Request for Waiver of Overpayment

A civilian employee of the Army requested reconsideration of the denial of his application for waiver of his debt to the United States. The debt arose from overpayments caused by administrative errors in the computation of the employee's pay as a Department of the Army civilian employee. The record showed that the employee, formerly a retired Government employee, was reinstated as a career employee with the Army. Under Federal regulations, the pay of that position was reduced by the amount of the employee's annuity. The employee was correctly paid at that rate until administrative errors were made in computing his basic rate of pay to reflect a general pay increase and a step increase. In his appeal, the employee contended that: (1) action on his application for waiver was delayed, (2) the amount of the debt was stated incorrectly and not adequately explained when he was originally notified, and (3) the major portion of the overpayment was attributable to administrative errors related to complicated payroll transactions rather than to his failure to report the increase in his annuity. In addition, the employee suggested that collection action should be suspended in consideration of the extra hours that a supervisor at his grade puts in without compensation. GAO held that the authority to waive overpayment of pay and allowances may not be exercised if there is an indication of fraud, misrepresentation, fault, or lack of good faith on the part of the employee. The record clearly showed that the employee was issued a Leave and Earnings Statement (LES) for each pay period for the purpose of verifying the accuracy of his pay. A review of his LES should have alerted the employee to the likelihood of an error in his pay. Therefore, GAO concluded that the employee was partially at fault since he failed to recognize the administrative errors and did not notify payroll personnel when they occurred. Accordingly, the denial of the employee's request for waiver of his indebtedness was sustained. Moreover, the employee's indebtedness may not be offset by reason of the fact that he may have performed noncompensable duties in excess of his regular responsibilities.