Matthew Kurdziolek, DAB CR6376 (2023)

DECISION

I sustain the determination of the Social Security Administration (SSA) that Petitioner, Matthew Kurdziolek, owes a debt to SSA of $16,609.01.

I. Background

This case was recently transferred to my docket from that of another administrative law judge.  The judge to whom the case was assigned had set a pre-hearing schedule that afforded the parties two rounds of simultaneously filed briefs plus an in-person hearing set provisionally for October 30, 2023.

On October 10, 2023, SSA filed a brief and a motion for summary judgment.  I concluded that there was no need for two rounds of briefs and afforded Petitioner until October 18, 2023 to reply to SSA’s brief and motion.  Petitioner filed a response on October 17, 2023.  Additionally, I canceled the in-person hearing because I found it to be unnecessary.  Order, October 16, 2023 (DAB E-file # 7).

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With its motion SSA filed six exhibits that it identified as SSA Ex. 1 – SSA Ex. 6.  Petitioner responded with nine exhibits that he identified as Kurdziolek Ex. 1 – Kurdziolek Ex. 9.  I receive these exhibits into the record.

Although SSA requested that I enter summary judgment, I find it to be unnecessary that I address the criteria for summary judgment in this decision.  The parties have stated the facts of this case in their briefs and exhibits.  Neither party presented evidence that requires an in-person hearing.  I therefore decide the case based on the parties’ written submissions.

II. Issue, Findings of Fact and Conclusions of Law

A. Issue

Petitioner does not deny that he is indebted to SSA, nor has he challenged SSA’s right to collect a debt.  He disputes the amount of his indebtedness.  Therefore, the only issue before me is whether Petitioner owes SSA a debt of $16,609.01.

B. Findings of Fact and Conclusions of Law

At the heart of this case is a dispute between Petitioner and SSA over his locality pay.  “Locality pay” is an adjustment to a federal employee’s salary based on that employee’s official duty station (ODS), or in the case of an employee who works from a remote location (“telework”) from that employee’s alternate duty station (ADS).

In 2022 Petitioner executed a telework agreement with SSA that established his ADS as Derwood, Maryland, and that gave him locality pay for the Washington-Baltimore-Arlington area.  SSA Ex. 1; SSA Ex. 2 at 5; 5 C.F.R. § 531.604(b).  The telework agreement explicitly stated that Petitioner’s days for participation at his ADS would be from Monday through Friday throughout each pay period.  SSA Ex. 1 at 1.  It stated that the location of the ADS could not be changed without prior approval of management.  Id. at 2.  It also stated that Petitioner’s hours of duty at the ADS would be the same as Petitioner’s official duty station (Woodlawn, Maryland).  Id.

However, Petitioner did not work from a Derwood, Maryland ADS.  Until June 2023 Petitioner teleworked from his residence in Williamsburg, Virginia, in violation of his telework agreement and without SSA’s approval.  SSA Ex. 4.  When SSA learned that Petitioner was not working at his ADS it immediately terminated his telework agreement.  It also determined that Petitioner was indebted to SSA for the difference between the Washington-Baltimore-Arlington locality pay rate and the Virginia Beach-Norfolk locality pay rate (Williamsburg is in the Virginia Beach-Norfolk locality pay area).

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SSA Ex. 1; SSA Ex. 4; SSA Ex. 5.  That difference amounted to the $16,609.01 indebtedness that SSA asserts.¹

Petitioner does not deny that he is indebted to SSA and he acknowledges that he was paid locality pay for working at an ADS that was not, in fact, where he worked.  He admits that he requested that SSA allow him to telework from Williamsburg but that his request was denied.  Petitioner’s pre-hearing brief at 1-2.  He contends that he executed the telework agreement establishing Derwood, Maryland as his ADS as a “futile and uncharacteristic decision that I fully regret and take total responsibility for.”  Id. at 2.  Petitioner acknowledges that he never teleworked from the Derwood ADS.  Id. at 3.

Petitioner contends, however, that while he does not dispute his indebtedness, he disagrees with the amount determined by SSA.  He contends that he was on authorized travel for much of the time that he teleworked.  He argues that, in fact, his primary duties are in the field and not from an ODS or an ADS.  He contends that he is indebted to SSA only for the hours that he worked from his Williamsburg residence.  Petitioner’s pre-hearing brief at 4.  He asserts that the other hours that he worked should not be subject to the Virginia Beach-Norfolk locality pay rate, and evidently, were correctly compensated at the Washington-Baltimore-Arlington locality pay rate.  Id.  Therefore, according to Petitioner, his indebtedness should be reduced to $10,447.84.

Although Petitioner asserts that he owes less than SSA contends, he does not dispute the locality pay rate differentials relied on by SSA.  Nor does Petitioner argue that SSA made calculation errors based on the total hours that Petitioner worked.

I find Petitioner’s arguments to be without merit.  The evidence establishes that Petitioner should not have been paid at the Washington-Baltimore-Arlington locality pay rate while he worked pursuant to his telework agreement because he never worked at the ADS at which he agreed to work.

Locality pay is governed by regulations at 5 C.F.R. §§ 531.604 and 531.605.  An agency such as SSA determines an employee’s locality pay by determining that employee’s official worksite consistent with rules set forth at 5 C.F.R. § 531.605.  5 C.F.R. § 531.604(b)(1).  The employee’s official worksite is the employee’s position of record where the employee regularly performs his or her duties.  5 C.F.R. § 531.605(a)(1).  If the employee’s work involves recurring travel or that employee’s work location varies on a recurring basis, that employee’s official worksite is the location:  “as determined by the employing agency subject to the requirement that the

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official worksite must be in a locality pay area in which the employee regularly performs work.”  5 C.F.R. § 531.605(a)(2).

The regulations do not allow for adjustment of locality pay for days traveled by an employee, even if that travel is extensive.²  Rather, the regulations direct that locality pay must be premised on the employee’s official worksite, that being where the employee regularly performs work.  In this case, and as Petitioner admits, that worksite was in Williamsburg, Virginia and not in Derwood, Maryland.

The evidence establishes unequivocally that SSA determined that Petitioner’s position of record consisted of his ODS at Woodlawn, Maryland and his ADS at Derwood, Maryland, based on its assumption that Petitioner would regularly perform work while living in Derwood.  Petitioner was required to work in Derwood as a condition of his employment.  He failed to perform any work in Derwood, not because he traveled constantly (even if he traveled a lot) but because he regularly performed work that he should have been performing in Derwood at his residence in Williamsburg.  As Petitioner acknowledges, more than one-half of the debt determined by SSA is valid because it consists of locality pay for work performed by Petitioner in the Washington-Baltimore-Arlington area when he was in fact working in Williamsburg, Virginia.  Petitioner’s pre-hearing brief at 4; Kurdziolek Ex. 9.

SSA’s determinations of Petitioner’s ODS and ADS were entirely consistent with regulatory requirements.  Petitioner would have been entitled to receive locality pay for a Washington-Baltimore-Arlington ADS had he worked from a Derwood, Maryland location, even had he traveled extensively while working from that location.  He forfeited that pay when he violated his telework agreement and he is not entitled to keep any of it because he traveled frequently.  SSA’s assessment of the debt is correct.

Lastly, I have considered the record and determined that Petitioner’s petition for hearing was not baseless and did not result from an intent to delay SSA’s collection activity. 20 C.F.R. § 422.810(h)(4)(ii)(B).

Endnotes

¹ SSA explained how the debt was calculated, based on the differential of locality pay rates between the Washington-Baltimore-Arlington and the Norfolk-Virginia Beach locality pay areas.  SSA Ex. 6.

² As SSA points out, it would be an administrative nightmare for an agency if it had to adjust an employee’s pay for each day that the employee traveled to a work site other than his or her ODS or ADS.  Furthermore, those adjustments—if it were even possible to make them—would not necessarily work to the employee’s advantage because official travel likely would involve some travel to sites where locality pay is less than that for the employee’s ODS or ADS.  Undoubtedly, much of Petitioner’s travel on behalf of SSA was to sites where the locality pay was less than that of either the Washington-Baltimore-Arlington or the Norfolk-Virginia Beach locality pay areas.