Office of the General Counsel

Date: January 15, 1998
Matter of: [xxx]
File Number: s9700369

OPM Contact: Jo-Ann Chabot

Two federal employees claim that they were entitled to receive a 25 % cost of living allowance (COLA) for employees whose posts of duty are in nonforeign areas from the day that their transfer to [state] became effective, rather than from the day that they actually reported for duty in [state]. Their claim is denied for the reasons stated below.

Under 5 U.S.C. 5941 and Executive Order 10000, as amended, certain federal employees in nonforeign areas outside the 48 contiguous states are eligible for COLAs when local living costs are substantially higher than those in the Washington, D.C., area. Nonforeign area COLAs are paid in Alaska, as well as in Hawaii, Puerto Rico, the U.S. Virgin Islands, Guam, and the Commonwealth of the Northern Mariana Islands. The Office of Personnel Management (OPM) regulation that was in effect when the claims arose, 5 C.F.R. 591.210(f) (1996 ed.), provided that payment of a COLA would begin "as of the date of arrival on regular assignment or transfer, or on the date of entrance on duty in the case of local recruitment." These regulations, at 5 C.F.R.  591.201 (1996 ed.) defined "date of arrival" as "the employee's first day in a pay status in the allowance or differential area,." and "allowance area" as "a geographic area for which an allowance has been authorized."

Before issuing that version of section 591.201 as a final rule, OPM received a recommendation that payment of the differential should begin at the start of the employee's first pay period in a duty status in the allowance or differential area. 55 Federal Register 1370, 1371 (January 16, 1990). OPM did not accept the recommendation on the basis that it would not be appropriate to authorize payment of an allowance for any part of a pay period preceding an employee's arrival in the nonforeign area. Id. OPM noted in this regard that it had revised the definition of "date of arrival" to correspond with the first day that the employee is in a pay status in the allowance area. Id. OPM also noted that "[t]he information needed to determine an employee's date of arrival . . . should be readily available in the agency's records." Id. Thus, according to the OPM regulations that were in effect when this claim arose, an employee became entitled to payment of the COLA on the first day that he or she reported to work in the allowance area, rather than on the day that the employee's transfer to that area became effective. The pertinent agency regulation (Order 3550.10, Chapter 7, Section 413d) reflected this interpretation in providing that an agency employee is entitled to payment of allowances "when the employee arrives at the post of duty and starts work on his regular assignment, or on the date of entrance on duty when the employee is recruited locally."

The claimants accepted a transfer from a position in [state] to another position with the same federal agency in [state] Their transfer became effective September 29, 1996, with an estimated reporting date of November 1, 1996. However, on October 2, 1996, the claimants' new supervisor in [state] asked them whether they would be willing to attend training classes in [state]. Based on information he received from the agency's regional human resource management specialist, the supervisor advised claimants that as long as they were attending training classes subject to the [state's] region's travel and training orders, they would be entitled to receive the COLA.

The claimants arrived in [state] for training on October 6, 1996. Although their pay checks of October 22, 1996 reflected they had received a 25% COLA, their paychecks of November 5, 1996 did not include the COLA and reflected as well that the COLA they had received during the previous pay period had been deducted from their pay. The claimants left [state] when their training concluded and reported for work in [state] on December 17, 1996.

Under the regulations that were in effect at the time this claim arose, the claimants became entitled to receive a COLA when they arrived at their duty post. In view of this, their claim of entitlement to a COLA from the date that their transfer became effective is denied.

The inaccurate information that the claimants' supervisor allegedly provided does not constitute a basis for approval of their claim. Payments of money from the Federal Treasury are limited to those authorized by law, and erroneous advice or information provided by a government employee cannot bar the government from denying benefits that are not otherwise permitted by law. Office of Personnel Management v. Richmond, 496 U.S. 414, 110 S. Ct. 2465, rehearing denied, 497 U.S. 1046, 111 S. Ct. 5 (1990). Under the regulations that were in effect at the time this claim arose, the claimants were not entitled to payment of a COLA until they reported for duty at their duty station in Alaska.