B-175083, FEB 23, 1972

B-175083: Feb 23, 1972

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THE PROVISIONS OF 4 CFR 91.5(B) PRECLUDE WAIVER WHEN THE CIRCUMSTANCES INDICATE THAT A REASONABLE MAN WOULD HAVE BEEN PUT ON NOTICE AS TO THE OVERPAYMENT. CLAIMANT SHOULD HAVE BEEN AWARE OF THE PROBABILITY OF ERROR AND SINCE 5 U.S.C. 5584 DOES NOT ALLOW WAIVER WHEN THERE IS AN INDICATION OF FAULT ON THE PART OF THE EMPLOYEE. YOUR REQUEST FOR WAIVER OF THE OVERPAYMENT WAS DENIED BY LETTER OF OUR CLAIMS DIVISION DATED NOVEMBER 17. IT APPEARS FROM THE RECORD BEFORE US THAT YOU WERE EMPLOYED BY ST. THE SPECIAL RATE WAS DISCONTINUED EFFECTIVE JULY 13. WAS SHOWN ON YOUR PAY PERIOD EARNING STATEMENT AS $381.60 GROSS AND $236.90 NET. WAS ERRONEOUSLY SHOWN ON THE EARNING STATEMENT AS $472 GROSS AND $289.32 NET.

B-175083, FEB 23, 1972

CIVILIAN EMPLOYEE - ERRONEOUS OVERPAYMENT OF PAY - REQUEST FOR WAIVER DECISION AFFIRMING PRIOR DENIAL OF A REQUEST OF D. JANE KLEMER, AN EMPLOYEE OF ST. ELIZABETH'S HOSPITAL, FOR WAIVER OF AN ERRONEOUS OVERPAYMENT OF PAY INCIDENT TO THE SIMULTANEOUS DISCONTINUANCE OF A SPECIAL SALARY RATE AND AN INCREASE IN GENERAL SALARY. THE PROVISIONS OF 4 CFR 91.5(B) PRECLUDE WAIVER WHEN THE CIRCUMSTANCES INDICATE THAT A REASONABLE MAN WOULD HAVE BEEN PUT ON NOTICE AS TO THE OVERPAYMENT. IN THE INSTANT CASE, CLAIMANT SHOULD HAVE BEEN AWARE OF THE PROBABILITY OF ERROR AND SINCE 5 U.S.C. 5584 DOES NOT ALLOW WAIVER WHEN THERE IS AN INDICATION OF FAULT ON THE PART OF THE EMPLOYEE, THE PRIOR DENIAL MUST BE AFFIRMED.

TO MRS. D. JANE KLEMER:

WE REFER FURTHER TO YOUR LETTER OF JANUARY 4, 1972, WHEREIN YOU ASK FOR RECONSIDERATION OF THE DENIAL OF YOUR REQUEST FOR WAIVER OF THE CLAIM OF THE UNITED STATES AGAINST YOU IN THE AMOUNT OF $907.20 DUE TO AN ERRONEOUS OVERPAYMENT OF PAY.

YOUR REQUEST FOR WAIVER OF THE OVERPAYMENT WAS DENIED BY LETTER OF OUR CLAIMS DIVISION DATED NOVEMBER 17, 1971, ADDRESSED TO THE DEPARTMENT OF HEALTH, EDUCATION, AND WELFARE.

IT APPEARS FROM THE RECORD BEFORE US THAT YOU WERE EMPLOYED BY ST. ELIZABETH'S HOSPITAL, NATIONAL INSTITUTE OF MENTAL HEALTH, WASHINGTON, D.C., AS A GS-10, STEP 2, IN A POSITION WHICH ENTITLED YOU TO PAY AS A GS- 10, STEP 3, UNDER A SPECIAL SALARY RATE. THE SPECIAL RATE WAS DISCONTINUED EFFECTIVE JULY 13, 1969, COINCIDENT WITH A GENERAL SALARY INCREASE. YOUR BIWEEKLY BASE PAY PRIOR TO THE PAY PERIOD ENDING JULY 12, 1969, WAS SHOWN ON YOUR PAY PERIOD EARNING STATEMENT AS $381.60 GROSS AND $236.90 NET. YOUR NEW BASE PAY FOR THE NEXT PAY PERIOD ENDING JULY 26, 1969, WAS ERRONEOUSLY SHOWN ON THE EARNING STATEMENT AS $472 GROSS AND $289.32 NET. DURING THIS PERIOD YOUR SALARY SHOULD HAVE BEEN SHOWN AS $407.20 GROSS PER PAY PERIOD. THUS, YOU WERE OVERPAID A GROSS OF $64.80 PER PERIOD FOR 14 PAY PERIODS OR A TOTAL OF $907.20. YOUR EARNING STATEMENT - COPIES GIVEN TO EACH EMPLOYEE BIWEEKLY - SHOWS CORRECTLY THE ANNUAL RATE OF PAY TO BE $10,594, AN INCREASE OF $677 A YEAR FROM YOUR PRIOR ANNUAL RATE OF $9,917.

IN THE CLAIMS DIVISION LETTER OF NOVEMBER 17, 1971, IT WAS POINTED OUT THAT EVEN A CURSORY INSPECTION OF YOUR PAYROLL STUBS WOULD HAVE SHOWN THAT YOU WERE BEING PAID $90.40 IN GROSS - RATHER THAN APPROXIMATELY $26 - PER PAY PERIOD ABOVE YOUR OLD RATE AFTER CONVERSION TO THE NEW SALARY TABLE.

THE STANDARDS FOR WAIVER OF CLAIMS AS SET FORTH IN 4 CFR 91.5(B) PROVIDE, INSOFAR AS HERE PERTINENT, AS FOLLOWS:

" *** 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 OVERPAYMENTS OF PAY UNDER THIS STANDARD NECESSARILY MUST DEPEND UPON THE FACTS EXISTING IN THE PARTICULAR CASE. *** "

WE RECOGNIZE THAT IN YOURS AND SIMILAR CASES THERE IS ALWAYS AN ELEMENT OF DOUBT AS TO ELIGIBILITY FOR WAIVER. NEVERTHELESS, AS POINTED OUT IN THE ABOVE STANDARD, WHERE THERE IS A SUBSTANTIAL UNEXPLAINED VARIANCE IN PAY WHICH A REASONABLY PRUDENT MAN SHOULD HAVE QUESTIONED, WAIVER ACTION IS ORDINARILY PRECLUDED.

WE FEEL THE SUBSTANTIAL INCREASE IN PAY SHOULD HAVE ALERTED YOU TO THE PROBABILITY OF ERROR AND OF THE NECESSITY TO MAKE INQUIRY THEREIN. BECAUSE OF THIS FAILURE, WE DO NOT BELIEVE IT CAN BE SAID THAT YOU ARE WITHOUT FAULT IN THE MATTER.

THE PROVISIONS OF 5 U.S.C. 5584 EXPRESSLY PRECLUDE THE WAIVER OF A CLAIM WHEN THERE IS AN INDICATION OF FAULT ON THE PART OF AN EMPLOYEE, AND, THEREFORE, WE MUST SUSTAIN THE ACTION OF OUR CLAIMS DIVISION IN DENYING THE WAIVER OF THE GOVERNMENT'S CLAIM AGAINST YOU.