B-199457.OM, DEC 8, 1981

B-199457.OM, DEC 8, 1981

SUBJECT: DIOLINDA R. DEXHEIMER, ET AL. - REQUEST FOR WAIVER - B-199457-O.M.

ASSOCIATE DIRECTOR, AFMD - CLAIMS GROUP (ROOM 5858):

THIS IS IN RESPONSE TO YOUR MEMO OF JUNE 24, 1980, FROM THE CHIEF, DEBT BRANCH REQUESTING OUR ADVICE CONCERNING THE CLAIMS OF FOUR EMPLOYEES WHO HAVE ASKED FOR WAIVER OF THE OVERPAYMENTS THEY RECEIVED AS THE RESULT OF ERRONEOUS PROMOTIONS.

THE FACTS ARE AS FOLLOWS:

MS. DIOLINDA R. DEXHEIMER, Z-2819198, A CIVILIAN EMPLOYEE OF THE DEPARTMENT OF THE NAVY, WAS SELECTED FOR A TEMPORARY PROMOTION EFFECTIVE DECEMBER 19, 1976, AS A PERSONNEL STAFFING SPECIALIST AT THE GRADE OF GS- 7. THE PROMOTION WAS MADE PERMANENT JANUARY 30, 1977. FROM DECEMBER 19, 1976, THROUGH MARCH 25, 1978, MS. DEXHEIMER PERFORMED THE DUTIES OF A PERSONNEL STAFFING SPECIALIST.

SUBSEQUENTLY, THE OFFICE OF PERSONNEL MANAGEMENT (OPM) AUDITED THE NAVY'S RECORDS AND DETERMINED THAT MS. DEXHEIMER'S PROMOTION OF DECEMBER 19, 1976, HAD BEEN A REGULATORY VIOLATION BECAUSE SHE DID NOT HAVE THE 1 YEAR OF SPECIALIST EXPERIENCE REQUIRED FOR ELIGIBILITY FOR A GS-7 POSITION UNTIL DECEMBER 19, 1977. THE NAVY THEN ESTABLISHED A DEBT REPRESENTING THE DIFFERENCE BETWEEN THE SALARY MS. DEXHEIMER WOULD HAVE EARNED AS A GS- 6 PERSONNEL CLERK AND THE SALARY SHE EARNED AS A GS 7, FOR THE PERIOD DECEMBER 19, 1976, THROUGH DECEMBER 18, 1977, A TOTAL OF $1,152.43.

JOHN W. PULLEN, Z-2821667, A CIVILIAN EMPLOYEE OF THE DEPARTMENT OF THE ARMY, WAS SELECTED FOR PROMOTION FROM HIS POSITION AS A SUPPLY CLERK AT GRADE GS-5, TO THE POSITION OF SUPERVISORY GENERAL SUPPLY SPECIALIST AT THE GRADE OF GS-7, EFFECTIVE SEPTEMBER 16, 1979. MR. PULLEN PERFORMED THE DUTIES OF THIS POSITION THROUGH JANUARY 18, 1980. ON OCTOBER 22, 1979, THE CIVILIAN PERSONNEL OFFICE DISCOVERED THAT MR. PULLEN HAD NOT TAKEN THE PACE, WHICH WAS ONE OF THE PREREQUISITES FOR THE GS-7 POSITION. MR. PULLEN WAS THEN GIVEN THE EXAMINATION; HOWEVER, HE FAILED TO ACHIEVE A COMPETITIVE RATING. AS A RESULT, ON JANUARY 18, 1980, THE ARMY CANCELLED HIS PROMOTION RETROACTIVE TO SEPTEMBER 16, 1979, AND RETURNED THE EMPLOYEE TO HIS FORMER GRADE AND POSITION. A DEBT WAS ESTABLISHED WHICH REPRESENTED THE DIFFERENCE IN SALARY BETWEEN THE AMOUNT MR. PULLEN WOULD HAVE RECEIVED AS A GS-5 SUPPLY CLERK AND THE AMOUNT HE ACTUALLY RECEIVED AS A GS-7 SUPERVISORY GENERAL SUPPLY SPECIALIST FROM SEPTEMBER 16, 1979, THROUGH JANUARY 17, 1980, A TOTAL OF $1,399.94.

JAMES E. WASHINGTON, Z-2819604, A CIVILIAN EMPLOYEE OF THE DEPARTMENT OF THE NAVY, VOLUNTARILY TOOK A REDUCTION TO LOWER GRADE FROM HIS POSITION OF AIR CRAFT ELECTRICAL WORKER AT THE GRADE OF WG-8, IN ORDER TO ENTER A TRAINING PROGRAM AS AN INDUSTRIAL ENGINEERING TECHNICIAN AT THE GRADE OF GS-7. MR. WASHINGTON DID NOT MAKE SATISFACTORY PROGRESS IN THE TRAINING PROGRAM, AND THE NAVY RETURNED HIM TO HIS FORMER POSITION AND GRADE LEVEL EFFECTIVE MAY 7, 1978.

THE OFFICE OF PERSONNEL MANAGEMENT AUDITED THE NAVY'S RECORDS AND ON MARCH 27, 1979, DETERMINED THAT THE RETURN OF MR. WASHINGTON TO HIS FORMER POSITION AND GRADE REPRESENTED A PROMOTION, AND SUCH ACTION VIOLATED REGULATIONS BECAUSE IT WAS COMPLETED WITHOUT PRIOR COMPETITION. HOWEVER, OPM GRANTED AN EXEMPTION TO COMPETITIVE PROMOTION PROCEDURES TO PERMIT MR. WASHINGTON'S PROMOTION EFFECTIVE MARCH 27, 1979. A DEBT WAS ESTABLISHED IN THE AMOUNT OF $869.75, WHICH REPRESENTED THE DIFFERENCE IN SALARY BETWEEN THE AMOUNT MR. WASHINGTON WOULD HAVE RECEIVED AS A GS-7, AND THE SALARY HE ACTUALLY RECEIVED AS A WG-8.

IN THE CASE OF RICHARD L. REESE, Z-2803890, A CIVILIAN EMPLOYEE OF THE DEPARTMENT OF NAVY, THE RECORD SHOWS THAT THE MARINE CORPS LOGISTICS SUPPORT BASE PACIFIC, BARSTOW, CALIFORNIA, ESTABLISHED 15 GS 5 FIREFIGHTER POSITIONS IN 1975. THE APPLICATIONS OF 19 ELIGIBLE GS-4 FIREFIGHTERS WERE SUBMITTED TO THE SELECTING OFFICIAL, WHO WITH TWO ASSISTANT FIRE CHIEFS, INTERVIEWED THE 19 APPLICANTS. THE PANEL SELECTED MR. REESE FOR ONE OF THE GS-5 POSITIONS AND EFFECTIVE JUNE 8, 1975, MR. REESE BEGAN SERVING IN THIS POSITION. HE CONTINUED TO PERFORM THE DUTIES OF A GS-5 FIREFIGHTER UNTIL HIS RESIGNATION ON JANUARY 12, 1978.

ONE OF THE UNSELECTED APPLICANTS FILED A COMPLAINT AGAINST THE PANEL, CHARGING IT WITH NEPOTISM ON THE BASIS THAT ONE OF THE ASSISTANT FIRE CHIEFS ON THE PANEL WAS MR. REESE'S FATHER-IN-LAW. AN ARBITRATOR SUBSEQUENTLY DETERMINED THAT THE ACTIVITY HAD VIOLATED FEDERAL LAW AND REGULATIONS REGARDING NEPOTISM AND IN VIEW OF THIS, DETERMINED THAT MR. REESE SHOULD VACATE HIS POSITION EFFECTIVE JANUARY 31, 1977. WHEN THE ACTIVITY APPEALED THIS DECISION, THE U. S. FEDERAL LABOR RELATIONS COUNCIL AGREED THAT THE ACTIVITY HAD VIOLATED FEDERAL REGULATIONS REGARDING NEPOTISM, BUT THEY AMENDED THE AWARD TO PROVIDE FOR A DETERMINATION FROM OPM AS TO MR. REESE'S ENTITLEMENT TO CONTINUE TO HOLD HIS GS-5 POSITION. THE OPM LATER DETERMINED THAT MR. REESE'S APPOINTMENT COULD BE REGULARIZED IF CERTAIN REQUIREMENTS WERE MET; HOWEVER, BY THE TIME THE ACTIVITY RECEIVED THIS DECISION, MR. REESE HAD ALREADY RESIGNED. THE NAVY ESTABLISHED A DEBT IN THE AMOUNT OF $3,002.05, WHICH REPRESENTED THE DIFFERENCE IN SALARY BETWEEN THE GS-4 AND GS-5 POSITIONS FOR THE PERIOD JUNE 8, 1975, THROUGH JANUARY 12, 1978.

THERE IS SOME QUESTION AS TO WHETHER THESE CLAIMS SHOULD BE CONSIDERED UNDER THE WAIVER STATUTE, 5 U.S.C. 5584, OR WHETHER THE EMPLOYEES SHOULD BE CONSIDERED TO BE IN DE FACTO STATUS. THEREFORE, YOU ASK THE FOLLOWING QUESTIONS:

QUESTION 1

"WHEN AN EMPLOYEE IS IMPROPERLY PROMOTED TO A HIGHER GRADED POSITION, CAN HE/SHE GENERALLY BE CONSIDERED A DE FACTO EMPLOYEE IF HE/SHE PERFORMS THE DUTIES OF THE HIGHER GRADED POSITION? THIS IS ASSUMING OF COURSE THAT THE APPOINTMENT IS NOT IN VIOLATION OF A STATUTORY PROVISION AND THAT THE EMPLOYEE WAS NOT GUILTY OF FRAUD OR DELIBERATE MISREPRESENTATION IN THE MATTER. IN THE CASE OF MR. REESE, IT APPEARS THAT HIS APPOINTMENT WAS IN VIOLATION OF STATUTORY PROVISIONS REGARDING NEPOTISM AND THUS HE COULD NOT PROPERLY BE CONSIDERED TO HAVE BEEN IN A DE FACTO STATUS."

PRIOR TO THE ENACTMENT OF 5 U.S.C. 5584, WE CONSIDERED EMPLOYEES IMPROPERLY PROMOTED TO AND PERFORMING THE DUTIES OF HIGHER GRADED POSITIONS AS DE FACTO EMPLOYEES. SEE 36 COMP.GEN. 73 (1956); 34 ID. 266 (1954); 33 ID. 475 (1954); AND 27 ID. 730 (1948). SINCE THE PASSAGE OF THAT STATUTE, HOWEVER, FOR THOSE EMPLOYEES COVERED BY THE WAIVER STATUTE, WE HAVE TREATED THE OVERPAYMENTS RECEIVED DUE TO IMPROPER PROMOTIONS AS ERRONEOUS PAYMENTS SUBJECT TO WAIVER CONSIDERATION. SEE 56 COMP.GEN. 1003 (1977); 49 COMP.GEN. 18 (1969); JERRY L. MINOR. B-185509, JUNE 9, 1976; B-179417 O.M., OCTOBER 1, 1973; B-172910, JULY 20, 1971.

IN VICTOR M. VALDEZ JR., 58 COMP.GEN. 734 (1979), WE ENUNCIATED A NEW RULE WITH REGARD TO IMPROPER APPOINTMENTS. WE NOW INTEND TO APPLY THE VALDEZ RULE ONLY TO SITUATIONS WHERE THERE HAS BEEN AN IMPROPER INITIAL APPOINTMENT OF AN INDIVIDUAL IN THE FEDERAL SERVICE. THUS, THE VALDEZ RULE DOES NOT APPLY TO THE PRESENT CASES WHICH INVOLVE PERSONNEL ACTIONS AFFECTING EMPLOYEES ALREADY ON THE ROLLS. ACCORDING TO OUR OLD DE FACTO RULE, UNDER WHICH ERRONEOUS PROMOTIONS COULD LEAD TO DE FACTO STATUS, AN INDIVIDUAL SUCH AS MR. REESE, WHOSE PROMOTION WAS IN VIOLATION OF A STATUTORY PROVISION, WOULD NOT BE ENTITLED TO RETAIN HIS SALARY AS A DE FACTO EMPLOYEE.

MR. REESE'S OVERPAYMENTS MAY BE CONSIDERED FOR WAIVER, HOWEVER, FOR WE HAVE HELD THAT INDIVIDUALS APPOINTED OR PROMOTED IN VIOLATION OF THE ANTI- NEPOTISM STATUTE, 5 U.S.C. 3110, MAY BE REGARDED AS EMPLOYEES FOR PURPOSES OF THE WAIVER STATUTE. SEE B-174154 APRIL 3, 1972, AND B-159716-O.M., JULY 8, 1969.

QUESTION 2

"IF SUCH AN EMPLOYEE CAN BE CONSIDERED A DE FACTO EMPLOYEE, WOULD A DETERMINATION OF DE FACTO STATUS DEPEND ON WHETHER OR NOT THE DUTIES OF THE HIGHER GRADED POSITION WERE DISTINCTLY DIFFERENT FROM THOSE OF THE LOWER GRADED POSITION? IN THE CASES OF MS. DEXHEIMER, MR. PULLEN, AND MR. WASHINGTON IT APPEARS TO US THAT THE DUTIES THEY PERFORMED UNDER THE ERRONEOUS PROMOTIONS WERE DISTINCTLY DIFFERENT FROM THE DUTIES THEY WOULD HAVE PERFORMED IN THE LOWER GRADED POSITIONS; HOWEVER, IN THE CASE OF MR. REESE, THE DISTINCTION BETWEEN HIS DUTIES AS A GS-4 FIREFIGHTER AND HIS DUTIES AS A GS-5 FIREFIGHTER IS NOT CLEAR."

IT IS OUR OPINION THAT THE CLAIMS OF THESE FOUR INDIVIDUALS SHOULD BE HANDLED UNDER THE WAIVER STATUTE. HOWEVER, TO ANSWER YOUR QUESTION, THE FACT THAT ONE POSITION IS GRADED HIGHER THAN ANOTHER INDICATES THAT THE DUTIES OF EACH POSITION DIFFER AND A DETERMINATION OF DE FACTO STATUS GENERALLY INCLUDES THE FINDING THAT THE INDIVIDUAL IS PERFORMING THE DUTIES OF THE POSITION TO WHICH HE IS ASSIGNED.

QUESTION 3

"IF THE ANSWER TO QUESTION 2 IS AFFIRMATIVE, WHO WOULD HAVE THE RESPONSIBILITY FOR DETERMINING WHETHER AN INDIVIDUAL EMPLOYEE'S DUTIES UNDER AN ERRONEOUS PROMOTION WERE DISTINCTLY DIFFERENT FROM THOSE OF THE LOWER GRADED POSITION? SHOULD SUCH A DETERMINATION BE THE RESPONSIBILITY OF THE EMPLOYEE'S AGENCY, THE OFFICE OF PERSONNEL MANAGEMENT OR OUR OFFICE? FURTHERMORE, WHAT GUIDELINES SHOULD BE USED TO MAKE SUCH A DETERMINATION?"

IN LIGHT OF OUR ANSWER TO QUESTION 2, WE BELIEVE IT IS NOT NECESSARY TO ANSWER THIS QUESTION.

QUESTION 4

"IF THE ANSWER TO QUESTION 1 IS AFFIRMATIVE, WHAT RELEVANCE DOES THE ISSUANCE OF AN SF-50 HAVE IN DETERMINING DE FACTO STATUS? IN THIS REGARD, WE NOTE THAT THE ARMY DID ISSUE AN SF-50 RETURNING MR. PULLEN TO HIS FORMER GRADE RETROACTIVELY, BUT THE NAVY HAS NEVER ISSUED ANY SF-50S IN THE CASES OF MS. DEXHEIMER, MR. WASHINGTON, AND MR. REESE."

SIMILARLY, IN VIEW OF OUR ANSWER TO QUESTION 1, IT IS NOT NECESSARY TO RESPOND TO THIS QUESTION.

QUESTION 5

"IF AN EMPLOYEE IN THE ABOVE DESCRIBED CIRCUMSTANCES CANNOT BE CONSIDERED A DE FACTO EMPLOYEE, DOES THE ERRONEOUS PAYMENT REPRESENT THE DIFFERENCE BETWEEN THE RATE DUE THE ORIGINAL GRADE AND THE HIGHER GRADED POSITION? IN THIS REGARD, WE NOTE THAT MS. DEXHEIMER, MR. PULLEN, AND MR. REESE, COULD BE SAID TO HAVE SERVED UNDER A PREVIOUS VALID APPOINTMENT IF THE ERRONEOUS SF-50S WERE SIMPLY CANCELLED AND THEREFORE, A BASIS FOR ENTITLEMENT TO THE SALARY OF THE LOWER GRADED POSITION PERHAPS EXISTS; HOWEVER, MR. WASHINGTON WAS TERMINATED FROM HIS POSITION IN THE TRAINING PROGRAM PRIOR TO BEING ERRONEOUSLY RETURNED TO HIS FORMER POSITION AND, THEREFORE, A CANCELLATION OF THE PROMOTION WOULD NOT RETURN HIM TO THE TRAINING PROGRAM."

IN OUR CASES CITED ABOVE, WHERE WE WAIVED OVERPAYMENTS RESULTING FROM IMPROPER PROMOTIONS, WE CONSIDERED THE ERRONEOUS PAYMENTS AS THE DIFFERENCE BETWEEN THE RATE OF THE ORIGINAL GRADE AND THE RATE OF THE HIGHER GRADE RATHER THAN THE ENTIRE SALARY RECEIVED IN THE HIGHER GRADED POSITION.

ALTHOUGH THE FACTS OF MR. WASHINGTON'S SITUATION DIFFER, WE DO NOT FEEL THAT HIS CLAIM NEEDS TO BE TREATED DIFFERENTLY. MR. WASHINGTON WAS NOT SEPARATED FROM SERVICE. HIS TERMINATION FROM THE TRAINING PROGRAM AND HIS REAPPOINTMENT TO HIS OLD POSITION WERE TREATED AS A PROMOTION AND WERE ACCOMPLISHED BY THE SAME SF-50. THE OFFICE OF PERSONNEL MANAGEMENT DID NOT OBJECT TO TREATMENT OF THESE ACTIONS AS A PROMOTION BUT RATHER FOUND FAULT WITH THE WAY THE PROMOTION WAS EFFECTED. THUS, THE PROMOTION WAS NOT CANCELLED AND AN EXCEPTION TO COMPETITIVE PROMOTION PROCEDURES WAS GRANTED BY THE OFFICE OF PERSONNEL MANAGEMENT. SINCE MR. WASHINGTON WAS RECEIVING SALARY RETENTION, THE ERRONEOUS PAYMENT WOULD BE THE DIFFERENCE BETWEEN HIS RETAINED RATE AND THE RATE OF THE HIGHER GRADED POSITION.

YOUR QUESTIONS ARE ANSWERED ACCORDINGLY.