Washington, D.C.
U.S. Office of Personnel Management
Compensation Claim Decision
Under section 3702 of title 31, United States Code
Zama, Japan
Damon B. Ford
Compensation and Leave Claims
Program Manager
Agency Compliance and Evaluation
Merit System Accountability and Compliance
05/20/2020
Date
The claimant is a Federal civilian employee of the Department of the Army (DA) in Zama, Japan. He requests the U.S. Office of Personnel Management (OPM) reconsider his agency’s denial of living quarters allowance (LQA). We received the claim on June 10, 2019, and the agency administrative report (AAR) on October 15, 2019. For the reasons discussed herein, the claim is denied.
Prior to his current employment, the claimant was employed by private firm Battlespace Flight Services performing contractor work in the Middle East. After his “last contract deployment to Iraq,” he traveled to Japan on vacation to visit his family (i.e., wife and children) who resided in Misawa, Japan. A copy of the air ticket number and airline confirmation provided by the claimant, shows he arrived in Tokyo, Japan on May 19, 2017. Further, the claimant reported on his completed “Questionnaire for LQA Determinations,” that he was in Misawa, Japan from June 16, 2017 to September 5, 2017. While in Japan, on August 29, 2017, the claimant applied for his current Federal civilian position of Aircraft Mechanic, WG-8852-10. On September 5, 2017, the claimant returned to the United States. On May 4, 2018, the claimant received a firm job offer for the DA position, which he accepted. At that time, the job offer stated that he was eligible for LQA. However, prior to appointment, on May 10, 2018, after a review of the claimant’s LQA in accordance with new Department of Defense (DoD) guidance, the agency reversed its decision and determined him ineligible to receive LQA. The agency notified the claimant of his LQA ineligibility by issuing an amended job offer letter dated May 10, 2018. Nonetheless, the claimant accepted the job offer without LQA and was appointed to the position effective May 29, 2018.
The claimant asserts eligibility for LQA as a U.S. hire under the provisions of Department of State Standardized Regulations (DSSR) section 031.11 for employees recruited in the United States. He states that he “was domiciled in the continental U.S. at his home in Spring, TX. during his recruitment process and his acceptance of the formal offer and DD1614 extended to him and addressed to him at his residence in Spring, Texas dated 11 May 2017.”
The agency determined the claimant ineligible for LQA because he did not meet eligibility requirements under DSSR section 031.11, in connection with criteria from DoD “New Living Quarters Allowance Guidance,” dated January 3, 2018, relating to U.S. hires and temporary absences from the United States. Specifically, in its AAR, the agency states the following:
…A review of Mr. Sherratt’s LQA in accordance with the new guidance has determined that he is ineligible for LQA because he was on vacation in Japan from 16 June 2017 to 5 September 2017. His position was announced during the period 18 August 2017 to 29 August 2017. He applied on 29 August 2017 while he was on vacation in Japan. The time he spent in Japan on vacation was over the 30 day limit specified in the updated guidance. Therefore, he did not meet the eligibility requirements IAW DSSR 031.11.
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. The Department of Defense Instruction (DoDI) 1400.25, Volume 1250 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 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:
A person who physically 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.
The DA also adheres to specific eligibility criteria set forth in DoD’s “New Living Quarters Allowance Guidance,” dated January 3, 2018. It states U.S. hires include:
b. Applicants who, during any portion of the recruitment process, leave their usual, customary dwelling place in the United States for travel, visits, vacations, or other trips of a clearly short duration, normally not more than 30 days. There must be clear evidence the applicant has not terminated his/her U.S. residency or established residency outside of the U.S. [emphasis added].
Pursuant to the provisions of DSSR 031.11 in connection with the DoDI 1400.25, Volume 1250, an employee’s status as a “U.S. hire” is based on physical residency at the time of recruitment for the position in question. An employee must be physically residing in the United States for the entire recruitment period, i.e., from the time of application until acceptance of a formal job offer. Therefore whether an employee is deemed to be recruited in or outside the United States is dependent on the geographic location of the employee when recruited, not on the existence of a residence at some place other than where the employee is actually located at that time. In this case, the claimant was physically residing in Japan, not the United States from May 19, 2017 to September 5, 2017, when he applied for the position in Japan. Therefore, he may not be considered a U.S. hire for LQA purposes under DSSR section 031.11, implementing regulations of the DoDI, and agency LQA policy guidance dated January 3, 2018. See OPM File Number18-0027.
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 previously discussed, 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.