Bailey v. Office of Personnel Management
711 F. App'x 976
| Fed. Cir. | 2017Background
- Tracy Bailey, former USPS employee, applied for and received FERS disability benefits effective Feb 16, 2008.
- OPM requested updates on Bailey’s Social Security Disability Insurance (SSDI) status; she initially reported a denial but later became entitled to SSDI as of Feb 1, 2013.
- OPM later learned of the SSDI entitlement, recalculated Bailey’s FERS payments, and determined a $6,518 overpayment for Feb 1, 2013–Jan 30, 2014.
- OPM sought recovery, initially via 36 monthly installments, then—after Bailey sought waiver and lower installments—reduced recovery to 130 monthly payments of $50 (plus a final smaller payment) and denied waiver.
- Bailey appealed to the Merit Systems Protection Board (Board); the Administrative Judge affirmed OPM, finding OPM proved the overpayment and Bailey failed to establish entitlement to waiver or further repayment adjustment.
- Bailey appealed to the Federal Circuit, which reviews the Board’s decision for abuse of discretion, arbitrariness, or lack of substantial evidence and affirmed the Board’s decision.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Bailey is entitled to waiver of FERS overpayment recovery | Bailey argued she promptly informed OPM of her SSDI award and is without fault; recovery would be against equity and good conscience | OPM argued it gave advance notice of SSA reporting obligations, Bailey failed to notify OPM, and OPM independently learned of the SSDI award | Board and Federal Circuit held OPM met its burden; substantial evidence showed Bailey failed to notify OPM and was not entitled to waiver |
| Whether repayment schedule should be further adjusted for financial hardship | Bailey argued $50/month still causes financial hardship and asked for lower installments | OPM argued its adjusted schedule ($50/month) was reasonable given Bailey’s reported income and expenses | Held that substantial evidence supports the Board’s finding Bailey failed to show she needs substantially all income for ordinary living expenses; $50/month schedule stands |
| Whether Board applied correct legal standards and considered evidence | Bailey argued Board ignored her timely notice and financial details | OPM argued Board applied correct law and reviewed financial records | Held Board applied correct legal standard and adequately considered and weighed the financial evidence |
| Whether the Board’s decision is supported by substantial evidence and not arbitrary | Bailey argued decision lacked adequate evidentiary support | OPM argued record supports the Board’s factual findings and legal conclusions | Held decision is supported by substantial evidence and affirmed |
Key Cases Cited
- Consol. Edison Co. v. Nat’l Labor Relations Bd., 305 U.S. 197 (1938) (defines substantial evidence as such relevant evidence as a reasonable mind might accept as adequate to support a conclusion)