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338.3 - Collection of Erroneous Payments of Pay and Allowances to Employees

This chapter provides policy for collecting erroneous payments of pay and allowances to U.S. Geological Survey (USGS) employees.


OPR: Office of Administration

InstructionChapter is updated to reflect current guidance.

1.  Purpose.  This chapter provides policy for collecting erroneous payments of pay and allowances to U.S. Geological Survey (USGS) employees.

2.  Policy.  It is USGS policy to accurately account for all debts due the USGS and to systematically and aggressively initiate collection action for the expeditious collection of such debts.

3.  Responsibilities.  Pursuant to the Debt Collection Act of 1982 and Department of Interior Credit and Debt Handbook, the USGS is responsible for the collection of debts resulting from its operations.

A.  Interior Business Center, Division of Payroll Operations, is responsible for notifying the USGS of erroneous salary and/or benefits payments made to USGS employees.

B.  The Chief, Office of Accounting and Financial Management (OAFM) is responsible for the establishment and control of a documented system of controls for aggressive debt collection action, including deductions for recovery of erroneous payments to current employees.

4.  Entitlement to Notification, Hearing, Written Response, and Final Hearing.  An employee is entitled to notification of the existence of a debt as a result of an erroneous payment and the potential for collection of such a debt via payroll deductions as provided for in 5 U.S.C. 5514.  Requirements of the notification and explanation of employee rights are included in SM 338.4.9A-C.

5.  Collection.

A.  Repayment Plan.  Whenever possible, payment should be made in a lump sum.  OAFM will attempt to arrange an agreeable repayment plan with the employee if payment cannot be made in lump sum.  Repayment plans will be established for a maximum duration of 3 years, with a minimum monthly payment of $50.

B.  Payroll Deductions.  If a repayment plan cannot be arranged, collection by salary offset will be initiated by OAFM.  Such deductions are not to exceed 15 percent of the employee's disposable pay which is the pay remaining after withholdings required by law have been deducted.  Guidelines for collection by salary offset from indebted current and former Government employees are included in SM 338.4.9D-I.  Recovery may also be made from other payments due an indebted employee (see SM 338.4.9J).

6.  Interest, Penalties, and Administrative Costs.  OAFM will assess all such charges on debts being collected under these procedures (see SM 338.4.5C).

7.  Refunds.  Amounts collected in error pursuant to this chapter will be refunded promptly to the employee.

/s/ Karen D. Baker                                                                                          April 9, 2014
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Karen D. Baker                                                                                                    Date
Acting Associate Director for Administration and Human Capital