATION OF THE PERIOD FOR WHICH HE AGREES TO CONTINUE IN THE SERVICE OF HIS AGENCY. EACH AGREEMENT SHALL ALSO PROVIDE THAT IF THE EMPLOYEE FAILS TO GIVE THIS ADVANCE NOTICE AND ENTERS THE SERVICE OF ANOTHER AGENCY OR ORGANIZATION IN ANY BRANCH OF THE GOVERNMENT, HE MUST REPAY THE GOVERNMENT THE AMOUNT OF THE ADDITIONAL EXPENSES INCURRED BY THE GOVERNMENT IN CONNECTION WITH THE TRAINING COVERED BY THE AGREEMENT. THE HEAD OF THE AGENCY WHICH HAS AUTHORIZED THE TRAINING MAY WAIVE IN WHOLE OR IN PART THE OBLIGATION UNDER THE AGREEMENT WHEN HE FINDS THAT REPAY-BE AGAINST EQUITY AND GOOD CONSCIENCE OR AGAINST THE PUBLIC INTEREST.

(B)(1) THE HEAD OF AN AGENCY, OR A REPRESENTATIVE ESPECIALLY DESIGNATED BY HIM FOR THIS PURPOSE, MAY WAIVE IN WHOLE OR IN PART ANY RIGHT OF RECOVERY UNDER SECTION 4108(C) OF TITLE 5, UNITED STATES CODE, WHEN HE FINDS THAT RECOVERY WOULD BE AGAINST EQUITY AND GOOD CONSCIENCE OR AGAINST THE PUBLIC INTEREST.

THE INSTRUCTIONS SET FORTH IN FPM LETTER NO. 410-8 WERE ISSUED TO BRING THEM IN CONSONANCE WITH OUR DECISION B-162265 OF SEPTEMBER 21, 1970, WHICH HELD THAT AN EMPLOYEE WHO TRANSFERS TO ANOTHER GOVERNMENT AGENCY PRIOR TO COMPLETING HIS PERIOD OF OBLIGATED SERVICE SHOULD BE RELIEVED OF LIABILITY FOR PAYMENT ONLY WHEN THE CIRCUMSTANCES OF HIS CASE FALL WITHIN THE CONDITIONS FOR WAIVER SPECIFIED IN 5 U.S.C. 4108 (C). THESE CONDITIONS ARE THAT IT BE SHOWN RECOVERY WOULD BE AGAINST EQUITY OR GOOD CONSCIENCE, OR AGAINST THE PUBLIC INTEREST.

WE NOTE THAT HUD HAS INDICATED THAT IT IS RECEIVING THE BENEFIT OF THE TRAINING MR. JONES RECEIVED WHILE EMPLOYED IN THE DEFENSE SUPPLY AGENCY. IN VIEW THEREOF WE SEE NO OBJECTION TO A (PUBLIC INTEREST) WAIVER OF MR. JONES' INDEBTEDNESS CONDITIONED ON COMPLETION OF HIS OBLIGATED SERVICE BY CONTINUED EMPLOYMENT WITH HUD. UNDER SUCH CIRCUMSTANCES THE QUESTION OF WHETHER THE INSTRUCTIONS OF THE CIVIL SERVICE COMMISSION MAY BE APPLIED RETROACTIVELY BECOMES IMMATERIAL. THE FIRST QUESTION IS ANSWERED ACCORDINGLY.

QUESTION NO. 2:

2. IN THE EVENT YOU DETERMINE THAT THE AMENDMENT WAS EFFECTIVE TO PROVIDE FOR THE TRANSFER OF THE EMPLOYEE'S SERVICE OBLIGATION TO THE GAINING AGENCY, YOUR ADVICE AND GUIDANCE IS REQUESTED WITH RESPECT TO THE ACTION TO BE TAKEN IN CASES OF THOSE EMPLOYEES WHO, WITHOUT DISCHARGING THEIR SERVICE COMMITMENTS TO THE DEPARTMENT OF DEFENSE, AND PRIOR TO THE ISSUANCE OF THE AMENDMENT HAVE TRANSFERRED TO OTHER GOVERNMENT AGENCIES OR ORGANIZATIONS WHERE THEY REMAINED FOR A PERIOD OF TIME AT LEAST EQUAL TO THE SERVICE COMMITMENT BUT WHO NEVERTHELESS HAVE REIMBURSED THE DEPARTMENT OF DEFENSE FOR THE COSTS OF THEIR TRAINING?

THE LAST SENTENCE OF 5 U.S.C. 4108(C) PROVIDES:

THE HEAD OF THE AGENCY CONCERNED, UNDER THE REGULATIONS PRESCRIBED UNDER SECTION 4118 OF THIS TITLE, MAY WAIVE IN WHOLE OR IN PART A RIGHT OF RECOVERY UNDER THIS SUBSECTION, IF IT IS SHOWN THAT RECOVERY WOULD BE AGAINST EQUITY AND GOOD CONSCIENCE OR AGAINST THE PUBLIC INTEREST.

AS TO THOSE EMPLOYEES WHO HAVE TRANSFERRED TO OTHER GOVERNMENT AGENCIES, AND AGAINST WHOM DEMAND FOR REIMBURSEMENT HAS BEEN MADE AND COLLECTION EFFECTED, THERE IS NO AUTHORITY UNDER PRESENT LAW FOR FURTHER ACTION TO BE TAKEN. THE WAIVER AUTHORITY EXTENDS ONLY TO THE WAIVER OF THE RIGHT OF RECOVERY. TO CONSTITUTE A VALID WAIVER THERE MUST BE A RIGHT OR PRIVILEGE TO BE WAIVED. JONES V CITY OF WEST PALM BEACH (1918), 79 SO. 438, 441; SAN BERNARDINO INVESTMENT CO. V MERRILL (1895), 41 P. 487, 488; 8 COMP. GEN. 664 (1929). SINCE THE DEBT HAS BEEN EXTINGUISHED, NO RIGHT OF RECOVERY REMAINS. COMPARE 5 U.S.C. 5584(C) CONCERNING OVERPAYMENTS OF PAY AND PROVIDING SPECIFIC AUTHORITY WITH RESPECT TO WAIVERS INVOLVING AMOUNTS PREVIOUSLY REFUNDED BY THE EMPLOYEE. THE AUTHORITY WITH RESPECT TO INDEBTEDNESS UNDER THE TRAINING ACT IS NOT SO EXTENSIVE. IN ANSWER TO QUESTION NO. 2, THERE IS NO BASIS IN LAW FOR FURTHER ACTION TO BE TAKEN.

QUESTION NO. 3:

3. IN THE EVENT YOUR ANSWER TO QUESTION 1 IS IN THE NEGATIVE COULD THE DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT, OR OTHER AGENCIES AND ORGANIZATIONS IN LIKE CASES, REIMBURSE THE DEPARTMENT OF DEFENSE FOR ALL OR A PROPORTIONATE SHARE OF THE COSTS OF TRAINING ON THE THEORY THAT THE BENEFIT OF SUCH TRAINING INURES TO THE DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT OR OTHER GAINING AGENCY?

IRRESPECTIVE OF WHETHER A DETERMINATION IS MADE THAT RECOVERY IS REQUIRED AT TIME OF TRANSFER OR THAT AN EMPLOYEE'S OBLIGATIONS UNDER A SERVICE AGREEMENT ARE SATISFIED BY SERVICE WITH ANOTHER AGENCY, THERE WOULD BE NO AUTHORITY UNDER THE LAW FOR THE ASSESSING OF COSTS OF TRAINING AGAINST THE AGENCY TO WHICH THE EMPLOYEE TRANSFERS.

WHEN YOUR FINAL DECISION IS REACHED ON WAIVER IN THE CASE OF MR. JONES, IT IS REQUESTED THAT YOU NOTIFY OUR OFFICE SINCE COLLECTION HAS BEEN HELD IN ABEYANCE PENDING YOUR DETERMINATION.