Mr. CORNELL. Well, Mr. Chairman, I feel that our colleague here is trying to attack two points only, not suggesting a complete revision. We have had testiony on these other things. I do believe that his suggestion has some merit. I do not think that anybody has touched upon the second part of it, that was to have a 3-day waiting period unless the disability exceeds 14 days.

Our behalf is that that has merit and should be considered. Mr. GAYDOS. Maybe I could ask a question there. Where did you get the 14 days?

Mr. PEASE. It is an arbitrary figure, Mr. Chairman. With the understanding that if an injury does exceed any given period of time, then it is unfair to ask the employee to use up his own sick pay for the past 3 days. It could be 12 days, 20 days, there is no magic in that figure.

Mr. GAYDOS. What do you think it will accomplish? If you put the 3 days back in, what will it accomplish, and why?

Mr. PEASE. Right now, the employee, if he is injured at all, could make the case, can go on COP immediately. He has nothing whatever to lose, does not lose any of his sick pay accumulation, gets paid fully, and I think that it just encourages an employee to take off, go and see his doctor and stay on COP.

The 3-day waiting period was established in the Federal law and is, as I say, in every State law. It means that the employee, if he gets in it, has to say, "Am I injured badly enough that I want to take off 1 day or 2 days or 3 days or whatever the waiting period it is of my sick pay, understanding that some day I may get sick and need it?"

I do not see that as a big deterrent to abuse of the workers' compensation system, but I do see it as a way of making the employee think twice before automatically going on COP.

You and I both know, we have been working for a lifetime, and when you have injuries, it depends a lot on your attitude. Many workers go around with an injured leg and never think a thing of it and they just limp for a couple of days-I have done that myself. But others would say, "Gee, if I have a pulled muscle or whatever and it does not cost me a thing, I might as well go on COP and start collecting it." I think that this will gently nudge people in the direction of thinking twice before going automatically on COP for any minor injury.

Mr. GAYDOS. We have heard that opinion voiced before and I guess that is one way of looking at it. I find a lot of difficulty in accepting a proposition to intermingle sick pay with workmen's compensation pay.

I think the two are different. One is leave with pay for a nonjob related injury or illness and one is compensation for an injury sustained on the job. They are two different concepts, and you are mixing them up. It seems to me basically unfair that there is always the presumption that the person is cheating.

Some people do not cheat.

I am firmly convinced that the majority of the people do not cheat, by far the large majority, in Government, out of Government, in professions, or what have you. And I know that it is a serious problem, but let me ask you this.

Is it proper to try to force a person to come to work with an injury-to force him to come for those 3 days because a waiting period is built into that law and he needs that pay and does not have any more sick leave?

Is it not better to favor what I believe is the greater number of people who are honest and who are going to be taking off that time because they have to?

If it is not true, then my whole presumption of the honesty and integrity of the majority of people is wrong.

Mr. PEASE. Well, Mr. Chairman, I fully join you in the presumption that most people are honest. I think that is true. That is one reason why it is especially important for Congress to strike this balance between the competing rights of the employers, employees, and the public as I have said before.

If there are provisions which encourage the small minority who want to cheat to do just that, it undermines the morale of the great majority who do not cheat and do not want to cheat.

As you said yourself a minute ago, if you thought that most people were cheating, you would cheat yourself. Thankfully, we do not have that impression.

Mr. GAYDOS. Does not the solution of our problem direct itself to the area of catching the cheater? That is what we are talking about. We are not presuming we are going to continue along with the cheaters and let them do what they want. We are looking at the method of attack to defend the system that we have and to correct it.

I am suggesting that we have to go after the cheater, but we have to devise proper ways to do it. You are suggesting actually, you know, that we penalize the honest person as well.

Truthfully, in my own personal opinion, I do not think that the lack of a waiting period is the real problem.

Yet, you seem to dwell on these two particular areas here. You want to put in a 3-day waiting period and make the honest person go to work hobbling on a bad knee. You seem to suggest this would solve the overall problem that we have and that is where I cannot agree with you in principle.

It might be part of the problem, but I do not think it is the main problem or the bigger problem of all of the problems that are in the system.

Mr. CORNELL. Mr. Chairman, may I make a point there? We all recognize the effects of original sin, even though you may say that you think most people are honest. How, then, would you account for the tremendous increase in the reporting injuries over the period since 1974?

Mr. PEASE. Well, Mr. Cornell, my own suspicion, again with no absolute evidence, is that people who are injured are more likely to report those injuries if they can go directly on to COP than if they have to possibly lose a day or 2 days or 3 days of sick pay. I said before that we need to strike a balance. I do not offer this as a final or a complete solution, but in the postal system, for example, the costs are threatening to exacerbate the Postal Service deficit even more. One cent out of every 13 cent stamp now goes to the workman's compensation program.

While I do not want to penalize the hypothetical employee who has to hobble along on a sprained ankle for 3 days, that may be a part of the balance that we achieve where we try to balance the rights of taxpayers not to be subjected to ever increasing taxes and the rights of employers, Federal employers, who do suspect that several of their employees, some minority, are malingering.

Mr. CORNELL. May I address a question to the chairman in this particular case? Would you conclude from the figures given of the increased reported injuries that those injured prior to 1974 law were working despite the fact that they were injured and that only after the 1974 law did they decide to go on disability.

Mr. GAYDOS. We are doing an agency survey, to respond to my colleague, on that very subject matter, and will be trying to compare the statistics from both before and after the amendments to try to ascertain whether a questionable trend has emerged as a result of the 45-day COP provision and the elimination of the waiting period.

As soon as we get those figures, we will be in a better position to evaluate the program.

Mr. CORNELL. When you look at the figures and the increase in reported injuries, either there are a greater number of injuries, the number of injuries has greatly increased for that period of time, or the people prior to the law were working despite the injuries. There must be some explanation for it. Certainly, it must not be based entirely on the increased number of employees. In some instances, that would be a decrease.

Mr. GAYDOS. Let me say this. If the statistics substantiate the conclusion that there are more people reporting accidents because they could get paid for the accidents where before they could not, I would have to say, in my own mind, in good conscience, that the law before was wrong. It was not the purpose of the law to penalize a person because of the way that it was set up so that if he was authentically injured, he would not report it.

I do not think that the old law, if it was not working properly, or was framed improperly, should be continued, I really do not. I want to catch that cheater. I think that penalties for cheaters would have some effect.

I would think we should consider how we might take a giant step toward curing the other major problems in the program rather than focusing upon something like reinstatement of a 3-day waiting period, and assuming that that is the culprit.

Mr. CORNELL. Do you honestly believe that we can get that type of information, that is, prior to 1974, people were working despite the fact that they had some type of disability?

Mr. GAYDOS. What was that?

Mr. CORNELL. That we could get that information, that people were working despite disability.

Mr. GAYDOS. You would not be able to get that information. Mr. CORNELL. That is the point. You have to see what relationship there is here to the great increase in reported injuries.

Mr. GAYDOS. We could resolve this issue of improper claims if there were mechanisms in place for promptly processing claims and ferreting out those which were based on insufficient evidence of job relatedness and disability. If we wished to draft some correc

33-532 O 79 (Pt. 2) - 12

tive legislation, I think these are the matters we should consider. There is no magical solution in adopting a 3-day waiting period and requiring 14 days of disability to establish eligibility.

Mr. CORNELL. Our colleague here is not hard and fast on that 14day period. He said it is just an arbitrary figure that he picked up, so we could possibly say, for instance, if the injury exceeded 10 days, 2 working weeks

Mr. GAYDOS. My response would be, if he cheated in the first place, he would cheat later on. If he cheated in the first place, 15 days later he still is going to be a cheater, he is not going to change. You defeat what you are trying to do in the first place if he is a cheater.

Mr. CORNELL. I doubt that.

Mr. GAYDOS. He might be less of a cheater, I do not know. Mr. CORNELL. A couple of days off here or there.

Mr. GAYDOS. I do not know myself.

Mr. PEASE. Mr. Chairman, what you say certainly has a lot of validity to it.

Mr. GAYDOS. I want you to help us on this. I am really sincere when I say that we want to accommodate you. These concepts of yours-I know you are a reasonable man. If they proved unreasonable, I am sure you would change your mind. That is the only reason why I am asking all of these questions. We want your support.

Mr. PEASE. Mr. Chairman, I appreciate that very much. I think that it is key for you to keep in mind, as the committee deliberates on what is reasonable I have been looking into the OWCP for the last 5 months but, before that, when I was in the Ohio Legislature, I had a great deal of experience with the Ohio workers compensation program and it has many of the same, exact problems that the Federal program has.

If you think about being reasonable or realistic, the prospect of getting efficient administration of that program is very low. Despite all of the good things that we might do or mandate legislatively, the chances that there will be a dramatic improvement in the administration of the program, in order to pick up the cheaters, are not very good.

What I see my legislation doing is to provide an interim step which will try to reserve the trend that started up so high in 1974, at least try to contain it before we have a program which is totally beyond our ability to finance it.

Mr. GAYDOS. The waiting period before the 1974 amendments was 21 days. What do you think of 21 days? Would the concept be the same?

Mr. PEASE. Sure. The important thing, Mr. Chairman, is the first 3 days, that there be 3 days when you have to use your sick pay and think about, "Do I really want to do that or not?" When it becomes wiped out, 14 days, 21 days, that makes no difference to

me.

Mr. GAYDOS. Do you have any more questions?

Mr. CORNELL. No, Mr. Chairman.

Mr. GAYDOS. I want to thank you most sincerely for taking the time out of a busy schedule to come here before us. I see that you

have some statistics there and we would like to make them a part of the record.

Mr. PEASE. Mr. Chairman, that is my request. It is just a page and a half, which is a summary of survey returns that we got from letters that we sent out from all of the Federal agencies. I think that the committee may find that they are of some value.

Mr. GAYDOS. Without objection, I would make them a part of the committee record.

[The survey referred to above follows:]

3 Unknown.

Note.-Unresponsive.

HUD-unaware of reporting requirement, no COP records.
Justice Department-unaware of reporting requirement, no records.
State Department-unaware of reporting requirement, no COP records.
USIA forward information to State Department, no COP records.

Equal Employment Opportunity Commission-inadequate reporting records.
Federal Mediation and Conciliation Service-no COP records.

Community Services Administration-insufficient records.

Indian Claims Commission—no records.

Architect of the Capitol-unaware of reporting requirements, no COP records.

Another 28 Federal agencies, including the Labor Department and HEW, have not responded in any form to my survey on the Federal Employees Compensation Act.

Mr. GAYDOS. Thank you so much for your interest and we will be in contact with you. If we have any new developments, we can discuss them with you. If you would like to come back, formally or