Washington, DC
U.S. Office of Personnel Management
Compensation Claim Decision
Under section 3702 of title 31, United States Code
Damon B. Ford
Compensation and Leave Claims
Program Manager
Agency Compliance and Evaluation
Merit System Accountability and Compliance
03/05/2019
Date
The claimant is a Federal civilian employee of the Department of the Army (Army) in Taegu, South Korea. She requests the U.S. Office of Personnel Management (OPM) reconsider her agency's denial of living quarters allowance (LQA). We received the claim request on May 2, 2018, and the agency administrative report on May 21, 2018. For the reasons discussed herein, the claim is denied.
The claimant was appointed to a Psychology Technician, GS-0181-07, position in Taegu, South Korea, effective May 1, 2017. Prior to this appointment, the claimant traveled throughout Asia between May 3, 2016, and September 20, 2016. While on travel, the claimant applied for her current Army position on August 2, 2016. Army offered the claimant a firm job offer on March 28, 2017, which she accepted. The job offer stated that the claimant was authorized LQA in lieu of having U.S. Government quarters provided and she began receiving the allowance. However, on April 13, 2018, after a review of the claimant’s LQA in accordance with new guidance, the agency reversed its decision and determined the claimant ineligible to receive LQA.
The agency asserts the claimants initial LQA determination, made on November 4, 2016, was based on a Department of Defense (DoD) policy advisory, dated September 19, 2013, that allowed applicants who were temporarily absent from the U.S during the recruitment process to be considered as a U.S. Hire for LQA determination purposes. However, the September 19, 2013, policy advisory was rescinded and replaced by new LQA guidance dated January 3, 2018. The agency contends employees who were determined eligible for LQA in accordance with the September 19, 2013, policy advisory and are now determined ineligible under the January 3, 2018 guidance.
The Department of State Standardized Regulations (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. Thus, the Department of Defense Instruction (DoDI) 1400.25-V1250 implements the provisions of the DSSR but may not exceed their scope; i.e., extend benefits that are not otherwise permitted under 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 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 physically resided permanently in the United States or the Commonwealth of 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.
The Department of the Army, Far East region, also adheres to specific policy guidance outlined in the Under Secretary of Defense (P&R) memorandum, dated January 3, 2018. It further defines a U.S. hire as:
b. Applicants, who during any portion of the recruitment process, leave their usual customary dwelling place in the U.S. for travel, visits, vacations, or other trips of a clearly short duration, normally not more than 30 days [emphasis added]. There must be clear evidence the applicant has not terminated his/her U.S. residency or established residency outside of the U.S.
An employee’s status as a “U.S. hire” is based on physical residency at the time of recruitment for the position in question. Thus, an employee must be physically residing in the United States from the time of application until acceptance of a formal job offer. This language does not allow for a more expansive interpretation such as the maintenance of a place of residence in the United States. Therefore, whether an employee is deemed to be recruited in the United States or outside the United States is dependent on the location of the employee when recruited, not the existence of a legal residence at some other place other than where the employee is actually located at that time. In this case, the claimant was travelling in Asia for portions of the recruitment process and was not permanently or physically residing in the United States from the time she applied for employment until and including the date she accepted the formal job offer. Therefore, she may not be considered a U.S. hire for LQA purposes under DSSR section 031.11 and implementing regulations of the DoDI and implementing Army guidance, dated January 3, 2018.
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 U.S. to accept Federal employment in a foreign area. 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 deny LQA to 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.