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


04/30/2015

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Date

The claimant is a Federal civilian employee of the Department of the Army (DA) in Wiesbaden, Germany.  He requests the U.S. Office of Personnel Management (OPM) reconsider his agency’s denial of his living quarters allowance (LQA).  We received the claim request on May 13, 2014, the agency administrative report (AAR) on August 19, 2014, and additional documentation subsequently provided by the agency in November 2014 at OPM’s request.  For the reasons discussed herein, the claim is denied.

The claimant was appointed to a DA position with the Federal civil service in Hanau, Germany, on April 5, 2004.  He was subsequently reassigned to a DA position at Fort Knox, Kentucky, effective June 19, 2011.  While assigned to the position in Kentucky, the claimant was placed on "Absent-Uniformed Service" status when activated into active duty (AD) military service with orders to report to Kaiserslautern, Germany, no later than April 26, 2013.  A Standard Form 50 (SF-50), Notification of Personnel Action, dated April 29, 2013, documents his absence from his Fort Knox-based DA position due to his uniformed service.  His AD orders, initially for a period of 45 days, were later extended to 148 days.  The end date of his AD military service has been reported variously as September 30, 2013, as identified by the claimant in his claim request; as September 24, 2013, by the agency in its AAR; and as September 21, 2013, by the relevant DD Form 214, Certificate of Release or Discharge from Active Duty, covering the period in question, which is issued upon a military service member’s discharge from active duty and was provided by the agency at our request.  Although an SF-50 documents a "Return to Duty" to his Fort Knox-based DA position on October 1, 2013, the claimant did not return to the United States.

Following his initial period of AD service, the record shows the claimant reported for inactive duty military training in Germany for 10 days to start no later than September 21, 2013, and for four days to start no later than November 4, 2013.  He was recalled to AD service on November 12, 2013, for a period of 64 days which was later extended to 130 days.  A November 12, 2013, SF-50 documents his second absence from the Fort Knox-based DA position due to his uniformed service.  Between these two periods of AD service, from October 1 to November 4, 2013, the claimant states in a November 19, 2013, email to his servicing human resources office that he “was in Europe on [his] own dime awaiting more active duty orders” and “not on leave.”  While in Germany during this timeframe, the claimant applied for, was selected, and subsequently assigned to the position with DA in Wiesbaden, Germany, to be effective on February 9, 2014.  His SF-50 shows a "Return to Duty" to his Wiesbaden-based DA position on March 1, 2014.

The Department of State Standardized Regulations (DSSR) contain the governing regulations for allowances, differentials, and defraying of official residence expenses in foreign areas.  Within the scope of these regulations, the head of an agency may issue further implementing instructions for the guidance of the agency with regard to the granting of and accounting for these payments.  The Department of Defense Instruction (DoDI) 1400.25-M, dated February 23, 2012, and in effect at the time of the claimant’s appointment, implements the provisions of the DSSR, but may not exceed their scope; i.e., extend benefits that are not otherwise permitted by the DSSR.  Therefore, an LQA applicant must fully meet the relevant provisions of the DSSR before the supplemental requirements of the DoDI or other agency implementing guidance may be applied.

DSSR section 031.11 states LQA may be granted to employees recruited in the United States:

Quarters allowances…may be granted to employees who were recruited by the employing government agency in the United States, the Commonwealth of Puerto Rico, the Commonwealth of the Northern Mariana Islands, and the possessions of the United States.

The agency, in a January 10, 2014, email, denied the claimant’s LQA request, stating:

[The claimant], although initially activated onto active duty in United States for service in Germany[1], he had a break of more than three days between his two activations into that service; as such, DSSR Section 031.12b must be applied, which requires, apart from other criteria, that an individual must have been recruited in the United States by the Armed Forces in order to be considered eligible for the allowance.  Since [claimant] was reactivated onto military service while he was physically residing in Germany for what appears to be personal reasons, he was recruited in the overseas area.  This disqualifies him for LQA.

The agency further explains in its AAR to OPM:

[The claimant’s] hiring circumstances neither meet the requirements of the DSSR Section 031.12b as an employee recruited outside the United States, nor do they meet the requirements of the DSSR Section 031.11 as an employee recruited in the United States in connection with the provisions of the DoDI 1400.25-M, Volume 1250 and the clarified definition of the term “US Hire.”

To support his assertion of LQA eligibility as a U.S. hire, the claimant explains in his claim request to OPM:

Due to the budget uncertainty upon which the Department of Defense began the new fiscal year (FY14), my unit cancelled all orders past 30 September 2013 until further funding which was to be sorted out during the month of October 2013.  Instead of having the government fly me back to my residence in Kentucky only to have me fly back in the next days or weeks, I remained in Germany.  During that time I applied for and made the list for a job in Wiesbaden…At that time, regardless of where I was physically located in the world, I was still assigned (as a civilian employee) to the [Fort Knox-based civilian DA position] and residing in Kentucky; therefore, my orders clearly state my physical address.

However, this account is partially contradicted by the claimant's November 19, 2013, email to his agency, wherein he states: “On 30 October, I was in Germany.  I could not travel back to [Continental United States] due to a doctor’s restriction on travel due to medical condition.  This travel restriction was issued on 24 or 25 October and ran through 17 November.”

The record shows the claimant’s DA position at Wiesbaden, Germany, was open for recruitment from September 23, 2013, to October 4, 2013; he was subsequently offered the position on October 30, 2013.  The claimant acknowledges he remained in Europe throughout and between his periods of AD military service and inactive duty training including completion of his initial AD military service in September 2013; a 10-day military training commencing on September 21, 2013, and four-day training commencing on November 4, 2013; and the reactivation of AD military service on November 12, 2013.  Therefore, we conclude the claimant does not meet the basic LQA eligibility criteria under DSSR section 031.11.  The claimant was residing in Europe when he was recruited for his DA position at Wiesbaden, Germany, thus he was not residing in the United States or one of its enumerated territories or possessions as required under DSSR section 031.11.  Although he attempts to establish his “physical address” as the Kentucky-based address identified on his AD orders, the determining factor for LQA eligibility under section 031.11 is the geographic location at the time of recruitment, not the place considered by the employee as his “physical address.”  The plain language of the phrase “recruited in” clearly connotes physical presence in the United States at the time of recruitment.  This language does not allow for a more expansive interpretation such as maintenance of a residence in the United States, retention of civilian employment in the United States, or AD orders addressed to an address in the United States.  See OPM File Numbers 08-0098, 10-0037, 12-0019, and 13-0040.

The DSSR sets forth the basic eligibility criteria for the granting of LQA.  However, under section 013, it allows agencies to issue implementing regulations as follows:

When authorized by law, the head of an agency may defray official residence expenses for, and grant post differential, difficult to staff incentive differential, danger pay allowance, quarters, cost-of-living, representation allowances, compensatory time off at certain posts and advances of pay to an employee of his/her agency and require an accounting thereof, subject to the provisions of these regulations and the availability of funds.  Within the scope of these regulations, the head of an agency may issue such further implementing regulations as he/she may deem necessary for the guidance of his/her agency with regard to the granting of and accounting for these payments.  [Italics added.]

The use of the permissive term “may” in section 013 above as opposed to the mandatory terms “will” or “shall” indicate that LQA is a discretionary allowance on the part of the agency.  Thus, agency implementing regulations such as those contained in DoDI 1400.25 and locally-developed implementing instructions may impose additional requirements to further restrict LQA eligibility, but may not exceed the scope of the DSSR; i.e., allow for the granting of LQA in cases not otherwise permitted under the DSSR.  Therefore, the provisions of the DSSR must be met before the DoDI and other implementing instructions may be applied.

The agency also examined the claimant’s circumstances against locally-developed implementing instructions from the United States Army Europe.  The December 16, 2013, memorandum provides clarification on the U.S. hire definition.  The agency concluded that since the claimant’s AD military service was interrupted by more than three days, he would not meet the intent of local policy which states:

 For military personnel, including activated or deployed members of the Reserves or the National Guard, on an overseas assignment from the United States (TDY/TCS/PCS), any break in [AD] service exceeding three days (e.g., an intervening period of Inactive Duty Training (IDT), or other non-AD-covered period), that is followed by re-activation is considered a re-entry onto AD.  The location of that re-entry is operative for LQA eligibility purposes.  Unless a foreign area separation from AD was followed by an actual return to the United States under Government-provided transportation, LQA eligibility will be examined under [DSSR section 031.12].

The local DA policy was implemented in response to the September 19, 2013, memorandum issued by the Department of Defense (DoD) to provide the following policy advisory regarding the U.S. hire definition:

Temporary absences from the U.S. for reasons such as vacations, temporary duty assignments (including the private industry equivalent) or deployments by Reservists and National Guard members do not alter a person’s “U.S. hire” status, as contained in the Glossary in DoDI 1400.25-Volume 1250.

The DSSR does not exempt particular categories of employees, such as military reservists mobilized overseas like the claimant, from the provisions of section 031.11.  Agencies are thus precluded from doing so either explicitly or implicitly in their implementing regulations as this would exceed the scope of the DSSR.  See OPM File Numbers 13-0038 and 13-0040.  OPM applies agency-developed policies to the extent such guidance is in agreement with the DSSR, and conversely we will not consider instructions that contradict DSSR section 031 when such implementing instructions exceed the scope, meaning, or intent of the DSSR.  As the DoD’s policy advisory and, by extension, the local DA policy proffer benefits or advantages to military reservists mobilized overseas and to other groups of employees absent in the DSSR, we will not consider the claimant’s circumstances to the DoD policy advisory and any associated implementing policies for purposes of determining his LQA eligibility as a U.S. hire.  Regardless, we note that the above DoD policy advisory would not apply to the claimant because when he was recruited for the position in question while in Germany, he was not actively deployed.

The claimant does not state his situation meets the LQA eligibility requirements of DSSR section 031.12, but we will briefly address the criteria which states, in relevant part, that LQA may be granted to employees recruited outside the United States provided that:

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; or [italics added]

In its AAR to OPM, the agency states that “[t]here is no dispute that [the claimant] meets the requirements of DSSR section 031.12a.”  However, the agency’s statement preceded our request to obtain the claimant’s DD 214s for the periods of AD in question.  In response to our request, the agency provided the DD 214 covering his period of AD service commencing April 2013.  The DD 214 shows he entered AD on April 4, 2013, and identifies Wiesbaden, Germany, as the place of entry into active duty for the period of service in block 7a.  In his claim request to OPM, the claimant states he “came to Germany on [AD] 26 April 2013 from my home address at [a residence in Kentucky].”  Regardless, his DD 214 suggests otherwise as his home of record at time of entry, mailing address after separation, and address of his nearest relative identifies Germany- or Europe-based addresses.  Given these facts as documented by his military service records, we are unable to conclude the claimant’s presence at the place to which the quarters allowance applies is attributable to his employment by the United States Government as required by DSSR section 031.12a.

Regarding DSSR section 031.12b, the agency asserts in its AAR to OPM that the claimant’s circumstances do not meet eligibility requirements as “[the claimant] was not re-activated onto military duty in the United States but rather while he was essentially on personal business in Germany.”  As in the above paragraph, the agency’s statement preceded our request to obtain the claimant’s DD 214s for the periods of AD in question.  Application of section 031.12b to the conditions of prior civilian or military employment is fairly clear, in that there must be continuity of employment (i.e., “substantially continuous employment”) by a single employer from the time of initial recruitment in the United States by that employer, including the Armed Forces, up to the point of Federal appointment.  Although the claimant states he resided in the United States at the time of his first activation into AD military service in April 2013 which had him report to Germany, the relevant DD 214 conflicts with his statements as the official military record identifies his place of entry into AD as Wiesbaden, Germany, and the home of record as a residence in Germany.  Thus, prior to his "return to duty" to the Weisbaden position on February 9, 2014, the claimant had been physically present in Germany apparently from at least April 4, 2013, when he received his first AD activation; through the period October 1 to November 4, 2013, when he had remained in Germany still on DA rolls but in some indeterminate status; through a four-day military training commencing on November 4, 2013; and through his second AD activation commencing on November 12, 2013.  As such, he does not meet the requirements of DSSR section 031.12b in that prior to appointment, he did not have continuity of employment with a single employer who had recruited him in the United States.

DoDI 1400.25-V1250 specifies that overseas allowances are not automatic salary supplements, nor are they entitlements.  They are specifically intended as recruitment 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 living in a foreign area, that inducement is normally unnecessary.  Furthermore, 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).  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 OPM.  Nothing in this settlement limits the claimant’s right to bring an action in an appropriate United States court.

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