Washington, DC
U.S. Office of Personnel Management
Compensation Claim Decision
Under section 3702 of title 31, United States Code
Vicenza, Italy
Robert D. Hendler
Classification and Pay Claims
Program Manager
Agency Compliance and Evaluation
Merit System Accountability and Compliance
10/01/2015
Date
The claimant is a Federal civilian employee of the Department of the Army (DA), in Vicenza, Italy. She requests the U.S. Office of Personnel Management (OPM) reconsider her agency’s denial of living quarters allowance (LQA). Specifically, she requests an exception to Department of Defense Instruction (DoDI) 1400.25, Volume 1250, and Army in Europe Regulation (AER) 690-500.592 for authorization of LQA retroactive to October 10, 2010, when she was promoted to a position at the GS-11 grade level. We received the claim on December 16, 2014, and the agency administrative report (AAR) on July 24, 2015. For the reasons discussed herein, the claim is denied.
The claimant was appointed to a Federal service position effective December 7, 2009, as a Human Resources Technician (Military), YB-203-01, with the U.S. Army Garrison in Vicenza, Italy. She was determined ineligible for LQA at the time of recruitment because she did not meet eligibility provisions in DSSR section 031.11 in connection with DoDI 1400.25, Volume 1250, which permits the granting of LQA to employees recruited in the United States, and because the position for which she was selected did not meet minimum grade level eligibility requirements under AER 690-500.592 to be considered for LQA. Subsequently, on October 10, 2010, the claimant was promoted to her current position of Administrative Operations Specialist, GS-301-11, with the U.S. Army, Africa, Southern European Task Force.
Regarding the claimant’s ineligibility for LQA, the agency states in its AAR:
The claim is unsubstantiated and should not be allowed. Ms. Perry seeks an exception to policy to authorize her LQA as of 10 October 2010 when she was promoted to the GS-11 position that puts her within the threshold for the allowance under the AER 690-500.592. However, this request assumes that Ms. Perry was eligible for the allowance either under the DSSR Section 031.11 as an employee recruited in the United States or under the DSSR Section 031.12a and b., as an employee recruited outside the United States, and the only reason why she was not granted the allowance at the time of her initial appointment on 07 December 2009 was the fact that she was appointed to a position that did not meet the minimum grade level of GS-09 or equivalent imposed by the AER 690-500-592 for the allowance. Paragraph 4 of the AER requires that the basic eligibility criteria prescribed by the DSSR and the DOD guidance must be met in order to be considered eligible for LQA under the provision of the AER.
The DSSR contains 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. DoDI 1400.25, Volume 1250, dated July 31, 2009, and AER 690-500.592, dated November 18, 2005, in effect when the claimant was appointed, implement the provisions of the DSSR for DoD and DA employees. Because LQA is a discretionary allowance, agency implementing regulations may be more restrictive, but not more permissive, than the DSSR; i.e., they may impose additional limitations on the granting of LQA but may not extend benefits that are not otherwise permitted by the DSSR. Therefore, an LQA applicant must fully meet 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 prescribed in Chapter 100 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.
Relative to these criteria, DoDI 1400.25, Volume 1250, defines “U.S. Hire” as follows:
U.S. Hire. A person who resided permanently in the United States or the Northern Mariana Islands, from the time he or she applied for employment until and including the date he or she accepted a formal offer of employment.
Thus, an employee’s status as a “U.S. hire” is based on physical residency at the time of recruitment for the position in question.
The claimant appears to characterize herself as a U.S. hire, assuming eligibility under DSSR section 031.11. She states that in 2009, she “placed [her] house up for rent,” relocated from Florida to Massachusetts, and took up residence in her parents’ home to assist them with a family situation, and “was there for several months when a friend suggested [she] come to Italy for a break.” She asserts her “intent was to visit for a short time then return to Florida and resume [her] career as a Realtor.” Specifically, she states her “trip to Italy was conducted as a tourist with NO intent to remain permanently in Europe.” She further states: “While in Italy I was informed of an opportunity to interview for a job I had previously applied [sic] while in Massachusetts, I took the interview. When notified of selection shortly after the interview, I returned to the states to obtain proper documentation to work overseas.”
However, the claimant’s account does not establish her physical residency in the United States during the entire recruitment process per the definition of “U.S. hire” in DoDI 1400.25, Volume 1250; i.e., from when she initially applied for through the time she accepted the position in question.[1] The claimant did not provide documentation as to the dates or duration of her stay in Italy or her living arrangements there as evidence that her stay was intended to be temporary, or evidence that she had intended to return to the United States (e.g., round-trip airline tickets). Thus, she has failed to show she was in Italy for a short period of time “as a tourist” and in a transitory, non-residency status intending to return to the United States to resume her residency in the United States; i.e., that she had not relocated to Italy with the intention of residing in Italy. Her failure to provide such evidence, in light of the fact that she had placed her house in the United States for rental, gives us no basis on which to conclude the agency’s determination of her ineligibility under DSSR section 031.11 was in error.
Further, the vacancy announcement for the position provided with the AAR indicates that the area of consideration was limited to "candidates in the local commuting area." This suggests the claimant, although asserting she applied for the position while in the United States, would have presented herself as a local resident at the time of application in order to not be excluded as outside the area of consideration, but upon securing the position attempts to portray herself as a U.S. hire to be eligible for LQA. When a position is advertised via a vacancy announcement, the recruitment process must be considered to begin with that action and extend through the employee’s acceptance of the position. When an agency, as in this case, does not seek or take action to recruit candidates in or induce their relocation from the United States, the employee may not be considered to have been recruited in the United States. As such, there is no basis on which to consider the claimant a U.S. hire for LQA eligibility purposes under DSSR section 031.11 or its implementing regulations in DoDI 1400.25, Volume 1250.
Paragraph 7a.(1) of AER 690-500.592 limits LQA to employees recruited either in or outside the United States or its possessions for positions at grades GS-09 (or equivalent), WG-11, WL-09, WS-05, and above. The claimant was appointed to the Federal service on December 7, 2009, to a position equivalent to the GS-06 grade level, and was thus not eligible for LQA under the AER criteria. Any subsequent position changes (i.e., promotions or reassignments) are not "appointments" but rather internal placements occurring within the context of that initial appointment. In other words, LQA may only be conferred at the time of appointment if eligibility requirements are met and if the agency has offered it as a recruitment incentive for the position. See OPM File Numbers 10-0043, July 1, 2011, and 12-0038, February 4, 2014. Therefore, since any subsequent positions held by the claimant after her December 7, 2009, appointment do not constitute her initial appointment, they may not be considered for LQA eligibility purposes.
In her claim request, the claimant specifically requests “Exception to Policy based on [her] hiring as a GS-11." OPM adjudicates compensation claims for certain Federal employees under the authority of section 3702(a)(2) of title 31, United States Code (U.S.C.). The authority in 31 U.S.C. § 3702(a)(2) is narrow and limited to determining if monies are owed the claimant under the controlling statutes or regulations. Section 3702 does not include the authority to waive any provisions of regulation, such as the DSSR, which determines LQA eligibility, or associated agency implementing regulations.
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 OPM. Nothing in this settlement limits the claimant’s right to bring an action in an appropriate United States court.
[1] We regard the term “reside” in terms of its commonly-understood meaning and usage as to live in a place as one’s domicile or usual, customary dwelling place, distinguished from a temporary stay of short duration while in a travel, visiting, vacationing, or other clearly transitory status with expected return to one’s usual place of residence. This clarifies previously-issued decisions that used the language "physical presence" as opposed to "physical residency" in the United States at the time of recruitment in the discussion of the relationship between the DoDI definition of "U.S. hire" and DSSR section 031.11. The previous language was not intended to convey that the employee must have maintained continual presence in the United States during the recruitment process, as long as any short-duration absences did not displace the actual residency. Conversely, it was not intended to suggest that a transitory presence in the United States during the recruitment process falling short of actual residency would qualify the employee as a U.S. hire.