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Code of Federal Regulations Pertaining to U.S. Department of Labor |
| Employees' Benefits |
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| Office of Workers' Compensation Programs, Department of Labor |
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| Claims for Compensation Under the Federal Employees' Compensation Act, As Amended |
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| Compensation and Related Benefits |
20 CFR 10.422 - May compensation payments be issued in a lump sum?
- Section Number: 10.422
- Section Name: May compensation payments be issued in a lump sum?
(a) In exercise of the discretion afforded under 5 U.S.C. 8135(a),
OWCP has determined that lump-sum payments will not be made to persons
entitled to wage-loss benefits (that is, those payable under 5 U.S.C.
8105 and 8106). Therefore, when OWCP receives requests for lump-sum
payments for wage-loss benefits, OWCP will not exercise further
discretion in the matter. This determination is based on several
factors, including:
(1) The purpose of the FECA, which is to replace lost wages;
(2) The prudence of providing wage-loss benefits on a regular,
recurring basis; and
(3) The high cost of the long-term borrowing that is needed to pay
out large lump sums.
(b) However, a lump-sum payment may be made to an employee entitled
to a schedule award under 5 U.S.C. 8107 where OWCP determines that such
a payment is in the employee's best interest. Lump-sum payments of
schedule awards generally will be considered in the employee's best
interest only where the employee does not rely upon compensation
payments as a substitute for lost wages (that is, the employee is
working or is receiving annuity payments). An employee possesses no
absolute right to a lump-sum payment of benefits payable under 5 U.S.C.
8107.
(c) Lump-sum payments to surviving spouses are addressed in 5 U.S.C.
8135(b).
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