The Obama administration's proposal for modifying the Federal Employees' Compensation Act program faced a somewhat chilly reception during a recent hearing, with Democrats on a House panel and some hearing witnesses criticizing provisions that would reduce workers' compensation benefits for injured federal and postal employees with dependents. 

Republicans on the House Education and the Workforce Subcommittee on Worker Protections, including subcommittee Chairman Tim Walberg (R-Mich.), urged further study before making changes to the current program, which provides higher levels of benefits to FECA beneficiaries with dependents. The administration would like to move to a system that calculates FECA benefits without regard to family status. 

"Moving toward a single rate of wage loss compensation is worthy of consideration. However, we have to be mindful how this will affect federal employees with families, especially when their colleagues without dependents stand to gain financially," Walberg said during the July 10 hearing. 

Gary Steinberg, director of the Labor Department's Office of Workers' Compensation Programs, told the subcommittee that the administration's proposal calls for changing the benefit structure of FECA to eliminate augmented benefits currently provided to FECA beneficiaries with dependents. 

Currently, Steinberg said, such beneficiaries receive 75 percent of their benefits tax free, compared with just under 67 percent for FECA beneficiaries without dependents. 

"Few state systems provide any augmentation for benefits, and none approaches the federal level," he told the panel. Steinberg emphasized that the administration is proposing to change the program only for future FECA recipients, meaning current recipients would not see a change in their benefits. 

Instead, he said, FECA benefits should be set at a level of 70 percent, regardless dependent status. This would make it easier for OWCP to administer the program, while eliminating what Steinberg described as a disincentive for FECA beneficiaries with dependents - who make up the majority of beneficiaries - to return to work. 

According to Steinberg, the current structure requires OWCP to get updated information from FECA beneficiaries with dependents each year to ensure that they are still eligible for the augmented benefits. For example, he said, dependents after reaching the age of 18 are no longer eligible for purposes of determining FECA coverage. 

The administration also considers offering one benefit level to be more equitable, because agencies do not distinguish between employees with dependents and those without dependents for purposes of determining salaries, Steinberg said. He estimated that the administration's proposal would save the government $500 million over 10 years. 

Others on the panel disagreed, calling it unfair to put FECA recipients without dependents in a better financial situation than those with dependents by providing both groups with the same level of benefits. 

Rep. George Miller (D-Calif.), the ranking member of the full committee, took Steinberg to task on this point. Miller noted that at one point in his testimony, Steinberg said that employees with dependents often are not the only wage earners in their families. 

Thus, Miller said, Steinberg was acknowledging that there are differences between the two types of recipients. This suggests that it is not inequitable to offer two different levels of benefits, Miller said. 

In other public sector news:

• ODNI and Clearances. The Office of the Director of National Intelligence would be required to issue guidance to help federal agencies determine which civilian positions require security clearances under legislation introduced by Sen. Tester (D-Mont.), chairman of the Senate Homeland Security and Governmental Affairs Subcommittee on Efficiency and Effectiveness of Federal Programs and the Federal Workforce. 
• EEOC, No to More Furloughs. The Equal Employment Opportunity Commission said it does not intend to impose three additional unpaid furlough days on its employees during fiscal year 2013, beyond the five days of furloughs employees already have taken this year due to sequestration, according to a statement from the American Federation of Government Employees, which represents agency employees. 
• 4.5 Percent Raise for California Workers. California Gov. Brown (D) signed legislation giving approximately 95,000 state workers a 4.5 percent raise as part of a new three-year collective bargaining agreement, a day after Service Employees International Union Local 1000 said 90 percent of its voting members had ratified the contract. 
• GASB on New Accounting Rules.The Governmental Accounting Standards Board issued a proposal aimed at eliminating the potential for understatements of public defined benefit plan contributions during the initial implementation of the board's new pension accounting rules.