B-200280.OM, MAR 17, 1981

B-200280.OM, MAR 17, 1981

SUBJECT: WAIVER OF INDEBTEDNESS - GEORGE J. VUTURO - B-200280-O.M.

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

RETURNED HEREWITH IS CLAIMS FILE NO. Z-2817103, CONCERNING THE JUNE 30, 1980 APPEAL OF MR. GEORGE J. VUTURO, FROM YOUR DETERMINATION OF MARCH 25, 1980, DENYING HIS REQUEST FOR WAIVER OF HIS DEBT TO THE UNITED STATES. THE DEBT, IN THE AMOUNT OF $716.25 AROSE OUT OF AGENCY FAILURE TO WITHHOLD FICA TAXES FROM HIS SALARY FROM SEPTEMBER 11, 1977, THROUGH MAY 5, 1979.

THE FILE SHOWS THAT MR. VUTURO WAS EMPLOYED BY THE VETERANS ADMINISTRATION (VA) ON A PART-TIME BASIS AS A HEALTH SERVICES RESEARCH AND DEVELOPMENT TRAINEE DURING THE PERIOD IN QUESTION. AS A RESULT OF ADMINISTRATIVE ERROR, THE INITIAL VA FORM 5-4650 "NOTIFICATION OF PERSONNEL ACTION" ISSUED IN HIS CASE WAS CODED TO REFLECT THAT NO DEDUCTIONS WERE TO BE MADE FROM HIS SALARY FOR RETIREMENT.

IT WAS SUGGESTED IN THE CLAIMS GROUP DETERMINATION LETTER THAT MR. VUTURO SHOULD HAVE EXPECTED SOME FORM OF RETIREMENT DEDUCTION FROM HIS PAY INASMUCH AS "IT IS COMMON KNOWLEDGE THAT DEDUCTIONS ARE MADE FROM ALL EMPLOYEE'S PAY" FOR THESE PURPOSES. WE DO NOT BELIEVE THAT SUCH A CONCLUSION IS WARRANTED HERE.

FOR THE PURPOSE OF 5 U.S.C. 5584, "FAULT" IS CONSIDERED TO EXIST IF, IN LIGHT OF ALL THE CIRCUMSTANCES, IT IS DETERMINED THAT AN EMPLOYEE EXERCISING REASONABLE DILIGENCE SHOULD HAVE KNOWN THAT AN ERROR EXISTED BUT FAILED TO TAKE ACTION TO HAVE IT CORRECTED. SEE 4 C.F.R. 91.5. THE STANDARD TO BE EMPLOYED IS WHETHER A REASONABLE PERSON SHOULD HAVE BEEN AWARE THAT HE WAS RECEIVING PAYMENT IN EXCESS OF HIS PROPER ENTITLEMENTS. GEORGE R. BUCHERL, B-192485, NOVEMBER 17, 1978.

ITEM 10 OF VA FORM 5-4650 IS ENTITLED "RETIREMENT" AND PROVIDES FOR FIVE CATEGORIES OF RETIREMENT STATUS. INCLUDED IS THE DESIGNATION "4. NONE", WHICH IS THE RETIREMENT CATEGORY IN WHICH MR. VUTURO WAS ERRONEOUSLY PLACED RATHER THAN "2. FICA." IT IS ALSO TO BE OBSERVED FROM THAT DOCUMENT THAT AS A PART-TIME TRAINEE HE WAS IDENTIFIED AS BEING IN AN EXCEPTED POSITION, WITHOUT TENTURE, EXEMPT FROM THE FAIR LABOR STANDARDS ACT, AND INELIGIBLE FOR BOTH INSURANCE AND HEALTH BENEFITS. IN VIEW OF HIS PART-TIME STATUS AND THE FEW FEDERAL EMPLOYMENT BENEFITS TO WHICH HE WAS ENTITLED IT APPEARS TO US THAT THE FACT THAT HIS RETIREMENT CATEGORY WAS ERRONEOUSLY MARKED "4" RATHER THAN "2" WOULD NOT HAVE SERVED AS NOTICE OF ERROR. SINCE HIS LEAVE AND EARNINGS STATEMENTS WERE CONSISTENT WITH HIS VA FORM 5-4650, WE ARE NOT PERSUADED THAT HE WAS OR SHOULD HAVE BEEN AWARE THAT HE WAS RECEIVING PAYMENT IN EXCESS OF HIS PROPER ENTITLEMENT.

ACCORDINGLY, THE CLAIM OF THE UNITED STATES AGAINST MR. VUTURO IN THE AMOUNT OF $716.25, IS HEREBY WAIVED.

ATTACHMENT

DIGEST

A PART-TIME TRAINEE WITH THE VETERANS ADMINISTRATION WAS ADMINISTRATIVELY PLACED IN AN IMPROPER RETIREMENT CATEGORY ON HIS NOTIFICATION OF PERSONNEL ACTION (VA FORM 5-4650), WHICH RESULTED IN AN ADMINISTRATIVE FAILURE TO PROPERLY DEDUCT MONEY FROM HIS PAY FOR FICA PURPOSES. IN VIEW OF HIS LIMITED FEDERAL EMPLOYMENT STATUS AND THE FACT THAT HIS LEAVE AND EARNINGS STATEMENTS WERE CONSISTENT WITH HIS VA FORM 5-4650, IT DOES NOT APPEAR THAT HE SHOULD BE AWARE THAT HE WAS RECEIVING PAY IN EXCESS OF HIS ENTITLEMENT AND WAIVER UNDER 5 U.S.C. 5584 IS APPROVED.