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What is this case about?
The law provides that when a federal employee retires, dies, or separates
(“quits”) from federal employment, he or she must be paid a lump-sum payment in
cash for any unused annual (vacation) leave still in his or her account on the
date of retirement, death, or separation. The law also provides how that
lump-sum payment must be calculated, as follows: The lump-sum payment must
equal the amount the employee would have received if he or she had remained
employed by the federal government until the expiration of the unused annual
leave.
Therefore, for example, if an employee retired (or died or separated) with 160
hours of unused annual leave in his or her account, the lump-sum payment would
have to equal the same pay that the employee would have received if he or she
had stayed as an employee for four more weeks instead of retiring. Normally,
this simply would mean that the lump-sum payment should equal the employee’s
basic pay for that four-week period, and it would be paid in cash upon
retirement (less applicable taxes and withholding).
But, for example only, what if the employee retired on December 31 between
April 7, 1993 and September 7,1999, but a pay increase of 4 percent, for
example, went into effect on January 7 of the next year, which would have been
a few days after he or she retired?
Usually, an across-the-board pay increase goes into effect at the start of the
first pay period in the next year. If that employee had remained in federal
employment for the 160 hours of unused annual leave that he or she had in his
or her account instead of retiring on December 31, he or she would have
received the benefit of the new pay increase for most of those 160 hours
because the new pay rate would have started to take effect on January 7. Thus,
the lump-sum payment should not have been calculated entirely on the rate of
basic pay that the employee was receiving when he or she retired on December
31, but rather the calculation should also have included the employee’s higher
rate of pay because of the new pay increase from January 7 until the end of the
period of his or her unused annual leave of 160 hours from December 31.
Some federal government agencies applied this rule correctly, but other
agencies did not do so on a consistent basis. You may have been employed by one
of the 17 federal agencies that did not always apply the rule correctly, and
this class action lawsuit attempts to remedy that omission. IF YOU WERE
EMPLOYED BY THE VA OR BY A DIFFERENT FEDERAL AGENCY OTHER THAN THE 17 AGENCIES
LISTED ABOVE, THE LITIGATION WILL CONTINUE.
In addition, under the law SES employees and SFS employees during this period
were able to accumulate many more hours of unused annual leave than GS
employees, and thus the amount of back pay applicable to those former employees
could be considerably greater in calculating the lump-sum payment that should
have been made when the new pay increase in the next calendar year after
retirement is taken into effect.
There are two other situations where this rule of law comes into play:
If, for example only, an employee was regularly scheduled to work at least
every other Sunday, or one Sunday each pay period, for four (4) consecutive pay
periods before he or she retired, separated, or died on December 31 between
April 7, 1993 and September 7, 1999. If that employee had retired with
four-weeks’ worth of unused annual leave (160 hours), he would have worked at
least two (2) and perhaps even four (4) additional Sundays if he or she had
stayed in the federal service for four more weeks until his unused annual leave
was used up. Therefore, the lump-sum payment should have included pay equal to
those Sunday Premiums in addition to the employee’s basic pay for 160 hours of
unused annual leave. Unfortunately, federal agencies did not include Sunday
premium pay when they calculated the lump-sum payment during this period
between 1993 and 1999.
Finally, State Department and other federal employees who were employed
overseas on foreign soil may have received a foreign post allowance for
off-base housing. The amount of the allowance varied depending on the
particular country involved and the number of dependents the employee had who
lived in such housing. This foreign post allowance should have been included in
the calculation of the lump-sum payment for unused annual leave for any such
employee who retired, died, or separated in the foreign area.
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What is a Class Action lawsuit?
A class action is a type of lawsuit in which one or a few named plaintiffs
bring suit on behalf of all the members of a similarly situated group to
recover damages for all members of the group, without the necessity of each
member filing an individual lawsuit or appearing as an individual plaintiff.
Class actions are used by courts where the claims raise basic issues of law or
fact that are common to all members of the class, thereby making it fair to
bind all class members to the order and the judgment in the case, without the
necessity of hearing essentially the same claims over and over again and
unnecessarily consuming scarce judicial resources.
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Am I covered by this settlement?
The following class is certified for settlement purposes only pursuant to Rule
23 of the Rules of the United States Court of Federal Claims (“RCFC”):
All civilian employees who retired, died, or separated beginning
April 7, 1993 and before September 7, 1999 from employment by an agency,
establishment or instrumentality thereof of the 17 federal agencies identified
above, and who upon retirement, death or separation were eligible for a
lump-sum payment for unused annual leave pursuant to 5 U.S.C. 5551(a), and: (a)
who worked in occupational series listed above and who regularly received
Sunday premium pay immediately prior to retirement, death or separation which
was not included in their lump sum payment.
(1) prior to September 30, 1994, for FAA employees; or
(2) prior to September 30, 1996, for Department of Treasury, General Services
Administration, and Office of Personnel Management employees; or,
(3) prior to October 1, 1997 for Department of Agriculture, Department of
Commerce, Department of Defense and its component agencies (including the Corps
of Engineers), Department of Energy, Department of Health and Human Services,
Department of Housing and Urban Development, Department of the Interior,
Department of Justice, Department of Labor, Department of State, Department of
Transportation, Environmental Protection Agency, National Aeronautics Space
Administration and Social Security Administration employees; and/or
(b) whose pay rate would have increased as a result of any across-the-board
annual adjustment and locality pay adjustment or general system-wide pay
increase that would have become effective for that employee had the employee
remained in service for the period of his or her unused annual leave, but such
increased rate was not included in the calculation of the lump-sum payment for
unused annual leave of General Schedule (GS) employees, Foreign Service (FO/FP)
employees, Senior Executive Service (SES), Senior Foreign Service (SFS),
Administrative Law Judges (ALJ), Board of Contract Appeals (BCA); and/or,
(c) who received a foreign post allowance under 5 U.S.C. 5924(1) as authorized
by the U.S. Department of State’s Standardized Regulations (Government
Civilians, Foreign Areas) immediately prior to retirement, death, or separation
in the foreign area but such allowance was not included in the calculation of
the lump-sum payment for unused annual leave.
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Will all class members be entitled to payment?
No. In accordance with the settlement, only those employees who had unused
annual leave in their account when they retired, died, or separated AND were
not paid the proper lump-sum payment at that time, or at a later time were not
paid a supplemental lump-sum payment, are entitled to payment in this case.
Many of the class members were not paid the proper amount of the lump-sum
payment for unused annual leave and, accordingly, many class members are
entitled to a settlement payment. On the other hand, a substantial number of
class members were not disadvantaged when they received their lump-sum payment,
because either they were not entitled to any lump-sum payment at all because
they had used up all of their annual leave before they retired, separated, or
died, or they received the payment to which they were legally entitled either
when they retired, separated, or died, or in a supplemental lump-sum payment
thereafter. For these people, the actual pay that they received was correctly
calculated. Because these class members were never harmed, they will receive no
money under the court-ordered remedy.
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I am a Class Member. When will I be paid?
Checks were issued on January 25, 2008 to all class members with valid claims.
All checks become stale after 120 days and will not be reissued after that date.
Checks issued represent the full award and include wages and interest,
less appropriate taxes and withholdings. In January 2009, you will be sent a
Form W-2 wage statement. If you have received $600 or more in interest, you
will be sent a Form 1099-INT as well.
Not all class members were entitled to a payment. If you filed a timely claim
and have not received a check or denial letter, please write to the Settlement
Administrator at:
Archuleta Settlement Administrator
P.O. Box 4540
Portland, OR 97208-4540
After calculating awards, we found that some Class Member would be entitled to
a small sum, or sometimes nothing at all. After careful consideration, it was
decided that paying all of the awards less than $50 would negatively impact the
Fund’s ability to pay the remaining class members. For that reason, the
Settlement Administrator exercised the option given by the Court-approved
Remedial Methodology, and set a de minimus of $50. Those people who
filed an otherwise valid claim, but were entitled to an award of less than $50
were sent a letter on January 25, 2008.
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I am the successor of a deceased Class Member. When will I be paid?
Checks were issued to all successors of deceased class members on January 25,
2008. All checks become stale after 120 days and will not be reissued after that date.
No withholdings have been made, but this payment may be reported to
the taxing authorities, as applicable. If you have received $600 or more in
Income or Interest, you will be sent a Form 1099 in January 2009.
Not all class members were entitled to a payment. If you filed a timely claim
and have not received a check or denial letter, please write to the Settlement
Administrator at:
Archuleta Settlement Administrator
P.O. Box 4540
Portland, OR 97208-4540
After calculating awards, we found that some Class Member would be entitled to
a small sum, or sometimes nothing at all. After careful consideration, it was
decided that paying all of the awards less than $50 would negatively impact the
Fund’s ability to pay the remaining class members. For that reason, the
Settlement Administrator exercised the option given by the Court-approved
Remedial Methodology, and set a de minimus of $50. Those people who
filed an otherwise valid claim, but were entitled to an award of less than $50
were sent a letter on January 25 2008.
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Is the Settlement final?
A settlement has been reached with the Federal Government on behalf of former
employees of the 17 Federal agencies listed above creating a Settlement Fund of
$ 7,458,950.08 and providing for the payment of back pay and interest to
qualified eligible claimants according to a remedial methodology that was
approved by the Court on June 1, 2006.
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What should I do if I am the Survivor of a deceased Class Member?
If you are the survivor or successor of a Class Member who passed away after
filing a valid claim, you may have received a check or letter made out to that
Class Member. Depending upon your situation, you may be able to deposit this
check. Please consult your bank.
If you received a check but cannot deposit it, or did not receive a check or
letter, please contact the Settlement Administrator immediately. You need to
send a letter containing:
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Your full name, Social Security Number and mailing address.
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The Class Member’s full name and Social Security Number.
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An explanation of your relationship to the Class Member, as well as any
documentation you have available.
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A copy of the Class Member’s death certificate (please do not send originals).
You only have 120 days from the date the check was issued to contact the
Settlement Administrator, so please do not delay. These matters can only be
addressed in writing, so please do not call the toll free number about them.
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How was my award calculated?
There were four different situations covered by this settlement, each having its own type of calculation. Please choose one of the following claim types for information on how awards were calculated.
Statutory Increase (GS, FO, FP, ALJ and BCA employees)
Statutory Increase (SES and SFS employees)
Sunday Premium Pay
Foreign Post Allowance
If you are unsure of which category applied to you, please visit the General Information page for a full description of each.
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I was a member of the CSRS. Why was Social Security Tax withheld from my check?
One of the duties of the Settlement Administrator was to calculate the appropriate tax withholdings for each Class Member receiving an award. Because a portion of the Settlement payments that were made were considered wages, we were required to withhold all of the normal taxes “employers” usually do. Unfortunately, we were not informed by the Office of Personnel Management of the retirement system information for each potential Class Member, and it would not have been administratively possible to obtain this information from the potential 80,000+ Class Members. In order to ensure that we were compliant with all of the necessary tax laws using the information we had on file, all payments were processed with Social Security Tax withheld.
There is a small percentage of the Settlement Class that are, or were at their time of employment by the government, part of the Civil Service Retirement System (CSRS) and are not subject to Social Security Tax. These Class Members should consult a tax advisor prior to filing their 2008 tax return. While we are not tax experts, and we cannot advise you on how to proceed, it is usually possible to be refunded any excess Social Security Tax withheld during the year. Again, please consult a tax advisor.
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Who are the lawyers appointed by the court as Class Counsel?
Class Counsel means Ira M. Lechner and Daniel M. Katz, who are experienced
plaintiffs’ attorneys approved by the court as Lead Class Counsel and Co-Class
Counsel, respectively. They are also referred to as Plaintiffs’ Counsel. They
are paid out of the Settlement Fund as ordered by the Judge of the United
States Court of Federal Claims.
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How did you or will you get my name and address?
The Office of Personal Management (“OPM”) supplied the list of names and
addresses for purposes of this settlement only. Your personal information is
being held in strict confidence.
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Will I receive updates on the status of the litigation?
This Internet site will be periodically updated to reflect the current status
of the case. If you desire to receive specific information about the case or
information specific to your claim, you may write to the address below:
Archuleta Settlement Administrator
P.O. Box 4540
Portland, OR 97208-4540
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