ECAB Sends Case Back to OWCP to Rethink $84,820.09 Overpayment Ruling Against Employee's Widow

Washington, DC (WorkersCompensation.com) -- As occurs at the state level, receiving Social Security benefits can impact what federal workers’ compensation benefits employees, or their surviving spouses, may receive. 

As an example, in P.W. v. Department of the Navy, No. 20-1132 (ECAB 11/30/22), the widow of a federal employee may have received nearly $85,000 in overpayments, depending whether a federal agency’s calculations turned out to be correct. 

The widow of a Navy employee filed a claim for compensation, alleging that the employee, then a 44-year-old machinery mechanic, sustained severe steam burns to over 70 percent of his body when he was exposed to residual hot water and steam while working on a low-pressure steam piping system in the performance of duty and that he subsequently died as a result this injury. 

The Office of Workers’ Compensation Programs accepted the claim for survivor benefits and paid the widow survivor benefits. Later, the Social Security Administration forwarded a completed Federal Employees Retirement System dual benefits form to OWCP. 

In a FERS offset overpayment calculation, OWCP found overpayment amounts totaling $84,820.09 due to the widow’s receiving SSA benefits from the employee’s FERS retirement annuity and that this portion of SSA benefits was a prohibited dual benefit. 

Although OWCP determined that the widow was without fault in the creation of the overpayment, it denied waiver of recovery because no financial information had been submitted. OWCP advised that $299 would be withheld from the widow’s continuing compensation benefits every 28 days. 

The widow appealed to the Employees’ Compensation Appeals Board. 

Under the Federal Employees’ Compensation Act, workers’ compensation benefits for federal employees must be reduced by the portion of SSA benefits based on age or death that are attributable to federal service. 

In this case, ECAB held that the widow’s receive of benefits under FECA and SSA benefits was a prohibited dual benefit. However, that wasn’t the end of the story. 

According to ECAB, the case was “not in posture for decision with regard to the period and amount of the overpayment.” 

That was because: 

• It was unclear whether the reported benefit rates represent the SSA survivor benefit rates received by the widow or the employee’s SSA age-related retirement benefits. 
• It was unclear whether the widow’s own SSA disability benefits were incorporated in the reported rates. 
• OWCP calculated that the widow received an overpayment of compensation from Aug. 1, 2004, through Jan. 4, 2020, but the widow was not in receipt of SSA survivor benefits based on the employee’s FERS retirement account until about July 2016. 

Thus, ECAB remanded the case to OWCP to recalculate the period and amount of overpayment of compensation.