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Friday, April 15, 2011

Department of Labor is advocating reduction in FECA benefits

The Labor Department has proposed what they characterize as an "overhaul" of the FECA process. It is noteworthy that OWCP has been presenting the proposed changes to employing agencies, "stakeholders" in their parlance, but has not made any effort to communicate this to injured workers who apparently get in the way of the process of managing FECA, the federal workers' compensation benefits program for federal employees. This is being presented as a way to move older, injured workers into retirement and remove alleged "disincentives" for younger employees to return to work. They propose that injured claimants should receive 70 percent of their salaries, tax free, until they reach retirement age. When they reach retirement age, under Labor's proposed plan, benefits would be reduced — called the "conversion entitlement benefit" — to 50 percent of their gross salary at the time of their injury, with cost of living adjustments, still tax free.