July 8, 2019

In the Matter of the Administrative Offset Petition

BEVERLY A. TORAIN v. UNITED STATES POSTAL SERVICE

P.S. Docket No. AO 19-18

APPEARANCE FOR PETITIONER
Albert E. Lum
Labor Relations Admin Group, LLC

APPEARANCE FOR RESPONDENT
Jacqueline K. Allen
Labor Relations Specialist
United States Postal Service

INITIAL DECISION

The Postal Service seeks to collect $3,259.24 from Beverly A. Torain, which represents 80 hours of unearned annual leave.  Because the Postal Service has met its burden of proof, I deny the Petition and rule in favor of the Postal Service which may collect the assessed debt.

FINDINGS OF FACT

1. Ms. Torain served as the Postmaster for Apex, North Carolina, from August 2014 until her retirement in December 2018 (Tr. 53, 88).
2. During this time, Ms. Torain was an Executive and Administrative Schedule (EAS) employee.  As an EAS employee, Ms. Torain received a set salary and was not eligible for overtime.  (Tr. 36, 47, 64-66, 85, 88-89).
3. Her supervisor was the Greensboro District, Area 2, Post Office Operations Manager (POOM) (Tr. 24-25, 51).
4. Ms. Torain was on extended sick leave from July 2017 to April 2018 (Tr. 89, 116-17).  During that time, she did not have access to her work email.  When she returned, she had a large volume of unopened email (Tr. 49-50, 117-18). 
5. On March 18, 2019, the POOM sent an email to supervisors in his district (including Ms. Torain) stating in relevant part:

I will be the approver for all Postmasters/OICs (officers in charge) in POOM group 2 offices for request[s] over 40 hours.
Your 3971 [Request for or Notification of Absence] ¹ must be approved and signed by me to be considered as official.  If any leave was approved by any of my predecessor[s] I will need to validate it, and it should be on file with [the] POOM 2 Secretary currently. (Resp. Exh. 5 (emphasis in original); Tr. 25-26, 48-50).

6. On July 29, 2018, Ms. Torain approved two PS 3971 forms for herself.  The POOM did not approve either leave form.  The first form was for 40 hours of leave during the first week of pay period 17-2018 (August 6 through August 10, 2018).  The second leave form was for 40 hours of leave during the second week of pay period 17-2018 (August 13 through August 18, 2018).  (Resp. Exhs. 1, 2; Tr. 25, 38-39, 92).
7. On each PS 3971, under the “Type of Absence,” Ms. Torain checked the box for “Other” and handwrote beside it “Change in NS [nonscheduled] days.”  In the remarks section Ms. Torain wrote:  “COMP TIME FOR WORK ON NS DAYS.”  She then identified ten different Saturdays (five on each PS 3971) when she worked (Resp. Exhs. 1, 2).
8. One of the ten days Ms. Torain identified was July 28, 2018.  Ms. Torain claimed compensation for this day twice.  (Petition, Attachment 3; Resp. Exh. 2; Tr. 121-22, 126-27).
9. The POOM did not direct Ms. Torain to work on any non-scheduled day (Tr. 35, 64-65).
10. Ms. Torain was paid for the 80 hours of leave (Resp. Exh. 7; Tr. 70).
11. Ms. Torain retired from the Postal Service in December 2018 (Tr. 53-54).
12. On December 20, 2018, the Postal Service issued Ms. Torain an invoice for $2,409.23 for 80 hours of unearned leave between August 6, and August 18, 2018 (Petition, Attachment 2).
13. On January 11, 2019, the Postal Service issued Ms. Torain a Notice of Intention To Collect A Debt By Administrative Offset Under The Debt Collection Act for a debt of $2,409.23 (Petition, Attachment 1).
14. Ms. Torain filed a timely Petition challenging the assessed debt (see Petition). 
15. On February 21, 2019, the Postal Service assessed a debt of $850.01 for taxes related to the 80 hours (Pet. Exhs. 4, 5; Tr. 80-81).
16. The parties stipulated that the tax issue should be added to this litigation and were provided the opportunity to address the tax issue at trial (Tr. 17-19, 80-82). 
17. The value of the 80 hours of leave and associated taxes is $3,259.24 (Petition, Attachment 1; Pet. Exhs. 4, 5; Tr. 78-80).²

DECISION

To recover in a salary overpayment case, the Postal Service must prove:  (1) that it made the salary overpayments to Ms. Torain; (2) the amount of those payments; and, (3) that Ms. Torain is not entitled to keep those payments.  See DePumpo v. United States Postal Service, AO 14-248, 2015 WL 13647615 (I.D. January 6, 2015).  If the Postal Service proves these elements, the burden shifts to Ms. Torain to demonstrate that she is entitled to keep the overpayment.  Id.
The parties agree that Ms. Torain did not work between August 6, 2018, through August 18, 2018, was not charged annual or sick leave for that time, and was paid her normal salary and related taxes for a total of $3,259.24.  Therefore, the only issue before me is whether Ms. Torain is entitled to retain the overpayment.
The Postal Service does not have mandatory compensatory time for EAS employees.  Postal Service regulations provide that “[w]hen an exempt employee is directed to work a full day on a holiday or other full day in addition to normal workdays, the supervisor may grant a full day of personal absence without charging it to official leave.”  Employee Labor Relations Manual (ELM) § 519.733 (emphasis added). 
This concept is reinforced in the Supervisor’s Guide to Scheduling and Premium Pay, Handbook F-401 (August 2000).  This Handbook provides: 
If an exempt employee is directed to work a full day on a holiday or other nonscheduled day in addition to normal workdays, the employee’s supervisor may grant a full day of personal absence without charge to official leave.  A full day of personal absence is only authorized when the employee has worked a full day on a nonscheduled day or holiday.
Id. at 68 (emphasis added). 
The POOM credibly testified that he did not direct Ms. Torain to work nine nonscheduled days, and he did not grant ten days of personal absence without charging annual leave.  Therefore, the Postal Service has proved that Ms. Torain was overpaid, and the burden shifts to Ms. Torain to demonstrate that she is entitled to keep the overpayment.
Ms. Torain makes three arguments for why that she is entitled to the $3,259.24. 
First, Ms. Torain argues that the POOM directed her to ensure that the Apex Post Office was meeting its goals knowing that the facility was understaffed.  Implicitly, such performance requirements necessitated Ms. Torain working on Saturdays.  The record does not include specific evidence that the POOM directed Ms. Torain to work the days for which Ms. Torain claims credit.  On the contrary, the POOM denied that he specifically directed her to work those days.  On balance, the POOM’s testimony is credible.
Second, Ms. Torain stresses that the POOM “may grant” a full day of personal absence when she worked the Saturdays.  Petitioner argues that with the POOM’s implicit approval of her extra work, he also implicitly granted the compensatory time for personal absences.  Both the ELM and Handbook F-401 use the word “may” not “shall,” so it is a discretionary choice, not a required action.  The record does not show that the POOM exercised his discretion to grant ten days of personal absences, implicit or otherwise.  On the contrary, Ms. Torain approved her two leave forms, the POOM did not approve them.  Furthermore, Ms. Torain submitted two separate leave forms for 40 hours each during the same pay period instead of one leave form for 80 hours, which would have needed the POOM’s approval, suggesting that she would not welcome the POOM’s review. 
Third, Ms. Torain argues that fundamental fairness supports her being able to retain the money because she worked the extra hours.  This argument lacks a legal foundation.  Ms. Torain was an EAS employee and not entitled to overtime.  Neither the ELM nor Handbook F-401 provide for a supervisor being able to earn compensatory time absent supervisor approval.³   Ms. Torain has not demonstrated that she is entitled to retain the compensation she received for the 80 hours.
With regard to taxes, because the dispute crossed the calendar year, the Postal Service recalculated the debt to include $850.01 to accommodate the tax consequences.  The Postal Service is required to withhold taxes on behalf of its employees and forward this money to the federal, state, and local government in the year in which the income is earned.  See 26 U.S.C. § 3402; 26 C.F.R. § 31.3402(a)-1.  It is well settled that if an employee does not repay a debt by the end of a calendar year, the agency is no longer able to recoup the taxes it forwarded to the tax authorities on behalf of the employee.  See, e.g., Salzano v. United States Postal Service, DCA 17-228, 2019 WL 479670 (January 7, 2019).  Because the Postal Service cannot recoup taxes it forwarded on behalf of the employee after the close of the calendar year, the Postal Service is entitled to recover $850.01 for the related taxes it paid to the tax authorities on Ms. Torain’s behalf.  Ray v. United States Postal Service, DCA 18-104, 2018 WL 4220789 (August 17, 2018) citing Aaron Thorne, DCA 12-319,  2013 WL 12303256 (April 16, 2013).

ORDER

The Petition is denied.  The Postal Service may collect $3,259.24 through involuntary administrative offset.

Peter Pontzer
Administrative Law Judge