Washington, DC

U.S. Office of Personnel Management
Compensation Claim Decision
Under section 3702 of title 31, United States Code

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Robert D. Hendler
Classification and Pay Claims Program Manager
Agency Compliance and Evaluation
Merit System Accountability and Compliance


08/19/2014

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Date

The claimant is a former Federal civilian employee of the Department of the Army (DA) in Pyong Taek, Republic of Korea.  He requests the U.S. Office of Personnel Management (OPM) reconsider his agency’s termination of his living quarters allowance (LQA).  We received the claim on November 18, 2013, and the agency administrative report (AAR) on January 28, 2013.  For the reasons discussed herein, the claim is denied.

The appellant reported on his resume a series of consecutive employments in Korea commencing with the firm DynCorp Inc. (April 1990-January 1992); Raytheon Aerospace and Aviation (January 1992-March 1997); Program Executive Office and Aviation (PEOA) (November 1997-April 2008); and Thomas J. Davis, Inc./Jung Il Associated (TJD-JI) ("21 April 2008- Present," the resume being undated).  He was appointed to the Federal service on January 5, 2009, and was granted LQA.[1]  In May 2013 the claimant was notified that, as a result of a Department of Defense (DoD)-directed LQA audit, it was determined he did not meet the LQA eligibility provisions in the Department of State Standardized Regulations (DSSR) section 031.12b, which requires that an employee recruited outside the United States must, prior to appointment, have been recruited in the United States by his or her previous employer and have been substantially continuously employed by such employer under conditions providing for return transportation to the United States.  The notification letter stated that he had been "identified as an employee recruited outside the United States who had more than one employer in the overseas area prior to [his] appointment into appropriated fund Federal civilian service."

The agency states in its AAR that the claimant is ineligible for LQA because he has not demonstrated that “he was not employed in Korea prior to his employment with TJD-JI, was recruited from the United States by TJD-JI, or that his employment with TJD-JI contained conditions which provided for his return transportation to the United States.”

The claimant asserts "the government mistakenly determined that I had worked for more than one employer prior to my appointment into appropriated fund Federal civilian service," that he "departed the Republic of Korea and terminated all association with any government agencies or Department of Defense Contractors," and he "was not in the Republic of Korea when [he] received a job offer from a DoD Contractor (TJD) and that employer represented [his] sole employer prior to [his] acceptance of a Federal civilian service job offer."  The crux of his assertions appears to be that after the conclusion of his employment with PEOA, he departed Korea and returned to the United States, where he subsequently accepted the job offer fromTJD-JI. 

The DSSR sets forth the basic eligibility criteria for the granting of LQA.  DSSR section 031.12 states, in relevant part, that LQA may be granted to employees recruited outside the United States under the following circumstances:

a.  the employee's actual place of residence in the place to which the quarters allowance applies at the time of receipt thereof shall be fairly attributable to his/her employment by the United States Government; and

b.  prior to appointment, the employee was recruited in the United States, the Commonwealth of Puerto Rico, the Commonwealth of the Northern Mariana Islands, the former Canal Zone, or a possession of the United States, by:

(1) the United States Government, including its Armed Forces;

(2) a United States firm, organization, or interest;

(3) an international organization in which the United States Government participates; or

(4) a foreign government

and had been in substantially continuous employment by such employer under conditions which provided for his/her return transportation to the United States, the Commonwealth of Puerto Rico, the Commonwealth of the Northern Mariana Islands, the former Canal Zone, or a possession of the United States.  [Italics added]

The agency’s language that the claimant had “more than one employer in the overseas area” as the basis for his LQA ineligibility is not used in the DSSR.  Rather, it is an abbreviated way of characterizing section 031.12b, which allows LQA eligibility in those instances where the employee, prior to appointment, had “substantially continuous employment” with one of the entities listed under b(1) through b(4), and which entity (i.e., the singular usage of “such employer”) recruited the employee in and provided return transportation to the United States or its territories or possessions.  By extension, an employee who has had more than one “employer” overseas prior to Federal appointment would be disqualified because the initial overseas employer rather than the employer immediately preceding appointment would have recruited the employee in the United States.  Therefore, the claimant misconstrues the agency’s characterization of DSSR section  031.12b as requiring only that he have had no more than one employer overseas before his Federal appointment.  This is only partially correct, as the criteria also require that the one employer have recruited him in the United States and that he have had substantially continuous employment by that employer under conditions which provided for his return transportation to the United States or one of the other identified locations. 

Relating this to the claimant’s case, he would be eligible for LQA under DSSR section 031.12b only if he could establish that TJD-JI (his employer prior to his appointment to the Federal service) had recruited him in the United States; i.e., that he was physically in the United States during the recruitment process, from his initial application for the job with TJD-JI through his receipt and acceptance of the job offer. 

The record includes a copy of an email from the claimant to an agency human resources staff member wherein he provides the following account of events preceding his hiring by TJD-JI:

1.  My replacement for Apache PM arrived in Feb 2013 and I was relieved of my duties in Korea and directed to return to the US after closing out personal affairs so I was on Vacation conducting my own business.

a.  From that I was not employed in Korea after 5 Mar 2008.
b.  All of my household goods left Korea in Jan 2008, Family (and dogs) followed in Feb 2008 and after 5 Mar 2008 I did not have any email communication until I arrived at my relatives home on 25 Mar 2008, therefore I did not receive any notification I was hired until I opened my mail.  All forms received were already filled out and only required my signature and then resent to TJD-JI.
c.  I arrived in the US at my company and quit employment and purchased my tickets back to Korea with funds provided by TJD-JI. 
d.  My official hire date was 21 April 2008 (ref Job Offer Letter).  I arrived in Korea on 19 April 2008. 

2.  Based on the above and the proof previously submitted that I did in fact move out of Korea completely I feel I DID NOT have multiple back to back employers prior to becoming a GS in Jan 2009.  Therefore I should be reinstated for LQA.

Although the claimant states he was “not employed in Korea after 5 Mar 2008,” was “directed to return to the US,” and sent his household goods out of Korea in January 2008 and his family in February 2008, he acknowledges he did not leave Korea until March 25, 2008.  This is consistent with the Korean passport document identified as "Certificate of Entry & Exit" submitted by the agency with the AAR, showing the claimant's departures from and arrivals in that country.  In the first half of 2008, it shows the claimant exited Korea on March 24, 2008, and re-entered on April 19, 2008.  The “job offer letter” cited by the claimant was an email dated March 12, 2008, extending a position with TJD-JI to the claimant while he was still in Korea.  Therefore, we conclude that the claimant was in Korea when he was recruited for the position with TJD-JI.  Whether the claimant was in the United States when he opened the email and whether his family and household goods had returned to the United States before or during the recruitment process is irrelevant to the determination of eligibility under DSSR section 031.12b.  The only relevant consideration is the claimant’s physical location when he was recruited by TJD-JI. 

The record also includes a document titled "Invited Contractor and Technical Representative Personnel Data Report" dated March 17, 2008, which identifies the "type of report" as "change in data" as opposed to "arrival," which appears to identify the claimant as having changed contracts rather than having arrived in Korea on a new contract, and identifies the "date and place of hire" as "14 Mar 08, Huntsville, AL USA."  (Since this portion of the report is "to be completed by the contractor employee," it is not regarded as independent documentation of his location at the time of recruitment.)  This would appear to contradict the claimant's assertion that he had "terminated all association with any government agencies or Department of Defense Contractors" before his employment with TJD-JI.[2]  The record also includes a letter dated March 17, 2008, Subject: Accreditation Letter for USAEDFE Contractor, identifying the claimant as an employee of TJD-JI, and two "Certificates of Employment" dated September 9, 2008, and December 16, 2008, and signed by TJD-JI officials (the Chief, Administrative Division, and the President/General Manager, respectively), both of which identify the claimant as having been hired by that firm "on 14 March 2008 from Huntsville, AL, U.S.A."  However, the latter document is problematic in that it states "TJD-JI shall also pay [future tense] the Employee transportation allowance for Employee and his family airfares from the U.S.A. to the Republic of Korea;" i.e., the letter is dated nine months after the claimant's hiring by that firm but states the firm "shall pay" as opposed to "has paid."  Regardless, the claimant’s own admission that he did not depart Korea until March 24, 2008, as documented on the "Certificate of Entry & Exit" establishes that he was not hired by TJD-JI from Huntsville, Alabama, on March 14, 2008.

To support his claim, the claimant submitted the following additional documents to verify that he “departed the Republic of Korea and terminated all association with any government agencies or Department of Defense Contractors”:

(1)  TJD-JI "Cash Disbursements Posting Log" dated March 24, 2008, showing that on posting date 3/18/08 a check for $993.40 was recorded for the claimant for "Hiring Airfare-One Way."  This does not indicate when the travel occurred or the departure or destination points but regardless, the claimant acknowledges he departed Korea on March 24, 2008, after the date of the job offer email.  The date he returned to Korea to begin his employment with TJD-JI is not germane to the LQA determination. 
(2)  "Freight Invoice" from Woosung Global Moving showing the claimant's "household goods moving charge" with "P.O.L." Incheon, Korea, and "P.O.D." United States, and the dates "E.T.D." 01/09/2008, "E.T.A." 01/09/2008, and a third date (written in Korean) 01/11/2008.  As discussed earlier, the location of the claimant’s household goods during his recruitment by TJD-JI is not germane to the LQA determination.
(3)  "Memorandum for Airlines" dated February 26, 2008, certifying that a dog being shipped by the claimant was "healthy for transport."  This contributes nothing to any determination of whether the claimant was recruited by TJD-JI in the United States.
(4)  Testimonial from an individual who asserts he has "been in Korea from 2003 until present and [has] been in direct contact [with claimant] though [sic] work the entire time and can verify his movements during the time in question."  This individual asserts that the claimant, after being notified he was being replaced (presumably by PEOA), "processed his household Goods for shipment... and sent his family out of country to visit relatives in early Feb [2008] awaiting his departure from Korea," that he had a one-month overlap with his replacement prior to his "departing Korea back to Huntsville, Al.," and that the claimant "left Korea March 2008."  Aside from any consideration of this individual's veracity or reliability, this testimonial does not establish that the claimant was physically in the United States when he was recruited  by TJD-JI and only serves to confirm that the claimant departed Korea in March 2008; i.e., on March 24, 2008, as indicated on the "Certificate of Entry & Exit." 

Further, the claimant has failed to establish that he was in “substantially continuous employment” by TJD-JI under conditions which provided for his return transportation to the United States or its territories or possessions.  In the AAR, the agency states the claimant “has refused to produce the original contract between him and TJD-JI which would contain all conditions of employment, and would demonstrate whether the employment provided for his return transportation to the United States upon completion of his contractual obligation.”  The only document referencing this is the previously-cited “Certification of Employment” dated December 16, 2008, which states: 

TJD-JI shall also pay the Employee transportation allowance for Employee and his family airfares from the U.S.A. to the Republic of Korea.  Upon completion of one year of satisfactory service, a round trip airplane tickets [sic] for Employee and his family to the point of the employment shall be provided by TJD-JI, providing that Employee’s contract has been mutually extended. 

First, this letter is dated at least eight months after commencement of the claimant’s employment with TJD-JI and thus does not represent whatever return transportation benefits may have been offered to the claimant at the time of hire.  Second, it does not specifically provide for the claimant’s return transportation to the United States but rather to the “point of employment,” which would presumably be determined by the firm.  Third, the wording of the firm’s provision of “round trip airline tickets… to the point of employment” implies not return transportation (which would presumably only require one-way tickets and would include a “transportation allowance” equivalent to that offered for the move overseas) but rather a home travel benefit to the “point of employment” and back.  Fourth, the payment of this benefit was contingent on the claimant’s contract with the firm being “mutually extended,” meaning that if either party terminated the contract at that point, the benefit would not be paid.  Therefore, this document does not establish that TJD-JI had, at the time of the claimant’s hiring, specifically committed itself to providing the claimant return transportation to the United States or its territories or possessions at the conclusion of his employment with that firm.

The statutory and regulatory languages are permissive and give agency heads considerable discretion in determining whether to grant LQAs to agency employees.  Wesley L. Goecker, 58 Comp. Gen. 738 (1979).  Thus, an agency may withhold LQA payments from an employee when it finds that the circumstances justify such action, and the agency’s action will not be questioned unless it is determined that the agency’s action was arbitrary, capricious, or unreasonable.  Under 5 CFR 178.105, the burden is upon the claimant to establish the liability of the United States and the claimant’s right to payment.  Joseph P. Carrigan, 60 Comp. Gen. 243, 247 (1981); Wesley L. Goecker, 58 Comp. Gen. 738 (1979).  As discussed previously, the claimant has failed to do so.  Since an agency decision made in accordance with established regulations as is evident in the present case cannot be considered arbitrary, capricious, or unreasonable, there is no basis upon which to reverse the decision. 

This settlement is final.  No further administrative review is available within the OPM.  Nothing in this settlement limits the claimant’s right to bring an action in an appropriate United States court.

 

 

 

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