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June 2002

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This article is in the news archives --- for current news go to the Third Branch News.


Congress Looks at Judiciary's Benefits Plans

Cafeteria-Style Plans May Be Key to Recruitment and Retention

"We do not live in a `one-size- fits-all' world," said the chair of the House Government Reform Sub-committee on Civil Service, Census and Agency Organization, opening a hearing last month on how cafeteria benefit plans could allow the nation's 1.9 million federal employees to tailor benefits to their own needs. Cafeteria-style benefits packages allow people to identify their own needs and custom-design their own benefits.

Noting that private employers, as well as state and local governments, now offer flexible benefits to recruit and retain well-qualified employees, Subcommittee Chair Dave Weldon (R-FL) said, "Employees find such programs attractive because they empower the individual to maximize the value of the benefits an employer offers. . . To ensure that the federal government will be able to compete effectively for talent in today's market, it is the obligation of this subcommittee to carefully examine the potential offered by cafeteria plans and other flexible benefit arrangements."

The subcommittee invited Judge Dennis Jacobs (2nd Cir.), chair of the Judicial Conference Committee on Judicial Resources, to testify on the Judiciary's expanded flexible benefit plan. Jacobs detailed for the sub-committee the success the Judiciary's plan has enjoyed, and how beneficial it would be to expand the choices available under the plan and to institute an employer contribution.

Under the direction of the Judicial Conference, in particular the Committee on Judicial Resources, and with the leadership of Administrative Office Director Leonidas Ralph Mecham, the Judiciary has developed a package of pre-tax supplemental benefits that help the federal courts remain competitive in the recruitment and retention of employees. The benefits include a health care flexible spending account for health care costs not covered by insurance, a dependent care flexible spending account for eligible day care expenses, a pre-tax payment of health account insurance premiums, and a commuter reimbursement account. The Judiciary also has introduced a long-term care insurance program for judges and judicial staff.

"Benefit programs like these," said Jacobs, "are common in state government and the private sector. We implemented them within the existing statutory framework, without seeking additional funds."

According to Jacobs, the Judiciary would now like to do more, but legislation allowing a cost-sharing arrangement with employees would be necessary. Such authority, if provided, would allow the Judiciary to establish a full-scale cafeteria- style benefits program. Combined employee and employer contributions could then be used to purchase bene-fits from a menu of choices that could include dental and vision insurance, leave conversion, expanded commuter subsidies, short- and long-term disability insurance, and prescription drug and mental health insurance. The incremental administrative cost for improving the current benefits program is estimated to be less than 1/10th of one percent of the total payroll.

"A modest employer contribution would allow greater flexibility, and would give each employee leverage to design a benefits package that fits the particular needs of the employee and the employee's family," Jacobs said. "We anticipate that this flexibility would improve recruitment and retention rates and increase employee morale, and would yield dividends—well in excess of the outlay—to ensure that the judicial branch can recruit and retain employees who are skilled, talented and dedicated."