U.S. Office of Personnel Management
Compensation Claim Decision
Under section 3702 of title 31, United States Code
Kadena Air Base
Department of the Air Force
Okinawa, Japan
Damon B. Ford
Compensation and Leave Claims
Program Manager
Agency Compliance and Evaluation
Merit System Accountability and Compliance
09/13/2021
Date
The claimant is a Federal civilian employee of the Pacific Air Forces, Kadena Air Base (AB), Department of the Air Force (AF), in Okinawa, Japan. He requests the U.S. Office of Personnel Management (OPM) reconsider his agency’s denial of a living quarters allowance (LQA) grant. We received the claim on February 8, 2021, and the agency administrative report (AAR) on April 1, 2021. For the reasons discussed herein, the claim is denied.
The claimant retired from active duty military service in Japan on January 31, 2007. Prior to retirement, he was offered a contractor position and traveled to his home in the United States prior to starting the position. The claimant was employed as a contractor for private companies First Defense Services[1] and Centerra Group, LLC (Centerra) from December 2006, to June 2009, and July 2009, to September 2019[2], respectively at Paya LeBar AB in Singapore. The claimant states his contract with Centerra was not renewed and he was given a cash payment instead of return transportation when he decided to return to the United States because he decided to travel and already purchased airline tickets. On October 4, 2019, the claimant and his spouse traveled to Okinawa, Japan for vacation. While in Japan, he applied for a Federal position with AF in November 2019. The claimant and his spouse were notified of his father-in-law’s illness and on December 6, 2019, they traveled to the Philippines. While there, he received tentative and firm job offers on December 20, 2019, and February 29, 2020, respectively. The Taal Volcano in the province of Batangas, where the claimant, his spouse, and father-in-law were staying, began erupting on January 12, 2020. They evacuated the province because they were within the volcano’s evacuation zone but returned in early February 2020 when it was safe to return. In a memorandum dated March 2, 2020, the agency determined the claimant LQA ineligible. On March 14, 2020, they traveled to Japan and the claimant was appointed into the Federal civilian service on March 16, 2020, as an Aerial Port Operations Officer, GS-2150-12, at Kadena AB.
The agency contends that the claim should be denied because the claimant is not eligible for LQA under the applicable rules and regulations. The agency asserts the claimant is ineligible under the Department of State Standardized Regulations (DSSR) section 031.12 and Department of Defense Instruction (DoDI) NUMBER 1400.25 Volume 1250. The agency further asserts “[The claimant] had a return transportation agreement to [his United States residence] with Centerra Group, LLC and received a monetary payment to use when he decided to return to the United States. [The claimant] was unable to provide any supporting documents due to his previous and unrelated emergency evacuation from the Taal Volcano eruption.” The agency goes on to state the claimant “had intervening employment, and…he does not satisfy [the relevant] conditions” in the DSSR and DoDI.
The 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. Therefore, an LQA applicant must fully meet the relevant provisions of the DSSR before the supplemental requirements of the DoDI 1400.25-V1250 or other agency implementing guidance may be applied.
Section 031.12 of the DSSR provides the following guidance relative to employees recruited outside the United States:
- 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
- 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.
The claimant meets section 031.12a because his presence in Japan is attributable to his employment with the AF.
DSSR section 031.12b 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.
DoDI 1400.25-V1250, defines “substantially continuous employment” as follows:
Former military and civilian members shall be considered to have “substantially continuous employment” for up to 1 year from the date of separation or when transportation entitlement is lost, or until the retired or separated member or employee uses any portion of the entitlement for Government transportation back to the United States, whichever occurs first.
The claimant does not meet several requirements of DSSR section 031.12b and is not eligible to receive LQA under this section. The claimant provided information in his LQA Questionnaire, signed and dated, January 16, 2020, indicating he was offered a contractor position and flew to his “home of record” in the United States prior to his retirement. However, he did not state his location when offered the contractor position[1]. The claimant states he then flew to Singapore to begin his contractor employment. We find the contracts with First Defense Services and Centerra were two separate, successive contracts and constitute two separate employers for purposes of LQA eligibility. Even assuming that First Defense Services had recruited the claimant from the United States, any potential eligibility for LQA was lost because he had two separate employers overseas prior to Federal appointment. We note he was not in substantially continuous employment upon his return to the United States on military deactivation orders as described in the DoDI 1400.25-V1250, which is based on the premise that, prior to appointment, the employee is physically located overseas and employed by one of the qualifying entities. The claimant also offers no evidence that he was in such employment under conditions which provided for his return transportation to the United States or its territories or possessions. He provided a copy of his Letter of Appointment with Centerra dated September 28, 2018, which states the company will return him to the closest major airport to his address in the United States. However, the claimant states Centerra gave him a cash payment instead of an airline ticket to use when he decided to return to the United States, as stated earlier. There is no documentation of this in the claim record. Therefore, it is unknown what return transportation benefits, if any, the claimant retains. For all the reasons stated above, the claim is denied.
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 Code of Federal Regulations (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.
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[1] In an email dated February 18, 2020 to his agency, the claimant states the company name was initially Defense Support Services (Lockheed).
[2] The record is unclear on the claimant’s contractor employment dates. In the same email referenced above, he states he was employed with First Defense Services and Centerra Group, LLC from December 2006 to September 2016, and September 2016 to September 2019, respectively.
[3] The record is unclear on whether the claimant was offered the contractor position before or after his return to the United States. He states in his incoming claim, he was “hired from the United States in 2006.”