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Pay & Leave Claim Decisions

Office of the General Counsel

Matter of: xxxx
Date: June 1, 2000
File Number: 00-4096

OPM Contact: xxxx

This is a claim for retroactive payment of a living quarters allowance (LQA). After a careful review of the record, the claim is denied.

The claimant was stationed overseas when she separated from active military service effective xxxx. Immediately prior to this, she was selected from an Open Continuous Announcement for a civilian position. She was subsequently appointed under the Veterans Employment Opportunity Act authority. According to the agency, at the time that xxxx was offered the position, she was informed that payment of LQA was not authorized. She chose to accept the employment offer under those conditions.

Upon her appointment to the civilian position, a xxxx representative contended that there was "an administrative oversight" in not authorizing an LQA for xxxx. The representative stated that the equipment specialist position met the definition of a hard-to-fill position. Although required to be pre-determined under a USAREUR regulation, the representative stated that this pre-determination would have been difficult to make since there was not documented recruitment history in filling this type of position within xxxx. In xxxx, the Civilian Personnel Advisory Center denied the LQA request, because the position was not identified by management prior to recruitment as being hard-to-fill and that, based on their recruitment experience, the position could not be substantiated as one.

In xxxx, another representative requested an LQA for xxxx, citing that the employee had not used any portion of her former government transportation return rights to the U.S. and that her continued presence in a foreign area was attributable solely to her employment by the U.S. Government. In xxxx, the Director of Civilian Personnel, USAREUR, denied the claim, citing USAREUR policy that restricts the payment of LQAs for local hires. Although the policy does provide for granting LQA to local hires when selected for pre-identified hard-to-fill positions, recruitment for the position produced 12 qualified applicants. According to the agency, this did not indicate a difficulty in locating a sufficient number of qualified candidates from which to make a selection and that there was, therefore, no basis for identifying the position as hard-to-fill.

The Overseas Differentials and Allowances Act, Pub. L. 86-707, 74 Stat. 793, 794 (Sept. 6, 1960), as amended and codified at 5 U.S.C. '' 5922-5924, provides that, under regulations prescribed by the President, LQAs Amay@ be paid to federal employees in foreign areas. The President, by executive order, delegated this authority to the Secretary of State who issued Standardized Regulations concerning eligibility to receive, and payment of, LQAs. Section 013 of the Department of State Standardized Regulations (DSSR) further delegates to the heads of federal agencies the authority to grant LQAs to agency employees. Section 013 of the DSSR specifies that the head of an agency Amay@ grant quarters allowances and issue further implementing regulations as he or she may deem necessary for the guidance of the agency in granting such allowances. The [agency] has issued further implementing regulations through its requirements for DoD civilian employment overseas, DoD 1400.25-M, CPM 592.

Section 031.12 of the DSSR provides that quarters allowances Amay@ be granted to employees recruited outside the United States, when:

a. the employee&#39s actual place of residence in the place to which the quarters allowance applied at the time of receipt shall be fairly attributable to his employment by the United States Government; and

b. prior to appointment, the employee was recruited in the United States . . by the United States Government, including its Armed Forces, . . . and has been in substantially continuous employment by such employer under conditions which provided for his/her return transportation to the United States . . . *

The DSSR further provides that Section 031.12b Amay@ be waived by the head of agency upon determination that unusual circumstances in an individual case justify such action. Thus, the DSSR authorizes, but does not require, agency officials to grant an LQA when an employee fulfills the basic eligibility requirements in the DSSR.

The statutory and regulatory language 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&#39s action was arbitrary, capricious, or unreasonable. Joseph P. Carrigan, 60 Comp. Gen. 243, 247 (1981); Wesley L. Goecker, 58 Comp. Gen. 738 (1979).

Even though the claimant meets the criteria in section 013.12 of the DSSR, the DoD regulation specifies further that, except in unusual circumstances, an LQA is to be used as an incentive to persuade employees in the United States to apply for overseas positions. Subchapter 1-1b of DoD 1400.25-M, CPM 592 provides in relevant part:

The foreign post differential and the foreign area allowances (except the post allowance) are not automatic salary supplements attached to all positions in the foreign area. They are intended to be recruitment and/or retention incentives for U.S. citizen civilian employees living in the United States to accept federal employment in a foreign area. If a person is already in the foreign area, that inducement normally is unnecessary. The specific circumstances under which an employee who is hired in a foreign area may be granted the allowances are provided in section 031.12 of the DSSR, as supplemented by this chapter. (Emphasis added.)

The claimant was hired locally and was not living in the United States at the time of her appointment to the civilian position. The common, consistent thread running through the agency&#39's denials of her request for an LQA was that the position she filled was advertised locally and was not pre-identified as having unique or unusual skills, knowledge or ability. Moreover, the agency&#39's denial decisions consistently noted that there was not a documented history of difficulty in locating qualified candidates to fill this position and, therefore, it was not considered a hard-to-fill position.

In view of the permissive rather than mandatory language in the applicable statutes and regulations, as noted above, the degree of discretion that heads of agencies have in determining whether to authorize these allowances, and the facts of this claim, we cannot say the agency&#39's application of the DOD regulation in this case was arbitrary or capricious. Accordingly, the claim is denied.

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

Control Panel