DEFICIENCY APPROPRIATION LANGUAGE

To bear out what Mr. Rothman has said, I will read some language from the Deficiency Appropriation Act of last year, reading from chapter VI of that act:

DEPARTMENT OF LABOR

OFFICE OF THE SOLICITOR

Salaries and expenses: For an additional amount for "Salaries and expenses," $300,000, to be derived from the highway trust fund created by section 209 of the Highway Revenue Act of 1956.

That was just a specific thing for the present fiscal year, but I thought we ought to have that since we have been discussing this matter. I thought we might have those two provisions of the statutes in here.

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Senator PASTORE. Am I to understand, from what the gentleman has already said, that that was the idea that was already advanced last year by the Senate committee, this authorization of the money Senator HILL. That was an estimate sent up to us by the Bureau of the Budget. The estimate come up to the Senate committee from the Bureau of the Budget and we put that estimate into the bill, which meant that the estimate was put in by the Senate Appropriations Committee. Then, of course, it was approved by the Senate, and then it went to a conference committee of the House, and the House conferees agreed to it, and, of course, both the Senate and the House approved the conference report.

I do not like to interrupt, Senator, but I thought it might be well to get this in with regard to that question.

Senator PASTORE. That puts it in the proper chronological order.

HOUSE VOTE ON REDUCTION

Senator HILL. That is right.

Also in that connection, Mr. Rothman, I would like to call attention to the fact that the House vote on the new reduction was a rather decisive vote, 241 for the deduction and 171 against it. That is about a 70-vote majority. Some of those votes were rather close, we know, but this one was a rather decisive vote.

Mr. ROTHMAN. You are correct, sir.

Senator HILL. In one of those votes, you know, the reduction lost by one vote.

Mr. ROTHMAN. Yes; that is true.

Senator HILL. That is another matter entirely from what we are discussing here, but they lost by one vote. I think the vote was about 206 to 207.

Senator THYE. Mr. Chairman, I would be interested in having Mr. Rothman give us the specific details as to what his problems would be in the event the House figure stands. I was not here at the time you opened the hearing this morning.

I have been reading your statement, Mr. Rothman, since arriving at the hearing this morning. I was detained in my office with a longdistance call.

I would like to have the answers specifically as to what the House reduction would do to your Department. How would it affect your

ability to carry the load that you must carry and be responsive to the needs of the public that you serve, if the House cut stands?

Senator HILL. Will you excuse me just 1 minute, Senator Thye? Senator THYE. Yes, Mr. Chairman.

Senator HILL. I think Mr. Rothman attempted to summarize that for us while you were tied up on that telephone call. I felt a little guilty in interrupting Senator Pastore's questions. Would you let him complete his questioning and then we can go back to you, Senator Thye?

Senator THYE. Yes.

ENFORCEMENT OF FAIR LABOR STANDARDS ACT

Senator PASTORE. That is exactly what I have been trying to get at. We have been told that there would be a cut in personnel, and that among them would be 18 to 20 attorneys who enforce the Fair Labor Standards Act in the field. I want to know how that cut would affect the enforcement of that act.

Senator THYE. That is exactly what my question is.

Senator PASTORE. Just mentioning numbers will mean nothing unless we get an overall picture of what the result will be.

Mr. ROTHMAN. If I may, before I reply to your question, Senator Pastore, I would like to comment briefly on one of Senator Hill's

comments.

ABSORPTION OF MANDATORY CUTS

A number of the Members of the House have told me that they did not understand, at the time the cut in the Solicitor's Office was made, that it would be necessary for the Solicitor's Office to absorb these mandatory costs, but the matter had developed to the point where there was not much that they could do about it at that point.

TOTAL FIELD STRENGTH

In answer to your question, Senator Pastore, you asked what our total strength was, and this is the answer: Our total base or authorized strength for the field offices are 93 attorneys, and the 2 principal Federal wage and hour laws, the Fair Labor Standards Act and the Public Contracts Act, would be affected.

As I pointed out, enforcement actions under these two major laws have increased steadily over the past several months. The rate of filing cases is the largest in the history of the act. Now that the time has come to handle those cases, in fairness not only to the employees involved but to the employers, we will not have the necessary strength. In addition to the total 29 positions which will be below our authorized base, other positions will have to be distributed within the central office and elsewhere.

So, in general, we will not be in a position to carry on the lawenforcement activities of the Department of Labor as well as if we were permitted to stay on our authorized base strength that we were authorized to have in 1957.

RECOVERIES FROM THIRD-PARTY TORT FEASORS

We would also appreciate the additional modest request that we made. Among the purposes of the request, here is an example: The

Federal Government presently obtains from third-party tort feasors, who injure Federal workers to whom the Government must pay workmen's compensation, a kind of subrogation right. Gross recoveries from third parties in the calendar year 1956 amounted to $2,510,416. We have a very small staff, and if we were allowed to have 2 additional persons, 1 attorney and 1 secretary, we believe that we could save for the Government a substantially increased amount of money. Senator HILL. Do you have any further questions, Senator Pastore? Senator PASTORE. NO.

Senator HILL. Senator Thye?

Senator THYE. Yes, Mr. Chairman.

That amount of money that you would secure for the Government, Mr. Rothman, would be what kind of money? And why is it owed to the Government?

TYPICAL CASE

Mr. ROTHMAN. For this reason, Senator: Let us take an example. An automobile driver strikes and injures a United States mail car and injures the driver; the United States Government must pay workmen's compensation under the Federal Employees' Compensation Act to the employee of the United States Post Office. Unless some efforts are made to obtain the amount in damages from the third party, who was at fault, who struck the United States employee, that person is relieved of a financial obligation that he does have.

Senator THYE. And it is your Department's responsibility to pursue that case and to collect damages if it is possible to collect them? Mr. ROTHMAN. Our responsibility is the responsibility to see that somebody pursues that case. The United States employee may on his own pursue it, but in such a case we recoup our payments.

Senator THYE. Does the responsibility fall to the District Attorney's Office in the respective State where the accident occurs? Mr. ROTHMAN. No. We have been using counsel well-versed and qualified by experience and reputation to obtain it.

Senator THYE. Let me use an example here. Just assume now that a mail carrier driving down a city street in St. Paul was struck by Mr. A-we will call him that for the sake of identification-and that Mr. A has insurance and that the police and everybody concerned have established the fact that Mr. A's car hit the mail carrier and that the mail carrier was injured; how do you proceed in that particular case?

I am not a lawyer and am not familiar with the procedure in such

cases.

Mr. ROTHMAN. It is a very complicated arrangement, and one in which the Government, in order to maintain the proper role of Government and not otherwise, does not go too far.

In answer to your question, I will say we do not hire the attorney. It is the responsibility of the injured person to obtain his own counsel, and he can choose whatever attorney he wishes. There are some instances where the injured person, for one reason or another, including his lack of interest because he is obtaining workman's compensation from the Government, does not do anything.

In those cases we do have approved attorneys in the area, and we recommend the attorney.

Senator THYE. Let me pursue that just a little further. Say that the man was struck, that there was damage to the mail truck. Who collects for the mail-truck damage? Do you collect it, as a department, or does the district attorney collect it? Or who is responsible for collecting for the damage to that mail truck? Does that not fall to the Postmaster General and his staff to go into the damage there? Mr. ROTHMAN. For the damage to the mail truck, I would say "Yes."

FUNCTIONS UNDER EMPLOYEES' COMPENSATION ACT

Senator THYE. In the event that the man has suffered a physical disability, he is going to limp for some time, who establishes the extent of the man's disability? He has now been caused to limp and he is not going to be as active and probably will not get back on his mail route.

Mr. ROTHMAN. The United States Department of Labor, through the administration of the Federal Employees' Compensation Act. Senator THYE. Is that where you come in?

Mr. ROTHMAN. Yes, sir.

Senator THYE. In proportion to the number of automobiles on the highways and on the streets, your so-called accidents have increased and you have more cases of that type, which you have to follow into court; is that correct?

Mr. ROTHMAN. Yes, sir.

Senator THYE. If you do not follow the case, that man may be drawing employees' compensation for some additional time and he may come up with a claim which one of us people in Congress would have to pursue through the Judiciary Committee because he suffered a permanent disability.

Is my understanding of that correct?

Mr. ROTHMAN. Under the Federal Employees' Compensation Act, we believe that permanent disability, all aspects of the injury, can be handled administratively. There is a period of limitations involved. We do find that members of the Congress, because of a late filing, are asked to see whether the administrative agency will consider one of these claims for one reason or another.

Senator THYE. That is right.

Then another consideration is that if he has suffered a permanent disability and the man that struck his mail truck had liability insurance. Or do you, as Solicitor, concern yourself with making certain that he has pursued legally to collect damages for the physical disability that he has suffered, to collect from the insurance company that covers the other man's vehicle and the other man?

Mr. ROTHMAN. That is correct, Senator. As Solicitor, it is our obligation to see to it that the employee has pursued this matter so that the Federal Government recoups and obtains whatever funds are due it because of the incident.

Senator PASTORE. But as to the actual work in the field, insofar as the bringing of the suit is concerned, even by subrogation, is that done by one of these 18 or 20 attorneys that are being dropped, or is that done by some attorney in some other department? I think that is the question that Senator Thye wants answered.

Senator THYE. Yes.

Senator PASTORE. It is true that we have these rights under the law, but who actually carries out the machinations of bringing this to a substantial collection of damages?

Mr. ROTHMAN. Because of the arrangement under the law, the injured employee can obtain his own counsel.

Senator PASTORE. And so he usually does, because his damages there would be far in excess of his compensation; is that not correct? Mr. ROTHMAN. That is right.

To answer your previous question, it is done through private counsel.

Senator PASTORE. Now you come to the question that he has received compensation and you want to recoup the amount of money he has received overall in his recovery in court; is that correct? Mr. ROTHMAN. That is correct.

Senator PASTORE. How do you do that? Do you employ one of these attorneys to do that?

Mr. ROTHMAN. No; we do not.

I can ask Mr. Boote, who is here, the Assistant Solicitor, in charge of employees' compensation to tell you about that.

Senator PASTORE. We are trying to show the justification of these 18 to 20 attorneys. Let us show it.

Senator THYE. We must have some idea in our minds as to why they are necessary; otherwise, for myself, I will say I am going to have a terrible time of it, after having answered a lot of mail this morning about Government spending, to justify why I should vote an increase here.

I have just gotten through answering some very irritated taxpayers.

Senator HILL. Mr. Boote, can you answer that question?

THIRD PARTY CASES

CASES EXAMINED

Mr. BOOTE. Mr. Chairman, let me mention that out of the 18 attorneys mentioned, there are about 2 or 3 attorneys that are constantly combing cases that come in by the thousands from various parts of the country to the Bureau of Employees' Compensation and look for liability in these third-party cases. They examine, on an average, about 15,000 cases a year, that is, either new cases, or cases that are sent back for one or more reasons.

One of their main jobs is to find the liability, to find the cases in which we think we can recoup damages. Those cases are combed. Very often the liability is so clear that the official superior of the employee, following our regulations, will notify this man to proceed in accordance with those regulations, which would require him to institute suit against the third party.

That is not the end of the line, because very many times we can assist the attorney who is trying the case out in the field. He is not our attorney, he is a private attorney, but he relies very often on material that we can supply him in order to make a better case. Senator THYE. Let us go into that right here.