B-190204, JAN 26, 1978

B-190204, JAN 26, 1978

TERMINALLY ILL EMPLOYEE APPLIED FOR DISABILITY RETIREMENT AND WAIVED MILITARY RETIRED PAY, BUT NEGLECTED TO REQUEST LEAVE WITHOUT PAY (LWOP) AND DIED WHILE IN SICK LEAVE STATUS PRIOR TO APPROVAL OF DISABILITY RETIREMENT. FAILURE TO REQUEST LWOP RESULTED IN SUBSTANTIALLY LOWER SURVIVOR ANNUITY TO EMPLOYEE'S WIDOW. SINCE RECORD INDICATES THAT FAILURE TO REQUEST LWOP WAS DUE TO EMPLOYEE'S BELIEF HE HAD PERFORMED ALL ACTIONS NECESSARY TO CARRY OUT HIS INTENT TO MAXIMIZE ANNUITY, GAO HAS NO OBJECTION TO SUBSTITUTION OF LWOP FOR SICK LEAVE.

BERNARD J. CANTLEY - SUBSTITUTION OF LEAVE WITHOUT PAY FOR SICK LEAVE:

THIS ACTION CONCERNS THE REQUEST OF CAPTAIN W. H. MAYER, SC USN, COMMANDER, NAVAL ACCOUNTING AND FINANCE CENTER. CAPTAIN MAYER REQUESTS OUR DECISION WHETHER LEAVE WITHOUT PAY MAY BE RETROACTIVELY SUBSTITUTED FOR SICK LEAVE IN THE CASE OF BERNARD J. CANTLEY (DECEASED), A FORMER EMPLOYEE OF THE NAVY.

CAPTAIN MAYER REPORTS THE FACTS OF THIS CASE AS FOLLOWS:

"MR. CANTLEY WAS STRICKEN WITH A TERMINAL ILLNESS IN JULY 1975. HAVING BEEN AUTHORIZED BY MR. CANTLEY TO ACT IN HIS BEHALF, MRS. CANTLEY CONTACTED THE CIVILIAN PERSONNEL OFFICE AND WAS COUNSELED REGARDING THE FILING OF HER HUSBAND'S APPLICATION FOR DISABILITY RETIREMENT AND WAIVER OF MILITARY RETIRED PAY. SHE WAS ALSO COUNSELED ON THE OPTION OF REQUESTING THAT MR. CANTLEY BE PLACED IN A LEAVE WITHOUT PAY STATUS IN LIEU OF SICK LEAVE, AS DISCUSSED IN FEDERAL PERSONNEL MANUAL SUPPLEMENT 831-1, SUBCHAPTER 3-5-F(4), IN ORDER TO ENSURE THE MAXIMUM SURVIVOR ANNUITY BENEFITS IN THE EVENT OF MR. CANTLEY'S DEATH. MRS. CANTLEY SUBMITTED THE APPLICATION FOR DISABILITY RETIREMENT AND WAIVER OF MILITARY RETIRED PAY WITH AN EFFECTIVE DATE FOR THE WAIVER OF AUGUST 25, 1975. MRS. CANTLEY DID NOT SUBMIT A SPECIFIC REQUEST THAT MR. CANTLEY BE PLACED ON LEAVE WITHOUT PAY. MR. CANTLEY DIED ON AUGUST 11, 1975 WHILE FINAL ACTION ON THE NOTICE OF APPROVAL OF HIS APPLICATION FOR DISABILITY RETIREMENT WAS NOT COMPLETED BY THE U.S. CIVIL SERVICE COMMISSION, BUREAU OF RETIREMENT, INSURANCE AND OCCUPATIONAL HEALTH UNTIL AUGUST 22, 1975. ON THE DATE OF HIS DEATH, MR. CANTLEY WAS CARRIED IN A SICK LEAVE WITH PAY STATUS WHICH RESULTED IN A DETERMINATION BY THE COMMISSION THAT MR. CANTLEY'S WAIVER OF MILITARY RETIRED PAY WAS NOT EFFECTIVE PRIOR TO HIS DEATH ON AUGUST 11, 1975 AND, THEREFORE, A SEVERE REDUCTION IN SURVIVOR ANNUITY BENEFITS PAYABLE TO MRS. CANTLEY RESULTED AS CREDIT FOR MILITARY SERVICE COULD NOT BE INCLUDED IN CIVIL SERVICE ANNUITY COMPUTATIONS."

THE DEPARTMENT OF NAVY RECOMMENDS APPROVAL OF ITS PROPOSAL TO AUTHORIZE A CHANGE IN MR. CANTLEY'S LEAVE RECORDS TO SHOW THAT HE WAS IN A LEAVE- WITHOUT-PAY STATUS AT THE TIME OF HIS DEATH.

THE CIVIL SERVICE COMMISSION PROVIDES GUIDELINES CONCERNING COUNSELING EMPLOYEES WITH SERIOUS ILLNESSES WHO HAVE APPLIED FOR DISABILITY RETIREMENT AS FOLLOWS:

IN CERTAIN DISABILITY CLAIMS (WHERE THE NATURE OF THE DISABILITY APPEARS TO BE VERY SERIOUS AND THE APPLICANT IS IN RECEIPT OF MILITARY RETIRED PAY), THE FOLLOWING PROCEDURE IS SUGGESTED IN ORDER TO ENSURE THE MAXIMUM SURVIVOR ANNUITY BENEFITS TO THE EMPLOYEE AND SPOUSE. WHERE UNUSED SICK LEAVE IS INVOLVED, AND THE APPLICANT MEETS THE AGE AND SERVICE REQUIREMENTS FOR A DISABILITY ANNUITY, HE OR SHE MAY BE PLACED ON LWOP INSTEAD OF SICK-LEAVE-WITH-PAY STATUS, AND REQUEST A WAIVER OF MILITARY RETIRED PAY. IN THE EVENT OF THE APPLICANT'S DEATH WHILE THE DISABILITY CLAIM IS PENDING, HE OR SHE CAN BE CONSIDERED TO HAVE COMPLETED A VALID WAIVER OF MILITARY RETIRED PAY AFTER THE COMMENCING DATE OF ANNUITY BECAUSE THE ANNUITY WOULD COMMENCE THE DAY FOLLOWING THE LAST DAY IN PAY STATUS. IN THIS WAY, CREDIT FOR ALL HONORABLE, ACTIVE PERIODS OF MILITARY SERVICE WILL BE INCLUDED IN COMPUTING BOTH THE ANNUITY AND THE SURVIVOR ANNUITY BENEFITS." FEDERAL PERSONNEL MANUAL (FPM) SUPPLEMENT 831-1, S3- 5F(4).

THE ABOVE-QUOTED GUIDELINES ARE NOT MANDATORY. THAT IS, THE CHOICE IS THE EMPLOYEE'S AND ONCE THE EMPLOYEE HAS MADE HIS ELECTION, THE AGENCY MAY NOT REVERSE THAT ELECTION. THEREFORE, THE COMMISSION'S GUIDELINES DO NOT PROVIDE THE GROUNDWORK NECESSARY TO SUGGEST THAT THE AGENCY'S FAILURE TO PLACE MR. CANTLEY IN A LEAVE-WITHOUT-PAY STATUS CONSTITUTES AN ADMINISTRATIVE ERROR.

THE RECORD SHOWS THAT MRS. CANTLEY, WHO WAS AUTHORIZED TO ACT FOR HER HUSBAND WHO WAS IN THE HOSPITAL, EXECUTED HIS APPLICATION FOR DISABILITY RETIREMENT AND HIS WAIVER OF MILITARY RETIRED PAY AND DELIVERED THOSE PAPERS TO THE AGENCY ON JULY 22, 1975. HOWEVER, NO REQUEST WAS MADE TO CHANGE HIS SICK LEAVE STATUS TO A LEAVE-WITHOUT-PAY STATUS. THE APPLICATION FOR RETIREMENT AND THE WAIVER WERE TO BE EFFECTIVE AUGUST 25, 1975. MRS. CANTLEY STATES THAT SHE ASSUMED THAT THE RETIREMENT PAPERS AND WAIVER OF MILITARY RETIRED PAY WOULD TAKE CARE OF HER HUSBAND'S RETIREMENT. SHE KNEW THE AUGUST 25, 1975, DATE WAS PLACED ON THE PAPERS BUT THOUGHT THAT WAS FOR THE CONVENIENCE OF THE GOVERNMENT AND ITS 2-WEEK PAY PERIOD SYSTEM TO SIMPLIFY ACCOUNTING TRANSACTIONS. SHE ALSO BELIEVED THAT HER HUSBAND WAS RETIRED UPON THE SUBMISSION OF THE APPLICATION AND THE WAIVER.

SINCE THE RECORD SHOWS THAT MRS. CANTLEY TOOK TWO OF THE THREE ACTIONS NECESSARY TO MAXIMIZE HER HUSBAND'S ANNUITY AND HER POTENTIAL SURVIVOR ANNUITY, IT APPEARS THAT HER FAILURE TO REQUEST THAT MR. CANTLEY BE PLACED ON LEAVE WITHOUT PAY AROSE FROM THE MISTAKEN BELIEF THAT SHE HAD DONE ALL THAT WAS NECESSARY TO ACCOMPLISH THAT RESULT. AN AGENCY MEMORANDUM DATED JANUARY 26, 1976, STATES THAT MR. CANTLEY ELECTED TO EXHAUST HIS SICK LEAVE BEFORE APPLYING FOR LEAVE WITHOUT PAY. HOWEVER, THAT STATEMENT APPEARS TO BE INCORRECT. MR. CANTLEY WOULD HAVE EXHAUSTED HIS SICK LEAVE MORE THAN A WEEK BEFORE AUGUST 25, 1975, THE EFFECTIVE DATE SHOWN ON HIS RETIREMENT APPLICATION AND WAIVER. ALSO, THE EFFECTIVE DATE SHOWN ON THE DOCUMENTS IN QUESTION IS THE SECOND MONDAY IN A BIWEEKLY PAY PERIOD, NOT THE LAST DAY OF THE PAY PERIOD. IN VIEW OF THE ABOVE, IT IS OUR OPINION THAT IT WAS MR. CANTLEY'S INTENTION TO TAKE ALL STEPS NECESSARY TO MAXIMIZE HIS ANNUITY AND THAT OF HIS WIFE AND THAT THE FAILURE TO FORMALLY REQUEST LEAVE WITHOUT PAY WAS DUE TO THE MISTAKEN BELIEF THAT ALL STEPS HAD BEEN TAKEN TO CARRY OUT THAT INTENTION. THUS, IT APPEARS THAT HIS CONTINUANCE ON SICK LEAVE WAS CONTRARY TO HIS INTENT TO MAXIMIZE HIS ANNUITY AND HIS WIFE'S SURVIVOR ANNUITY.

THE AUTHORIZATION OF LEAVE WITHOUT PAY BY AN AGENCY IS SOLELY A MATTER OF ADMINISTRATIVE DISCRETION, EXCEPT IN CERTAIN CASES NOT RELEVANT HERE. FEDERAL PERSONNEL MANUAL SUPPLEMENT 990-2, BOOK 630, SUBCHAPTER S12-2. PAST CASES, WE HAVE NOT OBJECTED TO AGENCY REQUESTS EITHER TO RETROACTIVELY SUBSTITUTE LEAVE WITHOUT PAY FOR SICK LEAVE (B-130687, MARCH 15, 1957) OR TO ADMINISTRATIVELY CONSIDER AN EMPLOYEE'S LEAVE STATUS SUBSEQUENT TO HIS DEATH (B-130418, FEBRUARY 28, 1957). WE ARE MINDFUL OF OUR DECISION B-188242, AUGUST 9, 1977, IN WHICH WE DENIED AN EMPLOYEE'S REQUEST TO RETROACTIVELY SUBSTITUTE LEAVE WITHOUT PAY FOR ANNUAL LEAVE. HOWEVER, IN THAT CASE, THERE WAS AN AGENCY REGULATION STATING THAT LEAVE WITHOUT PAY WOULD NOT ORDINARILY BE GRANTED IF AN EMPLOYEE HAD ANNUAL LEAVE TO HIS CREDIT. APPARENTLY, THE NAVY DOES NOT HAVE A SIMILAR REGULATION THAT WOULD PRECLUDE THE GRANTING OF LEAVE WITHOUT PAY UNDER THE CIRCUMSTANCES OF THIS CASE.

IN VIEW OF THE ABOVE, WE CONCLUDE THAT THE DEPARTMENT OF NAVY HAS THE AUTHORITY TO MAKE A RETROACTIVE SUBSTITUTION OF LEAVE WITHOUT PAY FOR SICK LEAVE IN ORDER TO SHOW MR. CANTLEY IN A LEAVE-WITHOUT-PAY STATUS AT THE TIME OF HIS DEATH. IF SUCH A SUBSTITUTION IS MADE, THE PROPER ADJUSTMENTS SHOULD BE MADE IN HIS MILITARY RETIRED PAY ACCOUNT TO REFLECT THE WAIVER OF THAT PAY.