B-171256, DEC. 22, 1970

B-171256: Dec 22, 1970

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WHERE EMPLOYEE OF INTERNAL REVENUE SERVICE WAS GIVEN A STEP INCREASE PRIOR TO THE TIME HE WOULD BE ENTITLED THERETO. HE COULD HAVE BEEN EXPECTED TO BE AWARE OF THE ERROR. HE IS REQUIRED TO MAKE AN INQUIRY AS TO THE CORRECTNESS OF THE PAYMENT IN ORDER TO MAINTAIN A GOOD FAITH POSTURE. WHO ASSURED HIM THE INCREASE WAS PROPER. SANFORD KARO: THIS IS IN REFERENCE TO YOUR LETTER OF AUGUST 10. WHICH REQUEST WAS THE SUBJECT OF OUR JUNE 15. YOU WERE ERRONEOUSLY ADVANCED TO STEP 5 OF GS-12. YOU WERE OVERPAID IN THE AMOUNT OF $388.80. NORRIS IS UNABLE TO RECALL THE PARTICULAR DISCUSSION. STATED IN A MEMORANDUM TO THIS OFFICE THAT WHERE AN EMPLOYEE RAISES SUCH A QUESTION IT IS HER USUAL PRACTICE TO CHECK WITH THE ADMINISTRATIVE OFFICER.

B-171256, DEC. 22, 1970

WAIVER OF ERRONEOUS PAYMENT DECISION WAIVING THE CLAIM OF THE U.S. AGAINST SANFORD KARO FOR $388.80 ERRONEOUS PAYMENT OF SALARY. WHERE EMPLOYEE OF INTERNAL REVENUE SERVICE WAS GIVEN A STEP INCREASE PRIOR TO THE TIME HE WOULD BE ENTITLED THERETO, AND HE COULD HAVE BEEN EXPECTED TO BE AWARE OF THE ERROR, HE IS REQUIRED TO MAKE AN INQUIRY AS TO THE CORRECTNESS OF THE PAYMENT IN ORDER TO MAINTAIN A GOOD FAITH POSTURE. WAIVER OF OVERPAYMENT UNDER THIS STANDARD MUST DEPEND UPON THE FACTS EXISTING IN THE PARTICULAR CASE, AND WHERE EMPLOYEE BROUGHT THE MATTER TO THE ATTENTION OF HIS SUPERVISOR, WHO ASSURED HIM THE INCREASE WAS PROPER, THE CLAIM MAY BE WAIVED.

TO MR. SANFORD KARO:

THIS IS IN REFERENCE TO YOUR LETTER OF AUGUST 10, 1970, WHEREIN YOU ASK FURTHER CONSIDERATION OF YOUR REQUEST FOR WAIVER OF ERRONEOUS PAYMENT OF PAY AS AN EMPLOYEE OF THE INTERNAL REVENUE SERVICE, DEPARTMENT OF THE TREASURY, WHICH REQUEST WAS THE SUBJECT OF OUR JUNE 15, 1970, LETTER TO YOUR AGENCY.

THE RECORD INDICATES THAT ON MARCH 24, 1968, YOU WERE ERRONEOUSLY ADVANCED TO STEP 5 OF GS-12, ONE YEAR PRIOR TO ELIGIBILITY, AS A RESULT OF WHICH, FROM THAT DATE UNTIL MARCH 22, 1969, YOU WERE OVERPAID IN THE AMOUNT OF $388.80. SINCE A FELLOW EMPLOYEE HAD ADVISED YOU THAT AT THAT TIME YOU WOULD NOT BE ENTITLED TO A STEP INCREASE, YOU STATE THAT WHEN YOU RECEIVED NOTIFICATION OF THE INCREASE YOU INQUIRED OF YOUR SUPERVISOR, MRS. NORRIS, AS TO YOUR ENTITLEMENT AND THAT SHE CHECKED HER RECORDS AND ASSURED YOU OF THE CORRECTNESS OF THE ACTION. MRS. NORRIS IS UNABLE TO RECALL THE PARTICULAR DISCUSSION, BUT STATED IN A MEMORANDUM TO THIS OFFICE THAT WHERE AN EMPLOYEE RAISES SUCH A QUESTION IT IS HER USUAL PRACTICE TO CHECK WITH THE ADMINISTRATIVE OFFICER. YOU STATE FURTHER THAT, IN RELIANCE ON HER HAVING VERIFIED THE CORRECTNESS OF THE INCREASE, YOU ASSUMED THAT YOU WERE ENTITLED THERETO.

THE STANDARDS FOR WAIVER OF CLAIMS ARISING OUT OF AN ERRONEOUS PAYMENT OF PAY ARE FOUND IN 4 CFR 91-93, WHICH IMPLEMENTS 5 U.S.C. 5584, AS ADDED BY PUBLIC LAW 90-616, APPROVED OCTOBER 21, 1968. THEY PROVIDE FOR WAIVER WHERE:

"(B) COLLECTION ACTION UNDER THE CLAIM WOULD BE AGAINST EQUITY AND GOOD CONSCIENCE AND NOT IN THE BEST INTEREST OF THE UNITED STATES. GENERALLY THESE CRITERIA WILL BE MET BY A FINDING THAT THE ERRONEOUS PAY OCCURRED THROUGH ADMINISTRATIVE ERROR AND THAT THERE IS NO INDICATION OF FRAUD, MISREPRESENTATION, FAULT, OR LACK OF GOOD FAITH ON THE PART OF THE EMPLOYEE. *** ANY SIGNIFICANT UNEXPLAINED INCREASE IN AN EMPLOYEE'S PAY WHICH WOULD REQUIRE A REASONABLE MAN TO MAKE INQUIRY CONCERNING THE CORRECTNESS OF HIS PAY ORDINARILY WOULD PRECLUDE A WAIVER WHEN THE EMPLOYEE FAILS TO BRING THE MATTER TO THE ATTENTION OF APPROPRIATE OFFICIALS. WAIVER OF OVERPAYMENT OF PAY UNDER THIS STANDARD NECESSARILY MUST DEPEND UPON THE FACTS EXISTING IN THE PARTICULAR CASE. *** "

WE STATED IN B-165663, JUNE 11, 1969, WITH RESPECT TO THE REQUIREMENT THAT THERE BE NO INDICATION OF FAULT ON THE PART OF THE EMPLOYEE THAT:

"WHETHER AN EMPLOYEE WHO RECEIVES AN ERRONEOUS PAYMENT IS FREE FROM FAULT IN THE MATTER CAN ONLY BE DETERMINED BY A CAREFUL ANALYSIS OF PERTINENT FACTS, NOT ONLY THOSE GIVING RISE TO THE OVERPAYMENT BUT THOSE INDICATING WHETHER THE EMPLOYEE REASONABLY COULD HAVE BEEN EXPECTED TO HAVE BEEN AWARE THAT AN ERROR HAD BEEN MADE. IF IT IS ADMINISTRATIVELY DETERMINED THAT A REASONABLE MAN, UNDER THE CIRCUMSTANCES INVOLVED, WOULD HAVE MADE INQUIRY AS TO THE CORRECTNESS OF THE PAYMENT AND THE EMPLOYEE INVOLVED DID NOT, THEN, IN OUR OPINION, THE EMPLOYEE COULD NOT BE SAID TO BE FREE FROM FAULT IN THE MATTER AND THE CLAIM AGAINST HIM SHOULD NOT BE WAIVED."

BECAUSE OF THE STATEMENT OF YOUR FELLOW EMPLOYEE, IT APPEARS THAT YOU HAD REASON TO DOUBT THE PROPRIETY OF THE PAYMENTS MADE. IN FACT, YOUR LETTER STATES THAT YOU DID QUESTION YOUR ELIGIBILITY TO RECEIVE THE WITHIN-GRADE INCREASE AND BROUGHT THE MATTER TO THE ATTENTION OF YOUR SUPERVISOR WHOSE RESPONSIBILITY IT WAS TO HANDLE PERSONNEL MATTERS. IN VIEW OF HER STATEMENT THAT UNDER SUCH CIRCUMSTANCES SHE ORDINARILY WOULD HAVE VERIFIED THE CORRECTNESS OF THE PAYMENT, WE FEEL THAT YOU ACTED AS WOULD A REASONABLE MAN UNDER THE CIRCUMSTANCES AND WERE JUSTIFIED IN RELYING UPON HER ASSURANCES THAT THE INCREASE WAS PROPER.

THEREFORE, UPON FURTHER CONSIDERATION OF THE MATTER WE HEREBY WAIVE THE CLAIM OF THE UNITED STATES AGAINST YOU FOR THE $388.80 COVERING THE PERIOD FROM MARCH 24, 1968, TO MARCH 22, 1969.