October 22, 2018

In the Matter of the Debt Collection Act Petition

J. JANELLE HUFFMAN v. U.S. DEPARTMENT OF VETERANS AFFAIRS

P.S. Docket No. VA 17-200

APPEARANCE FOR PETITIONER:
J. Janelle Huffman

APPEARANCE FOR RESPONDENT:
Kelly J. Burns, Esq.
Department of Veterans Affairs

FINAL DECISION UNDER THE DEBT COLLECTION ACT OF 1982

J. Janelle Huffman is a nurse who worked for the Department of Veterans Affairs (VA) for forty years until her retirement.  Between 2010 and 2015, her duties in a hospital’s medical surgery unit required that in addition to regular hours she work nights, weekends, and overtime.
In 2010, Congress passed a law changing how the VA calculates a nurse’s premium pay for night, weekend, and overtime hours.  The VA implemented the statute in 2016 which meant that the VA needed to retroactively adjust Ms. Huffman’s pay for work performed between 2010 and 2015.  The revised calculations relate to numerous days within 127 pay periods.
The VA made a payment in 2016 to Ms. Huffman based on its revised calculations.  This case involves the VA’s claim that it overpaid Ms. Huffman.  Ms. Huffman defends by arguing that the VA did not give her credit for the actual hours she worked and that she is entitled to additional premium pay.  Given the conflicting evidence about actual hours, premium pay, and payments made, this case required that I decide the net effect of the pay adjustments during the six-year period.
Specifically, the VA assessed Ms. Huffman with a $6,336.35 debt for a salary overpayment.  Because a large portion of the VA’s calculations were incorrect, the Petition is granted in part and denied in part.  The VA may collect $3,622.16.

FINDINGS OF FACT

1. Ms. Huffman worked as a nurse for the VA for forty years.  Relevant to this litigation, she worked as a registered nurse in the Medical Surgery Unit at the VA Central Iowa Healthcare System between 2010 and 2016.  (Tr. 59-60, 178-79, 471; AE 3).
2. Ms. Huffman was a part-time employee and was normally scheduled to work 32 hours per week (64 hours per two-week pay period).  Her usual schedule was from 3:30 p.m. to midnight, and she often worked weekend shifts.  (AE 3, 7, 10, 12, 20; Tr. 180, 351-52, 375, 448).
3. Depending on the time and number of hours worked, Ms. Huffman could earn regular, overtime, weekend, or night differential pay.  Overtime, weekend, and night differential pay are considered premium pay and have different pay rates.  Patient needs dictated that Ms. Huffman would often work premium pay hours.  (AE 7; Tr. 45, 65, 150, 209).¹
4. In 2010, Congress passed The Caregivers and Veterans Omnibus Health Services Act of 2010, Pub. L. 111-163 (the section relevant to this litigation is codified at 38 U.S.C. § 7453, Nurses: additional pay) which changed the methods for calculating premium pay and had the practical effect of increasing the premium pay a nurse would receive for premium hours.  Id; see also Tr. 62, 65-66.
5. Under the statute, night differential pay adds 10% to an employee’s hourly pay rate; weekend pay adds 25% to an employee’s hourly pay rate; and overtime pay adds 50% to an employee’s hourly pay rate (AE 4; Tr. 65-66).
6. Although required to implement the statute in 2010, the VA did not do so until 2015.  The VA’s failure to timely implement the statute resulted in many nurses, including Ms. Huffman, being underpaid for several years.  (AE 1, 2; Tr. 16, 60-64).
7. An agreement between the VA and the National Nurses Union provided that salary underpayments due a nurse for work done between 2010 and 2015 could not be reduced (i.e., offset) by a nurse’s debts resulting from other salary issues.  In practical terms, this meant that the VA had to pay any salary underpayments and then go back and separately collect any salary overpayments.  (AE 2 at 8; Tr. 61, 119-20, 155).
8. The VA calculated the additional pay owed to Ms. Huffman for work done between 2010 and 2015.  Almost every pay period (127 pay periods in total) included pay adjustments increasing her pay.  Based on its calculations, the VA paid Ms. Huffman $9,328.32 on October 1, 2016.  (AE 3 at 1; AE 7; AE 11; Tr. 71).
9. The VA also determined that it overpaid Ms. Huffman $6,336.35 for work done between 2010 and 2015 (AE 6; Tr. 71, 86).
10. The VA issued Ms. Huffman six debt notice letters dated February 2, 2017 (one each for the years from 2010 through 2015), to collect the $6,336.35 salary overpayment.  None of the notices produced by the VA include a notice to Ms. Huffman of her right to request a hearing.  (AE 8; see also 5 U.S.C. § 5514).
11. Ms. Huffman filed a Petition, dated March 6, 2017, requesting a hearing (Petition).²   Although a timely Petition should have stayed collection, the VA collected $6,336.35 from Ms. Huffman (see 5 U.S.C. § 5514).  To correct this error, these proceedings were stayed until the VA complied with the law and returned the money (see Order and Memorandum of Telephone Conference dated September 27, 2017).³
12. Proceedings were also stayed because the VA did not produce the relevant Time and Attendance Source Records (see Order and Memorandum of Telephone Conference dated December 14, 2017; see also Order dated January 12, 2018).  After the VA eventually produced those records, Ms. Huffman was given the opportunity to review them.  She subsequently amended her analysis challenging the VA’s calculations based on the actual hours she worked and requested an offset for unpaid premium pay.

ACTUAL HOURS

1. After the Petition was filed, the VA also reevaluated its calculations based on the actual hours worked as shown in the daily time sheets and reduced the debt assessment by $1,488.82 (Tr. 230-31, 286, 291, 336).
2. In addition to the $1,488.82, Ms. Huffman continued to challenge $790.44 in adjustments related to seven pay periods (i.e., pay periods 2010-12, 2010-14, 2011-11, 2011-19, 2012-18, 2012-22, and 2015-19).
3. During the hearing, Ms. Huffman and the VA’s pay analyst agreed to several adjustments for five of the seven pay periods.  For pay period 2011-11, I adopt the VA’s revised calculations.  For the seventh pay period, 2015-19, the VA did not demonstrate that it made the overpayment of $29.92 it now seeks to collect.  The net result is that the debt assessment is reduced by $483.68.  (Tr. 463, 452, 467-69, 376-77, 455-56, 424-26, 434, 442, 350-58, 363-64; AE 12 at 73).
4. When combined, the calculations based on the actual hours worked reduces the assessed debt to $4,363.85.⁴

OFFSETS

1.  Ms. Huffman submitted three requests for offsets seeking to further reduce the assessed debt referred to as Offset 1, Offset 2, and Offset 3.  Offset 1 and Offset 2 include sixty-nine line items identifying adjustments to particular days of work between pay periods 2012-19 to 2016-29 totaling $2,740.21.⁵   (Pet. Exh. 234-47, referred to as Offset 1; Pet. Exh. 248-275 referred to as Offset 2).  Offset 3 is a resubmission of certain line items from Offsets 1 and 2 (see Pet. Offset 3, July 13, 2018 at 505; see also Offset 3, August 31, 2018 at 32).

Offset 1

1. In Offset 1, Ms. Huffman requested 18 adjustments to the VA’s calculations for an offset of $1,349.45.  The VA conceded six of the adjustments worth $243.58.  (Agency Response to Offset Arguments dated May 31, 2018 at 1-3).
2. In addition, Ms. Huffman is entitled to 8 hours of overtime premium for work performed on September 5, 2016, for an additional offset of $161.28 (AE at 3104-05).

Offset 2

1. In Offset 2, Ms. Huffman requested 51 adjustments to the VA’s calculations for an additional offset of $1,390.76.  The VA conceded eleven of the adjustments worth $284.65 (Agency Response to Offset Arguments dated May 31, 2018 at 2).⁶
2. Additionally, Ms. Huffman is entitled to overtime premium for two hours worked on January 16, 2012, for an additional $37.26 (Agency Response to Offset Arguments dated May 31, 2018 at 3).
3. Ms. Huffman worked 65 hours in pay period 2012-17, but was only paid for 64.75 hours.  She is entitled to additional compensation for 0.25 hours, which is worth $9.32.  (AE at 3110).⁷
4. Ms. Huffman is entitled to an additional 1.25 hours of night differential in pay period 2012-19 worth $5.60 (AE at 3111-12).
5. When combined, Offsets 1 and 2 reduce the remaining assessed debt of $4,363.85 by $741.69 for a new balance of $3,622.16.

Offset 3

1. In Offset 3, Ms. Huffman repeated her arguments for the previously disallowed amounts in Offsets 1 and 2.  The remaining offsets are based on Ms. Huffman’s allegation that the daily time sheets were incorrect. ⁸  Thus, Ms. Huffman argues that instead of just the $9,328.32 she received in October 2016 (see Finding 8), she is entitled to an additional $2,241.96, which would leave a net debt balance of less than $1,500.  (See Pet. Offset 3, July 13, 2018 at 505; see also Offset 3, August 31, 2018 at 32).
2. The evidence does not support an additional adjustment for Offset 3.

DECISION

The VA assessed debts totaling $6,336.35 for salary overpayments pursuant to the terms of the Debt Collection Act of 1982.  5 U.S.C. § 5514.  When an agency seeks to recover a salary overpayment, it bears the initial burden to prove that:  (1) it made the salary overpayment; (2) it properly calculated the amount of the overpayment; and (3) the employee was not entitled to the overpayment.  Herrin v. United States Department of Veterans Affairs, VA 17-48, 2017 WL 5516590 (June 30, 2017). 
The dispute in this case focuses on whether the VA properly calculated the amount of the overpayment.  The VA initially calculated the assessed debt based on the leave and earnings sheet for each pay period.  During this litigation, the VA produced the daily time and attendance sheets.  It was clear that there were numerous errors in transcribing the data from the handwritten daily time sheets to the automated payroll system, determining when premium pay was earned, and transmission of the data from the VA to its payroll agent, the Defense Finance and Accounting Service.  After Ms. Huffman filed the Petition, the VA revised its calculations based on the daily time sheets, which reduced the assessed debt by $1,488.82.  Ms. Huffman then successfully proved another $483.68 in calculation errors made by the VA based on the actual hours she worked.  Taken together, these adjustments reduce the assessed debt from $6,336.35 to $4,363.85.  Based on a preponderance of the evidence, I conclude that the VA has only proved that it is entitled to collect $4,363.85.
Ms. Huffman seeks to reduce the remaining debt by arguing that she is entitled to additional offsets for unpaid premium pay that she earned during the relevant six years.  We have allowed offsets when the amount is closely related to the assessed debt.  See, e.g., Prado v. United States Postal Service, DCA 16-200, 2018 WL 1362944 (January 30, 2018)(offset is permitted when the underpayment is so closely related to the overpayment as to constitute a single debt dispute).  The best data showing the hours worked was contained in the handwritten daily time sheets.  Using the daily time sheet data resulted in both increases and decreases in premium pay earned by Ms. Huffman during the six-year period.  Because the assessed debt for salary overpayment is closely linked to the underpayments, offset is appropriate in this case.
Ms. Huffman’s calculations are identified as Offset 1 (Pet. Exh. 234, dated April 1, 2018), Offset 2 (Pet. Exh. 248, dated April 6, 2018), and Offset 3 (submitted on July 8, 2018).  Ms. Huffman submitted requests for sixty-nine adjustments (Offset 1 and Offset 2).  The VA agreed (based on the data in the daily time sheets) that Ms. Huffman was entitled to credit for seventeen of the sixty-nine adjustments.  These offsets totaled $528.23.  In addition, Ms. Huffman proved to a preponderance level of the evidence that she was entitled to four additional offsets of $213.46.  When combined, these offsets reduce the assessed debt from $4,363.85 to $3,622.16.
Ms. Huffman failed to prove entitlement to any further offsets.  She bases her argument for additional offsets on her personal calendars she used to track her work schedule (see Huffman Exhibits March 13, 2018).  In contrast to Ms. Huffman’s personal calendars, the record includes a second set of daily timekeeping data. 
On a daily basis the nurse supervisor in the Medical Surgery Unit would annotate, by hand, a time sheet with any additional time worked by each nurse and when those hours were worked (Tr. 30-32, 39-44; Time Data Sheets submitted January 19, 2018 at 1-545).  These records were kept as part of the nurse supervisor’s duties.  Employees were instructed to check their timesheets before submission at the end of each week to the finance office.  (Tr. 43-44, 53-54).  If there was a discrepancy between what the nurse supervisor wrote and what the nurse believed he or she worked, the nurse and the nurse supervisor were required to resolve the discrepancy.  This process was relatively contemporaneous to the submission of the hours to the finance department for preparation of an employee’s leave and earnings statements (Tr. 30-44).  When faced with competing data, I believe the data on the time sheets kept in the Medical Surgery Unit, which was entered and checked contemporaneously, is more reliable than Ms. Huffman’s personal calendars.  Accordingly, I do not grant the Petition as to the additional offsets.
Ms. Huffman makes an additional argument that the VA’s calculations should not be given weight because they include several errors totaling seven cents (see Huffman spreadsheet submitted on August 31, 2018).  Given the number of calculations, the seven cents is attributable to rounding errors and is not an indicia of incorrect calculation or methodology.

ORDER

The Petition is granted in part and denied in part.  The VA may only collect $3,622.16 from Ms. Huffman by involuntary administrative offset.

Peter F. Pontzer
Administrative Judge