In the Matter of the Petition by

RICHARD BROWN
2186 Fifth Avenue

at

New York, NY 10037-2704

P.S. Docket No. DCA 03-247

APPEARANCE FOR PETITIONER:
Joann McNeill
421 8th Avenue, Room 1045
New York, NY  10199-9998

APPEARANCE FOR RESPONDENT:
Christine Patterson
Labor Relations Specialist
United States Postal Service
421 8th Avenue, Room 3505
New York, NY  10199-9401

FINAL DECISION UNDER THE DEBT COLLECTION ACT OF 1982

            Petitioner, Richard Brown, filed a timely Petition for Hearing after receiving a Notice of Involuntary Administrative Salary Offsets from a supervisor on May 22, 2003.  This Notice stated the Postal Service's intention to withhold $1,571.73 from Petitioner's salary to recover a shortage in an account for which Petitioner was responsible.

            A hearing was held in New York City on July 30, 2003.^[1]  The Postal Service presented testimony from Petitioner’s supervisor, Geraldine Moorer.  Petitioner testified in his own behalf and also presented testimony from Ruby Henry, a clerk.  Both parties relied on documents filed prior to the hearing, and Petitioner submitted two additional documents during the hearing.  The following findings of fact are based on the entire record.

FINDINGS OF FACT

            1.  At the time pertinent to this case, Petitioner had been a window clerk at the James A. Farley Post Office in New York City for approximately eighteen months (Tr. 88; PS Ex. 7).^[2]

            2.  On March 14, 2000, Petitioner’s supervisor at the time, Ms. McCloud, conducted an audit of Petitioner’s account and found it to be $1,579.56 short.  Petitioner requested a second count (Tr. 8; PS Ex. 6).

            3.  A second count was conducted by Ms. Moorer and Petitioner on April 25, 2000.  This time the shortage was found to be $1,571.73.  Petitioner signed a PS Form 3294, Cash and Stamp Stock Count and Summary, indicating agreement with the accuracy of the count.  The reason for the delay between the two audits was that Petitioner changed jobs.  His account was sealed and there were no transactions in the account during the interim.  (Tr. 8-9, 19, 59-60, 70; PS Ex. 5).

            4.  Petitioner’s audit history shows that he had three audits, all in 1999, prior to the one in issue here.  The first of those showed a shortage of $241, and the others showed small shortages within the acceptable tolerance level.  (PS Ex. 7).

            5.  On an audit sometime after the one in issue, Petitioner’s account was short but he found some stamp stock locked in his truck.  When this stock was added, it brought his account into balance.  Petitioner is not authorized to keep stamp stock in his truck.  (Tr. 75-77).

            6.  On April 26, 2000, Ms. Moorer issued Petitioner a Letter of Demand for $1,571.73.  Petitioner’s union filed a grievance on his behalf and a Step One meeting was held by Ms. Moorer and Petitioner’s union representative, Mr. Posner, on June 6, 2000.  The position put forth by Petitioner and the union was that Petitioner should be relieved of liability because of some Postage Validation Imprinter (PVI) adjustments, and because of lack of training.  PVI refers to postage meter sales.  Ms. Moorer looked into this and concluded from available records that Petitioner had made PVI adjustments properly and that there were no errors that could account for the shortage.  (Tr. 10-11, 58-59; PS Ex. 4; Pet. p. 51).

            7.  It is unclear what, if anything, happened regarding this alleged debt after the grievance was denied at Step One, but the Notice of Involuntary Administrative Salary Offsets was issued on May 21, 2003.  (PS Ex. 3).

DECISION

            The standard for determining an employee’s liability in a case such as this provides that employees to whom postal funds and accountable paper are consigned “are held strictly accountable for any loss unless evidence establishes that they followed the postal procedures established when performing their duties.”  Handbook F-1, Post Office Accounting Procedures (November 1996), §141.

            Respondent’s burden of proof in a case of unexplained shortage is to show that a loss occurred from an account for which the employee is accountable.  Respondent is not required to prove any specific dereliction, or act of negligence, by Petitioner.  When a properly conducted inventory, or audit, shows a stock shortage relative to a previously established balance, this constitutes proof of loss unless other evidence raises sufficient doubt about the accuracy of the inventory or the previously established balance, or otherwise suggests that there may have been no actual loss.  If Respondent proves a loss, the burden then shifts to the employee to show that he or she followed established procedures, or to present other evidence that would warrant relieving the employee of liability.

            Petitioner’s principal contention is that the shortage may have been caused by an error in making correct system entries when he ordered and received stamp stock at some time prior to the audit.  In support of this, at the hearing Petitioner presented two PS Form 17s, dated January 20 and February 11, 2000 (Pet. Exs. A and B).  Each was signed by Petitioner and a witness, showing that Petitioner received stock on those dates, each time in an amount close to the amount of the shortage.  Petitioner did not demonstrate, however, how an error on either of these transactions would have caused a false shortage.  It would seem that if he received stock but failed to enter it into the system, as he hypothesized in his testimony (Tr. 87-88), his account would have shown an overage, not a shortage.  He presented no evidence to suggest that stock that he did not actually receive was entered into the system as being part of his account.

            Because Petitioner did not show any connection between the two stamp stock requisitions discussed above and the March/April shortage, and as there is no evidence that the audit was not properly conducted or that it was inaccurate,  Respondent’s evidence is sufficient to prove a loss of $1,571.73.

            Petitioner also contended that he brought the stamp requisition problem to Ms. Moorer’s attention after the audit so that she could investigate it.  Ms. Moorer testified that Petitioner mentioned nothing other than the PVI matter as a possible explanation for the shortage.  I find her testimony, supported by her record of the Step One meeting (Tr. 9-10, 15-16, 45; Pet. p. 51), more credible on this point.

            Petitioner also argued that he was harmed by the passage of time, as his memory of the audit has dimmed and Ms. Henry could remember nothing at all about the incident.  Clearly, it might help both sides if these cases did not linger so long before a Notice of Involuntary Administrative Salary Offsets was issued.  In this case, however, Respondent produced the pertinent records, and Ms. Moorer’s testimony was clear and thorough.  Petitioner has not demonstrated that the delay prevented him from adequately presenting his case.

            Finally, there is the issue of whether the evidence shows that Petitioner followed proper postal procedures in performing his duties and could, therefore, be relieved of liability under that provision of the standard of liability quoted above from the F-1 handbook.  Other than his testimony that he was always careful in safeguarding his stamp stock, and that he always counted stock that was issued to him to verify that he received what was shown on the Form 17, Petitioner presented no evidence on this point.  His audit history (see Finding #4) is not helpful to him in this regard, and there is no independent evidence to support his testimony.  Also, his suggestion that he might have received stock without entering it into the system contradicts the claim that he always counted and verified.  Finally, his recounting of the incident in which he found some stamp stock in his truck shows at least one occasion when he did not follow proper procedure.  Petitioner has not carried his burden of showing that he followed prescribed postal procedures.

            Respondent has proved a loss of $1,571.73, and Petitioner has not shown a basis for relief from liability.  The Petition is denied.  Respondent may collect $1,571.73 from Petitioner’s salary.

Bruce R. Houston
Chief Administrative Law Judge

[1]  The hearing was conducted by the undersigned Administrative Law Judge via speaker telephone from Arlington, Virginia.  All other participants, including the court reporter, were present in a conference room at the hearing site.

[2]  References to the hearing transcript are “Tr._.”  References to documents attached to Respondent’s Answer are “PS Ex._.”  References to documents submitted by Petitioner will be referenced by page number, “Pet. p._.”