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The Compensation Commission in 1945 paid out more than $14,000,000 for compensation benefits for the injury and death of Government employees. Its administrative cost connected with the Federal Employees' Act amounted to approximately $900,000, or 6.4 percent of the benefits paid. The Commission is one of the few agencies of the Government to receive a compliment rarely bestowed by a congressional appropriations committee for economy in administrative expenditures. In reporting the annual appropriation for the Commission for 1942, the House Committee on Appropriations stated :

The committee desires to commend the Commission for the economical way in which the Commission has been operated. Such a record is deserving of a real plaudit.

The importance to employees of the Federal Government of the administration of the Federal employees' compensation law is emphasized by the report of operations under such law. The Compensation Commission reports show that in the 512 years between January 1, 1940, and June 30, 1945, the Commission received more than 625,000 reports of injury to Government employees. The estimated compensation benefits payable in such cases amount to more than $51,000,000. Nearly $6,000,000 of such benefits are in connection with employees of the Post Office Department. During such period 99 postal employees suffered fatal injuries and the average award of death benefits in such fatal cases was $12,064 per case.

Postal employees generally have a very substantial interest in the administration of the compensation-for-injury law. The experience of our organization, dating from the enactment of the law in 1916, leads us to the conclusion that the interests of the employees may best be served by the present bipartisan commission form of organization.

I therefore respectfully urge that the committee in its wisdom favorably report House Concurrent Resolution No. 151 submitted by Mr. Pittenger.

I want to thank the chairman and the members of the committee for this opportunity to express the views of the National Federation of Post Office Clerks.

I would like to say one word more. I was glad to hear the member from Pennsylvania of the Judiciary Committee say that that mittee considered plan No. 2 beyond legality.

Mr. WHITTINGTON. With all due deference, it will not be the first time that that committee or any other committee made a mistake.

Mr. CHURCH. The questions of compensation and the handling of those matters, do they essentially all conflict with the problem of welfare? They are two essentially different ideas.

Mr. HALLBECK. One is a substitute for a legal right.

Mr. CHURCH. If one dominates the other, then you have lost in your case the benefit of representation for the interest of the compensation problem,

does that summarize your statement ? Mr. HALLBECK. Yes.

Mr. WHITTINGTON. We are glad to have your statement. Mr. Clarence F. Stinson, with the National Association of Letter Carriers, desires to make a statement.



Mr. STINSON. Mr. Chairman, I only desire to take about 2 minutes. My name is Clarence F. Stinson. I am secretary of the National Association of Letter Carriers, an organization of over 70,000 letter carriers, located in every city in the United States. On behalf of my organization, I appear here for the purpose of opposing plan 2. I note here in plan 2 that the President in his message said that this proposes to reduce expenditures and promote economy, and to increase efficiency.

I have been down here as legislative representative of my organization for many years. I have had personal contact with the Compensation Commission ever since it was organized in 1916. I know of no governmental agency in the entire governmental set-up that has a representation for fairer dealing and more efficiency than the Compensation Commission.

Under the plan which you have proposed here, it is proposed to set up a board of three to whom we can go with our cases. In the past, we have had the most difficult cases with the Compensation Commission. It must be remembered, with all due respect to your statement, that I can see no connection whatsoever between the Compensation Commission and the various agencies to which you refer, because in each and every one of these cases, personal injury is involved. The question as to whether or not the man was actually injured while performing his duty is involved.

Perhaps if the examiner turns down tho case, we have the opportunity of personally appearing before the Board of Commissioners

. themselves, the three men, and it takes a majority vote to decide on the case. We have got a wonderfully efficient agency and you propose to set up something untried and unknown. It appears to me somewhat similar to an epitaph that appears on a tombstone up in the Boston cemetery. It runs something like this: "I was well. I wanted to be better. I saw a doctor and here I am. .” That is what you propose to do here. You propose to give us something new. I sincerely hope that this committee might see its way clear to kill plan No. 2 for the time being and later on bring the other features of this plan into effect.

Now, the AFL, with which our association is connected, is also opposed to this legislation. With your permission, I desire to read here a copy of a letter which has been sent to every member of this committee. [Reading:]

Over a period of years conventions of the AFL have adopted resolutions calling for a continuance of the United States Employment Compensation as an independent bipartisan agency. We believe the plan will not meet the intent of the bill as passed by Congress insofar as economies are concerned, and that the plan in regard to the compensation commission is unlawful and unconstitutional. We, therefore, oppose Reorganization Plan No. 2, and request its rejection. Your attention is also directed to a letter I wrote to Chairman Manasco on May 23, 1946, regarding the Government reorganization plans, of which I am mailing you a copy.

WILLIAM GREEN, President of the AFL.

Mr. Chairman, I thank you for the opportunity. Mr. Rich. You say it is unconstitutional. Can you cite your reasons why it is unconstitutional?

Mr. STINSON. Mr. Chairman, I was reading Mr. Green's telegram, or at least his letter.

Mr. Rich. He has access to legal talent and anyone that says a thing is unconstitutional-I am no lawyer-I would like to know why it is unconstitutional. I swore to uphold the Constitution of the United States, and I do not want to do anything that is unconstitutional. If Mr. Green has any legal talent in his organization, they ought to submit a small brief on that as to why it is unconstitutional.

Mr. STINSON. I, like yourself, am not a lawyer. We had an illustration this morning of where one member of the Judiciary Committee appeared before this committee and expressed an opinion in behalf of said committee that this provision was illegal. Mr. Whittington, however, takes exception. You would not expect me as a layman to attempt to defend this particular provision.

Mr. Rich. I would expect you to have business ability enough to ask Mr. Green to give us their legal reasons why it is unconstitutional

Mr. STINSON. I think that can be done. Thank you very kindly. Mr. WHITTINGTON. We are glad to have had your statement.

I think the chairman of that Commission is one of the most efficient persons in the Government. Mr. STINSON.


agree with you on that. Mr. WHITTINGTON. The next witness is Mr. Twait, railway association clerk.



Mr. Twait. My name is Ole Twait, vice president of the Railway Mail Association.

Mr. Chairman and gentlemen of the committee, our association has a membership of 23,297 railway postal clerks who perform service in traveling railway post office cars, highway post offices, transfer offices, air mail field and terminal railway post offices and in offices of field officials.

The railway mail service may be defined as the arteries of the postal service, embracing the distribution of transit mail carried over the railway systems, highway post office routes and air routes. It is an around-the-clock job as continuous distribution must be performed during each 24-hour period. A total of 13,970 railway postal clerks perform service on railroad trains where the element of hazard to injury while on duty is always present.

The United States Employees' Compensation Act was approved September 7, 1916, and provides for the payment of compensation for disability or death of an employee resulting from a personal injury sustained while in the performance of his duty.

The Commission is an independent agency of the Government and is administered by three bipartisan members who exercise and perform quasi-judicial functions. It has operated efficiently, capably and economically for a period of approximately 30 years. The interests of

the Government and the welfare of the employees have been zealously protected and administered during all of this period of time.

It is not proposed under the provisions of Reorganization Plan No. 2, to abolish the three-member bipartisan commission and place the administration of this independent agency of the Government under the jurisdiction of a Federal Security Administrator who would set up a Board of Appeals composed of three members who would make final decisions on appeals from determinations and awards in Government employees' compensation cases.

Why is it desirable to abolish this independent agency which has functioned so efficiently since its creation by the Congress? No economy in cost of operation is involved. No elimination of overlapping functions between the existing agency and other departments of the Government would take place because none exist at the present time. The Commission handles only cases involving compensation resulting from injuries sustained while on duty. By what process of reasoning can it be asumed that this agency will function more efficiently under a Federal Security Administrator and a three-member Board of Appeals, when the record clearly shows competent, capable and economical administration during the past 29 years!

It has been the experience of railway postal clerks throughout the years that have elapsed since September 7, 1916, that the United States Employees' Compensation Commission has administered this law in a fair, equitable and impartial manner.

We, therefore, respectfully request that the proposal in plan No. 2 to abolish the three-member bipartisan Commission be not concurred in by the Committee on Expenditures in the Executive Departments and that Senate Concurrent Resolution 65 or House Concurrent Resolution 151 be approved.

Mr. WHITTINGTON. We are glad to have had your statement.

Mr. WHITTINGTON. Mr. Howard M. Starling, Association of Casualty and Surety Executives. Mr. Starling.



Mr. STARLING. I am manager of the Washington office, Association of Casualty and Surety Executives, an organization composed of 68 stock casualty and surety companies, practically all of whom are licensed by the United States Employees' Compensation Commission to write insurance under the Longshoremen's and Harbor Workers' Act and the District of Columbia Compensation Act. We wish to submit a statement in opposition to the President's Reorganization Plan No. 2 and in support of House Concurrent Resolution No. 151.

Mr. WHITTINGTON. You object to the whole works, or just some

Mr. STARLING. We object only to the transfer of United States Employees' Compensation Commission. I may be laboring under a misapprehension, but I understood the President's plan was not subject to amendment.

Mr. WHITTINGTON. I want to know if you object to the whole works or just some part of it?

Mr. STARLING. Only section 3.

part of it?

Mr. Rich. If the plan No. 2 is not in accordance with your views in one particular, it has to be rejected as a whole in order that the President may have the complaints that you register here, and if he wants to submit another plan, then he has that privilege.

Mr. STARLING. That is correct.

Mr. WHITTINGTON. If we just make one mistake in that plan, you will not think too hard of us?

Mr. STARLING. One mistake can be an awfully bad mistake sometimes.

Plan No. 2 transfers the functions of the United States Employees' Compensation Commission to the Federal Security Agency. It also makes certain other changes in the powers and functions of that agency, including abolition of the Social Security Board and the transfer of its functions to the Federal Security Administrator.

The United States Employees' Compensation Commission, largely through Deputy Commissioners, administers the Longshoremen's and Harbor Workers' Compensation Act, the District of Columbia Compensation Act, and the compensation act covering outlying defense bases. As part of its duties under these acts, it determines what employers shall be authorized to self-insure their compensation liability and what insurance companies shall be permitted to write insurance under these acts. It also administers the United States Employees' Compensation Act covering Government employees.

The plan makes no specific provision concerning the hearing of cases under the first-named acts before Deputy Commissioners and does not make clear whether such Deputy Commissioners will be retained, and if so, under whose jurisdiction they will function. Since the functions of the United States Employees' Compensation Commission are transferred to the Federal Security Agency, presumably all administrative duties now carried on under the jurisdiction of the Commission would be transferred.

The Reorganization Act of 1945 gave the President broad powers to reorganize agencies of the Government, but primarily for the purpose of reducing expenditures, increasing efficiency and facilitating orderly transition from war to peace.

Plan No. 2 would be detrimental to efficiency. Compensation administration is a specialized field which requires long years of study and experience. The United

The United States Compensation Commission created in 1916 possesses this experience and has done an eminently satisfactory job from the standpoint of the injured employee, the employer, and the insurance carrier. The Federal Security Agency, however, has performed no functions in the field of workmen's compensation. At least temporarily, confusion is bound to result in the administration of these laws during reorganization. The plan does not indicate whether deputy commissioners, before whom claims are now heard, shall be retained. Possibly, the Security Agency may wish to transfer their duties to its existing branch offices. Adjudications of claims, therefore, is bound to be delayed to the detriment of employers and employees. Whether ultimately the Federal Security Agency, which has so many other interests and no experience in this field, will be able to accomplish efficient administration of these compensation laws, may be seriously questioned.

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