Comparison of Amtrak Employee Injury Settlement Costs Under the Federal Employers' Liability Act and State Workers' Compensation Programs

GAO discussed the: (1) National Railroad Passenger Corporation's (Amtrak) costs for claims settled under the Federal Employer's Liability Act (FELA) in comparison with potential costs under state workers' compensation programs; and (2) amount of money Amtrak claimants spent on attorney fees. GAO compared FELA costs with Connecticut, which has the highest workers' compensation benefits, and Indiana, which has the lowest benefits. GAO found that: (1) FELA was a negligence statute that determined the amount of damages for each individual case through negotiation or litigation; (2) state compensation systems established fixed schedules of benefits based on the specific injury and duration of disability; (3) although both FELA and state compensation programs paid for employees' medical and rehabilitation costs and lost wages, FELA covered losses due to pain and suffering related to the injury; (4) FELA settlements were one-time, lump-sum payments with an elapsed time between injury and settlement of 66 weeks, while most state settlements were typically a series of payments stretching over several years and began the year of the injury; (5) Amtrak paid a total of $24 million under FELA for cases closed in 1984, but would have paid $21 million in Connecticut and $7 million in Indiana under their rules; (6) under FELA, both liability and compensation amounts were subject to negotiation, while the state programs based payments on the classification of the disability as temporary, permanent partial, permanent total, or fatality; (7) attorneys who represented FELA claimants received between 25 and 33.3 percent of the final settlement as their fee; and (8) 41 percent of FELA claimants had an attorney represent them, while 4 percent of Connecticut's and 6 percent of Indiana's claimants had attorneys.