EXTENSION OF MEDICAL BENEFITS FOR OVERSEAS EMPLOYEES AND THEIR DEPENDENTS

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP80-01826R000900100003-3
• Release Decision: RIPPUB
• Original Classification: S
• Document Page Count: 92
• Document Creation Date: December 15, 2016
• Document Release Date: October 4, 2002
• Sequence Number: 3
• Content Type: REPORT

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TABLE OF COMMITS
Tab A - Medical Benefits
Al - Staff Study of Legislative Teak Force
A2 - justification
Tab B - Death Gratuity
131 - Staff Study of Legislative Task Force
B2 - justification
Tab C - Educational Allowances
Cl - Staff Study of Legislative Task Force
C2 - Justification
Tab D Liberalized Retirement
D1 - Staff Study of Legislative Task Force
D2 - Justification
Tab E et ion from Performance Rating Act
El - justification
Tab F Special Rome Leave Benefits
Fl - justification
Tab G MisoingsPersono Legislation
01 - Justification
Tab IT Jaw Security
Ul - Staff Study of Legislative Task Force
Tab I - Personnel Reserve
Ii - Staff Study of Legislative Teak Force
Tab J - An act To improve and Strengthen the Administration
of the Central Intelligence Agency."
Tab K - Special Legislative Liaison Problems
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MEDICAL BENEFITS
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STAFF STUDY OF LEGISLATIVe: TASK FORCE
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SalENSION OF MEDICAL BeNX-SITs FOR
OVERSEAS EMPLOYEES AND?THEIR DEPENDENTS
PROBLEM
a, Should any medical and hospitalization benefits he made a-sellable
te the members of fewiliee of CIA employees?
b, Are additional medical and hospitalization benefits necezeery for
CIA employees who are temTerarilyassigaed abroad?
Co Should the provisions of law relating to "assigpment abroad" be
broadened so that aesignaents to U, So territories and possessions are
covered by the additional medical and hospitalization benefits now available
only to assignments in foreign countries?
2, FACTS BEARING ON THE PEOBLEM
a, Benefits available to employees,
(I) CIA employees wherever stationed are covered by the Federal
Employees Compensation Act (FECA) with respect to medical cares
hospitalizations disability's and death benefits resulting fram injury
or death incurred while in the performance of duty, This Act is the
over-ell Government statute covering all Government employees. In the
event of injury in the performance ofs full medical care and
hospitalization are assured? In the event of permanent disability s an
employee weuld receive two thirds of his basic pay. In the event of
deaths the widow with two children would receive seventy par cent of
the employeegs basic salary. The Act confers very liberal monetary
benefits when measured against any other compensation plan, (Annex A)
(2) In the CIA Act of 1949 (Public Law 110) additional medical
benefits are granted to employees permanently aesigned abroad. The
additional benefits consist of more liberal standards of eligibility
for medical and hospitalization benefits. In effects the law permits
those benefits for any injury or illness which is not I-4,2 result of
nisconAuct or inteensrence? In addition to the actual nedicas ani
heopitalization benefits, travel expenses are authorized to posit
employees to be treated at tla nearest locality izLere saitabl
hospit.ali,mtion estistL, (Annex
(3) There are also in exiist..once two prorams Lor insuriag against
hospitallzaidoh and !xi-Joel a:LI-Arnow. Those 1,:p.xa.zs aY: the Group
Hospltalizatican Iric. (0.1I) and the alley-ark:at Llc:ployeos health
Association (GE1A). CHI has a standard plea available toroups in
the Washington area and overseas and is considered by many one of the
41, tm,
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better hospitalisation plane. It nroviuos both surgical and nospitali-
zation benefits. 0711A is an older pier and is currently being supple-
mented byfFEE in the CIA program. Benefits and costs are comewhat less
than under GHI, Under both programs layments are not made if medical
and hospitalization expenses are paid under FT7,CA or rr. 110. (Annex C)
(h) It is true that in certnin areer abroad, infornal erranomumts
can 1.e made to take care of medical and hospitalization in various canes,
For exerole, where CI! is opernting a medicsl facility based on other
considerations, trentments or hosnitalization often can be granted on
a bacis of no direct cost to the Government. In addition) from time to
time CI: has been able to arrange trensnortation for certain individuals
on s space available basis from the military. In liow of budget
restrictions, nonreimburcable services available from other agencies
will be increacingly difficult. In addition, utilization of the recently
npnroved broad apnlication of PL 110 will lessen the importance of
these informnl arrangements.
b. Benefits available to dependents?
(1) The OHI and GT= programs Mentioned AOTO also include
dcpandents,
(2) The info -mil arrangements discussed above for employees can
be mode in some cases for dependents, However, they are more important
'n the case of dependents since there i less that the Agency can do
for dependents by virtue of existing lays, Therefore, any informal
arrangements for hoe italization or transportation are extremely
Important in asninting what otherwise mi?ht be hardship cases.
c. The benefits of F1CA are available no matter whore the employee is
assigned or physically located and without regard to permenent station
assignment or tonnorery Onty status. The benefits of PL 110, however, are
available only to CIA emnloyoes permanently assigned abroad? Thus personnel
on temporary 'Iuty abroad do not have the benefits of PL 110 available to
them. Further, the present wording of the law denies PL 110 benefits to
personnel assigned (whether permanent or tennorary) to U. F. territories
and p000essions.
d At the time CIA presented the then nronosed n 110, there had
been included in it Provision for medical benefits for denendents, The
nareau o: the Judget took the position that CCP did not have any unusual
grounds :'or lejuesting tnis legislation and, therefore, since no legislative
precedent oxintod, they would not concur. On this 'hoods, pro7ision for
dopenclems wan deleted,
e. Pertnent here is the welfare
establiehed. It ie the purpose of this
northy casec to nnicn emoloyees are
which aro not reimbursable under Agency
foundation which was recently
fonnolkition to make grants in
conf.onted with personal hardships
regulations, It is contemniated that
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the foundation would make grants in warranted cases where
an employee have become ill causing extrene financial horf
it will assist to MIS degree in solving acme of the probl
of illness or injuries of dependents abreadc,
f. The various military services base their medice
on various statutes, ?hose statutes generally are oermist
rather than directive tiowever, through the years traditf
practices developed se that it is regarded nou os a privil
secure medical care for dependents. In the recent past tl
attempts in the Conereer to cut down availebility of such
he dependents of
'bipt, Therefore,
1113 arising out
care of dependents
-vs in nature
)11 and adninistrative
go and a right to
)re have been
aenefits.
e. Ne civilian agency of Government to this date has secured legisla-
tion permitting expellees of medicel care nnd hospitalization of dependents
tote asainaed by the Governsatc.
h. At the present time there are egoreytmately
with a total of dependents.
25X9A21
employees abroad
(1) :lased on this figure the beet estimate of annual costs for
a program of making the proposed medical and hoseitelieation benefits
(including ation) available to c.-eendents in foreign countries
would be
(2) The annual costs for meielne such benefits available to
nersonnel on temeorare duty abroad tire estimated at $49000.
(3)
9roadnning the concept of "assiened abrond"
in addition to foreign countries is
estimated to cost annually%
(a) 7moloyees (Permanent arsienneet)
(b) Dependants
(c) Employees (Temporary duty)
(4) T'stimated costs for the entire nronose
program total
eo DISCUSSIOV
a It can be argued that since CI; sends an eepleyee abroad and oayt
2or the transportation of his dependentes, CIA should assume similar resnenvi-
011itles for the dependents with respect to medical care and hospitalization
as are assumed for the employee. In either case the hardship on the
employee is juet as reel. Cu the other hand it can be argued that the
matter of seneine dependent abroad is a question of privilege with the
Government agreeing to pay the expenses of transnortation if the emoloyee
desires his dependents with him. Raving exercised his choice than the risk
of illness to dependents te assumed by the emeloyee. From the standneint
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of the Agency it can be further argued that the individual:mey be in no
frame of mind to fuliU his duties if he is concerned with getting his
wifeeer children to a suitable hospital for medicel treatmeato
b. A fel...rex:apples of east cases will illustrate that this ratter aee
be of a very serious nature. The facts are masked to avoid identification Of
indieriduals.
5X1A6A since a high incidence of
5X1A6A
' (1) AnindielAlualewas vent to
to co -Tuberculosis the Government under FtCA would return him
ulosis if #13 employee were
and took his wife with him.
to the United States and hospitalize him for an appropriate period of
treOmente In addition they would pay disability compensation during
the period of his disability. However, when the wife contracted
Tuberculoties Cleves not authorized either to pay for transportation
or reimburse aeer of the expeneos of medical care and hospitalization.
25X1A6pk (2) An employee was sent to I I Accompanying hip were
his wife and three children. In the event the employee came down eith
polio, expenses of transportations medical cares, hospitalizations, and
'
disability benefits, if applicable, Would be assumed by the Governnent
under rEcA. When one of the children came down with polio, it was
necessary for the wife to accompany the child back to the United
States for treatment probably for an extended period, Again CIA was
not authorized to pay any of the transeertation, medical, or
hospitalizatioa expenses.
2X1 A6A
? (3) In an employee of CIA appeared
to have been plagued with a series of "near accident's." Finally
the employee and his wife, while walking down the streets were struck
down by a hit and ran truck. An inference was drawn, because of hie
association with certain operations which somehow become known, that
the accidents were directed at taking his life. Since the facts
supported such an inferences CIA assumed full responsibility for
medical and hospitalization expenses and, under MA, disability
payments mould have been forthcoming, if applicable. On. the other
hand the wife with the same disability or injury and incurred as ca.
result of being narried to a CIA employee was not entitled to the
medical benefits provided by either FECA or P10110.
co The principal protection afforded for medical care of dependents
is the CTUI insurance coverage. However, the benefits available are
considerably decreased where hoseitalization occurs abroad. This is this
to the fact that vario.s hospitals under contract are not available and
a dollar rate is then substituted for the actual hospitalization benetits.
Consieteht with the \over-all career concept developing within CIA, it would
seem highly desirable -whore employees are subjected to hardships arisine
out of illness or injury occurring to their deeendents? that some provision
for relief be made, If it can be fairly stated that the hardship would
not have arisen except for the fact that the individual was placed in a
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particular position by CIA, it is believed that equitable grounds are
eatablished for furnishing relief from the hardship. There should also
be considered that from a practical standpoint, most wives are to some
extent knowledgeable of their husbands' affiliations with the Agency. In-
evitably they also learn names of other people and gain a glimmering of
the type of activities, Under such situations CIA, for security reasons,
might not wish those individuels to be treated abroad, particularly where
anesthetics would be involved,
d, In examining the problem it would seem that the equities which
create the desirability for this type of benefit for dependents arise only
where the employees are assigned abroad? /n connection with the extent
of coverage the eligibility standards can be assimilated either to FA or
PL 11D. It is believed that use of PL 110, "Standard of Eligibility", is
not completely defensible since specific examples which might be cited
would appear to lack complete justification. One such example could be
hoe ital care for the wife of a CIA employee injured in a traffic accident
On the other hand, equating the "Standard of Eligibility" to
wo ? be far more defensible in that there would have to be established
a causal relationship by the fact of the individual being in a particniAr
location because of the head of the familyes employment by CIA, In each
of the cases indicated in paragraph sib" above, there is every likelihood
that the proper causal relationship could be established-., Fundamenballya
in each case the individual was exposed to hazard by virtue of being a
dependent of a CIA employee and being with him. Conditional hazard would
not be present were the employee stationed in the United States. It would
seem necessary and desirable to incorporate some type of limitation under
present circumstances when are employee suffers a disability, illness, or
injury, which may extend for some time? Payments are made by virtue of
authority in PL 110 only until such time as the case can be processed to
the DEC. Thereafter CIA does not reimburse the expenses involved, Since
there mould be no method of turning over similar cases where dependents
are involved, some limitation must be established which would be susceptible
to sample administration, This would act to avoid payments covering
extended periods of illness or hospitalisation, The (legation of who are
members of the family and who are dependents could be guided by the
regulations applicable to travel which designate the members of the
family for when CIA will assume travel expenses? These generally include
wife, children, and dependent parents of the employee, (Annex 13)
se, Due to presout statutory limitations, the inability of CIA to
afford equal treatment to employees abroad based solely on assignment
status (i.e., whether permanent or temporary duty) results in inequitable
situations. Aare two people lare afflicted with pneumonia (not
traceable to performance of duty under FECA standards) it is strongly
urged that a designation of type of duty statue should not result in one
receiving medical and hospitalization care from CIA and the other person
being denied it. The justifications supporting such benefits for permanently
assigned personnel are substantially pplicable to persons on temporary
duty. The key here is that both types of persons are performing official
duties at the particular geographical location pursuant to official orders,
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fo The present statutory meaning of mabroadt, excludes such locations
25X1A6A ete I The justification for additional benefits while
abroad was easee an lower standards of sanitation, medical practices, and
hospital facilities and in some locations the complete inaceeseibility of
medical and hospital facilities. That justification validly applies to
the above-cited .locations. For security reasons the specific locations
cannot be specified in legislation And the simplest solution is to have
the term "abroad" extended to include U.S. territories and possessions.
(See Annex: A)
go In view of the previous experience by CIA an attempting to secure
legislation, careful consideration must be given to the appropriateness of
again seeking legislation? There have been no dissenters within the Agency
to the view that this type of legislation for dependents is desirable.
Balanced against the unanimous view is the fact that this could well be one
of the more controversial items to present to the Congress. Clearly we
would have to demonstrate why CIA employees and their dependents are in
such a different position than normal civilian employees to warrant this
additional benefit. It is believed that a reasonably strong justification
can be presented to the Congress, but it is difficult to judge at this
moment the seriousness of the opposition that may arise in both the Bureau
of the Budget and in the Congress. In any event it would seem highly
desirable that if CIA were presenting a package career service act that the
justification could be presented in a much stronger light than if it were
presented as a single item.
CCNCLUSICNS
a. Medical and hospitalization benefits for members of familiee of
CIA employee* are desirable and will do much to foster the CIA Career
Program and alleviate many hardship problems which are inevitable of great
concern to CIA.
b. Medical care and hospitalization benefits include transportation
to hospital facilities and should be made available to members of the
immediate families of CIA employees. Those benefits should be available
where the employee has permanent assignment abroad and has his dependents
with him. The eligibility for such benefits should depend on a prior
determination of causal relationship based on exposure to additional
hazard in a manner similar to the standard utilized by the Bureau of
Employees Compensation. Such benefits would be available only for the
period the dependent is abroad or until the employeegs current tour of
duty is terminated, whichever occurs earlier*
co The benefits available to employees under PL 1100 Section 5(a)(5)
who are permanently assigned abroad should be made available to CIA em-
ployees who are temporarily abroad on official Agency business?
d. The medical and hospitalization benefits of PL 110, Section 5(a)
(5) should be made available to CIA employees performing duty in the
territories and possessions of the United States?
en Leeislation is required to effect the above conclusions?
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ANNEX A
Federal Employees? Compensation Act
General.
The Federal EMployees? Compensation Act provides that the United States
shall pay compensation (as set forth in general below) for the disability or
death of an employee resulting from a personal injury sustained while in the
performance of his duty and for the administration of the Act by the Bureau
of Employees Compensation, Department of Labor. However, no compensation
shall be paid by the Bureau if the injury or death is caused by the willful
misconduct of the employee or by the employeeas intention to bring about the
injury or death of himself or of another, or if intoxication of the injured
employee is the proximate cause of the injury or death.
Definition.
The Act defines "employee" to include all civil officers and employees
of all branches of the Federal Government, including officers and employees
of instrumentalities of the United States wholly owned by the United Stateee
and persons renaering personal services of a kina e3miiarto engem ez
civilian officers ana employees of the United States to any department,
independent establishment, or agency thereof, without compensation or for
nominal compensation, in any case in which acceptance or use of such services
is authorized by an Act of Congress or in which provision is made by law for
peyment of the travel or other expenses of such person. It defines the
term "injury" to include, in addition to injury by accident, any disease
proximately caused by the employment. The term "compensation" is defined
as including the money allowance payable to an employee or his dependents
as well as any other benefits (such as hospital expenses) paid for out of
the compensation fund.
Exclusiveness of Remeqa
Section 7(b) of the Act provides that the liability of the United
States, or any of its instrumentalities, under the Act or any extension
thereof with respect to the injury or death of an employee shall be
exclusive, and in place, of all other liability of the United States or
such instrumentality to the employee, his legal representative, spouse
dependents, next of kin, and anyone otherwise entitled to recover damages
from the United States or such instrumentality, on account of such injury
or death, in any direct judicial proceedings in a civil action or in
admiralty, or by proceedings, whether administrative or judicial, under
any other workmanos compensation law or under any Federal tort liability
statute.
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awnsation Benefits.
The following schedule sets forth, in general,
under FECA.
DM.S.21,ulifications
1. Hospital and If approved facilities
medical expenses used and procedures
followed
2, Travel to place
of treatment
3. Services of an
attendant
If local facilities are
not suitable or available
If Administrator finds it
necessary because employee
is helpless as to require
constant attention
40 Compensation for If desired. May take
tine lost accrued sick and annual
leave
00 Augmented compensw.
If one or more dependents,
tion for dependents wife, husband, unmarried
Child, parent
6, Mineral and burial If death restate from
bills the injury
7. Death Benefits
a, Widow
b. Widower
C0 Children
Until remarriage or death
If wholly dependent upon
wife. (Til remarriagek
death or capable of self-
support)
'Ti]. child marries, dies,
or reaches 18
d. Orphan children ITU child marries, dies
or reaches 18
employee benefits
Amount
Varies with case
Varies with case
Not to exceed $75
per month
66 2/3% of monthly
salary or schedule
award
8 l/3% of monthly pay
(Limited to that part
of monthly pay-not in
excess of $420)
Not to exceed $400,
at the discretion of
the Administrator
45%
45%
To widow 40%0 and 15%
for each child not to
exceed 75%
35% for one child and
15% for each addi-
tional child not to
exceed 75% divided
among such children
share and share alike
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s? Parents (1) If one dependent
and one not
(2) If both are dependent
f. Other dependents (1) If one dependent
(2) If more than one
(3) If one wholly dependent
but one or more only
partially dependent
Territories end Poseessions of the United States.
?=IIMINIAA937.102132Y?r.Vir?Mbelpnii,a.M..d.IN..ai
Territories:
Possessions:
Hawaii
Alaska
(1) 25%
(2) 20% to each
(1) 25%
(2) yo% share alike
(3) 10% share alike
Puerto Rico
Canal Zone
Corn Islands
Omam
Virgin Islands of the United States
American Samoa
Midway Islands
Wake Island
Canten Island
Enderbury Island
Johnson Island
Sand Island
Swan Island
Trust Territory of the Pacific Islands
Northern Marianas
Caroline Islands
Marshall Islands
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ARM B
Central intelligence Agency Act of 1949
General.
The CIA Act of 1949 authorizes payment of the cost of treatment and,
where required, travel expenses to the nearest suitable hospital or clinic:
in the event of illness or injury requiring hospitalization, not the result
of vicious habits, intepperance, or misconduct on the part of the claimant,
Incurred in the line of duty while the officer or full time eeployee is
aesigned to a permanent-duty station outside the continental United States
its territories and possessions. It also authorizes the estab/ishment of
a. firsteaid station and a nurse at permanent-duty stations overseas where
the number of personnel warrants such a station and payment of the cost
of physical exaelnations and administering innoeulations or vaccinations
at overseas stations.
Discussion.
The CIA. Act authorizes the payment of medical expenses arising out
of illness or injury "incurred in the line of duty." In scope, the
criterion "incurred in the line of duty" encoppaeses the concept "incurred
in the performance of duty" found in the Federal Epployees'Compensatiot
Act and extends to cover also illness and injury "not the result of
vicious habits, intemperance, or misconduct.on his part, incurred while
on permanent assignment abroad." The Act does not authorize the payment
of compensation for time lost from work due to such illness or injury,
nor the payment of disability or death benefits.
The language contained in the subject medical authorities was drawn
from the Foreign Service Act of 1946 with congressional comments relating
thereto so indicating, without discussion. When we leek to the administration
of that Act under vouchered funds and the surveillance of the General
Accounting Office over payments made thereunder, we find a ready reference
for guidance. Set forth below is a complete list of (1) illnesses and
injuries in the Foreign Service for which payment was made under their
authority during the fiscal year 1951, (2) the number of eases of each
type, and (3) the average number of days of hospitalization for each type
of illness or injury.
Illnesses
No. of Cases
Avereee_p_se.
Infectious Diseases
Dysentery 24 12
Bronchitis 11 8
Hepatitis 41 19
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Illnesses
Infectious Diseases (contid.):
Ho. of Cases
Aveme
Influenza
15
6
Malaria
6
4
menineltis
1
11
Misc. Fevers
12
13
Dengue Fever
1
15
Rheumatic Fever
3
14
Scarlet Fever
1
10
Tick Fever
1
11
Misc. Intestinal Parasites
3
7
Mononucleosis
4
19
Mumps
3
10
Paratyphoid
1
6
Pleurisy
4
6
Poliomyelitis
2
6
Pneumonia
21
12
Tonsilitis
12
5
Tuberculosis
14
174
Typhoid
6
13
Injuries:
Automobile Injuries
7
7
Fractures
20
35
Head Injuries
5
10
Hernia
24
12
Misc. Injuries
7
6
Tumors and Cysts:
Cancer
16
30
.cyst
11
7
Benign Tumor
24
13
Respiratory Disorders:
Misc. Respiratory System Disorders
Misc. Upper Respiratory Infections
Tonsillectomy
9
/6
7
19
5
7
Digestive Disorders:
'
Appendectomy
6
6
Appendicitis
46
LO
Colitis
9
9
Diabetes
4
19
Misc. Digestive Disorders
13
9
Fissure Anal
5
33
Food Poisoning
35
Gall Bladder Disorders
5
17
Gall Bladder Operations40
Gastroenteritis
lg
15
Hemmorhoids
14
8
Liver Disorders
2
27
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Illnesses No. or Cases Averq.49Days
...._ ....._....._
Digestive Disorders (cod):
Misc. Rectal Disorders
Rectal Fistula
Sprue
Ulcers
Cardiovascular Disorders:
Raynauds Disease
Heart Condition
Hypertension
Misc. Circulatory Disorders
Thronbophlebitis
8
c
o
1
16
1
12
10
10
4
Jo
8
18
25
1
144
7
21
53
Eye, Ear, & Nose Disorders:
Ear Infections
9
10
Injuries to Cornea
5
6
Misc. Eye Conditions
Sinus Disorders
6
7
19
a
Psychoneurosis:
20
19
Urological Disorders:
Kidney Disorders
14
15
Misc. Urological Disorders
12
15
Misc. Male Genito System Disorders
7
19
Neurological Disorders:
Neuritis
Multiple Sclerosis
6
1
11
:31
Skin Conditions:
II
9
Gynoaological Disorders
19
7
Loconotor System:
Arthritis
. 18
9
Bursitis
6
5
Misc. Locomotor :3ystem Disorders
13
9
Osteoporosis
1
27
Ductless Gland:
4
28
Allergic Reactions:
4
9
Medical Observations
30
5
- 15 -
,
SECRET Tab Al
Approved For Release 2003/01/27 : CIA-RDP80-01826R000900100003-3
? Apvied Foraease 2003/01/27 : CIA-RDP80-018260)09001000Q03
ANNEX C
Hospital and 6urgica1 Insurance
General,
Hospital and surgical Group Insuranne Plans are available
to Agency employees through the Government Employees Health .
Association, a charitable corporation, incorporated under the
laws of the District of Columbia. The need for this vehicle
for the processing of insurance applications, paynente and claims,
arose out of the operational and security requirements of
Agency that precluded normal .application and claim submission by
Alenay employees, As a corollary to the requirement for a. proper
vehicle, CIA provides for the adminiatration of the Government
Enployees Health Association no a gratuitous service to those
employees availing themselves of the service. With the exception.
of the method of application, payment of premiums and claim sub-
mission and payment, the Group Insurance Plans available at the
present time (Mutual of Cmahe and Group Hospitalization Incorporated)
do not differ from those offered by the same companies to the
general public, The benefits are the same.
Coularison of. Benefits.
The attached tables provided by the Insurance Task Force lisi;
benefits offered by Group Hospitalization Incorprated and Mutual
of Omaha, known within the Agency as GEHA,
- 16 -
SECRET
Approved For Release 2003/01/27 : CIA-RDP80-01826R000900100003-3
Tab Al
Approved For Release 2003/01/27 : CIA-RDP80-01826R000900100003-3
Overseas Benefits
Currently
Offered
by GI.1;
Hospitalization
Hosp. Board & Room! $9.00 per day for 31 days $279 1. Hosp. Board & Rocs: $10.00 per day for 21 days $210
utth no limit on frequency, plus with 90 day interval on frequency, plus
$135.00 for hospital extras.... ......... 1 $64.00 for hospital extras................ ..... 64
Plus surgical as shown below.
5 Plus out-patient emergency up to.. ........
yallIRLEEIRt. 1st of next month.
2. Plus surgical as shown below.
$135 3. Plus out-patient emergency up to $ 10
4. Waiting period. 1st of next month, except for
tonsillectomies and pre-existing conditions--
10 months.
AmattE. Waiting period 9 months and
:;ended 9 months beyond term. of contract.
$9.00 per day for 14 days.. ........ $126
plus up to $45.00 total for Hosp. extras.
PSX.
maternity tota1.04.?.?...?????.....4
5. Matern44/. Waiting period 10 months,
No extension beyond term. of contract.
011 $9.00 per day for 8
$ 72
00000e11.rre,&00yeeoveopeekle.Ofeattotiove,
max. $ 72.
except Caesarean, termination of ectopic
pregnancy and miscarriage, for which hos-
pitalization benefits are 1. above.. max. ($274)
instead of $72.00
maternity total.. ............ ?............ $ 72
or $ 274
Approved For Release 2003/01/27 : CIA-RDP80-01826R000900100003-3
Apwed Foralease 2003/01/27 : CIA-RDP80-0182C000900100W
Currently
Offered
Wakes
(Example)
$ Ing. unil ......
100.
75 " " bilat........
140.
100 Appendectomy...?.
100.
100 Ra6.ical mastectomy...
179.
90 Fracture of spine........
129.
39 Hip dislocation ......
75.
190 Frostatectomy............
200.
90 Norma1 delivery...
80.
100.4.4 .Caesarean. ..... 0 ....
190.
190 Remova1 of kidney....
179.
sl cateract
190.
100.....0astreetomy
250.
29 TOnsillectomy............
55.
29 Adenoidectomy.. .. ...
55.
29 Eemorrhoidectomy
60.
50 normal Delivery.. .....
1 Hysterectomy
16
5.
- 18 -
Currently
Offered
PY Pg
(Fees paid sill
fully cover surgical
costs if subscriber
is a single parti-
cipant whose incomn
is 0000 or less
or if a family
participant 'whose
income is $9900 or.
Approved For Release 2003/01/27WORDP80-01826R000900100003-3
Tab Al
igkpurrently
JOffered
by Omaha
Approved For Release 2003/01/27 : CIA-RDP80-01826R000900100003-3
usts e?
Benefite in Washington
italixation
1. Hosp. Board & Boom, $9.00 per day for.... 1.* lisp. Complete Service for 21 days (Semi-pri, -
3 31 days with no limit on pregnancy, Partic, Hospital) with 90 day interval on
plus $135.00 max, for hospital extras.....* pregnancy see below
plus $5.00 per day for additional 160 days. ..$900,
see below
Currently
Offered
Plus surgical as shown above
. Plus out-patient emergency up to
Examples
?????11
Ait
Bd. & room Normal
fracture, .30 n
3 3.26.00 Plus a maxi-.bilat. hernia. ?14 "
90b00 mutt of $135.,unilat.
126,= to carer all.hysterectoMY-....44 "
90.00 hospital ex-.hemorthoidectomy 10"
27.00 tree.... ..... tonsillectomy... 3"
2. Plus Surgical as Shown above
3. Plus out-patient emergency up to
Examples
????
10. N a
see Firry ei
& room (diff.)
....... ...$135. (/ 45)
????????????????
4050
(/135)
00????9??????????
189.
63)
Plus all hospital extras, (16
? ....... 0?*04.1104
135 *
i 45)
listearwhich range from 250.
?000004$ 0003009,1
1890
/ 63)
for the simplest, uncompli-
000.06 ?Olf.f.? ????se
1350
(i 45)
cated appendectomy to very
el100?99 5 S SC . 0?0000
40$
(/1.)
substantial amounts for the
serious or complicated came.
Awt - 50% greater on Bd. & room than Omaha
1.* Basic costs of M. & room 2 213.50 per day are
absorbed by GUI completely
Approved For Release 2003/01/27 : CIA-RDP80-01826R000900100003-3
Apioied Forejease 2003/01/27 : CIA-RDP80-01826U0900100V3
SECRET
TABLE C3
Costs (monthly)
Omaha
Rom. Stleal
Total
Ropx. purge-ail
Teta/_,
1.60..iodiv16ua1 contract. ... ...
1.70
1.03,
2.70
---"
4.75..indiv. & spouse coottact....... 3.70
3.20
6.90
6.00.4ndiv. & spouse &
3.70
3.20
6.90
SECRET
Approved For Release 2003/01/27 : CIA-RDP80-01826R000900100003-3
Amigoyed Fore,lease 2003/01/27 : CIA-RDP80-018260)09001000ti
aCRET
ANNEX D
Extract from Foreign Service Travel Regulations
1.2 Definitions
a.
b.
(1) Wife
(2) Children (including step-children and adopted
NI-2AS) mho are unmarried and under 21 years of
age or, regardless of age, are physically or
mentally incapable of supporting themaelves.
(3) Parents (including step-parents and adoptive
of the employee, or of the spouse, shen
such parents are American nationals and are 90
percent or more dependent on the employee for
support.
(*)
Sisters and brothers (including stap-aisters,
step -&EIers,iAiiiive sisters, and adoptive
brothers) of the employee, or of the spouse, shen
such sisters and brothers are American nationals,
are 90 percent or more dependent on the employee
for support, are unmarried, and are under 21 years
of age; or, regardless of age, are American
nationals and are physically or mentally incapable
of supporting themselves.
k51 Husband
who is physically or mentally iocepable of
supporting himself.
-21 -
Tab Al
Approved For Release 2003/01/PFER-RDP80-01826R000900100003-3
%we Appripd For Release 2003/01/27 : CIA-RDPV1826R000V00003-3
JUS TUT' ON
- 22
Tab A2
sEaRET
Approved For Release 2003/01/27 : CIA-RDP80-01826R000900100003-3
25X1A6A
Apkived Foiplease 2003/01/27 : CIA-RDP80-0182(0009001004203
SWIM
EXTENSION OF MEDICAL BENEFITS FOR OVEP,SEAS EMPLOYEES
AND MIR DEPENDENTS
;:loques exist under current authorities in the field of medical
benefesels for employees of CIA and their dependents. Certain overseas ea=
ployceis are being denied medical benefits merely beeause they are serving
In a qeeporeeyeduey assignment or at a post in a territory or possession
of th I United States, elso? at the present time, there is no authority
for p4oviding modicel benefits to the .dependent of Agency employees
servf 4; overseas. It is requested that consideration be given to the
enac Int of logieletioe designed to elimininate these inequities.
Ino Central Intelligence Agency Act of 1949 (63 Stat. 208) provides
nedicll benefits to ceri;ain Agency employees overseas. The authority for
proes;fieg these benefit? is contained in Sections 5(a)(5)(A) and (C) of
the I ?-, The additionel benefits consist of more liberal standarde of
eliW ,elity for medical end hospitalization benefits than are provided
by tai Federal Employees? Compensation Act of 1916 (Public Law 2679 64th
Congloss), as asended. ,
The lengnage of Section 5 was based on Title IX, Part E of the
"Fereien Service Act of 1946" (Public Law 724, 79th Congress). Under the
previelono of that Act, medical benefits authorised therein may be
p?3vided all officers and employees of the Foreign Service eho are assigned
et.road, regardlees of their particular status at the time of overseas
assignment. The Dopartnent of State has defined "assigned abroad" to
mean ,,while physically outside the continental limits of the United States
pursuant to official orders." The wording of the authority in Section 5(a)
(5)(A) and (C) of the CIA Act appears to grant the same benefit as those
greeted by the State Department authority, Section 5(a) of the CIA Act,
however, limits the application of the CIA authority to officers and
full-time employees assigned to permanent-duty stations outsid: the
eontinentel United States, its territories, and possessions. This limita-
tion precludes payment of medical expenses of employees who are overseas
on temporary-duty orders, or who are serving in areas such as and 25X1A6A
Present statutory limitations require distinctions betmeen overseas
personnel based solely on their assignment status (i.e,? whether
permanent or temporary duty) and result in inequities. Two employees
stationed at the same post and both afflicted with cancer (not traceable
to performance of duty under the standards of the Federal Employeee
Compensation Act) should receive the same medical and hospitalization
benefits from CIA. The justifications supporting such benefits for
permanently assigned personnel are substantially applicable to persona
on temporary duty. The basic factor in both situations is that the
employee is performing official duties at a particular geographic location
pursuant to official orders, As noted above, the present statutory
meaning of "abroad", at contained in CIA authority, precludes the extension
of medical benefits to personnel in locations such as
-23wTab A2
Approved For Release 2003/014140A-RDP80-01826R000900100003-3
25X1A6A
ApOied FoQplease 2003/01/27 : CIA-RDP80-0182119009001000403
SECRET.
The justification for medical benefits in excess of those provided wider
the Federal Employees' Compensation Act, was based on lower standards of
sanitation, medical practice, and hospital facilities and, in some locae
tions? the complete inaccessibility of medical and hospital facilitiee,
That justification is equally valid with respect to the above-cited legis-
lation. Furthermore, it is believed that the fact that a particular area
may or may not be a "territory or possession" has no bearing whatsoever
on the health and sanitary conditions in that area,
The cost to the Government of extending medical benefits to Agency
employees on temporaryeduty assignments overseas as well as extending the
"assigned abroad" concept in the CIA Act to include U, S. territories and
possessions in addition to foreign countries, is estimated to be very low
in terms of the benefits to be derived. Based on our recent experienceeo
the cord, would be approximately $11,000 per manum,
Another basic problem is the Agency's lack of authority to provide
medical benefits for the dependents of personnel serving overseas. The
mission of the Central Intelligence Agency requires the permanent assign
ment of career employees to all areas of the world. It has long been an
established Government policy to allow dependents of employees serving
abroad to accompany these employees at Government expense. The merit of
such a policy is above question. The presence of an employee's wife and
family in the area is extremely beneficial to his morale and, as a con-
sequence, he performs more effectively. Also, it is our belief that the
Government has a moral obligation to reimburse its employees for medical
costs and incidental travel expenses due to illness contracted by their
dependents by reason of conditions to which they are exposed because of
the employee's work, The proposed legislation provides as a criterion of
eligibility for dependents' medical benefits that there be a causal
relationship between the contraction of the dependent's condition and the
place and nature of the employee's assignment. The criterion is similar
to the requirement in the Federal Employees' Compensation Act that an
employee's condition is traceable to the conditions of his assignment,
It has been estimated that the annual cost of administering a program
providing medical benefits for dependents will be approximately $247,000.
This amount would provide fends for medical benefits to dependents of
Agency employees "assigned abroad" on a permanent duty basis including
those in territories and possessions.
Favorable consideration of the proposed legislation is requestede
- - Tab A2
SECRET
Approved For Release 2003/01/27 : CIA-RDP80-01826R000900100003-3
Appr ve For Release 2003/01/27 : CIA-RDPV4-091826ROW0100003-3
DEATH GRATUITY
Tab B
Approved For Release 2003 j. CIA-RDP80-01826R000900100003-3
Apprcc.51 For Release 2003/01/27 : CIA-RDPW1826R000)0100003-3
STAFF STUDY OF LEGISLATIVE TASK FORCE
?- 26 . Tab B1
Approved For Release 2D03101 : CIA-RDP80-01826R000900100003-3
i?ziod3r ov ed For Release 2003t /27miCIA-RDP80-018200090010(403-3
PROVISION OF DEATH BENEFIT TO A DEPENDENT RELATIVE OF
PERSONNEL WHO DIE WHILE IN AGENCY EMPLOYMENT
?
. PROBLEM
Because of the unique nature of this Agency and the consequent pectinarities in the status of its personnel ineelation to personnel of other
Government agencies, certain disadvantages-axe incurred by survivors of
Agency personnel in procuring the monetary benefits to which they are en.
titled by reason of the decedentls government loyment. (See Annex:A)
2, FACTS BEARING ON THE PROBLEM
a. The ostensible employment of covert personnel in other govern-
mental and non-governmental positions necessitates extensive internal pro-
cessing of records, and, in some cases, an unsubstantiated claim, in
applying for death benefits under existing programs available to government
employees. In extraordinary cases, no death benefits however deserved
may be forthcoming. (See Annex A)
b., All existing measures for death benefits - as provided by the
Civil Service Retirement Act of May 22, 1920, as amended; by the Federal
Employees Compensation Act of September 7, 1916, as amended; and by the
War Agencies EMployees Protective Association insurance policies - are
contingent upon the occurrence of certain conditions precedent, (See
Annexes rs C, D, respectively.) Security factors cause inordinate but
unavoidable delays to arise in the acquisition, processing., and review
of data required to prove the presence Of the required'ponditions.
c. The military services are authorized to pay a death gratuity to
the appropriate survivor(s) of an amount equal to six months pay it
the rate received by the officers enlisted man, or nurse at the time of
his or her death. (34 U0 S. C. 943 Navy; 10-U. S. C. 903 ArMl). (See
Annex: E)
de Since World War II a trend toward Gratuitous insurance for
employees has appeared in the field of private industry. (See Annex fl
e, There is no general legislative precedent for a death gratuity
for survivors of civilian employees of the U. S. Government. However,
5 TJ S c, 11.8 (f) may represent a step in this direction since it does
allow a grant of money to survivors of indigenous civilians employed abroad,
(See Annex G)
f. Since the emphasis in a career service program is on the selection
and developrent of younger personnel, it is believed that a low mortality
rate does and will prevail in this Agency and that the cost of such a
benefit would not be excessive. (See Annex H)
Tab B1
Approved For Release 2003/0PRIA-RDP80-01826R000900100003-3
Acii-oved Fora lease 2003/01 ,r0h4-RDP80-0182V09001004-3
DISCUSSION
In the past century strong new influences have come into the labor-
management relationship. These influences have been manifested in public
social security legislation and pAvate agreements between labor and
management. They have been stimulated by enlightening studies in the
field of employee motivations. The effect of these influences is that
wages are no longer measured solely in terms of remuneration for work
performed, but also in terms of health and welfare benefits provided by
management. Every employer, public and private, must reckon with the
trend of employee benefits and keep apace thereof lest his efforts to
attract and retain personnel be jeopardized,
4. monism=
a, In order to compensate for inordinate delays in receiving death
benefits and thereby place personnel of this Agency on an equal basis
with employees of other civilian services, and to equalize thief Agency/a
competitive position with the military services and private industry in
developing a career service, a death gratuity benefit should be incorporated
in the career service program.
b, The death gratuity should be awarded immediately upon official
notification or death.
c, The gratuity should be a lump sum of 3100004
d, Since this gratuity will be contingent solely upon death while
In the Agency/a employment, it should be in addition to, and not an
alternative of any moneys to which the survivor(s) may be entitled by
reasons of contributions by the decedent during his lifetime or under
workmentas compensation provisions. It should hot be aubjeat to set off
any. indebtedness of the decedent. (See AnneotE)
ea This gratuity should, be available only to survivors of regular
officers and employees of the Agency, excluding consultants, persons whose
services are obtained by special contracts, and military personnel in
active status assigned to duty with this Agency,'
f. This gratuity should be awarded regardless of the cause of death;
however, intoxicationl attempts to do harm to oneself or to another, or
any deliberate misconduct on the part of the employee resulting in gie
death should raise a presumption of ineligibility of the survivors, which
presumption may be set aside at the discretion of the Director,
28 . Tab Bl
SECRET
Approved For Release 2003/01/27 : CIA-RDP80-01826R000900100003-3
Ali:red Foralease 2003/011177dA-RDP80-01826000900100W-3
ANNEXA
Disadvantages of Survivors of Agency Personnel
The subject of financial assistance to his survivors in the period
of emergency after his death is a most important one in the mind of every
breadwinner. By offering a means of coping with the problems of this
subject, the employer increases efficiency by building better morale and
reducing turnover,
Probably the three largest employee groups are: (1) those in private
industry, (2) those in military service, and (3) civilian employees of the
Government. All have some form of death benefits. Free insurance programs
exist and are being extended by the employers for the benefit of the first
group, The military services grant a death gratuity. Members of the third
group are subject to the more complicated administrative procedures and
limitations of the Civil Service Retirement Act and the Federal Employees
COmpeasation Act. (See Annexes B and C9 respectively)
Survivors of Agency personnel may enjoy a slight advantage in that
once a claim has left this Agency it may receive confidential and more
expeditious handling in the Civil Service Commission or the Bureau of
Employeets Compensation0 In order to preserve the efficacy of any special
-arrangements, however, they must only be used in cases which fully warrant
them. For reasons of security, the Agency prefers to have its claims
processed in a manner normal to other Government establishments.
Before a claim for any benefits which become due upon death maybe
submitted to the Civil Service Commission, it is necessary that the
employeeos leave record and financial accounts be settled. This often
requires the submission of data from the field. Any funds which may be
due the survivors are subject to set off any indebtedness of the employee
to the Agency. When extremely covert arrangements for purchases of
articles or pay have been effected, as has happened and probably will
continue to happen, the settlement of accounts becomes complicated and
drawn out.
Death claims to the Bureau of Employee's Compensation must be ac-
companied by a certificate of death and an Official Superior's Report of
Injury, Form CA-2. The component of the Agency of which the decedent was
a member or his superior in the field most submit the completed CA-2,
together with an opinion as to whether operational security might be
jeopardized by submission of the case to the Bureau. This statement is
forwarded through the Security Office for review and final decision on
security questions.
29 - Tab 81
SECRET
Approved For Release 2003/01/27 : CIA-RDP80-01826R000900100003-3
Avved ForOlease 2003/04t2777CIA-RDP80-0182V309001004-3
If a Claimant eppeala directly to the Bureau, the claim is immediately
passed to this Agency so that the internal procedures required for the
maintenance of security will not be circumvented. The procedures of
claiming employee compensation awards are receiving great attention in
the Insurance and Claims Branch of the Employee Services Division? and
considerable progress has been made. However, the number of organizational
components and the number of persons involved will still be a handicap on
efficient procedures. This problem is peculiar to a security agency.
With respect to both civil service retirement claims and employee .
compensation claims, it is conceivable that the case of a particularly
sensitive employee could not be submitted for death benefits, even to the
cleared Agency ,contacts. This same employee might for security reasons
be barred from ebtaining War Agencies Employee Insurance. There would be
no means of compensating his survivors. CIA Regulation Isheds much 25X1A
light an the proper use of Sect. 10 Public Law 110, 81st congress, let
Session, and on the basis thereof it is considered doubtful that such
compensation could properly be made thereunder.
Attached herewith are two tables. Table?' is a chronological listing
of Agency employees who have died during the fiscal years 1952 and 1953,,
This table shows the time lapse between the date of death and the date
Agency accounts were settled. The time consumed by internal Agency
processing is shown in the column headed "Lapse Months."
Table A2 shows the schedule of lapsed time between the date of death
and the dates on, which. disbursements were made from the sources indicated
in favor of the survieors.
The median average lapse of all cases shown in Table AI is 3 months.0
Five,, recently settled eases were selected to constitute Table A? since
(L) they include both vuchered and unvouchered employees and (2) the delay
In each of the selected cases approximates the median delay of 3 months.
For the purpose of processing records all death cases are handled on
the basis of the decedentos being a staff employee.
The data shown in Takla Al and the extension of information on some
of those cases in Table A4 show that a considerable portion of the total
lapsed time from the date of the epployees death to the first receipt of
money is attributable to the Agencre internal processing as required by
security factors,
OP 30 fill Tab B1
SECRET
Approved For Release 2003/01/27 : CIA-RDP80-01826R000900100003-3
ved Foraease 2003/01 PR trCIA-RDP80-0182V0900100V
TABLE Al
Officers and EmployesMo Died While in Ageney Employ Dari ;Lc
Years 1952-1953 cmd Whose Accounts. ava Been Settled
Vouchered or Date of
Case Unvouchered Death
W?P,MMOSCOM?M.?50?,.ftg,t1
1 v 7-6-51
2 v 8-8-51
3 tiV 8-14-51
4 UV 104-11-51
5 v 1147-51
6 v 12-31-51
7 V 2-18-52
8 v 2-29-52
9i, v 3-21-52
lo uv 14-20-52
32 uv 4-12-52
/2 UV 5-9-52
13 V 547-52
14 UV 7-29-52
15 UV 8-25-52
16 v 8-29-52
17 UV 8-31-52
13 UV 9-16-52
/9 UV 9-26-52
20* uv 10-14-52
21 uV 11-11-52
22 UV 12-17-52
23 v 1-21-53
24 uV 2-21-53
25 uV 2-22-53
26 v 3-9-53
27 uv 3-12-53
28 uv 3-14-53
29 UV 3-30-53
30 V 4-12-53
31* UV 5-6-53
?, It 5.4.53
33 V 6-12-53
34 V 6-29-53
35* UV 9-9-53
36 V 11-9-53
37 V 12-3-53
* Died outside U. S.;
Account
Sott1ed and
Porwarded
7-26-51
6-13-52
3-21-52
3-21-52
5-22-52
2-6-52
5-28-52
146-53
11-17-52
2-453
8--4-52
34.6-53
10-23-52
94.8-52
2-13-53
1-13-53
3'-30-53
131-53
245-53
4-16-53
4,1-53
3-17-53
44.7-53
6-16-53
528-53
6.24-53
7-20-53
6-23-53
8--3-53
9-15-53
12-23-53
12-10-53
Wontao
W1,00010.,11,-.44,4
3
3
9
7
3.
9
2
1
- 31 - Tab 131
Approved For Release 2003/MeTtgfIA-RDP80-01826R000900100003-3
25X1 A6A
Avved FoVlease 2003/0107.: 9.11A-RDP80-0182W00900100Q-3
TABLE A2 .
Payment-Dates of Selected Cases*
Cam
PLY
Status
Date
of
Death
Date
Agency
' Account
Settled
Final Pay
Dates of Payment
C.S.C.
BoE*Co
1
117
3-1243
64643
6-18-53
4.16-53
8-1043
ILL)
2
UT
3-3043
6-24,53
6-18-53
7-10-53
3
v
4.1243
7-7-53
7-10-53
7-21-53
N.A.
4**
uv
5-643
7-2043
8-11-53
Nu.
8-12-53
Pending
5
v
5--843
6.23-53
7-8-53
N.A.
7-20-53
N.A
6
uv
W-1141
Filed
4-8-52
Rejected
10-942
* Five recently settled cases were selected as representative of median
cmses. The sixth case was selected only to show elapsed time of a
B,EnC, case.
*, Died overseas. All others died in U. SO
32 -
Tab B1
SECRET
Approved For Release 2003/01/27 : CIA-RDP80-01826R000900100003-3
Awaved Forkirdlease 2003/01/27,32Ft-RDP80-0182V009001000-3
ANNEX 8
Death Payments as Provided by the Civil Service Retirement Act
of May 22, 1920, as Amended
The onlyrlump sum amount payable to the survivor of an employee
is the unpaid compensation due the decedent. (See 5 II, S. C. 61 (f).)
The legislation embodied in 5 U. S. C. 61 (f) is designed to facilitate
the settlement of accounts of certain deceased civilian officers and
employees of the Government." This legislation is indicative of a
cognizance on the part of the Congress of the burdensome procedures and
delays, in making funds available to sarvivors. However s this legislation
does not affect the annuity or refund amounts which are controlled by
separate legislation,
Ilmediate lump sum payments of annuity or refund moneys may be
made only (1) if the deceased employee has completed less than 5 years
civilian services or (2) if he has completed 5 years service but leaves
no widow or children entitled to immediate or future annuity, If a
deceased employee loaves a widow or children entitled to an immediate
or future annuity, a delayed lump sum payment may be paid (1) when the
annuity of the last survivor has terminated or (2) if the deceased
employee is survived only by a widow and her right to future annuity
is lost by her remarriage or her death before the age of 50. (Ques.
188-1900 Page . 27.280 Pamphlet 18s U. S, C. S. C?, May 1951).
The primary purpose of the Civil Service Retirement Act is that it
is aimed at providing a subsistence fund over a period of yearss and not
at alleviating the immediate financial burdens attendant upon the death
of a breadwinner, A death gratuity is aimed at the latter.
. 33-I. Tab Bi
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ANNEX C
Death Benefits as Provided by the Federal Employees Compensation At
of September 7p 1916? as Amended
In case of death resulting from injury or disease, the law provides
for payment to the personal representatives of the deceased employee an
amount not to exceed $400.00 for the payment of funeral and burial
expenses.
The Federal Employees Compensation Act has its roots in the common ,
law master-servant relationship and the workmen's compensation laws which
have so modified that relationship that employer responsibility for job
-
incurred injuries by employees has been greatly extended. The only bars
to eleployee compensation for job-incurred injuries by Federal Employees
are willful misccoduct, intoxicetions'and intent to bring about injury
to oneself or to another employee. The CI3VIIIOn law bars of assumption of
risk, contributorynegligence, or fellow-employee negligence are of no
effect,
The only requirements for employee compensation benefit are work
injuries or ocoupational diseases. Underlying these requirements which are
so broad as to apparently make an insurer of the employers is the basin
responsibility of the employer to provide a work area free of hazards.
A statement of one of the sponsors of the bill which subsequently was
enacted as the Act of September 7, 1916, ia germeneornaccidents do
happen even in occupations not usualy dolominated hazardous. If under
such circumstance an accident does happens it is certainly because at that
particular time and under these particular circumstances there was some
hazard," (Congressional Record (House), July 12, 1916, Vol. 53P Page
10892)0
Employee Compensation is not a largesse of the Government but is a
fulfillment of a moral obligations hence its value as an inducement to
career service is neutralized and the acquisition of benefits is delayed
by procedural requirements.
314 - Tab B1
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ANNEX D
Death Payments as Provided by the War Agencies Employees
Protective Association
The War Agencies Employees Protective Association was founded during
World War II when nnrestricted life insurance was Unavailable to many
civilian U* S. Government employees who were to serve overseas. The
service of this Asaociation has continued and offers unusual benefits and
low cost coverage* It Is contemplated that mai&erShip in the Association
will no longer be li ited to persons actually preparing te,eMbarka but
will be extended te those who indicate an intent to serve overseas._
Attached herewith as Table Di is a table describing War Agencies
Employees Protective Association insurance cost and coterage.
The merits of this insurance program cannot be questioned; howevera
the employee who chooses to avail himself of the program must undertak
a financial obligation to do so. Therefore, the employee who already
carries insurance which covers him elate* the continental limits of the
United States and/or already carries insurance which he desires to retain
without incurring additional obligations may find the opportunity of
War Agencies Employees Preitective Association insurance beyond his reach*
The attraction of the insurance program as a carear.;inducing benefit
is limited to time who can ani will avail thenselves of it* A death
gratuity benefit would be available and attraotive to all employeen.
. 35 - Tab B1
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Up to 40 incl,
3
41-50 incl,
5145 incl.
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1
TABLE D
Basic
AtILSE
Amount
of
Basic Polisz
Current Dividend
Life Insurance
Additions
Accidental
Death Benefit
Total
Coverage
Cost
Per
Month
Less than 43,200
%COO
41,000
$ 7,500
$13 p 500
6 4.17
43,200 & over
10,400
2.000
150000
27000
8,-33
Less than $3,200
$ 5,000
$1,000
$ 7,500
$139500
$ 5.21
43,200 & over
10,000
2,000
15,000
27,000
10.42
Less than $3,200
$ 5,000
10.p000
7.500
$13,500
$ 625
$3,200 & over
10,000
2,000
15,000
27,000
1250
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ANNEXE
Death Gratuity in the Military Services
The Military Services have been authorized aince 1908 (35 Stet, 128)
to pay a death gratuity consisting of an amount equal to six months pay
at the rate received by the officer, enlisted man, or nurse at the tine of
his or her death, the only requirement being that d ath is caused by
wounds or disease while on active duty. (34 U. S, Co 943, NAVY), (10 U.
Sc Cc 9030 ARMY)0
As can be found stated in Vole 58, Congressional Record, P. 5693,
this death gratuity benefit is of a long standing and is designed to tide
over the emergency caused by the death of the head of a family., This
intent was reaffirmed in an amendment sUbseqe t-to the case of Spotevood
Va U. Sop 80 Ct., Cl. 8360 1935. The decicion in the Spotswood case stated
that a death gratuity 'becaele part of the decedent's estate and URI cubject
to distribution accordingly The present wording of the U. S. Code reflects
the amendment that the gratuity be paid directly to designated persons for
the purpose Of implementing the legislative intent.
The power to award death gratuities is vested in the Secretaries of the
respective departments and it may, be exercised "imMediately upon official
notification of death."
There is no statement that such a gratuity is subject to set-off of any
indebtedness of the decedent. Since it is designed as a right of the sur,-
vivort it is not likely that such a sat-off provision would be present, The
conditions of active duty and official notice of death are readily established
(except in those missing in action cases which are otherwise covered), there-
fore the delays of proving eligibility are avoidedc
The U. S. Court of Claims in Leal?. v. U, Se, 1948g 75 F. Supp. 248,
109 Ct, Cl, 760, stated that provisions for compensation of injuries and
diseases contracted by military personnel "were enacted for motives of
public policy mad should not be narrowly construed," This statement is
broad enough to admit the implicgtion that the. public interest will be served
by the existence and liberal construction of benefit provisions, in that
career military service will be fostered, The public interest would also
be served by fostering the development of a career intelligence service,
- 37 - Tab B1
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ANNEX F
Comparable Benefit in Private Industry
Although an insurance program at the employer's expense differs
from a gratuity benefit, they have, from the viewpoint of the emeloyeei,
the same effect. Consideration has therefore been given to the extent
of free insurance programs in private industry.
In a paper entitled "Trends in Employee Benefits", contained in the
Pe...2aeieeiWtepeLtt_a:Silieno on HuzantionsieiLeWeestreee
122, James M. Black, of Associated Industries of Cleveland, reported on
a survey of 104 leading Cleveland companies, On page 58 of the above-
mentioned paper, it is stated:
"Group life insurance - usually between $1000 and $2000 -
is available at company expense at almost all companies employing
1000 or more people, This is not a recent development. The trend
in this direction has been noticeable ever since World War II, and it
was accelerated after the Ford and Bethlehem pension settlements
in 1949,'
A further indication of the extent of free insurance on a nation-
wide scale may be found in the Digest of Selected Health, Ineurance
Welfare, and Retirement Plan under Collective Bargaining, published by
the Bureau of Labor Statistics in Auguste, 1951. Of the 37 firms con-
stituting the base of the survey, 10 provided insurance at company expense,
Among these 10 listed were the American Woolen Co, the Bigelow-Sanford
Carpet Co" the Kaiser-Frazer Corp., and the Minneapolis-Honeywell Regulator
Co.
These statistics reflect (1) the place in the employees mind of the
necessity for financial assistance to his survivors in the event of his
deaths and (2) the recognition on the part of management of the value of
such a benefit as increasing efficiency by inducing employee security and
continued employment, The experience of private industry in this regard
might well be applied to Government service.
Tab Bl
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ANNEX G
Exiting United Death Gratuity for Civilian Employees
Although there is no direct precedent for a death gratuity as
jroposed herein, it is believed that 5 U. s. C. 118 (f).1 which is quoted
below is of significant bearing:
(Public - No0 181 - 76th Congress)
(Chapter 286 - let Session)
(S. 1523)
AN ACT
To authorize the payment of burial expenses and
expenses in connection with last illness and death
of native employees who die while serving in offices
abroad of executive departments of the United States
Government,
Be it enacted by the Senate and :louse of Representatives
of the United States of America in Congress asseebled,
that the head of any executive department, which main-
tains permanent staffs of employees in foreign countries
is hereby authorised to pay oat of any appropriation avail-
able to the department concerned for miscellaneous or
contingent expenses, burial expenses, and expenses in
connection with last illness and death, not in excess of
$100 in any one case, of the native employees of such
department in those countries with respect to which the
Secretary of State shall determine it is customary for
employers to pay such expellees; and the head of any
executive department, which maintains permanent staffs of
employees in foreign countries where such custom does not
exist, is authorized, upon finding that the immediate
family of the deceased is destitute, to make such payments
within the limitations prescribed a,ove to the family,
heirs-at-law, or persons responsible for the debts of the
deceased, as the officer in charge of the office abroad
in which the deceased waE employed shall determine to be
proper.
"Approved July 15, 1939"
This legislation is directly applicable only to indigenous employees
of the U, ,!;. Government in foreign lands, however, the latter portion thereof,
beginning after the semi-colon, contains an expression of recognition of a
non-contributory award to civilian employees of the Government without the
qualification that injury or death occur in the performance of duty.)
Tab B1
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ANNEX H
Cost to Agency of Death Gratuity Benefit
During the past two years, about 40 Agency employees died, The total
cost to the Agency over this period would have approximated $40t000. Con-
sidering this sum in the ligat of the total number of Agency employees,
the cost per employee covered would be very email. The cost per employee
is the counterweight in determining the advantages to the Agency.
The emphasis in a career service pram must be on the selection and
development of younger personnel. Over the years, the fewer positions in
the higher scale of the service will cause a natural selection out process
to be operative,, This process will minimize the Cyclical factor of groups
of young personnel crowing old at the same time.
A career service program is based on selectivity and reduced numbers
of personnel. If the sums provided for career benefits are conducive to
that end, those sums may well be counterbalanced by fewer salaries and
reduced adeinistrative costs resulting from a lower turnover percentage.
Since a straight gratqity would involve a tinieum of administrative
procedures, the cost of administration of such a benefit would not be a
eignificant addition to the over-all cost structure.
- 40 - Tab B1
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ANNEX I
Gratuity Not a Bar or Set-Off to Other Moneys
The sole requirement for a death gratuity as herein proposed should
be death while in the Agency's employ. The administrative delays imposed
by security considerations could thereby be avoided and the optimum value
as a career inducement could be derived,
As stated in other portions of this study, existing death provisions
are conditioned upon the presence of certain facts (as regards Civil. Service
Retirement or Employee Compensation) or upon consideration by the employee
(War Agencies Employee insurance). They arise out of situations which are
over and above the mere fact of employment, therefore aright to any moneys
which may accrue from such situations should not be a bar to moneys due from
the naked relationship of employment,
Since the right to such a gratuity would be contingent upon employment
at the time of death, and no right would become vested until such happening,
the authority of the Director under Sect, 102 (c) of the National Security
Act of 1947 could be .exercised without fear of a claim from a survivor or
survivors of an employee who had been terminated.
- - Tab Bl
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JUSTIFICATION
Tab B2
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PROVISION OF DEATH BENEFIT TO A DEPENDENT RELATIVE OF
PERSONNEL WHO DIE WHTLF IN AGENCY EMPLOYMENT
'Problems arising from the unusual security requirements imposed upon
Agency employees are responsible for certain inequities to their survivors
in procuring the monetary benefits to which they would normally be entitled*
As a result cf considerable study on this problem within the Agency, it is
recommended that legislation be enacted to authorize payment of a death
gratuity to the survivors Of-deceased Agency personnele
The CIA has developed a career service concept in its employment
practices which places certain unique responsibilities on its employees
while at the same time providing benefits designed to compensate for some
of the restrictions involved in employment with an intelligence organi-
zation. Acquisition of existing death benefits - as provided by the Civil
Service Retirement Act of May 22, 1920, as amended; by the Federal Employees
Compensation Act of September 7# 1916, as amended; and by commercial
insurance policies - is contingent upon compliance with certain administra-
tive requirements. In normal Government employment, the facts and records
necessary to effect fairly rapid payment of claims or benefits may be made
available by the Agency concerned as necessary. This is often not the case
with this Agency. Security factors cause inordinate but unavoidable delays
to arise in the acquisition, processing and review of data required to
prove the presence of the required conditions. In some cases it is
impossible to substantiate claims without jeopardising intelligence sources.
A3 a consequence, it is considered that employees of the CIA and their
survivors are at a disadvantage, as compared with other employees of the
Federal Government.
Precedent foe the payment of death gratuities exists in the military
services. They- are aethorized to pay a death gratuity of an amount equal .
to six monthe, pay at the rate received by the officer, enlisted man, or
nurse at the time of his or her death (34 U.S,C. 943 Navy: 10 U.SX* 903
Army).
The legislation proposed by the Agency would give it the necessary
authority to pey death gratuities to survivors of deceased employees. The
gratuity would be awarded immediately upon official notification of death
and regardless of the cause of death. However, intoxication, attempts to
do harm to one or any deliberate misconduct on the part of the em-
ployee resulting in his death would raise a presumption of ineligibility of
the survivor(s) to the gratuity. The gratuity would be available only to
the survivors of bona fide employees of this Agency. The gratuity would
be in the amount of 01000 and would provide an appropriate and immediate
financial assistance to survivors, the equivalent of about three months
of average income* Since the gratuity would be contingent solely upon
death while the individual is in the employ of the Agency, it would be
in addition to any other compensation or benefit to Wnich the survivor
might be entitled. The gratuity would not be subject to set-off for
indebtedness.
Tab B2
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It is estimated that the cost of a death gratuity program such as the
above would net be excessive in terms of the benefits which would be
derived. Approximately 40 Agency employees died during the past two fiscal
years? In comparison with the total number of Agency employees, the cost
per employee Coveted would be snail; yet, it is believed that the provision
of this benefit would be advantageous to the Agency and its personnel.
Favorable consideration of the proposed legislation is requeatedo
Tab B2
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SEMI?
IMUCATIMAL ALLOW=
Tab C
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MUM
STAFF STUDY OF LEGISLATIVE TASK FORCE
SECRET Tab CI
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4441441f04.
zz'aztailma ALLWANCI2we FCii MIME LaERA.RIL QV AGENCY Fail=NEL,
1. F1OB1i24
What legislation, if any, should be sought by the Agency concerning
allowances to officers and epployees for the education of their einor
dependents while at pemmenent stations outside the continental Utited
States?
2. FACTS BEARING ON THE MUCK
a. The Agency does not now have either a formal policy or eon-
siaterit practice concerning educational 'Allowances for school,age dependents
of its personnel stationed in foreign countries or in United States
possessions and territories.
b. Legal opinion states that there is no uniform or specific authority
withir the Agency to expend money for such educational allowances.
c. Post differential payments made to eeployees of this Agency are
based on a variety of hardship factors and paid as a percentage of the
employee's salary without regard to existence or number of dependents.
, 0, Educational facilities for school-age dependents In various
locations, particularly in foreign countries, are frequently unsuitable,
inferior, excessively expensive, or non-existent.
e. The military services have authority to pay tuition costs for
dependents of their military personnel and civilian employees at foreign
military posts.
f. Other governmental agencies, including the Department of State,
do not have authority to pay allowances for education of dependents of
their employees overseas.
g. The Bureau of the Eudapt has sponsored a committee, includieg
representatives of State, FOA, Defense and CSC, to draft an "Overseas
Civilian Service Act" to consolidate and revise the laws relating to over-
seas and territorial civilian employees. A sixth draft provides in
pertinent part
"(4) An education allowance or grant as follow;
(1) An allowance to assist an employee
(0)
to provide for the elementary and secondary
education of hia minor dependents, inclwiing
costs of tuition, board and ramie corre-
sponds:eta courses and related costs;
(b) to transport his minor dependents, whenever
adequate elementary and secondary educational
Tab Cl
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SMUT
facilities are not available at the post at
which be is serving, to and from the nearest
locality where such facilities are available."
3. DISCUSSION
a. The ccocept of Career Service in the Agency contemplates
that employees serve, when and where required, in the best interests of the
Agency. It is inevitable that many enployees with minor dependents will
be required to serve in localities without adequate elementary and secondary
educational facilities while accomanied by such dependents.
b. It is therefore consiMerlattat an allowance for elementary
and secondary level education of minor dependents of such employees in a
legitismte goal for this Agency.
c. Legislative precedent for such allowances exists with reference
to the military services.
4. It is desirable that legislation pormit,such allowances to be
authorized, in the discretion of the DCI, in United States roasessioes and
territories as well as in foreign countries.
e. One vehicle for the establishment of adequate authority is the
draft legislation sponsored by the Bureau of the Budget to equalize, by
payment of an allowance, the costs of education of minor dependents overseas.
Z. CONCLUSIONS
a. Payment to officers and enployses of an allowance for elementary
and secondary level education of minor dependents in their eoepany while
serving in localities without adequate educational facilities or where the
costs Of such facilities are excessive would serve to encourage career
service.
b. Legislative authority in addition to that now extended to the
Agency is necessary before such edlemances maybe paid.
c. The purpose of such allowances should be to assist officers and
employees to provide for elementary and secondary education of minor
dependents, but not to pay all costs directly and indirectly connected
with such education.
d. Factors which should be considered in computing such allowances
are:
(1) A curriculum generally equivalent to that available intim
public schools of Washington, D. C.;
(2) The amount of tuition and fees charged for minor dependents
attending the public schools of Washington, D. C.;
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(3) Tuition, board., and romp correspondence courses and
related costs; and,
(4) Transportation to and from the nearest locality where a
generally equivalent curriculum is available.
e. - The legislation should authorize allowances as required, for
nersontel stationed in foreign countries and in United States possessions
and territories.
f. The legislation should cover all Agency personnel in order that
the Director of Central Intelligence could authorize educational alloWances
in extraordinary circumstances for foreign nationals who are not indigenous
to the area of employnent.
g. The Agency should seek legislation on this subject in the
foil :wing order:
. (1) Secure the required specific authority in an A nai
:7legis-
live program designed to further career ,service in the field of
tiOnal intelligence;
(2) In the event the Agnncy should not advance a legislative
77,n,Ogram, then support legislation advanced by the Bureau of the
'Budzet for general epplieetion to governmental agencies and obtain
er.ten31on of such legislation to this Agency; or,
. .(3) If neither of the above is feasible. during the next session
a the present Congress then budget specifically for such allowances
in the next Agency apprgpriation bill, thus seeking to establish
=mei legislative precedent and authority for such alloWances.
Tab CI
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SECIZT
JUSTIFICATION
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SECRET
EDUCATIONAL ALICWANCES POR LIINOR DEPENDENTS
OF AGENCY PERSONNEL
In .accordance with the C/A concept of a professional career service,
a?career employee accepts the obligation to serve anywhere and at any
time and for any kind of duty as determined by the needs of .CIA. As a
result of this concept, many employees with minor dependents are required
to serve in overseas localities where elementary and secondary educational
faculties are uasuitable, inferior, excessively expensive or non-existent.
It is believed that the Agency should be authorized to pay an educational
allowance to offset the difficulties referred to. The lack of such
authority can result in a difficult financial situation for the individual
employee with a resulting damage to his morale and effectiveness. In some
cases it may result in the Agency losing his services outright.
he legislatisn proposed by the Agency would enable it to provide an
alionee for the elementary and secondary school education Of a minor
deperleut aeaoknenying an Agency eeplegee to an overseas destination. The
-11a1r=e would partially defray the higher cost of education of miner de-
petits in overseas !areas as compared with the normal cost of such educa-
tion in public, schools in the United States-. It is to be noted that under
the e,.1therity requested the Agency would be able to pay educational allow-
to some foreign nationals. The CIA believes such authority is neces-
oay 1.n view of the fact that certain foreign. nationals with long periods
cf ce.rviee are emplwed by the Agency in overseas areas to which they are
not iudigenous.- It is not contesplated that this authority would be Used
to pcy educational allAmanoes to individuals -who are indigenous to the area
in wh17xh they art employed.
- 51 -
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TAB C2
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LIBERALIZED RETIREMENT
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STPSF =DI OF LEGISLATIVE TASK FORCE
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7RDP80-0182 0900100 3
410
LIBERALIZED RETIREMENT FOR CIA PERSONNEL
1, PROBLEM
The proposal that a liberalized retirement system be adopted for
CIA employees raises the following questions:
Do the duties of these employees vary to each a degree from the
dutiea of the average Government employee as to warrant a more liberal
retirement system?
b. Assuming that their duties subject them to unusual working
conditions is a liberalized retirement system a feasible method of
affording them compensation?
c, Inasmuch as legiLlation would be required to effect a change
in their retirement benefits, should this legislation take the form of
(1) a CIA retirement act, or (2) an amendment to the Civil Service
Retirement Act?
d, What factors should be considered in computing retirement
benefits?
e, What weielt should be given to the apolicable retirement
factors?
2, ASSUMPTION
It is assumed that a liberellzed,retirement system could not be
justified for CIA personnel purely on the basic of their CIA employment,
Although their duties subject them to unusual security restrictions,
this situation is not so unusual in Government agencies as to warrant
special retirement benefit considerations. Consequently, this study is
confined to consideration of a liberalized retirement system for CIA.
employees whose duties subject them to working conditions which are
substantially different from those of the average recipient of Civil
Service retirement tenefits,-.
3, FACTS BEARING ON THE PROBLEM
a, A -"Committee on Retirement Policy for Federal Personnel," ?
commiesioned by the Congressv under the leadership of Eliot Kaplan is
currently engaged in a study of the entire Government retirement BY8t8V1
Its findings might very well affect any legislation which CIA requests
for its employees,
b, Precedent exists for liberalized retirement systems for Govern-
ment employees whose working conditions are somewhat comparable to those
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of a substantial number of CIA employees in Section 691(d) of 5U0 S.
Code Annotated for persona engaged in the investigation and apprehension
of criminals (for examples FBI Agents) and in the Foreign Service Act of
1946 for Foreign Service Officers.
4. DISCUSSION
ae Do the duties of CIA employees vary to such a degree from the
duties of other Government employees as to warrant a more liberalized
retiroment system?
(1) The duties of a substantial number of CIA employees vary
from the duties of the average recipient of Civil Service retiree
ment benefits in the following respects:
(a) Some are from time to time engaged in activities
which might properly be defined as hazardous duty.
. (b) Some serve overseas intermittently or for extended
periods of time under clandestine conditions which limit
them in. the pursuit of normal living snd sometimes expose
them to hazardous conditions.
(c) Some serve overseas at posts which might properly
be defined as "unhealthful"
(2) Mille it is recognized that maw civilian employees of
other Government agencies, for example, Department of Defenses
Department of State, et al, serve overseas without special retire-
ment benefits, it must also be recognized that CIA employees serving
(b) They are neMbers of a career service which might
require than to serve at any post throughout the world as
operational need dictates*
(c) As employees of CIA they likely targets of
foreign intelligence services and, as such, are eubject to
unusual hazards.
(3) It must be further recognized that the type of clandestine
activity in which many CIA employees are engaged overseas requires
a combination of mental, physical, and psychological characteristics
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km)
which are found in diminishing proportions as employees advance
past age 50 and particularly in those employees who have been
engaged in such activity for an extended period of time. For
this reason, retirement at an earlier age than permitted by
the Civil Service Retirement Act for such employees is a
factor which, for the benefit of the service, should be consid-
ered in weighing justificatiore Apart from the benefit to the
service which could be achieved by encouraging early retirement
of some employees, the intangible factor of esprit de corps which
is derived in part from, separate and unique benefits and which is
no important as an incentive to the performance of duties overseas
which are of an unusual and sometimes semihazardous nature, must
also be given recognition.
b. Assuming that the duties of certain CIA employees subject then
to unusual working conditions, is a liberalized retireeent system a
feasible method of affording them compensation?
(1) Precedent exists for liberalized retirement systems for
FBI Agents and certain other Government employees because of hazardous
duty, and for Foreign Service Officers presumeblybecause of their
eligibility for continuous overseas service. It must be pointed
out, however, that FBI Agents receive no compensation for their
unusual type of duty other than special retirement benefit e and
that Foreign Service Officers, although receiving special retiro.
mentbenefitee are disqualified for post differential eompensation
which accrues to other Department of State employees serving
overseas.
(2) Considering overseas date under unusual working condi
tions as a factor which distinguishes CIA employees from other
recipients of Civil Service retirement benefitas it shoUld be
eecognized that if the acquisition of liberalized retirement
benefits resulted in disqualifying then in any way from the
financial benefits now accruing to such services, the achieve.
rant would be of little worth and definitely negative as a morale
factor o while this thought might seem to indicate that CIA would
be requesting greater benefits than accrue to recipients of other
liberalized retirement systems, the proposals of this paper as
hereinafter discussed are actually more conservative than the
retirement provisions of either the Foreign Servide Act of 1946
or Section 691(d) of 5 u. So Coda Annotated, utich applies to FBI
Agents and other persona engaged in the investigation and appree
hansian of criednalaG
(3) Inveighing the feasibility of applying liberalized
retirement benefits as compensation for the performance of haz-
ardous duty, as such, the following obstacles present themselves:
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(0) The difficulty of defining clearly what constitutes
hazardous duty and then describing it adequately in any
proposed legislation.
(le) The difficulty of applying the definition on a
practical basis as a factor in computing creditable service
for a reduced retirement age, e.g., the intermittent per.
formance of hazardous duty could net be measured on a length
of service basis.
(h) While recognizing that some employees of the Office of
Security, and TSS perform hazardous duty'
it is felt that provisioha should bemade for their coven
-
some method other than liberalized retirement benefits.
(5) It would appear, then, that a liberalized retirement
aystem is a feasible manner of compensating for duty overseas
under unusual conditions but is not feasible in CIA as a comene
satiaa for hazardous duty as such.
c. Inasmuch as legislation would be required to effect a change
in CIL retirement benefits, should this legislation take the form of a
CIA retirement acts or an amendment to the Civil Service Retirbmeat Act?
(1) Basic to the proposal for new legislation which would
affect CIA must be the consideration of whether or not the new
legislation might in any way restrict the existing authority of
the DC'. Caution must be exercised to assure that what appears
to he a gain In benefits to CIA employees does not result in an
encumbrance on the Directercs powers.
(2) The advantages of proposed legislation in the form of a.
CIA retirement act ley in the fact that such an act would allow
for the internal administration of the system without reference
to the authority or review of the Civil Service Commission.
(3) The advantages of requesting amendment to the Civil
Service Retirement Lot vould lay in the fact that advantage
could be taken of the existing framework which could be modified
only to the extent which the Agency. desired. The individual
rechenics of such items as "annuities to survivors," "return of
deposits" "reduced annuities" would not have to be spelled out
is they would if an entire retirement system were adopted.
(4) The advantages of an amendment to the Civil Service
Retirement Act appear to outweigh those of a CIA retirement
act principally on the basis of simplicity of application.
e 577
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de What factors should be considered in computing retirement
benefits?
In pursuing the thought expressed in paragraph lib above that
compensation by way of retirement benefits for hazardous duty did not
appear to be feasible, it should not, therefore, be used in the compue
tatioe of retirement benefits? The following factors merit consideration
as the basis for computing retirement benefits:
(1) Total length of service?
(2) Length of service overseas.
(3) Length of service overseas at an unhealthful post or posts,
as designated by the President under the provisions of Section 853 of
the Foreign Service Act of 1946.
(4) Agee
What weight should be given to applicable factors?
(1)Obvious1y the details to which the mechanics of the
eicopted *yetis' should extend would depend on whether the legislae
tion would tab, the form of a CIA retirement act, or an admendment
ta the Civil Service Retirement Act? This discussion is not intended
to outline in detail all the provisions of a separate CIA system but
will eenflne itself to the suggested weights which might be applied
to the various factors which might effect retirement.
(2) If there is validity in the idea that certain CIA employees
mho are engaged in activities which require qualifications found to
A lesser degree in persons over 50, it woad seem that using the
miniseeevelvintary age of 60 (as prescribed by the Civil Servide Retire
-
meat Act) as a 'oasis, credit could he given on applicable factors
to progressively reduce this age requirement to a point not less than
age 55. Further, using the 30 year minimum length of service require-
ment or the Civil Service Retirement Act as a basis, credit could be
? Elven on applicable factors to reduce the requirement to 25 or even
;?0 years service., The following is a suggested table of weights to
thieve the above requirements:
For each year of service overseas 18 months
creditable service
For each year at an unhealthful poet -,2 years
creditable service
For each year of service overseas - 6 months credit
toward reducing the voluntary retirement age
For each year of service at an unhealthful post -
8 months credit toward reducing the voluntary
retirement age
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(3) The application of seta a table of w ights would result
In a much more conservative relerement system han enjoyed by
? either Foreign Service Officer: or federal per onnel engaged in
the investigation and apprehen: Len of criminal p e.g., FBI Agente6
5. CONCLUSIONS
a. Arguments establishing ju tification for,
merit system for CIA employees engag in certain te
sufficiently conclusive to warrant request for le
b. A liberalized retirement ystem as a mear
to CIA employees for unusual workine conditions is
that in acquiring such benefits the recipients are
in any way from receiving compensatery benef'ts whj
them for duty overseas?
liberalized retire-
es of activities tee
islation.
of compensation
'easible providing
Lot disqualified
;h now accrue to
The proposed legislation should take the ?7orn of a request to
amend the Civil Service Retirement Acte
de 'Hazardous duty" should not be considered in itself as a retiree
merit benefit factor but should be used in justifying the use of other
factors which might be more practically applicable, Ages, total length
of services, length of service oversease and length of service at an um-
healthful ;east should be considered as practical factors for computing
retirement benefits.
(00 Practical conservative weight standards can be applied to the
factors which might qualify CIA employees for special retirement benefits?
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JUSTIFICATION
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LIBERALIZED RETIREMENT FOR CIA PERSO
This is a request for appropriate legislation to authorize a more
equitable retirement plan for employees of the Central Intelligence Agency
who are required to perform their duties under circumstances considered in
many respects to be unique in the civilian Federal service.
This proposal was submitted to Mr. H. Eliot Kaplan, Chairman of the
Committee on Retirement Policy for Federal Personnel on 14 December 1953
for the consideration of that group.
This Agency has instituted a professional career service, which in-
volves, among other things, a concept that employees are required to serve
where and when they are needed in the best interest of Agency activities,
In performing their assigned duties many of these employees frequently
are subjected to conditions which differ markedly from those generally
typical of Federal employment. In the course of their careers with this
Agency many employees will serve overseas under various cover restrictions
which have an abnormal influence on their living habits. These individuals
are likely targets of forces inimical to the best interests of the United
States and are thus continually subject to potential hazard. In the event
of war or civil disturbance in their area of assignment, they becoae
immediately susceptible to attack or seizure. In addition to these general
hazards, many of the Agency employees are required to perform duties which
are hazardous in themselves. Also, certain of our personnel are required
to serve at unhealthful posts in the course of their career with the Agency,
The overseas activities of many CIA employees require a combination
of mentale physical and psychological characteristics which are found in
diminishing proportions as employees advance in age. This is particularly
true among employees who have been engaged in such activities for an
extended period of time. In order to permit an infusion into the organi-
zation of younger personnel who have the desired qualifications, and
also to permit the equitable separation of older personnel, the older
Agency employees should be permitted to retire at an earlier age than
would be possible under the current Civil Service Retirement Act, and
this retirement should be on the basis of full annuity. Retirement on a
full annuity basis is considered equitable since many of these individuals
would suffer financial hardship in converting to other employment,
considering the specialized nature of their official activities and the
limitations imposed on divulging any information pertaining to these
activities.
Accordingly, it is recommended that legislation be enacted to permit
the retirement of the personnel referred to above on full annuity at an
earlier age than is permitted under the existing Civil Service Retirement
Act. It is recommended that, within the general framework of the present
Civil Service Retirement Act, personnel serving under the conditions
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previously indicated receive extra service credits. Under the attached
proposal, an individual's age requirement for voluntary retirement would
be reduced by six months for each year of his overseas service. Moreover,
the age requirement for his volantary retirement would be reduced an
additional two months for each year of such service at an unhealthful
post. In computing years of creditable service for retirement purposesa
an employee would receive a credit of lr years for each Year of his overt.
seas service and an additional credit of * year for each year of such
service at an unhealthful post.
This request is consistent with the precedents established by the
Congress in authorizing liberalized retirement plane for certain other
groups having similar requirements within the Federal service. the
Congress his authorized liberalized retirement plans for Foreign Service
personnel and for personnel %dime duties involve the investigation,
apprehension or detention of persons suspected or convicted of offenses
againet the criminal laws of the United States. Under the Foreign Service
Act, Foreign :Service officers having twenty years of service who have
reached the age of fifty years are entitled to retirement. Such individuals
are also granted additional service credit for time spent at unhealthful
poste, Special retirement for investigative personnel is provided by the
Civil Service Retirement Act of 19300 as amended, which provides that such
personnel ma: retire at age 50 when they have rendered at least 20 years
of service. This Agency believes that a special retirement plan for
certain of our personnel is consistent with the intent of Congress as
expressed in the two pieces of legislation referred to.
Although the retirement plan proposed by this Agency is more liberal
than that presently authorized by the Civil Service Retirement Act, it is
less liberal than the retirement plans of the Foreign Service or of the
military services. Since a given employee in the course of his employment
with the Agency wouldserve overseas only a portion of his time, retirement
at an extremely early age would almost certainly be precluded.
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EXEMPTION MOM PERFORMANCE RATING ACT
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EXEMPTION OF CIA FROM PERFORMANCE RATING ACT OF 1950
The Performance Rat
former uniform efficient(
development of performer
the various departments
of regulations issued b:
thereto.
mg Act of 1950 (64 Stet, 1098) abolished the
7 rating system and established a program for the
Je rating plans to meet the particular needs of
and agencies within the framework of the Act and
the U, So Civil Service Commission pursuant
The Act provides fcr the evaluation of performance and the recognition
ofumerits of employees us a means of improving the effeetiveness of em-
ployee performance, strtagthening supervisor-employee relationships, and
of recognizing outatan&ing contributions by employees. While there is no
problem with respect to the intent cnd spirit of the Acts certain procedural
features are prejudicia: to the accomplishment of the mission of the Central
Intelligence Agency0 Ii the main, the points of difficulty involve require-
ments relating to exteri:ial review ird inspectiun which are incompatible
with the Agencyts praoVces and policies goverylng security of information
and protection of interl.gence sources and metedsl-
Discussions witi rppreeentatives of the U. S. ivi1 Service Comission
have indicated that AnLaistrative solutions to these problems are not
feasible since they eou:il hamper the Commissiones discharge of its responsi.
bilities as stated ia tA Act. Therefore, the Agency has developed, and
is presently using eA eci- experimental basis, a plan for the evaluation of
personnel which sati3fite the particular requirements of this organisation
and is consistent wILWn he main objectives of the Performance Rat4mg Act.
The cost of administering this plan has not exceeded the probable cost of
administering a performace rating plan in conformance with the procedural
requirements of the Act. On this basis, it is requested that appropriate
legislation be apprved which will exempt the CIA from the Performance
Rating Act.
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SPECIAL HOME LEAVE BENEFITS
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SECRE'r
PROVISION OF SPECIAL HONE LEAVE BENEFITS
Section 5(a)(3)(A) or the Central Intelligence Agency Act of 1949
(50 U.S.C. 403(a) et seq.) provides authority to pay travel and trans-
portation expenses to employees so they can take accrued annual leave at
their place of residence after an assignment to a. permanent duty station
outside the continental United States, its territories or posseesions,
subject to certain conditions. The purpose- of this leave is to enable
employees who have accepted tours of overseas duty an opportunity to
spend some time in this country at reasonable intervals. This leave time
is of advantage to the employee and to the Government since it permits
the employee to become re-oriented to the traditions and customs of
everyday living in this country and to reestablish family ties.
One of the eligibility conditions for such leave is that the employee
have to his credit sufficient annual leave to carry hii in a pay status
for 30 calendar days This requires a minimum of 22 days accrued annual
leave.. Prior to the enactment of the Annual and. Sick Leave Act of 1951
(5 U.S.C. 2062)0 Agency personnel accrued 26 days annual leave a year.
It could be assumed that an employee, without any accumulated leave based
on prior Federal service, would be able to use a reasonable amount of
annual leave and still carry a sufficient balance to be eligible for home
leave, Since some employees accrue only 13 days a year, whereas others
accres.20 and 26 days respectively, there is a considerable difference
In the amounts of leave that may be taken by employees while overseas
in view of the fact all must reserve sufficient leave (i.e. 22: days)
during the 2 year overseas period to qualify for leave in the U. S.
following overseas assignment. For example, a new employee who accrues
leave at a rate of 13 days per Year will have only four days annual
leave available for use during a two-year service period if he.must
reserve 22 days for home leave use. On the other hand, another employee
who has 15 years of prior Federal service will have 30 days of anneal
leave available for use during his overseas tour of two years.
Apart from such differences, limitation of annual leave to four
days during a two year period is not compatible withmodern personnel
management practices.which encourage periodic intervals of rest and.
relaxation,. An additional disadvantage of the situation is that the new
employee is aenied the opportunity to take advantage of his residence in
the overseas area by visiting points of interest during leave periods.
Such opportunities are frequently an. incentive to employees in accepting
Overseas assignments as well as being a6vantageous to the Agency in
broadening their horizons.
EMployees of this Agency accept a concept of career service which
requires willingnesi to serve wherever needed. They are in many cases
required to serve overseas tours comparable to these required of Foreign
Service personnel, The travel benefits granted under sec. 5.(a) of the
CIA Act are comparable to those provided by sec. 933 of the Foreign
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Service Act of 1946. However, the special statutory leave benefits that
are granted Foreign Service personnel by sec. 203(f) of the Annual and
Sick Leave Act of 1951 (i.e., one week for each four months of service
outside the United States) are not provided CIA personnel who accept assign-
ments entailing extended overseas service. This special statutory leave is
additional to normal annual and sick leave; and may be used only in
connection with leave following overseas service.,
A very rough estimate of the probable cost of granting this benefit
can be based on the number of employees currently serving overseas, usual
duration of overseas assignment and average salary rate. It is anticipated
that additional payments in connection with such statutory leave would
2 X1 approximatel per year.
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MISSING PERSONS LEGISLATION
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MISSING PERSONS LEGISLATION
The Missing Persons Act (P. L. 4900 77th Congress), as amended, which
authorizes heads of agencies to designate Federal civilian and military
personnel as nissing-in-action or dead and to continue their salaries,
allowances and allotments during a missing status, will expire 1 February
1954. Since this legislation is Of prine importance in supporting the
execution of this Agency's mission, the imminent expiration of the Act
presents a grave problem, Appropriate legislation is requested to alleviate
this situation.
The necessity for legislation which will provide this Agency with the
essential authorities it now has under the Missing Persons Act is inherent
in the employment or overseas personnel under conditions of strife among
nations, whether it be civil or military, localized or world-wide, sur-
reptitious or overt? The severity of the need varies with the world
situation ? During the time of war, for example, military personnel are
extensively and primarily concerned. Although missing-in-action cases
are fewer in number in peacetime, the present and prospective world tensions
presage the continued exposure for an indefinite period of civilian and
military personnel to possible apprehension by unfriendly forces. Central
Intelligence Agency-personnel are especially vulnerable to seizure by
hostile foreign. forces. This results in part from the necessity for over-
seas operations and in part from the nature of intelligence activities.
Personnel engaged in entelligence operations may be subjected to sinister
and ruthless action; in this sense, the risks assumed by certain Agency
employees are abnormal in relation to those experienced by other civilian
employees and by military personnel in time of peace.
Notwithstanding the magnitude of the problem at any given period,
permanent legislation appears warranted as long as there is any threat of
seizure of overseas personnel? Carrent legislation achieves two principal
purposes. First, adninistrative requirements are established for making
individual determinations of missing status or death, and, second, pro-
vision is made for the continuance or termination of compensation, allowances
and allotments, as appropriate, That an administrative determination should
be made of an individual's status - missing or dead - seems elemental; a
finding of status is necessary for various reasons such as the notification
of dependents and beneficiariess.and the settlement of unpaid compensation0
eoreover, various legal actions are dependent upon and emanate from a
determination of death, such as changes in marital status, payment of insurance,
settlement of estates and receipt of certain governmental benefits.
The Agency's career service is predicated upon the willingness of its
employees to accept an obligation to undertake any assignment at any location
in the interest of the United States? Acceptance of this eommitanent is
deemed essential to the Agency'a operetions even though it may require an
employee to assume assignments and risks which are personally undesirable.
The Agency recoenizes, however, that such stringent demands must be counter-
balanced by an assurance to its personnel that their dependents will have
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some protection against financia/ adversity in the event detention occurs9
and in the event of death that a prompt legal determination of death may
be effected. The Agency believes that overseas employees exposed to risk
regard the financial repercussions of their possible seizure as a matter
of paramount concern, Accordingly, the proper recruitment and utilization
of personnel and the maintenance of an Agency career service amply justify
the continuance in this Agency of the authorities which it now has under
the present Missing Persons Act, This Agency believes that its needs can
beet be met by permanent legislation.
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JOB SECURITY
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awn
JOB SECURITr AND REDUCTION IN FORCE
1. PROBLEM
To determine whether additional legislation is required by the
Agency with respect to establishing the job security of career employees
and to conducting necessary reductions in force.
2. ASSUMPTIONS
a. It is the Agency's objective to develop and maintain a group
of dedleated people who are carefully selected and progressively trained,
rho desire to devote themselves permanently to the needs of the intelligeree
service of the U. S. Government, who enjoy the satisfaction of a job well
done, who look forward to the emoluments and benefits appropriate to such
service, and *in have the expectancy of a permanent career in CIA.
b. Career employees of the Agency will not be affected by reductions
in force until all practicable reductions have been accopplished among
other categories of personnel.
c. Such external review of the Agency's personnel activities ea
would reveal intelligence mathode and sources is undesirable.
d. Tbe Director would use his authority under section 102(c) of the
National Security Act of 1947 to separate any employee when necessary to
avoid the risk of such outside review as would reveal intelligence soirees
and methods.
3. PACTS BEARING CO THE PROD=
a. The size of certain career orgenizations in the Federal structure
(for exapple, military services Foreign Service, and permanent civil
service employees) is periodically established by legislative limitations.
b. Agency Regulation paragraph 2a(1) states that "the size of
this career staff (i.e., the CIA career staff) viii be determined, by the
long range seeds of the Agency rather than by its more variable temporary
requirements.."
c. The provisions of the Veterans Preference Act and its implement-
ing procedures apply to personnel activities of the Agency.
d. The Director, has authority under section 102(c) of the National
Security Act of 1947 to separate any employee of the Agency yhan he
determines that such action is in the national interest.
h. DISCUSSION
a. job security has been considered to mean an employee's expectancy
of a long term career in the Agency. This expectancy should be limited
only by the possibility of:
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(1) Resignation or death of the individual;
(2) Failure on the part of the individual to net Agency
requirements for performance, conduct, security or health; or
(3) A necessary reduction in force.
The concept of job security is inconsistent with frequent fluctuations in
the size of a career group, since they in large part upon the extent
to which the size of that career group conforms to the long range reeds of
the organization at any given time.
b. Although the size of career organizations in the Federal
structure is sometimes established, by legislative action, such action
requires Congressional review of the meepower plans and requirements of
the organization and pesetas the possible introduction of political con-
siderations in such determinations. Further since any change in the
maximum limitation established by statute must be effected by amendment
of the statute, the heads of such career organizations have no latitude
with respect to increasing the stated limitation without submitting appro-
priate justification for Congressional review. The undesirability of stb-
uiitting manpower plans and requirements to Congressional and. public
scrutiny would seem to offset any advantage which might be gained through
the establishment of statutory ltmitations on the size of the Agency's
career staff.
c. The Agency's objective of retaining dedicated career employees
would not be served by policies which would retain any individual who Lacks
an active personal interest in an Agency career. Nor would this objective
be served if separations of career eeployees were arbitrary or frivolous.
The continued association of a career employee with the Agency is of advantage
both to the Agency and to the individual. A decision to terminate this
association should be of at least as great importance as a decision to
establish such a relationship. Therefore, it should be reached only after
careful consideration of all pertinent facts both by the Agency and by the
individual concerned. The decision to terminate a career employee should
be made by a central authority established to make such decisions or by the
Director. Under present Agency-practice, this central authority is carried
out by the Director in the exercise of his authority under section 102(c) of
P.L. 253 - 80th Congress and in cases within the scope of Executive Order
10450, and in all other cases by the Assistant Director (Personnel). All
decisions to terminate are made with consideration of the advice of appro-
priate Agency officials.
a. It follows that internal control is necessary to insure, at
the Agency level, that all pertinent facto have been impartially considered
before a decision to separate a career employee is made. It has been argued
that such controls are restrictive and burdensome to operating officials by
requiring them to justify their separation proposals to the satisfaction of
a central Agency authority. Nonetheless such controls are essential in a
career service. /t should not be "easy" to separate a career employee.
The Agency's policies and procedures for the separation of employees have
been consolidated and recently coordinated throughout the Agency. Although
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the right of veteran preference employees to appeal separations to the Civil
Service Conoission conflicts with the general principle expressed in
Aesumption 2e above, experience indicates that undesirable disclosure of
intelligence sources and methods can be avoided through exercise of the
Director's special authority. (See Annex A)
e. The special status accorded veteran preference employees in
reductions in force is in some conflict with a merit concept. (tee Annex W
f. It would be unsound for the Agency to propose legislation to
amend. the Veterans Preference Act as it relates to reduction in ferce,emi
eppeals for the following reasons:
(1) The limitations imposed by the Act do not seriously
interfere with Agency operations;
(2) It would be extremely difficult if not impossible, to
present Justification which would withstand public scrutiny without dis-
closure of clandestine activities; and,
(3) It is inpossible that any such request would be favorably
received in view of current political considerations as they might be
expected to influence the Administration, the Congress, and the public.
CONCLUSIONS
a. Legislative action to establish maximum limitations en the size
of the career staff is neither necessary nor desirable. Such limitations
should be administratively imposed by the Director.
? b. The Agency's Regulations governing separations are adequate
for all types of separetices except an extensive and general reduction in
force and do not require additional legislation for effective implementation.
c. The Agency should not seek legislative exception from the
Veterans Preference Act.
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ANNEX A
Outside Appeals
The Veterans Preference Act establishes the right of Agency employees
with veteran pre:erence to appeal separation actions to the U S. Civil
Service Commission. This right conflicts with the principle that external
review of the Agencyls personnel activities is undesirable. Although the
Directors special authority might be used to avoid the possiblity of
external review of all separation actions, it his been the practice of
the Director to employ this special authority ally in those cases involving
sensitive information and in certain cases involving personal misconduct
or indiscretion, It appears that this practice has been satisfactory in
avoiding undesirable disclosure of information through employee appeals
outside the Agency.
The Agency has not yet used general reduction in force procedures as
prescribed by the Veterans Preference Act, although it has encountered
reduction in force problems, some of them severe, in certain units,
Those separation cases which have offered the possibility of appeal to
the Civil Service Commission have involved consideration only of the
employee 's performance in his position or his conduct. Appeals from re-
duction in force actions are not concerned solely with a particular
individual but may involve information concerning other employees and a
range of Agency activities. Although selective use of the Directors
special authority, as described above, would solve the outside appeal
problem in reduction in force actions, the citation of this authority
might reflect unfavorable upon the individual so separated lieverthel ss,
it would seem that the need to protect sensitive information must be
given primary consideration.
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ANNEX B
Reduction in Force
The special statue accorded veteran preference employees in
reduction in force would be in some conflict with a merit system in
this Agency or in any other organization. However, it must be recoge
nized that veterans preference was given in recognition of the Nation 9a
obligation to these individuals, It was not designed to further the
effectiveness of Government operations. Briefly, the Veterans Preference
Act provides that individuals who have performed active military service
in certain emergency periods and certain members of their immedlate
families (widowea dependent mothers, or wives of seriously disabled
veterans) will be granted special consideration in reduction in force.
The rulings of the Civil Service Commission which administers the Act
have the force of law and are binding on CIA, This consideration extends
to a prohibition against the retention of a noneveteran preference employee
in any position for which the veteran preference employee is qualified,
unless it can be demonstrated to the satisfaction of the Civil Service
Commission that the retention of the non-veteran is justified on the basis
of the "efficiency of the service".
Reduetion in force regulations under the Veterans Preference Act
provide that employees will compete for retention within groups established
by the Agency in consideration of geographic and organizational factors as
well as by occupation and grade. The manner in which the Agency established
retention groups would be subject to review by the Civil Service Commission
in connection with its consideration of individual appeals?
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PERSONNEL. RESERVE
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PERSONNEL RESERVE FM THE CENTRAL INTELLIGENCE AGENCY
It PROBLEM
To examine factOra relative to the establishment of a Personnel Reserve
in the Central Intelligence Agency.
24 FACTS BEARING ON THE PROBLEM
a. Personnel reserve organizations have proved effective in augmenting
the Military, Public Health, and oreign Service by providing trained forces
immediately available during initial periods and for duration of a national
emergency.
?
1)6 To provide for an effective personnel reserve, itis essential that
an agency have prior claid to the services of the reservist,
ot training is an essential part of a reserve program,
d. Regular employment reinstatement rights should be available to, the
reservist to the maximum extent possible.
e. Remuneration of the reservist provides some incentive in any Mutual
agreement between a reseriiet and the active organization Of which he is a
part.
f. Sources for organization Of a CIA reserve can be found in employee
listings of predecessor organizations, separatees in good standing of this
Agency, and by direct recruitment.
3. DIscpssIoN
at The purpose of a CIA reserve is to provide a trained force of
individuale, whiah, added to the force in the regular career service will be
adequate to enable the Agency to perform its functions and duties during
initial stages of national emergencio
b. The CIA reserve should be composed of citizens of the United States
and of its territories and possessions who are physically and otherwise
qualified for performance of duty, and who, through aceeptince of a reserve
appointment, indicate their intent Whin called to serve the Agency during
any period of national emergency or War declared by th Congress Or the
President to exist, and to take such training duty as may be required.
C, Consideration of security clearances as a problemin administration
of a personnel reserve has developed that it is one largely of additional
cost due to an increase of the nudber of investigations that must be Made to
assure valid security clearances for each reservist eiriplayeen). Continuing
costs for this investigatory procedure are estimated in Annex B "Cost
Estimates Direct/7 Chargeable to Administration of a CIA Personnel Reserve".
Provipion Of an adequate otter and funds to process reserve clearances on an
annual or periodic bsis is the answer -to this problem.
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SEMET
d. Handling of security information in a reserve training p7cgram ,
at these= time, avoiding compromise of current operations while proVidag
material of value to the reservist and the Agency is interelocked with tbo
form and organization of the reserve training program., A first premise in
avoiding such compromise is that the reserve trainee should not be given
on-theejob type training in certain components of the Agency. In other
components, on-the-job training is clearly appropriete. Considering these
facts in a very general sense, a reserve training program appears entirely
feasible provided the reservists are handled on a scheduled basis in courses
Carefully controlled and approved as to course content. Annex C "Comments
on a Reserve Training Program! provides further amplification of this.
e. Assignments in this Agency for reservists of other services are a
problem which must be considered in the establishment of a CIA reserve.
This is considered essential in view of the many well-qualified reservists
of other services currently employed in the Agency or others who might be
interested in serving the Agency during a national emergency but who
probably could not be interested in a CIA reserve if required to give up
their Military or other reserve commission giving certain retirement behefitse
The assignment of reservists of ether services to this Agency is probably a
problem for negotiation in each case between the Agency and those services
in queetion, including reimbursement for all costa and salary incident to
maintenance, of a reservist contract.
fp Review of the sources for obtaining CIA reserve membership indicates
that there are an estimated cases of individuals who were employs
of predecessor. organizations, and an estimated _ cases of individuals
who have been separated from this Agency:Under-honorable conditions, Of
these cases, many may prefer to maintain reserve membership in other argani-
rations in order to preserve retirement benefits, etc.
go The major problem in? establishing a CIA reserve is to conclude
an agreement with the military services for deferment of Agency reservists in
the event of mobilizationeand for utilization during an emergency of Agency
reservists who are in uniform or the military reserves. It would be
premature to make final determinations on such facets of the program as
employee eligibility, term of service, type of training, compensation and
benefits, reinstatement ridhte etc., prior to the conclusion of a basic
agreement with the National Security Council or Department of Defense.
h. There would be no necessity for paying reservists except during
periods of active duty or training. During such periods, however, the
reservist would be, in fact, an employee of the Agency, and it follows
that the Agency has authority for the payment of the reservist's salary as
an Agency employee.
40 caNdusioNs
a. It is concluded that a personnel reserve organization is. desirable
in order to insure orderly and effective augmentation of the Agency during
initial perieds and duration of a national emergency.
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100 It is concluded that the Director of th Central 'Intelligence Agency
has authority under existing law to train reservists ca active duty and to
obligate funds for that training. No legislation is required for this
purpose.
c. Establishment of a prior claim by the Agency to a reservist em
ployeets services is largely a matter of mutual agreement between the
reservist, his employer, the military service where the individual is a
member of a reserve in that service, and the Agency.
d, .Maintenance of securityclearances on reservist employees
constitutes no problem Other than ipproval by appropriate authority of an
adequate staff and funds to care for the investigatory work which is
chargeable to maintenance of security clearances.
e0 that the Pirector of Central Intelligence discuss this proposal
with the National Security Council or the Secretary of Defense,
6
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ANNEX A
Excerpts from Statutes Providing for Employee Reinstatement
1. The Foreign Service Act of 1946 (PublicLat 724 iCo.),
ress
Sec. 528. Reinstatement of Reserve Officers
"Upon the termination of the assignment of a Reserve Officer assigned
from any Government agency, such person shall, be entitled to reinstatement
in the Government agency by which he is regularly employed in the same
position he occupied at the time of assignment, or in a cartes' onding or
higher position. Upon reinstatement he shall receive the within-grade
salary advancement he would have been entitled to receive had he remained
in the position in which he is regularly employed under subsection (d),,
section 7, of the Classification Act of 1923, as amended, or any corres-
ponding provision of law applicable to the position in which he is serving.
A certificate of the Secretary that such person has met the standards re-
quired for the efficient conduct of the work of the Foreign Service shall
satisfy any requirements as to the holding of minimum ratings as a pre-
requisite to the receipt of such salary advancements."
24 Coeet_Guard (Public Law 207, 81st Congress)
(Title 14, Part /I - Coast Guard Reserve and Auxiliary)
Sec. 761. Engaging in Civil Occupation: Leave and Training Duty
. . . .All members of the reserve who are in the employ of the
United States government or the District of Columbia who are ordered to
duty by proper authority shall, when relieved from duty, be restored to
the positions held by them when ordered to duty."
3. Selective Training & Service Act of 1940
(Ch. 720, 54 Stat. 885, as reported in U. S. Comp, 1946 Ed., Title 50)
Sec. 308 APP-
"a. Any person inducted into the land or naval forces under this act
for training and service, who, in the judgment of those in authority
completes his period of training and service shall be entitled to a
certificate to that effect . ."
' "b. In the case of any such person who, in order to perform such
training and service has left or leavesa position, other than a 'temporary
position in the employ of any employer and (1) who receives such certificate,
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(2) is qualified to perform, the duties of such position, and (3) makes pli-
cation for reemployment within 90 days after he is relieved from such training
and service or hogpitalization continuing after discharge for a period of not
more than one year -
(a) If such position vas in the employ of the U. S. governmen
its territories or possessions, or the District of ColuMbia? such
person shall be restored to such position or to a position of /41'e
seniority and pay;
(b) If such position was in the employ of a private egplogsr0
such epployer Shall restore such person to such position or to a
position of like seniority status and pay unless the employer's
circumstances have so changed as to make it impossible or unreasonable
to do so;
(c) If such position was in the employ of any state or political
subdivision thereof, it is hereby declared to be the sense of the
Congress that such person should be restored to such position of like
seniority, status and pay.
c. Any person who is restored to a position in accordance with the
provisions of Para (a) or (b) of sUbsection b. sh431 be considered se
having been on furlough or leave of absence during his period of training
and service in the land or naval forces, shall be so restored witholit loss
of seniority, Shall be entitled to participate in insurance or other
benefits offered by the employer pursuant to established rules and
practices relating to epployees on furlough or leave of absence in effect
with the employer at the time such person, was inducted into such forces,
and shall not be discharged from such position without cause within one
year after restoration.
* * * * * * * * *
NOW: Sec. 1 of the Ant of June 1946 provided "that all of the provisions
of the Selective Training and Service Art of 1940, as amended, are hereby
expressly reenacted, except those provisione which are hereinafter emended
or repealed (Sec. 3030 305, and 316 of U. S. Code 1946 Edition, Title 50,
WAR, Appendix). Sec., 308, above, therefore was reenacted in June 1946.
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ANNEXE
Cost Estimates Directly Chargeable to Administration
of a CIA Personnel Reserve
Annual Recurring Expenditure Estimate*
Item Cost Estimate Per Individual
I. Security Clearance, Annual
Recurring Cost, Estimate $100.00
2. Salaries** .(estimate based on
0541, $5,940 per annum)
15 dap! 6 $16.50 247.50
Per Dias Subsistence
15 days 0 49,00 135,00
4. Transportation
(Est based on round trip
? .
Chicago-Washington?
Round trip 1st, clG fare $75.38
Round trip Lower Birth 19,3.0 944
TOTAL (Est.) $576.98
Est. Costs chargeable directly to a reserve program. Substantial
additional costs would be incurred that are not directly charge-
able to a reserve program, such as the expenditures of the Train-
ing and Personnel Offices in administering the program,
** Est based on Public Law 351, Section 510, Career Compensation
Act of 1949
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ANNEX C
Comments on a Reserve Training Program
Review of factors affecting training under a reserve program
reveals that such a training program is feasible provided that it
is handled on a scheduled basis carefully aeministered am controlled
as to approved course content to insure:
1. That information provided for the reservist is of
value and controlled on a true need-to-know basis.
2e That reserve training operations be confined to
approved locations. ?
3. That any plans for active employment of the reservist
during training shall be controlled in a manner insuring against
unprofitable shopping around the Agency, a procedure providing
limited training for the reservist and of questionable value
to the Agency as regards security of operations.
Am example of profitable on-the-job reserve training can be
eitoi in the ease of a support function such as Communications
where it appears feasible and desirable that communications
reservists, after appropriate indoctrination, can participate in
actual communication problems simulating operations. This type
of on-the-job training is not limited to the reserve training period
but can be extended to communications operations problems on a
continuing basis where the reservist volunteers for such a program.
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IN ACT *TOripROVE AND STRENGTFEJ TEE ADMINISTRATION OF TIE
CENTRAL INTELLIGENCE AGMICT.n
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An Act
To improve and strengthen the administration of the Central intelligence Agency
Be it enacted by the Senate and Rouse of Representatives of the United States
ofjAmerica in Coegress assmibled.
Sec. 10 Sections 1 through 9 inclusive, of this Act may be cited as the
*Central Intelligence Agency Act of 1954."
Sec 0 2. The Congress hereby declares that the objectives of this Act are
to develop and strengthen the Central Intelligence Agency so as --
? (1) to foster and establish a Career Service comprising a group of
dedicated people, carefully selected and extensively trained who will
accept an obligation to devote themselves permanently to the needs of
the national intelligence effort of the United Statess
(2) to grant the personnel of such Agency emoluments and benefits ap-
propriate to a Career Service and to assure permanency of tenure during
good behavior and the performance of competent work;
(3) to preiide ieprovement in the recruitment, selection, and training
of the personnel of the Agency;
:_(4) to provide for promotions to positions of authority and responsi-
bility on the principle of merit and to insure selection of persons for
promotion on an impartial basis;
(5) to provide salaries, allowances and other benefits that will per.
mit the Agency to draw its personnel from all elements of American life.
Sec., I, Under such regulations as the head of the Agency may preecribes,
the Ageneye'with respect to its officers and employees assigned to overseas
duty outeide the continental United States, shall --
(1) Mmthe-event of illness or injury requiring hospitalization of an
officer or full-time employee of the Agency or a member of the family of
an officer or fulletimeemployee of the Agency, where such illness or
Injury is brought about by circumstandes directly related to the fact
of such officerts or employee es duties or place of duty, not the result
el:vicious habits, intemperance, Or misconduct on his pert, incurred
While on aseignment outside the continental United States or while
accompanying at Agency expense such officer or employee on assignment
outside the continental United States in a locality where there does
not exist a suitable hospital or clinic, my the travel expenses ok
such officer or empleyeee or member of the :matey of such officer or
employee by whatever means the head of the Armee' shall deem appropriate
and without regard to the Standardized Government Travel, Regulations and
section 10 of the Act of March 3, 1933 (47 Stet? 1516; 5 U.S.C. 73b),
to the nearest locality *here a suitable hospitaler'clinie eeists and
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on his recovery pay for the travel expenses Of his return to his post
of duty, if the officer or employee or member of hie family is too ill
to travel Unattended, the Director may also pay the travel expenses of
an attendant;
(2) Establish a first-aid station and provide for the services of a
nurse at a pest at which, in his opinion sufficient personnel is em,
paoyed to warrant such a station: PROVIDED, That, in his opinion, it
is not feasible to utilize an existing facility;
?
(3)- In the event of illness or injury requiring hospitalization of
an officer or PAL-time employee of the Agency, not the result of
Vicious habits, inteeperance, Or misconduct on his part, incurred in
the line of duty while on assignment outside the continental United
States* pay for the coat of the treatment of such illness or injury
at a suitable hospital or clinic;
(4) in the event of illness or injury requiring hospitalization of
the member of the famiiy of an officer or Mistime employee of the
Agency, not'the reedit of vicious hibit80 intemperance, or miseondact on
his part, incurred while accompanying at Agency expense such officer or
full-time employee on assignment outside the continental United States,
aM brought about by circumstances directly related to the fact of such
officers or employee's duties or place of duty, pay for the cost of the
treatment Of such illnese or injury at a suitable hospital or clinic;
PROVIDED, however that payments under this sebsection are continued ,
00iy for such period as the head of the Agency shall prescribe;
(5) provide for the periodic physical examination and for the cost
of administering innoeelations and vaccinations to officers and employees
'oe.membere of the family of such officers or eMployees who shell accompany.
at Agency expense such officer or employee on assignment outside the
Continental United States.
See. 4.
(1) Immediately upon official notification of the deaths not the re-
sat of his owe misconduct, or any- officer or employee of the Central
Wellies-nee Azigloy the head of the Agency shall cause to be paid to the
widow, Ind if there be no widow to the child or children, and if Clore be
no widow or child to any other dependent relative of such officer or
employee previously. designated by him, the sum of 310000, in addition to
math other benefit-8 as the dependents or the estate of the decedent mar
be entitled under any other provision of -law, The head of the Agency
shell establish regulations requiring each officer and employee having no
wife or child to designate the proper dependent relative to Aloe this
amount shall be paid in case of his death. '
(2) Said amount shall be paid from any funds appropriate to the
Aiemcy; PROVIDED, That noneof such funds shell be used for the payment
of such sum to any married child or unmarried child over twenty-one
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years of age of a ueceased officer or employee who is not actually e de
pendent of such deceased officer or employee, and PROVIDED FURTHER, That
in the event of the death of ay beneficiary before payment to and
collection by such beneficiary of the amount authorized herein, such
gratuity shall be paid to thc next living beneficiary in the order of
succession above eteted, and PROVIDED FURTHER, That if there be no eAdow,
child or previously designated dependent relative, the head of the Agency
shall cause the amount hereie provided to be peid to any grandchild,
parent, brother, sister, or orandparent shown to have been dependent upon
such officer or employee prier to his death.
(3) Such gratuity shall nA be subject to set-off, attachment, exe-
cution or other legal procese seeking to charge such gratuity with the
satisfaction of any indebtedness of the decedent.,
(4) The head of the Agenc?, shall have the right to determine cases of
alleged misconduct or dependency and make awards under this section, and
his determination of any eater pertaining to such award shall be final
and conclusive upon the accoenting officers of the Government,
Sec. 5, The Agency shall, under such regulations as the head of the Agency
may prescribe, pay an allowance to assist an officer or employee of the agency
at a permanent station outside the United States to provide for the elementary
and secondary educctioa of a minoe dependent accompanying such officer or
employee. Such allowance shall be dosigned to defray partially the excess
cost of .education of such minor dependents over the cost of education ,at public
schools for children in the United States based on cot factors in such loca-
tions as the head of the Agency deems appropriates- Such allowance may include.
tuition, board and room, correependence courses and related costs; and trans-
portation to and from the nearest loeality where a generally equivalent course
is available?:
Sec, 6, Any officer or empleyeo of the Central Intelligence Agency who
is eligiLle to receive a retirement annuity under the provieione of the Civil
Service Retirement Act (5 U.S.C. 691 et seq.) may, with the permission of tha
head of the Agency, be allowed the following extra-service credits in determin
ing years of service and retirement age:
(1) for each year of service abroad the officer or employee shall re-
ceive credit for one and ono half years of service under the Retirement
Act. For each year of service in places stated by the President to be
unhealthful in accordance with section 853 of the Foreign Service Acts
or other law, the officer ce employee shall receive credit for two years
of service.
(2) each year of service abroad shall lower the voluntary retirement
age six months provided, however, that voluntary retirement shall not be
allowed until such officer or employee shall have reached 55 years of
Age. Each year of service at an unhealthful post shall lower the
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voluntary retirement age eight months. Reduction for either cause shall
not reduce the amount of annuity received. Proportionate lowering of the
voluntary retirement age shall be allowed for fractional years of service.
. Sec. 7, Section 2(b) of the Performance Rating Act of 1950, 5 U.S.C.,
section 2001(b), is hereby amended by the addition of a new subparagraph (12)
thereto, as follows: "(12) Central Intelligence Agency"
Sec. 8. The Agency shall, under such regulations as the head of the
Agency may prescribe:
(1) Order to the United States or its territories and possessions on
leave provided for in subsection (2) of this section every officer and
employee of the Central Intelligence Agency who was a resident of the
United States or its territories and possessions at the time of employe
ment, Upon completion of two pate seriice abroad or as aeon as possible
thereafter.
(2) Grant leave of absence to etficers and eeployees of the Central
Intelligence Agency without regard to any other leave which may be
granted such officers and employees by any other act, for use in the
United States, its territories or possessions, at a rate equivalent to
one week for each four months of service outside the several States and
the District of Coluebia, Such leave may be accumulated for feture use
without regard to the limitations contained in any other law but no such
leave which is not used shall be made the basis for any terminal leave
or lump-sum paytent,
Sec. 9. Regardless of the feet that the Act of April ise 1953, ca7,0
section l(f), (67 Stat? 201, 50 App. U.S.C. 10014005) cited as the "Missing
Persons' Act" may expire, be repealed or otherwise terminate the provisions
of said act shall remain in full force and effect with regard to all officers
and employees of the Central Intelligence Agency. The head of the Agency
shall prescribe appropriate rules and regulations for the administration, de-
termination and other matters required thereunder.
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SPECIAL LEGISLt:TIVE LIAISON ?ROM=
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9 January 2994
MUM= FOR: Chairman, CIA Career Service Board
SUBJECT Special Legislative Liaison Problems in the Proposed
Career Service Legislation
le ln connection with proposed medical benefits there appears to
be no legislative liaison problem,
2, In caenection with proposed death gratuities there appears to
be no special legislative liaison problem.
3. In connection with proposed educational allowances, in view of
the fact that over-all Government legislation to solve this problem has
been considered for some period of time, it would appear doubtful whether
the Bureau of the Budget would permit CIA to seek its own legislation in
this field. In view of the large number of children of Government em-
ployees overseas who have not received these benefits in the absence of
general legislation, it is thought that such a proposal if submitted to
the Congress might face rough sledding&
4. In connection with proposed legislation for liberalized retire-
ment it is felt that the Bureau of the Budget would not approve separate
CIA legislation until the Government has adopted an over-all position
following submission of the report of the committee on retirement policy
for Federal personnel heeded by W.. H. Eliot Kaplan, This committee report
is due in the near future4 and I believe that it is acquainted with our
peculiar prdhlwa, As the Congress ilea an interest in this report it is
doubtful whether they would consider any specialized provision for CIA in
this field until study of the Kaplan Committee's recommendations has been
completed.
5. In connection with the proposed exemption of CIA from the
provisions of the Performance Rating Act of 19500 it is mr understanding
that a general study is in progress looking to the possible revamping of
the entire performance rating program for the Government. This being the
case the Bureau of the Budget may feel that it would not be appropriate
at this time to seek =exemption from the provisions of the Act. However,
insofar as the Congress is concerned, there appear to be no reasons why
CIA should not be exempted, and it is my belief that the climate would be
quite favorable for this proposal.
6. In connection with proposals for liberalized home leave it is
felt that there would be no legislative liaison problems in this
connection)
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70 in connection with proposed legislation concerned with missing
persons, the present Missing Persons Act expires on 1 February 1954, A
bill which will place Missing Persons legislation on a permanent basis,
rather than= a basis of period extensions, was forwarded several months
ago by the Department of Defense to the Bureau' of the Budget which has
so far decline4 to approve it. Regardless of exeautive action, the
House Armed Services Committee proposes to commence hearings on some form
of HU legislation on 12 January, in view of the political pressures which
would accrue shou/d the present extension expire without replacement
legislation on 1 February, The present thinking is that the House will
recommend a further extension of present legislation to 1 July 1955.
However, the present temporary extension was opposed in the Senate on
the basis of the reqeirement for permanent legislation,, and it is believed
that this oppoeition may become more vocal with the request for a renewed
extension, In view of those facts it is believed that CIA will be covered
on Hissing Persons legislation either by a temporary extension or by the
permanent legislation proposed by the Department of Defense. If however,
it appears that permanent legislation is net to be enacted, then C/A
should indicate to the Bureau of the Budget its concern with this problem,
and request either the authority to seek permanent MIA legislation of its
own or urge the Bureau to release the current proposals before it.1 In
either event, it is not believed that the problem is one which should be
met at this time by a CIA proposal for MIA legislation of its own.
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CONFIDENTIAL
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WALTER L. MOM :1' IMER
Legislative Counsel
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