Recent Ruling Favors Retirees Who Were Injured on the Job

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(This article appeared in the May/June 2006 issue of TheAmerican Postal Worker magazine)

Doug Holbrook, Director

If you are a retiree who was partially disabled by a work-related injury, you want to make sure that your retirement annuity was computed accurately. A recent decision by the Merit Systems Protection Board (MSPB) should ensure that you get the annuity you deserve.

Retirement annuities are computed based on your length of service and wages for your “high-three” years. The union has always believed that the calculations should include contributions made for all “creditable service,” even for time missed because of a job-related injury.

The OWCP Factor

Until recently, the Office of Personnel Management enforced a policy dictating that employees returning to work on a part-time basis and having the remainder of their salary paid by the Office of Workers’ Compensation were to be treated as part-time workers. Their retirement annuities were calculated only on their part-time earnings, meaning the affected employees lost benefits.

For example, if an employee was able to work only six hours per day and received OWCP compensation for the other two hours, OPM’s policy would result in the employee’s annuity being based on six hours, with his or her annuity being reduced as much as 25 percent.

Full Credit – Even If Partially Disabled

A decision by the MSPB late last year, however, favored letter carrier David Hatch, who had challenged the OPM policy. Hatch was a full-time regular who had been working less than 40 hours a week because of limitations caused by a work-related injury. The MSPB concluded that he should not be considered a “part-time” worker for purposes of computing his high-three average salary (Hatch v. OPM, 100 MSPR 204). The MSPB reasoned that an injured employee who cannot be blamed for being unable to work should not be penalized in retirement.

The Merit System Protection Board’s decision to grant full-time salary credit for workers’ compensation periods will help guarantee that retirement years will be as secure as they should be.

The APWU has followed this case very closely, and when we received the MSPB decision, President William Burrus queried OPM to see how the agency would apply the ruling. On Feb. 10, he received a response from OPM Director Linda M. Springer:

“The Board [MSPB] found that Mr. Hatch … should have been treated as a full-time employee at separation for retirement purposes by the Office of Personnel Management.”

Falling Into the Hatch Category

“OPM has declined to pursue a judicial review of this decision and as you [Burrus] suggest, the Board’s decision is now precedent. OPM will apply the decision in all factually similar cases, both under (CSRS and FERS). This includes new applications for retirement benefits as well as cases that come to the attention of OPM for any reason, regardless of the commencing date of the annuity.”

The letter closed by saying that a Benefits Administration Letter explaining the Hatch case would be sent to all federal agencies, who would be asked to identify current employees whose retirements are pending and may be affected by this decision, those who may have recently retired, and those former employees that may fall into the Hatch category.

The Annuity You Deserve

Employees who were forced to work reduced schedules as a result of work-related medical conditions should now receive the annuities they deserve. Retirees who fit the Hatch profile and believe their annuity was computed on this pro-rated basis should write to OPM at: Retirement Operations Center, POB 45, Boyers, PA 16017.

Remember to include your retirement claim number, and be sure to state that you are writing regarding the Hatch decision.

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