Leave Buy Back?
Should a Federal Workers Compensation Claimant buy back his/her leave?
A claimant with an approved claim may buy back leave. However, I question whether this is really a good idea. OWCP does not pay back the full amount of the leave. OWCP only pays either 75% or 66 2/3% of the gross amount of the salary; not the net amount of the salary. Remember gross salary is not what you receive every two weeks. Your employer is mandated to deduct social security payment of 7% and various insurance premiums. OWCP does not consider the net amount that the claimant received in wages. OWCP then pays based on the gross wage.
Now comes the problem. The injured worker must reimburse the employer 25% or 33.3% of the gross weekly wage. The injured worker does not get any refund for the 7% social security. The injured worker must make the adjustment for taxes as well. Therefore, the injured worker is paying cash – out of pocket – to buy back a benefit that he/she may not use.
I do not personally like to pay full value of a future promise in present-day cash.