January 8, 2016

In the Matter of the Debt Collection Act Petition

KATRINA ELLIOTT v. UNITED STATES POSTAL SERVICE

P.S. Docket No. DCA 15-86

APPEARANCE FOR PETITIONER:
Albert E. Lum
Scialla Associates Inc.

APPEARANCE FOR RESPONDENT:
Cynthia Davis
Labor Relations Representative
United States Postal Service

FINAL DECISION UNDER THE DEBT COLLECTION ACT OF 1982

The Postal Service seeks to collect a $9,325.79 debt from Petitioner Katrina Elliott based on an alleged shortage in a unit reserve account.  The Postal Service has proved that Ms. Elliott is accountable for a part of the debt, but it has not proved that she was the unit reserve custodian when another part of the debt was found.  Accordingly, I conclude that the Postal Service may collect $6,219.94. 

FINDINGS OF FACT

1. Katrina Elliott was the unit reserve custodian at the Fords, New Jersey Post Office from June 2010 until September 27, 2012, when she transferred to another postal facility (Tr. at 11, 153–54, 161–62, 170; Exh. 10 at 4).
2. In anticipation of Ms. Elliott’s move and to prepare for the transfer of unit reserve accountability to a new custodian, Ms. Elliott and another postal employee counted the unit reserve stock on September 25, 2012 (Tr. at 128–30, 171; Exhs. 103, 105).  That count revealed a $6,219.94¹  shortage for Item Number 9100 (Unit Conversion) (Exh. 10 at 12; Tr. at 168).
3. When Ms. Elliott and the other employee discovered the shortage for Item Number 9100, they began a second count and contacted the Fords Postmaster (Tr. at 171).  The Postmaster stopped the second count and called the Office of Inspector General (IG) to investigate the shortage (Tr. at 12–13).
4. On September 27, 2012, two IG agents went to the Fords Post Office and interviewed Ms. Elliott and the Postmaster (Exh. 10 at 3).  During the interview, Ms. Elliott admitted that there was a shortage in the unit reserve account and that she was the unit reserve custodian (Exh. 10 at 3, 4, 6).
5. The record does not indicate whether the unit reserve stock was properly sealed after Ms. Elliott transferred on September 27, 2012 (Tr. at 33–34).
6. On October 3, 2012, Ms. Elliott’s representative²  and the Fords Postmaster counted the stamp stock in the unit reserve account.  The count revealed a shortage of $9,325.79.  Of that amount, $7,377.11 related to Item Number 9100 and the remainder, $1,948.68, related to other item numbers.  (Exh. 10 at 20–23).
7. On October 10, 2012, the Postal Service issued a Letter of Debt Determination to Ms. Elliot based on the shortage in the unit reserve account (Exh. 3 at 1).  The Postal Service then sent Ms. Elliott an invoice on January 2, 2013, for the same debt (Exh. 1 at 2).
8. The Postal Service issued a Notice of Involuntary Administrative Salary Offset on March 19, 2015, notifying Ms. Elliott of the Postal Service’s intent to collect $9,325.79 based on the alleged unit reserve shortage.  The Postal Service intended to collect the debt by offsetting 15% of Ms. Elliott’s disposable pay.  (Exh. 13).  Ms. Elliott then filed a timely Petition challenging the alleged debt.

DECISION

To collect a debt for a unit reserve shortage, the Postal Service must prove an actual loss in an account for which Ms. Elliott was accountable after a properly conducted stamp stock count.  See Jorden v. United States Postal Service, DCA 14-150 (September 29, 2014).  If the Postal Service meets this burden, Ms. Elliott will be personally accountable for the shortage unless she can prove circumstances that alleviate or offset the shortage.  Ms. Elliott bears the burden to demonstrate such exonerating circumstances.  See Zeola H. Brady, DCA 10-190 (February 11, 2011).

Here, the Postal Service has proved that there was a $6,219.94 shortage when Ms. Elliott left her position as the unit reserve custodian (Finding 2).  The remainder of the alleged debt consists of two parts: an additional $1,157.17 shortage related to Item Number 9100 and a $1,948.68 shortage related to other item numbers (Finding 6).  The shortage related to Item Number 9100 is discussed further below.  As to the shortage related to the other item numbers, the Postal Service has not shown that the shortage occurred while Ms. Elliott was the unit reserve custodian.  Rather, the shortage was first revealed during the October 3, 2012 count.  By that time, however, Ms. Elliott was no longer the unit reserve custodian.  The Postal Service has thus failed to prove that Ms. Elliott is accountable for this debt. 

As to the $6,219.94 debt, Ms. Elliott put forth three defenses, each of which is discussed in turn below. 

1.     Lack of Training

Ms. Elliott alleges that she had not been properly trained by the Postal Service in the duties and responsibilities of a unit reserve custodian.  According to Ms. Elliott, that lack of training caused her to make mistakes during her tenure as the unit reserve custodian, which contributed to the shortage.  Ms. Elliott specifically cites to instances when she transferred stamp stock to the Stamp Distribution Office but, because of a lack of training, failed to account for the transfer properly in the POS accounting system.  According to Ms. Elliott, because this accounting error resulted directly from her lack of training, she should be excused from the debt.

I disagree.  Once Ms. Elliott accepted accountability as the unit reserve custodian, she also accepted the responsibility to learn the correct procedures to account for the inventory under her control.  See Diane Winbush, DCA 12-129 (November 29, 2012); Chenika Squalls, DCA 12-197 (December 7, 2012)(holding that the unit reserve custodian accepted the risk of accountability even if she believed she had not been properly trained to perform her job).  Further, as to the alleged shipments to the Stamp Distribution Office, Ms. Elliott has only presented vague testimony regarding the amounts and dates of the shipments.  She did not, however, produce any documents, such as the Form 17s, supporting this assertion.  (Tr. at 180, 204–05; see Raymond Keith Davis, DCA 09-107 (July 9, 2009); Michael Richards, DCA 06-117 (November 14, 2006)(holding that in the absence of Form 17s, a debt was not excused by non-specific allegations that stock had been sent to the Stamp Distribution Office)).  Ms. Elliott’s alleged lack of training thus does not excuse her from the debt.

2.     Stamp Stock Borrowed from the Fords Post Office

Ms. Elliott next asserts that postal officials from the Perth Amboy Post Office borrowed stamp stock from the Fords Post Office.  According to Ms. Elliott, the postal officials from Perth Amboy (1) did not process the proper paperwork to reduce the unit reserve accountability in the Fords Post Office when these transfers were made and (2) failed to return the stamp stock to the Fords Post Office.  Ms. Elliott contends that these improper practices contributed to the unit reserve shortage now in dispute.

Here again, Ms. Elliott has not presented anything other than vague testimony to support her argument.  There are no records supporting the alleged stock transfers, and Ms. Elliott could not provide the specific dates or amounts of the transfers (Tr. 166–68).  She also did not provide any evidence tying these alleged transfers to the shortage related to Item Number 9100.  In the absence of any such evidence, Ms. Elliott has not established that these transfers, even if they occurred, related to the disputed shortage.  See Phil Kennelty-Cohen, DCA 04-46 (July 14, 2004)(holding that offset is not appropriate unless the evidence establishes a probable relationship between a shortage and other stock allegedly offsetting that shortage).

3.    Increase in the Shortage Between September 25 and October 3

Finally, Ms. Elliott contends that she is not responsible for the increase in the shortage in Item Number 9100 stock that occurred between the first stamp count on September 25 and the second stamp count on October 3.

The record establishes that Ms. Elliott counted the unit reserve stock, including the Item Number 9100 stock, and found a shortage of $6,219.94 in the Item 9100 stock on September 25, 2012.  Her last day as the unit reserve custodian was two days later on September 27.

We have repeatedly held that an employee is only accountable for a shortage that occurred while the employee was the unit reserve custodian.  See e.g. Kathryn L. Schrack, DCA 11-52 et al. (August 26, 2011); Patricia Todd, DCA 02-82 (May 17, 2002).  Here, the record establishes that the shortage increased after Ms. Elliott’s last day as the unit reserve custodian.  She thus is not accountable for that increase.  Rather, she is only accountable for the shortage that existed on September 25, 2012.  That is especially true where, as here, the Postal Service has not proved that the unit reserve stock was properly secured between the time that Ms. Elliott left and the time the second count was conducted on October 3, 2012 (Finding 5). 

Ms. Elliott is therefore only accountable for a $6,219.94 shortage for Item Number 9100 as of September 25, 2012. 

ORDER

The Petition is granted in part and denied in part.  The Postal Service may collect $6,219.94 by involuntary administrative salary offset.

Alan R. Caramella
Administrative Judge

¹ An initial count showed a $6,380.86 shortage for Item Number 9100, but this amount was revised when two additional items valued at $160.92 were found and then added to the count, thereby reducing the shortage to $6,219.94 (Exh. 10 at 12; Tr. at 198¬¬–200).

² The representative was from the National Association of Postal Supervisors (Tr. at 87).