B-229316, Apr 18, 1988
Highlights
CIVILIAN PERSONNEL - Compensation - Overpayments - Error detection - Debt collection - Waiver DIGEST: The government's claim against an employee for salary overpayments is waived under the authority of 5 U.S.C. The special pay rate of his old position was included in the highest previous rate without permission of the Office of Personnel Management. The employee was not on notice of the error and not at fault for the overpayments. Appeals our Claims Group's determination that he is entitled to only partial waiver of the claim of the government against him for overpaid salary. We conclude that he is entitled to waiver of the entire claim against him. His grade was GS-11. His special pay was therefore established three steps higher.
B-229316, Apr 18, 1988
CIVILIAN PERSONNEL - Compensation - Overpayments - Error detection - Debt collection - Waiver DIGEST: The government's claim against an employee for salary overpayments is waived under the authority of 5 U.S.C. Sec. 5584, since collection action would be against equity and good conscience and not in the best interest of the United States. Overpayments resulted from an administrative error in fixing the employee's salary in his new position at the highest previous rate of his old position. Contrary to regulations, the special pay rate of his old position was included in the highest previous rate without permission of the Office of Personnel Management. The employee was not on notice of the error and not at fault for the overpayments.
David C. Starkie - Waiver of Salary Overpayments:
Mr. David C. Starkie, a former employee of the Bureau of Reclamation, Department of the Interior, appeals our Claims Group's determination that he is entitled to only partial waiver of the claim of the government against him for overpaid salary. On the basis of additional information submitted to us, we conclude that he is entitled to waiver of the entire claim against him.
BACKGROUND
Mr. Starkie occupied the position of Landscape Architect in May 1980. His grade was GS-11, step 2. Due to difficulty in recruiting and retaining Landscape Architects, the agency designated this position to receive a higher "special pay rate" under the authority of 5 U.S.C. Sec. 5303. His special pay was therefore established three steps higher, so that his salary was at step 5 of grade GS-11. Effective May 18, 1980, he was transferred to a new duty station and reassigned to the position of Outdoor Recreation Planner. This position did not entitle incumbents to special pay rates. Thus, shortly before his reassignment, the question arose as to whether Mr. Starkie's pay would be reduced to step 2 of grade GS-11.
Although he was no longer entitled to the special rate, the Bureau of Land Management decided that it could reassign him to his new position at step 5 of grade GS-11, since his salary at this step would not exceed the "highest previous rate" of his former position. Under the authority of 5 U.S.C. Sec. 5334 and 5 C.F.R. Sec. 531.203, when an employee is reemployed, transferred, reassigned, promoted, or demoted, an agency may pay the employee at any step within the grade of the employee's new position that does not exceed his or her highest previous pay rate in a former position. In establishing the highest previous rate, the agency must follow the rules set forth in 5 C.F.R. Sec. 531.203.
By notice of personnel action dated June 30, 1980, Mr. Starkie was officially informed that his special salary rate eligibility under 5 U.S.C. Sec. 5303 had terminated effective May 18, 1980. The notice did not indicate that his salary would be reduced or that he would no longer receive a salary in accordance with the highest previous rate determination of May 18, 1980. His salary set by the highest previous rate determination at step 5, grade GS-11, continued until he received a within-grade increase to step 6 effective July 12, 1981.
The Bureau of Reclamation notified Mr. Starkie on December 31, 1981, that the highest previous rate rules had prohibited using his former special pay rate to establish the highest previous rate as his salary upon reassignment to the Outdoor Recreation Planning position effective May 18, 1980. We note that under 5 C.F.R. Sec. 531.203(d)(3) the highest previous rate may not include any special rate that the employee received in a former position without the approval of the Office of Personnel Management. Evidently the approval had not been obtained in this case.
The Bureau of Reclamation determined that because of the mistake in using the special rate for the highest previous rate, Mr. Starkie had received overpayments of salary accruing between May 18, 1980, and December 12, 1981, in the amount of $2,488.70.
The Bureau of Reclamation recommended that Mr. Starkie's indebtedness for the overpayments be waived under the authority of 5 U.S.C. Sec. 5584. Our Claims Group by letter of March 15, 1983, approved waiver of only $158.40 accruing before June 30, 1980. It denied waiver for the remaining overpayments of $2,330.30 because the notice of personnel action of that date informed him that he was no longer entitled to the special pay rate and he was then on notice of future erroneous payments which he should have returned to the government.
DISCUSSION
Waiver of claims of the United States against federal employees who receive erroneous payments of pay and allowances is authorized by 5 U.S.C. Sec. 5584. Under this provision, the collection of an employee's indebtedness for an overpayment may be waived if collection action against the employee would be against equity and good conscience and not in the best interests of the United States. Waiver is denied if there is an indication of fraud, misrepresentation, fault, or lack of good faith on the part of the employee. If the employee is partly at fault because he or she was in a position to know that payment was erroneous but failed to take corrective action, waiver is not granted. In determining whether the employee was partly at fault, we ask whether under all of the facts and circumstances a reasonable person should have been aware that payment was received in excess of the proper entitlement. Frederick D. Crawford, 62 Comp.Gen. 608, 610 (1983).
In the present case, Mr. Starkie was sent the notice of personnel action of June 30, 1980, showing that the position to which he was reassigned did not entitle him to the special pay rate he had received in his former position of Landscape Architect. The notice, however, did not show any reduction of pay, and for good reason since the Bureau of Reclamation had determined to pay him in his new position at the same rate (step 5 of grade GS-11) as his old position in accordance with the highest previous rate rules applicable to reassignments. Consequently, Mr. Starkie was never notified of the overpayments he received until December 1981, after the Bureau of Reclamation became aware that under 5 C.F.R. Sec. 531.203(d)(3) the highest previous rate should not have included the special pay rate of his former position absent permission from the Office of Personnel Management. Further, the nature of his duties and his experience did not place upon him the responsibility for detecting this mistake.
On the basis of information in our files unavailable to our Claims Group when it denied waiver, we conclude that Mr. Starkie's overpayments resulted solely from an administrative error in fixing his salary under the rules applicable to an employee's highest previous rate in a former position. He was not notified of the mistake until after he received all of the overpayments, and not being in a position to detect the mistake, he was not at fault for the overpayments.
Accordingly, the entire claim of the United States resulting from those overpayments is hereby waived.