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Report analyzes retirement choices for injured federal workers

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federal retirement

Federal workers who retire after being injured may not be informed of the best options under the Federal Employees’ Compensation Act, the Government Accountability Office said in a report released Friday.

Factors such as the timing of an injury in a career affect how the federal workers compensation law’s total disability benefits compare with income security from typical federal retirement, according to the report, which found that injured federal workers could be shortchanged if their options are not fully presented.

At retirement age, injured workers can remain on the federal workers compensation program or instead choose to receive their benefits from the Federal Employees Retirement System. Yet workers may not be given a clear picture, according to the GAO’s analysis, which found through simulations conducted in 2018 that factors such as the length of retirees’ careers absent injury affected how similar their hypothetical workers compensation retirement benefits packages were to traditional federal retirement packages.

The standard retirement benefits minus injury increase “substantially” the longer a federal employee works and as a result, median current and reduced workers comp packages were greater than the standard retirement median for retirees with shorter careers absent injury. However, the GAO found that median workers comp packages were similar to or less than standard retirement packages for retirees with longer careers.

Therefore, the GAO recommends that the Department of Labor remind injured federal workers approaching retirement to obtain better estimates on retirement choices and that the department and the Social Security Administration “take steps to modernize and improve their process for calculating and providing information” on certain benefits in retirement that “would enable recipients to make complete comparisons of retirement options.”

Both the DOL and Social Security Administration concurred with the recommendations, according to the report.