Compensaton for Workers Injured in the Federal Workplace (FECA)

7/26/2011

U.S. Senate Committee on Homeland Security and Governmental Affairs Subcommittee on Oversight of Government Management and the Federal Workforce

Chairman Akaka and Members of the Subcommittee on Oversight of Government Management and the Federal Workforce, the National Treasury Employees Union (NTEU) appreciates the opportunity to offer this statement to the Subcommittee as it considers the important matter of Workers’ Compensation in the federal sector. NTEU represents over 155,000 federal employees at 31 agencies. Our members perform every type of work for the American public from Customs and Border Protection Officers, to Treasury Department employees sorting tax returns or involved in the printing of currency, to Food and Drug Administration scientists working in laboratories at home or on assignment inspecting products in India and Mainland China. These public servants show up for work each day expecting to perform their important duties diligently and professionally in service to their country and then safely return home to their families. Nevertheless, some will suffer workplace injuries that make it impossible for them to return to work for short or long periods of time and, regrettably, in some cases to never be able to return to work at all due to permanent injury or even death.

This year, the nation celebrates the centennial of Workers’ Compensation laws. One hundred years ago the first Workers Compensation program was enacted into law by the state of Wisconsin, following on workplace injury insurance programs adopted in Germany and Great Britain. Nine other states followed this progressive initiative that same year and by 1948 all states had laws covering private and state workers. Five years after Wisconsin led the nation on this, Congress moved to insure the federal government’s own employees as well as railway, longshoremen and other harbor workers. The Kern-McGillicudy Act developed the program we now know as the Federal Employees Compensation Act (FECA). Workers’ Compensation insurance is a recognition of the responsibility of employers and society to take care of those injured in the workplace. It was our nation’s first social insurance program. Today, Workers’ Compensation stands as an important protection for the benefit of all Americans. Almost 98% of the workforce is covered by workers’ compensation insurance.

FECA is one of the most important programs for federal workers. This program provides federal employees with workers’ compensation coverage for injuries and diseases sustained while performing their duties. The program seeks to provide adequate benefits to injured federal workers while at the same time limiting the government’s liability strictly to workers compensation payments. Payments are to be prompt and predetermined to relieve employees and agencies from uncertainty over the outcome of court cases and to eliminate costly litigation. Efficient government is advanced by a civil service that is expected to have the highest levels of professionalism and competency and in turn is fairly compensated and treated with dignity and respect. There is no greater disrespect to human dignity than to have to suffer injury from an unsafe workplace or from employer negligence.

NTEU welcomes a review of the FECA program, while always keeping in mind this is an issue of human dignity. We believe such a review should be broad and comprehensive. By that, we mean that it should never start or be rigidly limited to benefit payments. Instead the first principle should be making the federal workplace safe by actions to move us towards the goal where no worker need come to work with the possibility it will be his or her last day on the job because of a workplace injury. NTEU has worked with Republican and Democratic administrations on this goal and we are ready to continue those efforts.

However, I want to state our strong opposition to insurance benefit cuts, particularly for those employees who came to work one day ready to serve their country but suffered a workplace injury that resulted in them never being able to return. We are strongly opposed to proposals for a forced retirement provision or a cut in benefits for older, injured beneficiaries.

An employee who is injured on the job and unable to work receives FECA payments equal to 67% of wages at the time of injury (a slightly higher amount if he has family obligations). This reduction in income makes it impossible for an injured employee to fund a retirement plan. Once workplace injured workers are on FECA, they receive no further step/grade increases or contribution matches, nor are they able to make elective contributions to the Thrift Savings Plan. This holds true for Social Security as well as the federal retirement programs. Forcing a worker to give up regular FECA benefits at some age deemed to be retirement age and live on the income from retirement savings set aside up until his or her worklife was interrupted by an on the job injury would cause grave economic hardship to many disabled employees.

NTEU would also oppose elimination of the family benefit that is now a feature of FECA. This is not a complicated program to administer. It does not compensate for the tragic emotional burden a head of household must suffer having lost his or her ability to continue as the breadwinner for his or her children. But it does provide some modest additional payment so a former family breadwinner can still provide some material support for his dependents, such as maybe be able to afford to take them to a ballgame or to pay for dance lessons.

There are a number of ways that FECA fails to provide for just and proper benefits. NTEU would ask that the Senate act to improve FECA in this way, particularly regarding benefit amounts that have not been adjusted since 1949. NTEU has endorsed the Federal Workers’ Compensation Modernization and Improvement Act (HR 2465) that recently was approved by the House Education and the Workforce Committee on a bi-partisan basis. This legislation increases the maximum scheduled award for facial disfigurement from the $3,500 cap set in 1949 to $50,000 and then for the future, indexes to inflation that figure. It does the same for the 1949 enacted funeral expense limit from $800 to $6,000 and again indexing it for the future. NTEU is also pleased the House bill adds coverage for disability or death of a federal employee sustained in a terrorism incident. Representing employees of the IRS and the Department of Homeland Security, we know that they, as well as many other federal workers, are particular targets of terrorists.

Let me close by stating that NTEU very much wants to work with the Senate and any other policymakers to find ways to reduce the costs of the FECA program. As I have said, our belief is the best way to do so is not by reducing benefits or denying claims but by preventing the occurrence of injuries. NTEU is committed to a safe and healthy federal workplace where employees are less likely to ever suffer the injuries that lead to FECA claims. Our union has also been one of the strongest forces for innovation in the federal workplace, often working with management on bold new programs and sometimes dragging management forward over its reluctance. We have received reports from our members about management resistance or disinterest in light duty assignments, alternative worksites, disability accommodations and other actions that could allow FECA recipients to return to work. A change in management practices and culture is needed. I don’t expect this is something Congress can legislate, but the first step is to end the myth that able bodied workers are receiving FECA payments and accept the fact that many injured workers would like to return to work and could do so with open minded and innovative agency practices.

Further, NTEU is willing to work with policymakers to improve program integrity methods. For example, the Office of Worker Compensation Programs (OWCP) currently matches FECA claimants with Social Security Administration (SSA) data to determine if claimants have died. However, they do not match with SSA data to see if they are receiving wages that would make them ineligible for FECA benefits. If OWCP thinks FECA beneficiaries are falsely claiming dependents, they should be able to match their records with tax returns and FEHBP enrollment records. We support the cost savings provisions included in the bi-partisan legislation recently passed by the House Education and Workforce Committee including sections 7 and 9, allowing subrogation of continuation of pay and a chargeback for administrative costs. We strongly believe these are the types of reforms that should be explored before Congress moves to cut these social insurance benefits to injured federal workers.

Thank you for this opportunity to present NTEU’s views.