United States General Accounting Office

GAO Report to the Chairman, Committee on

Veterans’ Affairs, House of

Representatives; and the Honorable

Tim Hutchinson, U.S. Senate

April 1998 VETERANS HEALTH

ADMINISTRATION

Performance and

Conduct Issues

Involving Senior

Managers at VA

Medical Centers

GAO/GGD-98-92

GAO United States

General Accounting Office

Washington, D.C. 20548

General Government Division

B-276217 

April 30, 1998

The Honorable Bob Stump

Chairman, Committee on Veterans’ Affairs

House of Representatives

The Honorable Tim Hutchinson

United States Senate

This report was prepared in response to your requests that we undertake a

study of how the Department of Veterans Affairs (VA) manages the

performance of senior executives and deals with instances of poor

performance and misconduct. As agreed, we focused on the operations of

one component of VA, the Veterans Health Administration (VHA), during

fiscal years 1994 through 1996. Our objectives were to determine the

following:

• How was the VHA performance management system identifying and dealing

with poor and marginal performers at the senior management levels of

medical center director, associate or assistant director, and chief of staff?

• What effects, if any, have changes in organizational structure, policies, and

procedures instituted by VHA in fiscal year 1996 had on its ability to identify

and deal with poor and marginal performers?

• How was VHA identifying and dealing with instances of misconduct at the

senior management levels of medical center director, associate or

assistant director, and chief of staff?

Background VHA, with a fiscal year 1998 budget of over $18.5 billion and a workforce of

about 190,000 employees, is charged with providing health care to the

nation’s veterans and operates an integrated health care system that

includes medical centers, outpatient clinics, nursing homes, and

counseling centers. In October 1995, the House Committee on Veterans’

Affairs held a hearing on issues related to the management of VA’s health

care system. The hearing raised concerns about how VHA manages the

performance of its senior executives and deals with instances of poor

performance and misconduct, particularly at the 173 medical centers.

In October 1995, VHA implemented a major restructuring designed to

address problems in operational efficiency, accountability, and the

provision of quality health care. A significant component of that

restructuring was the realignment of VHA’s management and field structure

from 4 regional offices, each headed by a regional director who supervised

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B-276217 

the operation of 36 to 45 medical care facilities in his or her region, to 22

regional Veterans Integrated Service Networks. VHA designed the networks

so that each, headed by a network director, is intended to coordinate the

organization of various medical facilities in order to improve the efficiency

of medical care provided to veterans in a geographic region.

Typically, a medical center director, an associate or assistant director, and

a chief of staff (collectively the “management triad”) have senior

management responsibilities at each medical center. Medical center

directors and network directors are senior executives who are appointed

under either the Senior Executive Service (SES) or the Title 38 personnel

system.1

 Associate and assistant medical center directors are general

schedule (GS) employees in grades 13 through 15. Chiefs of staff are

appointed under Title 38. For purposes of this report, we referred to chiefs

of staff as SES equivalents because of the breadth of their responsibilities

and total pay.

The appraisal systems governing the job-related performance of members

of the management triads provide for an annual summary rating of one of

five levels: Outstanding, Excellent, Fully Successful, Minimally

Satisfactory, and Unsatisfactory. For the purposes of this report, we

defined “poor or marginal performers” as those employees who, in the

network directors’ view, performed at the Minimally Satisfactory or

Unsatisfactory levels, whether or not they actually received such

performance appraisal ratings. The appraisal systems also have provisions

for managers to assist employees in improving their performance and to

take formal, performance-based actions, such as demotions and removals,

when their performance is rated less than Fully Successful.

Like all VA employees, management triad members are expected to

maintain high standards of conduct. Instances of misconduct, which we

define as actions that would violate statutes, regulations, or VA policies,

are subject to a departmental process of investigation and discipline

calibrated to the offense. Misconduct includes, but is not limited to, such

actions as misuse of government property, sexual harassment, and

violations of travel regulations.

Results in Brief None of the 477 management triad members received a performance

appraisal of less than Fully Successful during the 1994 through 1996 rating

1

The Title 38 personnel system, created under the Act of January 3, 1946, 59 Stat. 677, as amended,

governs VA’s health care workers in such occupations as physician, dentist, and nurse.

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B-276217 

periods. This is not much different from how other executive agencies

rated their senior management employees during this 3-year period. Office

of Personnel Management (OPM) data showed that during this same period,

about one-tenth of 1 percent of an average of 5,066 senior executives

received a rating of less than Fully Successful. The OPM data also showed

that of an average of 126 employees in other executive agencies who were

in positions comparable to the associate and assistant medical center

directors, about eight-tenths of 1 percent received a less than Fully

Successful rating.

The network directors acknowledged in interviews, however, that the

record of the performance appraisals did not capture the actual

performance of all the management triad members. Two-thirds of the

network directors reported they had considered at least one member of

the management triads within their networks a poor or marginal

performer at some time during the period. The aggregate number of poor

or marginal performers reported by the network directors was 37. Various

information VHA headquarters provided showed that the performance of an

additional 10 triad members was considered to be marginal or poor some

time during the 3-year period. Thus, 47 (or 10 percent) of the 477 triad

members were viewed as performing at a less than Fully Successful level

at some time during this period. Over half of the network directors

believed that the number of poor or marginally performing triad members

within VHA over the fiscal year 1994 through 1996 period was relatively

small overall. They attributed this to VA’s selection process, which, in their

view, weeds out the poor performers before they reach the senior

executive level.

Most network directors agreed that they did not identify poor or marginal

performance in the performance appraisals, because those ratings

necessitate formal actions to remedy performance problems. The network

directors perceived those actions as time-consuming and distracting,

burdensome, and unlikely to produce a desired result. Most network

directors believed that formal actions based on an official performance

appraisal of less than Fully Successful created an adversarial and

unproductive relationship between management and the employee and

were unlikely to either improve performance or lead to removal. However,

because the network directors and other VHA senior managers had not

given the triad members an official rating that identified their performance

as poor or marginal, it would have been difficult for them to take formal,

performance-based actions against the employees.

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B-276217 

Although network directors did not use formal means to deal with poor or

marginal performers, they said they effectively managed poor performers

through informal means.2

 These informal measures, they said, included

informal counseling, reassigning a triad member to a position more suited

to an individual’s talents (without officially noting that the reassignment

was related to poor performance), and circumspectly encouraging the

individual to retire or resign. Almost all of the network directors agreed

that informal means of managing performance at the triad level were

effective means for dealing with poor or marginal performers. Almost all

of the network directors also stated that passing along poor performers to

unwitting colleagues is not now used as a technique for managing poor

performers, although they said it was formerly done under the regional

structure that existed prior to October 1995.

The network directors’ propensity to use informal, rather than formal,

means to address performance problems is not unique to them. Prior

studies by GAO and the Merit Systems Protection Board (MSPB) have shown

that managers and supervisors governmentwide have avoided taking

formal actions against less than satisfactory performers for some of the

very same reasons cited by the network directors. In its oversight capacity

for federal personnel issues, OPM has included in its strategic plan for fiscal

years 1997 through 2002 efforts to improve the capacity of managers to

identify and resolve performance problems.

The network directors were nearly unanimous in asserting that the

changes VHA recently implemented, particularly the reduction in the

number of triad members for whom they were responsible, were helping

them to identify and deal with poor performance. They also generally

agreed that VHA’s new, more quantifiable performance measures were

having, or would likely have, a positive effect on assessment and

management of performance at the triad level.

Most network directors did not consider misconduct to be a widespread

problem among management triad officials, although they did

acknowledge that instances of misconduct by employees at that level had

occurred. Departmental records showed 14 substantiated cases of

misconduct by triad members during fiscal years 1994 through 1996. In 6

of the 14 cases, VHA took disciplinary action, which ranged from a letter of

2

For purposes of this report, we defined formal means as performance-based adverse actions, such as

demotions or removals, that are taken on the basis of an official rating of less than Fully Successful.

We defined informal means as actions that are taken on the basis of an employee voluntarily agreeing

to them following management’s informal assessment of, rather than an official rating of, his or her

performance as poor or marginal.

Page 4 GAO/GGD-98-92 VHA’s Handling of Performance and Conduct Issues
B-276217 

admonishment to a demotion. For the remaining eight cases, no

disciplinary actions were taken. Rather, the employees either retired,

resigned, or were counseled.

The disciplinary actions that VHA took to address the misconduct created

some controversy that primarily revolved around one sexual harassment

case. The controversy about how VHA handled this case as well as

concerns about the effectiveness of VA’s “zero tolerance” policy for sexual

harassment and employment discrimination led to administrative and

statutory changes. In March 1997, VA changed its policy and procedures for

handling and resolving misconduct that involves senior VA officials. This

new policy required that a panel of senior VA executives would be

responsible for ensuring departmentwide consistency in dealing with

allegations of misconduct. Also, legislation was enacted in November 1997

that established a new process and structure for investigating and

resolving employment discrimination complaints. Under this legislation, VA

is planning to change the procedure for investigating allegations of

discrimination and sexual harassment.

Scope and

Methodology

To meet our objective of determining how VHA was identifying and dealing

with poor and marginal performers at the triad level, we analyzed data

obtained from VHA’s Management and Administrative Support Office on

performance ratings, reassignments, and other performance-related

actions. We did not verify the accuracy or completeness of these data, but

we did follow up on the readily apparent omissions and inconsistencies we

found in the data provided on ratings and other performance-related

actions.

Because VHA rating data indicated that no triad members received an

official summary appraisal rating of less than Fully Successful during the

1994 through 1996 rating periods, we interviewed the 21 VHA network

directors who were in their positions when we did the interviews during

April to July 1997. Although VHA has 22 networks, we were able to

interview only 21 of the 22 directors of these networks, because 1 had

resigned from VA at the time we began our interviews in April. We did

face-to-face interviews with 19 of the 21 network directors. For the

remaining two directors, we did a teleconference with one and a

videoconference with the other.

We interviewed the network directors because they are directly

responsible for rating and managing the medical center directors’

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B-276217 

performance and are expected to be knowledgeable about, and ultimately

responsible for, the ratings and performance of the associate and assistant

medical center directors and chiefs of staff. Our purpose in interviewing

the network directors was to (1) determine whether they believed some

triad members were not performing to the Fully Successful level, despite

what their official ratings showed; (2) identify what actions, if any, were

taken to deal with the triad members whom they believed performed at a

less than Fully Successful level; and (3) get their views on the

effectiveness of the actions in dealing with the performance problems. We

did not interview affected employees or representatives of VHA employee

organizations. Consequently, we do not know whether their views on the

effectiveness of the actions for dealing with poor or marginal performance

would be similar to or different from the views expressed by the network

directors.

To facilitate the network directors being open and candid with us, we

asked them to identify individuals, by position rather than by name, in

their own networks whom they believed were poor or marginal

performers, despite what the official ratings showed for 1994 through

1996. We also agreed to report the information that the network directors

shared with us in a manner that would not identify them or their network.

On the basis of the views expressed by the network directors during the

interviews, we developed our definition of poor or marginal performers.

To confirm our understanding of and obtain a consensus of the opinions

expressed during the interviews, we sent a survey instrument to the

network directors in July 1997 that summarized various opinions we had

discerned in the interviews. All 21 network directors responded to the

survey. We asked them if they agreed or disagreed with the 57 opinions or

had “no basis” for comment because they either had no knowledge of the

particular matter addressed in the opinion or believed they had not

worked long enough at VHA to comment. We excluded the “no basis”

responses in reporting the survey results, because we wanted to report the

opinions of only network directors who had a basis for either agreeing or

disagreeing with the opinions. We also excluded the “no responses” in

order to use a more precise respondent base in reporting the survey

results. The number of network directors who indicated “no basis”

responses and “no responses” varied. For example, the number of network

directors who indicated “no basis” ranged from no directors on 6 opinions

to 10 directors on 1 opinion. Five network directors did not respond to 19

of the opinions. The average number of “no basis” and “no responses” was

about four network directors per opinion.

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B-276217 

We also interviewed personnel officials in VHA’s Management and

Administrative Support Office; VHA’s former Chief Network Officer, who

was responsible for rating and managing the performance of the network

directors; and officials at OPM who oversee agencies’ operation of the SES

program. The purpose of the interviews with VHA officials was to

corroborate the information provided by the network directors and to

gather additional information about the number and management of poor

and marginal performers at the management triad level the official record

did not reflect, because the network directors were relatively new to their

positions. At the time of our interviews with the network directors, nearly

all of them had been in their positions 18 months. The purpose of our

interviews with OPM officials was to help us determine whether actions

taken by VHA to deal with poor or marginal performers were consistent

with regulatory and statutory requirements. We did not attempt to judge

the merits of the specific informal, performance-based actions taken.

We asked officials of VHA’s Management and Administrative Support Office

to confirm that the triad members whom the network directors identified

to us by position and whom they believed were poor or marginal

performers occupied those positions. We also asked them to provide

information, if any, on other triad members not identified by the network

directors who performed at a less than Fully Successful level at some

point during fiscal years 1994 through 1996. VHA provided various

documents that contained data on reassignments and other actions taken

to address performance-related problems of triad members who had not

been identified by the network directors.

We also followed up on the informal, performance-based actions that VHA

took during fiscal years 1994 through 1996 to deal with triad members

who, according to the network directors’ views and data provided by VHA’s

Management and Administrative Support Office, had been informally

judged to be performing at a less than Fully Successful level. We did so by

reviewing official personnel and employee performance files and

collecting data from VHA’s Management and Administrative Support Office

to determine whether (1) the less-than-satisfactory performers had been

subjects of other informal actions or formal, performance-based actions as

triad members during the 5-year period ending September 30, 1996; and

(2) inconsistent personnel actions had occurred, such as

less-than-satisfactory performers receiving performance awards in the

same year that informal actions had been taken to deal with their

performance.

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B-276217 

To meet our second objective of determining the effects, if any, of changes

in organizational structure, policies, and procedures recently instituted by

VHA on managing performance at the triad level, we interviewed personnel

officials in VA’s Office of Human Resources Management (OHRM) and VHA’s

Management and Administrative Support Office to identify the changes.

We also reviewed various VHA documents to confirm that the recent

changes had been implemented. These documents included samples of the

network directors’ performance plans that contained new performance

measures and directories and organization charts of VHA’s restructured

field facilities. Finally, we asked the network directors for their views on

the effects of these changes during our interviews and in our follow-up

survey with them. We did not do an independent assessment of the effects

of the changes.

To meet the third objective of determining how VHA was identifying and

dealing with instances of misconduct at the triad level, we reviewed VA and

VHA manuals that (1) detail the policy and procedures that managers are

required to follow in cases of alleged misconduct and (2) specify in a table

of penalties the range of penalties available for specific types of

misconduct. We analyzed data on the number, nature, and disposition of

misconduct cases addressed in fiscal years 1994 through 1996, which we

obtained from the records of VA’s Office of Inspector General (OIG), Office

of Equal Opportunity (OEO), and OHRM. We also interviewed officials from

these three organizations to clarify our understanding of the data provided

and to obtain their insights regarding VHA’s practices in dealing with

offenses of misconduct. We obtained the perspectives of the network

directors on how misconduct was identified and dealt with at the triad

level during our interviews and in a follow-up survey with them.

We were not able to determine whether the number and types of

misconduct complaints VHA received and substantiated involving its triad

members were comparable governmentwide, because OPM’s Central

Personnel Data File (CPDF) does not contain a record of misconduct

complaints. Misconduct complaints are not contained in the CPDF, because

they are not personnel actions.

We compared the range of penalties available at VA for handling instances

of misconduct with the range of penalties available at two judgmentally

selected executive agencies—the Department of Commerce and the

Department of Agriculture—because a governmentwide table of penalties

does not exist. The number of executive branch agencies precluded us

from doing a detailed comparison of the tables of penalties available at all

Page 8 GAO/GGD-98-92 VHA’s Handling of Performance and Conduct Issues
B-276217 

of them. For that reason, we chose two large federal agencies to serve as

points of comparison with VA and to provide a general illustration of the

penalties that other government agencies use to address misconduct.

A draft of this report was given to the Acting Secretary of VA and the

Director of OPM for their review and comment. On March 31, 1998,

designees of the Acting Secretary of VA, which included the director of

VHA’s Management and Administrative Support Office and several VA

officials from various offices, such as the Office of the Assistant Secretary

for Human Resources and Administration and OIG, provided us with oral

comments. Their comments are discussed on page 36. The Director of OPM

provided us written comments on a draft of this report in a letter dated

April 6, 1998. These comments are also discussed on page 36 and are

reprinted in appendix I.

We did our work in Washington, D.C., from March 1997 to January 1998 in

accordance with generally accepted government auditing standards.

Managers Said They

Used Informal Rather

Than Formal Means to

Deal With Poor or

Marginal Performers

VHA’s network directors did not use certain aspects of the formal

performance management system to identify and deal with triad members

whom they believed performed poorly or marginally. This is partially

supported by the fact that rating data for the 3-year period ending

September 30, 1996, showed that no triad members received a less than

Fully Successful rating. The majority of the triad members received ratings

of Outstanding or Excellent during 1994 through 1996. Consequently, VHA

could not take any formal, performance-based actions on the basis of the

triad members’ official performance ratings. The network directors cited

several reasons, such as organizational culture and systemic problems, for

not using the official performance appraisal and other formal means to

identify and deal with less-than-satisfactory performers. Nevertheless, the

network directors said they took actions to deal with triad members whom

they believed performed poorly or marginally. According to the network

directors, they used informal, rather than formal, means to deal with poor

or marginal performers because they believed the informal means were

effective, less time consuming, and less administratively burdensome.

The network directors’ avoidance of the formal system to address less

than Fully Successful performance is not unique to them. Prior to passage

of the Civil Service Reform Act (Reform Act) (P. L. 95-454, Oct. 13, 1978), it

was recognized that managers rarely gave unsatisfactory ratings, because

the follow-on actions for dealing with unsatisfactory performance were

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B-276217 

viewed as time-consuming and expensive. We reported in 1990 that

governmentwide, poor performers were not necessarily documented

through the appraisal process and that supervisors were unwilling to use

the formal process to deal with them.3 MSPB reported in 1995 and 1997 that

supervisors perceived disincentives to using the formal system to deal

with performance problems.4

 For example, MSPB reported that supervisors

were discouraged from taking formal actions against employees who

performed at an unacceptable level, because they perceived the process

for doing so as too complicated, time consuming, or onerous.

The Reform Act revised the procedures for taking actions against poor

performers to make it easier for managers to do so. However, the results

of this study and our 1990 study and of recent MSPB studies indicate that

managers perceive that this goal has not been achieved.

Formal Performance

Management System Was

Not Used to Identify and

Deal With Poor Performers

Our review of VHA performance appraisal data revealed that none of the

477 management triad members received a rating lower than Fully

Successful during the 1994 through 1996 rating periods. However, in

responding to our survey, 20 of the network directors agreed (and 1

disagreed) that VHA had some poor or marginal performers within the

management triads during that 3-year period. Fourteen of the 21 network

directors said they had poor or marginal performers in their networks. The

aggregate number of poor or marginal performers, according to the

network directors, was 37. Also, VHA headquarters provided various

documents, compiled in response to requests from us and from Senate and

House congressional staff, that identified an additional 10 triad members

whose performance was considered to be less than Fully Successful at

some point during the 3-year period. Thus, VHA considered that 47 (or

10 percent) of the VHA management triad members performed below the

Fully Successful level at some point during the 3-year period. According to

the network directors and documents provided by VHA headquarters, the

actions taken to address the performance-related problems of these 47

triad members included demotion, reassignment, and placement on a

performance improvement plan (PIP).

The fact that VHA officials did not rate any of their triad members as less

than Fully Successful is not much different from what occurs

governmentwide and in VA as a whole. Very few senior executives

3

Performance Management: How Well Is the Government Dealing With Poor Performers?

(GAO/GGD-91-7, Oct. 2, 1990).

4

Adherence to the Merit Principles in the Workplace: Federal Employees’ Views, MSPB,

September 1997; and Removing Poor Performers in the Federal Service, MSPB, September 1995.

Page 10 GAO/GGD-98-92 VHA’s Handling of Performance and Conduct Issues
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governmentwide received ratings of less than Fully Successful, according

to data from OPM’s Executive Information System. The data showed that

for the 1994 and 1995 rating periods, which ended September 30, eight

senior executives each year received a rating of Unsatisfactory or

Minimally Satisfactory. For the fiscal year 1996 rating period, five senior

executives received a rating of less than Fully Successful. The number of

executives who received a rating of less than Fully Successful during the

3-year period represented about one-tenth of 1 percent of an average of

5,0665

 senior executives rated during that period. OPM’s executive database

system also showed that no senior executives in VA received a rating of

Unsatisfactory or Minimally Satisfactory during the 3-year period. Data

from OPM’s CPDF showed that of an average of 126 employees in other

executive agencies who were in the same job series and grades as VHA’s

associate and assistant medical center directors, 1 employee (or

eight-tenths of 1 percent) received a rating of less than Fully Successful

during the 3-year period.

Also, the distribution of VHA’s ratings for its triad members at and above

the Fully Successful level during the same 3-year period did not differ

greatly from what occurred elsewhere in the government and in VA as a

whole. VHA rating data showed that from 75 percent to 85 percent of the

triad members were rated either Outstanding or Excellent during the

3-year period; 15 to 25 percent were rated Fully Successful. OPM’s data

showed that for this same period, 91 percent of an average of 5,066 senior

executives received either an Outstanding or Excellent rating, and about

9 percent received a Fully Successful rating. OPM’s data also showed that of

an average of 288 VA senior executives rated during the 3-year period,

83 percent received ratings of Outstanding or Excellent. Of an average of

126 employees in other executive agencies who were in positions

comparable to VHA’s associate and assistant medical center directors, OPM

data showed that 85 percent of these employees received a rating above

the Fully Successful level during 1994 through 1996.

According to the network directors, informal means were used to deal

with poor or marginal performers after holding frank, but generally

undocumented, discussions with the employees. In responding to our

survey, the majority of the network directors agreed that the following

four informal means had been used at VHA, and about one-third to one-half

5

This figure excludes an average of 1,235 senior executives in agencies with a three-level rating system

who received a Fully Successful rating during fiscal years 1994 through 1996. We excluded these

executives from our comparison, because VHA’s senior executives are rated under a five-level rating

system. According to an OPM official, the three rating levels consist of Unsatisfactory, Minimally

Satisfactory, and Fully Successful. He cited the Department of Defense as an example of an agency

with a three-level rating system.

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of them also indicated that they had used these informal means within

their networks to deal with poor or marginally performing triad members:

• reassigning an individual to a position more suitable to his or her skills,

• encouraging an employee to retire if eligible,

• encouraging an employee to accept another position (sometimes as part of

a negotiated settlement), and

• using the opportunity of organizational consolidations to leave a poor or

marginal performer out of the new structure.

Other informal means that some network directors noted in the interviews

included informally assigning a mentor to a struggling employee, detailing

the employee to another position, and deferring a rating while the

employee completed a PIP. However, in their responses to our survey,

network directors said that one informal means that is not used is the

passing along of poor performers to unwitting colleagues. The network

directors were nearly uniform in stating that this method, although used in

the past, was not now an option. Most network directors agreed that they

now have an understanding among themselves that they will not pass

marginal or poor performers to one another without first discussing the

reasons and circumstances.

Data provided by VHA headquarters officials confirmed that the types of

informal actions identified by the network directors and earlier defined in

this report had been taken with respect to triad members. The data VHA

provided also identified action plans as a means for dealing with poor or

marginally performing triad members. The action plans were designed to

ensure that triad members implemented recommendations made as a

result of reviews of their management of the medical centers.

In total, the VHA data showed a record of 7 types of actions taken with

respect to 29 of the 47 triad members identified by the network directors

and VHA headquarters records. The VHA data did not show a record of

actions (such as assignment of a mentor) that the network directors said

were taken to deal with the performance of the remaining 18 triad

members. For 11 of the 29 triad members, informal actions were initiated

to address their performance problems after September 30, 1996, the end

of our review period. According to our interviews with the network

directors and data obtained from VHA’s Management and Administrative

Support Office, the performance of the 11 triad members was considered

poor or marginal at some point during fiscal years 1994 through 1996;

however, the informal actions were initiated after September 30, 1996.

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For 19 of the 29 triad members, VHA took only 1 type of action; for 10 triad

members, VHA took 2 types of actions. Table 1 shows the types of actions

taken with respect to the 19 triad members.

Table 1: Actions Taken to Address

Performance Problems of 19 Triad

Members

Type of action Number of triad members

Reassigned 4

Demoted 5

Placed on a PIPa 4

Deferred rating while negotiating actions to address

the performance problem 0

Detailed to other positions or duties 1

Retired voluntarily following performance counseling 5

Placed on an action plan 0

Total 19

aThree of the four triad members were not rated at the end of the appraisal cycle. Instead, their

rating periods were extended until they completed a PIP. The rating period for the remaining triad

member was not extended. He was placed on a PIP before the appraisal cycle ended and rated

at the end of it.

Source: GAO’s analysis of data provided by VHA’s Management and Administrative Support

Office.

Of the remaining 10 triad members for whom 2 actions were taken, 5 were

initially detailed and later retired or were reassigned, demoted, or placed

on an action plan. For 4 of the 10, the rating periods were deferred or

extended, and they later resigned or were demoted or reassigned. The

remaining triad member was demoted and later voluntarily decided to

retire.

Of the four triad members whose rating periods were deferred, none

received a formal performance appraisal for the rating period that had

been deferred. One of the four triad members resigned from his position.

According to a VHA Management and Administrative Support Office

official, one of the remaining three triad members should have received a

rating but apparently did not because of an administrative oversight. This

official also said that the remaining two triad members were not rated,

because there was no practical point in doing so once they had agreed to

removal from their positions.

We followed up on the 29 triad members (15 medical center directors, 5

associate directors, and 9 chiefs of staff) who had been subjected to these

informal actions to determine if (1) they had been subjected to any other

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informal actions or any formal, performance-based actions during the

5-year period ending September 30, 1996; and (2) any apparently

inconsistent personnel actions had occurred, such as a triad member

receiving a performance-based award in the same year that the informal

action was taken.

In our review of the official personnel and performance files on the 15

medical center directors, we found that 1 of the 15 medical center

directors had been subjected to another performance-based action during

the 5-year period. After receiving performance counseling, the medical

center director was placed on a PIP during the fiscal year 1993 rating

period. For the remaining 14 medical center directors, the files did not

contain evidence of informal or formal actions being taken or proposed to

address performance problems from October 1, 1991, to September 30,

1996.

For the remaining 14 triad members (the 5 associate directors and 9 chiefs

of staff), data provided by VHA’s Management and Administrative Support

Office did not indicate that any of the 14 had been subjected to other

informal actions or to formal, performance-based actions during the 5-year

period that ended September 30, 1996. However, data provided by VHA’s

Management and Administrative Support Office showed that since

September 30, 1996, one of the nine chiefs of staff has been subjected to a

formal, performance-based action. The chief of staff was placed on a PIP

and subsequently given a Minimally Satisfactory rating for the 1997 rating

period. The VHA data also showed that the chief of staff was removed and

downgraded from the position effective January 18, 1998.

None of the 15 medical center directors received a performance award or

a pay advancement in the year that informal action was taken. Also, none

of the nine associate directors received a performance award in the same

year that informal actions were taken. According to VHA officials, chiefs of

staff do not receive performance awards because they receive special pay.

Most Network Directors

Viewed Informal Means as

Effective for Dealing With

Poor and Marginal

Performers

During the interviews and follow-up survey with the network directors,

they gave several reasons for avoiding rating triad members as less than

Fully Successful and avoiding taking formal actions to remedy

performance problems. The network directors described numerous

instances during our interviews in which they had undertaken informal

measures to improve poor performance. In responding to our survey, 15

network directors agreed (and 1 disagreed) with the opinion that informal

Page 14 GAO/GGD-98-92 VHA’s Handling of Performance and Conduct Issues
B-276217 

means are more effective than formal means for dealing with poor or

marginal performers. They also generally agreed with the opinion that

informal means of dealing with performance problems were less

adversarial (14 agreed and 4 disagreed) and less administratively

burdensome than the formal means (18 agreed and 1 disagreed).

Among the reasons cited by the network directors during the interviews

for avoiding rating triad members as less than Fully Successful were the

following:

• Three network directors said that it was especially difficult to lower a

rating when the performance level had not changed and the adjustment

was solely to correct the general problem of rating inflation that exists at

the triad level in VHA. Another network director added that a factor

contributing to rating inflation is that an individual’s prior performance

rating greatly influenced his or her current year’s rating.

• A rating of less than Fully Successful requires that a formal remedial

action be taken; when a formal action is invoked, it turns the problem into

a dispute, according to six other network directors. Three of these six

network directors also said that employees view ratings of less than Fully

Successful and evidence in the personnel file of formal,

performance-based actions as serious matters worth fighting. Thus, the

directors were reluctant to give marginal and poor performance ratings

and take formal performance-based actions, because this can result in an

adversarial atmosphere, which they believe might hinder resolution of

performance issues.

One of the network directors recognized that the practice of not giving

accurate appraisals can lead to certain problems. This director indicated

during our interview that as a result of not formally identifying poor or

marginal performers with the appropriate rating, it becomes difficult to

differentiate among individual employees because the appraisals are so

similar. This director, who has a private sector background, also noted

during the interview that this practice does not occur just in VHA. He said

that performance appraisals in many parts of the private sector were just

as benign as those he had observed in VHA. In both the public and private

sectors, he said, managers show little willingness to write accurate

performance appraisals.

Nine of the network directors also noted in the interviews that they

believed that undertaking formal performance actions imposes a heavy

administrative burden. One of the nine network directors noted that the

Page 15 GAO/GGD-98-92 VHA’s Handling of Performance and Conduct Issues
B-276217 

formal process often transformed an effort to establish an employee’s lack

of satisfactory performance into a legal dispute, where the objective

became the resolution of a dispute. Thus, the formal process often led to a

compromise, which two of the nine directors believed did not necessarily

lead to the best or the desired result.

As shown in table 2, in responding to our follow-up survey, the network

directors also cited additional reasons that contributed to managers not

giving less than Fully Successful ratings to triad members who should

have received such ratings and not taking formal actions to remedy

performance problems.

Table 2: Reasons Cited by the Network

Directors for Not Using Formal Means

to Identify and Deal With Poor or

Marginal Performers

Number of network

directors who:

Agreed Disagreed

The network directors either agreed or disagreed that the

following reasons contributed to managers not giving less

than Fully Successful ratings.

VHA’s culture is not to give a less than Fully Successful

rating. 11 6

Historically, the triad members had received ratings of

Fully Successful or higher. 16 1

The former performance measures for medical center

directors were too broad and subjective for identifying

performance problems. 15 3

The network directors either agreed or disagreed that the

following reasons contributed to managers not taking

formal actions.

The processes for taking formal actions were too

lengthy, paper-intensive, and time-consuming. 18 2

The burden of proof needed to take formal actions is

perceived to be too great. 16 3

A formal action can result in the poor or marginal

performers pursuing the various avenues of appeal

available to them. 17 2

The performance problem had to reach extreme

proportions in order for managers to be willing to pursue

the formal process. 14 4

Managers have concerns about being accused of poor

supervision, discrimination, or slander. 6 11

Managers have concerns about whether or not the VA

central offices (e.g., personnel and VHA headquarters

officials) would support them in dealing with poor

performers. 14 4

Source: GAO’s survey of the network directors.

Page 16 GAO/GGD-98-92 VHA’s Handling of Performance and Conduct Issues
B-276217 

Use of Informal Means to

Address Poor or Marginal

Performance Carries

Certain Risks for the

Agency

Because none of the triad members identified by the network directors or

VHA headquarters as poor or marginal performers had been officially rated

as such, it made it more difficult for the network directors and other VHA

senior managers to take certain formal, performance-based actions against

the employees in dealing with the performance problems. For example,

the reassignment, transfer, or removal of an SES employee for

unsatisfactory performance is permitted under 5 U.S.C. 4314(b). However,

because VHA officials gave triad members satisfactory or better ratings of

record even though they viewed their performance as poor or marginal,

the law did not permit the officials to take performance-based actions

against the triad members. Thus, VHA could not take any action against the

triad members unless they voluntarily agreed to the action VHA proposed to

take, because the action was based on an informal assessment of their

performance, not on an official rating of less than Fully Successful. This

use of informal means to identify and deal with poor or marginally

performing triad members can carry certain risks for the agency,

especially when the agency has not documented the poor or marginal

performance.

The failure to accurately evaluate the performance of an employee is a

failure to follow the requirements of the performance appraisal systems

mandated by law. For example, performance appraisal standards for SES

employees in chapter 43 of the United States Code require an accurate

evaluation of performance that is based on criteria related to the job or

position.

Although the VHA network directors and the top VA human resource

officials with whom we spoke said that the informal means have helped

them to successfully deal with poor or marginal performers, reliance on

these means carries certain risks for the agency. One of the two top human

resource officials at VA with whom we spoke also recognized that risks are

associated with using informal means, because such means generally do

not preclude the employee from taking action against the agency. For

example, triad members who were encouraged to retire and did so

because the network directors perceived their performance to be poor or

marginal but had not officially rated them as such could later appeal the

Page 17 GAO/GGD-98-92 VHA’s Handling of Performance and Conduct Issues
B-276217 

actions taken regarding them.6 These employees could allege that their

retirement resulted from coercion, deception, or misinformation from the

network directors. In such cases, VHA would have to prove that the

network directors had a valid basis for assessing the employees’

performance as unacceptable and that the employees retired voluntarily

and not because of coercion, deception, or misinformation from the

agency. As of the time we completed our audit work, one of the triad

members had filed an appeal with MSPB regarding the informal action taken

with respect to him. The triad member alleged that he was reassigned in

retaliation for whistleblowing.

We discussed VHA’s practice of relying on the informal system to identify

and deal with poor or marginal performers with VA’s two top human

resource management officials. They believed that the practice was

appropriate in cases where the network directors were informally taking

action to address a decline in the employee’s performance that had

occurred at some point during an appraisal period, even though the

employee had received a Fully Successful or higher rating for the prior

appraisal period. These officials said that it is better to deal with a

performance problem as it occurs rather than wait until the end of a

performance appraisal period to deal with it. We agree that taking action

under such circumstances is appropriate. We also note from our

interviews with the network directors that there is a general aversion to

documenting less than Fully Successful performance in official

performance appraisals.

The officials also recognized, however, that less-than-accurate appraisals

of employees’ performance do occur and are inconsistent with

performance appraisal policy. One of the officials characterized the

performance appraisal system as cumbersome and ineffective in its

outcomes and recognized that most VHA managers do not rely on it to

address perceived problem deficiencies. He said that this approach may

change over time as VHA develops more objective, quantifiable

performance measures. Both officials expressed the view that reliance on

informal means to address performance problems as well as a general

6

Because each of the triad members is appointed under separate personnel systems, their avenues of

appeal differ. Medical center directors appointed under the SES personnel system may request an

informal hearing before MSPB when a performance-based action, such as a removal, is taken against

them. This informal hearing is not considered a formal appeal. Medical center directors and chiefs of

staff appointed under the Title 38 personnel system generally do not have appeal rights to MSPB. They

may appeal actions to a VHA impartial examiner, a VHA Disciplinary Appeals Board, or the courts. The

associate and assistant medical center directors, who are appointed under the GS system, have appeal

rights to MSPB and the courts.

Page 18 GAO/GGD-98-92 VHA’s Handling of Performance and Conduct Issues
B-276217 

aversion to documenting poor performance on official ratings is a

governmentwide phenomenon and is not restricted to VHA.

We also discussed with OPM officials VHA’s practice of relying on the

informal system to identify and deal with poor or marginal performers.

These officials said that supervisors should give honest and accurate

appraisals. They also agreed that it is proper to informally deal with an

employee’s decline in performance during an appraisal period rather than

waiting until the end of a period and documenting the decline in an official

appraisal. The OPM officials did not specifically address VHA’s practice,

because they said they would need to know the details of individual cases.

For example, was the unacceptable performance extended over a period

of time during which the employee received inflated ratings, or did the

unacceptable performance occur during the rating period in which the

performance-based action was taken? The OPM officials pointed out that

performance management can be difficult and human nature sometimes

results in managers avoiding confrontation or giving an employee the

benefit of the doubt. They suggested, however, that if a system is flawed,

or perceived to be flawed, it should be examined with the objective of

making it more usable by managers while providing appropriate

protections to the employees.

We recognize that the network directors’ avoidance of the formal system

for identifying and dealing with unacceptable performance is not unique to

them. Far less than 1 percent of employees governmentwide in positions

comparable to those of the triad members received ratings below Fully

Successful during fiscal years 1994 through 1996. In 1990, we reported in a

governmentwide study that all poor performers were not necessarily

documented through the appraisal process. Supervisors who responded to

our questionnaire estimated that 89,500 (or 5.7 percent) of the estimated

1.57 million employees they supervised performed below the Fully

Successful level at some time during fiscal year 1988. Yet, OPM data for that

same year showed that about 0.6 percent of federal employees were rated

below the Fully Successful level. We also reported that poor performers

were sometimes not formally designated as such in a rating but instead

were given a Fully Successful, because supervisors did not want to use the

formal process to deal with them. In responding to our survey, the

supervisors indicated that they would not likely use the formal process,

because it took too long and used too much of their time.

Even prior to passage of the Reform Act in 1978, managers rarely gave an

unsatisfactory rating, because the follow-on actions for dealing with the

Page 19 GAO/GGD-98-92 VHA’s Handling of Performance and Conduct Issues
B-276217 

unsatisfactory performance were viewed as time-consuming, expensive,

and aggravating for all parties. Because the process for taking action on

the basis of unsatisfactory performance was viewed as slow and

burdensome, it deterred managers from taking action that might otherwise

have been appropriate. To make the process for taking actions against

poor performers easier for managers, the Reform Act changed the

standard of evidence for taking actions on the basis of unacceptable

performance from a “preponderance of evidence” to “substantial

evidence.”

However, the results of our study of VHA, our 1990 governmentwide study,

and recent MSPB studies indicate that managers do not perceive that the

process for dealing with poor performers is easy enough to use. MSPB

reported in 1995 that very few federal managers used the procedures

established by the Reform Act for taking performance-based actions

against poor performers. Instead, some managers were able to work

around the deficiencies of their poor performers by controlling

assignments and using other strategies, such as reassigning them to other

offices where they might improve. In responding to an MSPB survey,

managers and supervisors cited various factors that discouraged them

from taking formal actions. These factors were very similar to the reasons

given by VHA’s network directors for not using the formal system to deal

with performance problems. Managers and supervisors cited the following

factors in response to MSPB’s survey:

• Most supervisors perceived the procedures established by the Reform Act

to be too complicated, time-consuming, or onerous.

• Many supervisors were reluctant to create an unpleasant work

environment and believed that if they took formal action against a poor

performer, it was very possible that (1) higher level management would

not support them, (2) their decision would be reversed upon review or

appeal, or (3) they would be falsely accused of having acted for

discriminatory reasons.

• About a third of the supervisors said they had difficulty relating

performance deficiencies to their employees’ critical elements, and over a

third (39 percent) found it difficult to document employee performance.

Also, a 1997 MSPB study corroborated its 1995 findings on supervisors’ and

managers’ reluctance to take formal, performance-based actions.

According to MSPB’s 1997 report, 43 percent of second-level and higher

supervisors believed that their organizations had a major problem in

taking appropriate steps to correct inadequate performance. Fifty-nine

Page 20 GAO/GGD-98-92 VHA’s Handling of Performance and Conduct Issues
B-276217 

percent of the second-level and higher supervisors also believed that their

organizations had a major problem separating employees who could not or

would not improve their performance to meet the required standards. VA

supervisors and nonsupervisors responding to MSPB’s survey also believed

that their agency had a major problem with correcting inadequate

performance (41 percent) and separating poor performers (51 percent).

OPM’s strategic plan for fiscal years 1997 through 2002, in part, calls for

continuing its efforts to improve the capacity of managers to identify and

resolve performance problems effectively. One of the strategies outlined in

OPM’s plan for achieving this objective was to distribute by 1998

multimedia instructional materials to federal managers and supervisors on

how to identify and resolve performance problems, including how to take

successful action to remove a poor performer. On February 4, 1998, OPM’s

director provided the heads of departments and independent agencies

with a booklet and CD-ROM on addressing and resolving poor

performance. According to OPM’s director, this material is designed to

provide managers and supervisors with the information needed to

understand the process of dealing with unacceptable performance and

taking action when necessary.

We recognize the importance of distributing instructions and guidance on

how to identify and resolve performance problems. As previously

discussed, VHA managers as well as managers at other executive agencies

were reluctant to use the formal system, because they perceived the

system as overly burdensome, complex, and time-consuming. For the VHA

managers, their reluctance did not appear to relate to a lack of knowledge

on how to identify and deal with poor performers using the formal system.

However, to the extent VHA and other managers’ negative perception of the

formal system is attributable to a lack of knowledge on how to identify

and deal with poor performers, OPM’s instructions and guidance may help

managers to overcome their reluctance to use the formal system.

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B-276217 

Network Directors

View the Recent

Changes in VHA’s

Organizational

Structure and

Performance

Measures as

Improvements

Over the last 2-1/2 years, VHA’s environment and organizational structure

have been undergoing rapid change. In October 1995, VHA implemented a

major restructuring that was designed to improve the efficiency of, access

to, and quality of care provided to the nation’s veterans. A major

component of the restructuring was the realignment of VHA’s management

and field structure, which resulted in “the span of control” of the most

senior-level field executive positions being substantially reduced. Also in

fiscal year 1996, VHA implemented new, more quantifiable performance

measures for evaluating and holding its senior executives accountable for

their performance. According to the network directors, these changes

have improved how VHA operates and will help them to identify and deal

with poor or marginal performers. In responding to our survey, 19 network

directors agreed (and 2 disagreed) that, overall, these changes would help

in identifying and dealing with poor or marginal performers. The network

directors recognized, however, that the new changes have also had an

impact on how the triad members’ performance is now viewed under VHA’s

new system of operating.

Under the new system of 22 Veterans Integrated Service Networks that

was created in October 1995, each network director is now responsible for

approximately 24 triad members; under the old, “regional director”

system, the director was responsible for at least 80 triad members. The

network directors frequently emphasized in the interviews that the

reduction in the number of triad members for whom they were responsible

significantly improved their ability to gauge and manage performance.

Network directors said they believed they now have the opportunity to

become more familiar with all their triad members and to make their own

assessments of their performance, rather than relying on the appraisals

provided by the medical center directors. Management triad members

would no longer, as one director put it, “have a place to hide.”

The new, more quantifiable performance measures were first incorporated

into the network directors’ performance plans in the Spring of 1996. For

example, in order for a network director to be considered Fully Successful

under the fiscal year 1997 outpatient surgery performance measure,

65 percent of the surgical procedures performed in the director’s network

must be done on an outpatient basis. According to a VHA official, the

network directors are responsible for meeting the performance measures,

and how they elect to do so is up to them. The network directors may

choose to include the performance measures in the medical center

directors’ performance plans, but they are not required to do so. The VHA

official also said that the performance measures are not a required part of

Page 22 GAO/GGD-98-92 VHA’s Handling of Performance and Conduct Issues
B-276217 

the performance plans of the other triad members—the associate director

and chief of staff. In responding to our survey, all 21 network directors

indicated that they had included the same or similar performance

measures in the medical center directors’ performance plans.

The network directors generally agreed that VHA’s new, more quantifiable

performance measures are an improvement on the former, more

subjective measures. Several directors believed, however, that it was too

early to tell exactly how well the new measures would work, because they

had received their individual performance measures too late in the last

two appraisal cycles to completely implement them. The performance

measures were issued to the network directors about 6 months after the

1996 and 1997 rating periods began. One director cautioned that the

performance measures could be unreasonable and cited the performance

goal of “over 90 percent patient satisfaction with care” as an example.

Nineteen directors agreed (and 2 disagreed) with the opinion that the new

performance measures need some fine-tuning.

The network directors recognized that the recent changes under VHA’s new

operating environment—more quantifiable performance measures and

reduced span of control over the medical centers as a result of the

transition from a regional to a network structure—have altered how the

performance of triad members is now viewed. For example, two network

directors told us in the interviews that medical center directors who were

once considered outstanding performers under the old environment are no

longer considered to be such performers under the new environment. In

responding to our survey, 11 network directors agreed (and 6 disagreed)

that the recent changes in VHA’s operations and organizational structure

have led to a decline in the performance appraisals of some triad

members. For example, their performance appraisals may have dropped

from the Outstanding or Exceptional level to the Fully Successful level.

However, one of the six network directors who disagreed with this

opinion said that it should not be presumed that a drop from Outstanding

or Exceptional to Fully Successful reflects a drop in performance. Rather,

this network director said that in some cases, it is more reflective of a

difference in the network director’s management philosophy, particularly

when the director was hired from outside the VA system.

The triad members’ performance under the new environment also requires

a new set of managerial and technical skills, according to another two

network directors. For example, one network director said that it is

becoming increasingly difficult for senior executives to perform at the

Page 23 GAO/GGD-98-92 VHA’s Handling of Performance and Conduct Issues
B-276217 

satisfactory level if they do not possess certain technological or computer

skills. The other network director said that the medical center directors

today will need to have been exposed to doing cost-benefit analysis and

profit and loss statements. This network director also indicated that a

medical center director’s lack of the new skills, reluctance to adapt to the

new changes, or lack of an understanding of what is required under VHA’s

new environment can lead to him or her being considered a poor

performer.

Our analysis of the distribution of the medical center directors’ ratings for

fiscal years 1994 through 1997 indicates that the recent changes in VHA,

such as the new performance measures, have not led to an overall decline

in their performance ratings.7

 As shown in table 3, the percentage of

medical center directors rated at or below the Fully Successful level did

not increase over the 4-year period. Instead, there was generally a steady

increase in the percentage of medical center directors who received either

an Excellent or an Outstanding rating during this period. The table shows

that nearly 78 percent of medical center directors were rated above Fully

Successful in 1996, the first year that the changes were implemented,

which is slightly lower than the percentage rated above the Fully

Successful level in 1995. In 1997, 86 percent of the medical center directors

were rated above Fully Successful, which represents a 7 percentage point

increase over the percentage rated above the Fully Successful level in

1995, before the changes were implemented.

Table 3: Distribution of Medical Center

Directors’ Performance Ratings—1994

Through 1997

Percent of total rated

Rating year

Total number

rated

Below Fully

Successful

Fully

Successful Excellent Outstanding

1994 117 0 32.5 38.5 29.0

1995 126 0 20.6 43.7 35.7

1996 125 0 22.4 41.6 36.0

1997 133 0 13.5 47.4 39.1

Source: GAO’s analysis of rating data provided by VHA’s Management and Administrative

Support Office.

The director of VHA’s Management and Administrative Support Office

attributed the upward trend in the medical center directors’ ratings to the

7

Although the scope of our review was primarily fiscal years 1994 through 1996, we included fiscal year

1997 in our analysis because the requesters’ staffs asked us to review the 1997 rating data to see

whether or not the new performance standards would result in any medical center directors receiving

a less than Fully Successful rating. Since performance measures had not been uniformly given to

chiefs of staff and associate or assistant directors, we did not request 1997 rating data regarding them.

Page 24 GAO/GGD-98-92 VHA’s Handling of Performance and Conduct Issues
B-276217 

networks’ overall progress in achieving the performance measures. For

example, he said that VHA’s 1997 Network Performance Agreement Report

showed that the percentage of surgeries and diagnostic procedures

performed on an outpatient basis increased to 69 percent, which

represented a 33-percent increase over the 1996 rate of 52 percent. Also,

the patients’ overall quality rating of these outpatient services increased

slightly from 61 percent to 63 percent. This VHA official also believes that

the upward trend in the medical center directors’ ratings may have been

affected by the retirement of several poor or average performing medical

center directors over the last 4 years, thus leaving a cadre of

high-performing executives.

Disciplinary Actions

Taken for Misconduct,

but Not Without

Controversy

VHA network directors did not consider misconduct to be a widespread

problem within the management triad at VHA medical centers, although

some directors acknowledged that instances of misconduct had occurred.

In their survey responses, all but one of the network directors agreed that

misconduct is not considered a widespread problem within the

management triad at VHA’s medical centers. Misconduct offenses involving

triad members had not occurred in most networks; 13 of 21 network

directors agreed that “within the past 3 fiscal years, no conduct problems

occurred within my network that involved triad members.”

The network directors’ perception is confirmed by data compiled by VHA.

According to these data, VA authorities received a total of 35 allegations of

misconduct by management triad members during fiscal years 1994

through 1996. VA investigators substantiated 14 of the 35 allegations.8

 As a

result, VHA took disciplinary actions that ranged from a letter of

admonishment to a demotion. Even so, VHA has been criticized for being

too lenient in punishing some instances of misconduct. As a result of such

criticism, VA has established a new procedure to give closer scrutiny to

proposed disciplinary actions for misconduct. In addition, Congress

recently passed the Veterans’ Benefits Act of 1997, which established a

new process and structure for handling equal employment opportunity

(EEO) complaints.

8

A substantiated allegation means that the entity, such as the OIG or an administrative review board,

that investigated the allegation confirmed that the particular situation existed as alleged, according to

a top VA management official. However, substantiation of an allegation does not necessarily result in a

disciplinary action or a finding that something improper or inappropriate was done, according to this

official.

Page 25 GAO/GGD-98-92 VHA’s Handling of Performance and Conduct Issues
B-276217 

VHA’s Response to

Allegations of Misconduct

Allegations of triad member misconduct, as well as misconduct by other

VA employees, may surface through the EEO process, through management

channels, or through the VA OIG.

9

 Investigations of such allegations may be

conducted by OIG, EEO investigators designated by VA’s OEO, the Veterans

Integrated Service Networks, or by administrative review boards

established by VHA to address specific cases. Administrative review boards

normally consist of senior officials outside the medical facility where the

alleged misconduct occurred. Investigating misconduct allegations

generally entails collecting and reviewing relevant documents as well as

obtaining information from the employee identified in the allegation as

having perpetrated the offense and from other individuals considered to

have information pertinent to the case. The investigations are designed to

obtain the facts of the case so that management can determine (1) if the

allegation can be substantiated; (2) whether action is warranted; and

(3) what type of disciplinary action, if any, should be taken.

Regardless of what organization conducts the investigations, an

investigative report is normally prepared and provided to senior VHA

officials, usually the network director. The investigative reports generally

do not recommend that specific disciplinary actions be taken on

substantiated allegations of misconduct. Decisions on whether to take

adverse or disciplinary actions, and the specific action that is appropriate,

are generally made by the VHA officials who supervise the employee in

question. In the case of triad members, that individual has been the

cognizant network director, following consultation with senior VHA

headquarters officials.

VA investigations substantiated 14 of the 35 allegations. The 14

substantiated allegations involved 13 management triad members. For 6 of

the 14 allegations, VHA took disciplinary action, which ranged from a letter

of admonishment to a demotion. For the remaining eight allegations, no

disciplinary actions were taken. Instead, five of the eight allegations

resulted in the employees either retiring or resigning, and three resulted in

the employees receiving counseling. Appendix II provides further details

on the nature and disposition of each of the substantiated allegations.

According to a VHA official, 2 allegations of misconduct were substantiated

against 1 of the 13 triad members, a medical center director, during fiscal

9

VA does not keep consolidated statistics on the number of misconduct allegations received. An OIG

official estimated that OIG annually receives approximately 20,000 contacts through OIG’s telephone

hotline alone. The OIG official said that the majority of the 20,000 contacts do not represent

misconduct allegations. Instead, most of the contacts represent concerns about other matters, such as

veterans’ benefits and compensation, he said. An average of 700 of the 20,000 contacts result in cases

that are investigated; and 25 percent (or about 175) of those 700 investigated cases are substantiated,

the OIG official said.

Page 26 GAO/GGD-98-92 VHA’s Handling of Performance and Conduct Issues
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years 1994 through 1996. One of the two allegations involved installing a

video camera in a restroom. The medical center director installed the

video camera to discourage racial graffiti, according to another VHA

official. The other allegation involved the medical center director lobbying

his local congressman for funds to renovate buildings that would be given

to a medical school affiliated with the medical center. In the 2 fiscal years

preceding the period of our review, none of the 13 management triad

members had been named in any allegations of misconduct, according to a

VHA official.

The number of disciplinary actions taken for misconduct at VHA and

governmentwide, in proportion to the size of their respective workforces,

was comparable during fiscal years 1994 through 1996.10 VHA data showed

that 1 triad member was demoted during the 3-year period, which

represented two-tenths of 1 percent of an average of 421 triad members

employed as of the end of each fiscal year during that period. None of

VHA’s triad members were suspended or discharged because of misconduct

during this time period, according to VHA’s data. OPM’s CPDF showed that

during this same 3-year period, a total of 11 actions were taken

governmentwide, excluding VA. The 11 actions affected less than one-tenth

of 1 percent of an average of 7,292 employees who were in similar

positions governmentwide.

In deciding on the appropriate disciplinary action to take, management

officials are to consult a table of penalties, included in VA’s policy manual,

which describes the disciplinary penalties appropriate for most types of

misconduct. The table is not all-inclusive, because it is intended as a guide

for managers to use in administering disciplinary and major adverse

actions. Management officials generally retain the discretion to tailor

disciplinary actions to the incident of misconduct by considering a variety

of factors, both mitigating and aggravating. Such factors include the

employee’s length of service, past disciplinary record, the severity of the

misconduct, and whether the misconduct was intentional or inadvertent.

However, in cases where a specific penalty is required by statute (such as

a 30-day suspension for misuse of a government vehicle), such factors are

not to be considered.

One of 14 substantiated allegations involved a medical center director’s

misuse of a government vehicle while on official business. Although VHA

10We limited our comparison to discharges, suspensions, and demotions, because these types of

disciplinary actions result in a personnel action and thus are to be recorded in the CPDF. Although a

letter of admonishment is a disciplinary action, it does not result in a personnel action and thus is not

recorded in the CPDF.

Page 27 GAO/GGD-98-92 VHA’s Handling of Performance and Conduct Issues
B-276217 

procedures require a mandatory minimum penalty for a first offense of this

misconduct, VHA did not impose the penalty. Under the law, 31 U.S.C.

1349(b), “An officer or employee who willfully uses or authorizes the use

of a passenger motor vehicle or aircraft owned or leased by the United

States Government (except for an official purpose authorized by section

1344 of this title) or otherwise violates section 1344 shall be suspended

without pay by the head of the agency. The officer or employee shall be

suspended for at least one month, and when circumstances warrant, for a

longer period or summarily removed from office.”

In this case, the Deputy Under Secretary for Health decided that a

reprimand was the appropriate corrective action, even though VHA’s table

of penalties included the mandatory suspension. According to a VHA

official, clear evidence did not exist that would have proven the medical

center director’s action as a “willful” misuse of the government vehicle.

Because a governmentwide, standard table of penalties does not exist, we

compared VA’s table of penalties, which is applicable at VHA, with the tables

of penalties of two other judgmentally selected executive branch

departments—the Department of Commerce and the Department of

Agriculture. The purpose of our comparison was to see if the range of

penalties at VHA on the treatment of various instances of misconduct was

similar to the range of penalties at those two departments. Specifically, we

compared VA’s range of penalties for the types of misconduct involved in

the 14 substantiated cases at VHA. The types of misconduct included sexual

harassment, improper use of a government vehicle, fighting, participation

in an activity that created the appearance of a conflict of interest, abusive

language or behavior, and violations of the Privacy Act and merit system

principles.

This comparison showed no appreciable difference between the range of

penalties available at VA and those available at the other two executive

branch departments. For example, VA’s range of penalties for the first and

second offenses of misuse of a government vehicle is identical to the range

of penalties at Agriculture and Commerce. None of the three agencies’

tables of penalties list a penalty for a third misuse of government vehicle

offense. Depending on whether the misconduct represented an employee’s

first, second, or third offense, the range of penalties in some instances at

VA was either slightly harsher or less punitive than the range of penalties

available at Commerce and Agriculture. For example, VA’s suggested

penalty for a third offense involving conflict of interest is more punitive

than the penalty at Commerce. VA can remove an employee for a third

Page 28 GAO/GGD-98-92 VHA’s Handling of Performance and Conduct Issues
B-276217 

conflict of interest offense, whereas Commerce’s penalty for a third

offense of this same misconduct ranges from a 30-day suspension to a

removal. On the other hand, VA’s suggested penalty for a second offense of

fighting ranged from a 10-day suspension to a discharge. Agriculture’s

penalty for the same offense ranged from a 14-day suspension to a

removal. Viewed in this context, VA’s penalties generally conform to those

provided for at the two other executive branch departments. Appendix III

contains a table comparing the range of penalties available at each of the

three departments.

Controversy Over VHA’s

Handling of Misconduct

Led to Revisions in VA’s

Policy and Procedures for

Responding to Misconduct

Although VHA took disciplinary actions to address instances of misconduct,

these actions were not without controversy. VHA’s handling of 1 highly

publicized case, which is among the 14 substantiated allegations listed in

appendix II, led to VA changing its policy and procedures for handling

conduct and performance problems that involve senior VA officials.

The highly publicized case involved a former medical center director who

allegedly committed sexual harassment. VA’s OIG investigated the sexual

harassment allegations and determined that the former medical center

director sexually harassed one of the three female employees who had

alleged sexual harassment and that there was insufficient evidence to

support a finding that the director sexually harassed the other two female

employees. However, the OIG concluded that the former director’s

behavior toward the two other women was abusive, threatening, and

inappropriate.

The OIG provided a draft report to the network director for review and

comment in September 1996 and recommended that given the findings of

misconduct by the former director, appropriate administrative action

should be taken. The network director concurred with the OIG’s findings

and recommendations and initially proposed removing the director from

federal service. However, in December 1996, the network director

rescinded the proposed adverse action, referring to a lack of evidence and

doubts that a case would hold up on appeal. As a result, a negotiated

settlement was reached that ensured the former director’s removal from

the facility and SES. The former director resigned from SES, was

downgraded to a GS-14 nonsupervisory position, and was reassigned to

another VA medical center in a different state. He was allowed to

permanently retain his SES pay and was transferred at government expense

to another medical center.

Page 29 GAO/GGD-98-92 VHA’s Handling of Performance and Conduct Issues
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Some VHA employees, Members of Congress, and the media criticized the

settlement as too lenient. However, a VHA official with whom we spoke

believed that the settlement was made in the best interests of the

department and avoided further disruption at the former medical center

director’s facility. He acknowledged, however, that the decisionmaking

process should have been better coordinated with VHA headquarters senior

officials and the Office of General Counsel (OGC).

Because there was additional evidence of possible misconduct by the

former medical center director that was unrelated to the original

allegations, the OIG opened a second investigation in May 1997. That

investigation substantiated numerous incidents of misconduct by the

employee. As a result, on August 1, 1997, VHA notified the employee of its

intent to remove him from federal service. The employee retired on

August 15, 1997.

In the wake of the criticism received regarding the initial settlement with

this employee, VA instituted a new policy in March 1997 designed to ensure

more effective communication and coordination among top management

officials when conduct problems that involve triad members and other VA

executives are handled. VA revised its procedures for responding to

allegations of improper conduct by establishing a panel composed of

senior VA executives whose objective, among other things, would be to

ensure departmentwide consistency in dealing with allegations of

misconduct and to discuss the appropriate penalties for confirmed

allegations of misconduct.

Under these revised procedures, all proposed actions are to be reviewed

by the respective VA administration head or Assistant Secretary, OGC, and

the Office of the Assistant Secretary of Human Resources and

Administration. After this review, the Office of the Secretary is to be

informed of the results and is to consult with the Office of Public and

Congressional Affairs before clearing the proposed action for

implementation.

Before VA implemented the new policy, authority to approve and

implement such actions had been delegated solely to administration

heads, Assistant Secretaries, or other key officials. The new policy does

not differ dramatically from the old one it replaced, according to a VHA

official. However, “It . . . systematizes the process,” ensuring more

effective communication, coordination, and cooperation among VA’s senior

management, the VHA official said. The new policy was designed to ensure

Page 30 GAO/GGD-98-92 VHA’s Handling of Performance and Conduct Issues
B-276217 

that management coordination in handling misconduct cases that involve

VA senior executives is more effective, the VHA official said.

Most of the network directors believed that the recently instituted policy

on how to handle and reach resolution of conduct problems that involve

triad members and other VA executives will help ensure that such matters

are consistently dealt with. This viewpoint was held by 12 of the 21

network directors, according to our survey.

The new policy may facilitate the handling of conduct problems in the

future. However, it is not clear whether or not the policy applies to all VHA

medical center triad members. As worded, the new policy applies to

occupants of positions “centralized” to the VA Secretary, which includes

medical center directors who are members of SES as well as associate

medical center director GS-15 employees. However, the wording does not

specify whether or not the new policy covers Title 38 employees, who

include medical center directors and chiefs of staff, and assistant medical

center directors at the GS-13 or GS-14 grade level.

According to the director of VHA’s Management and Administrative Office,

all triad members are to be covered by the new policy. He said that Title 38

medical center directors are considered centralized to the Secretary by

virtue of the positions they occupy. This official also said that the intent of

the new policy is to include all members of management triads, including

medical center directors, associate and assistant medical center directors,

and chiefs of staff.

New Law Designed to

Improve EEO System at VA

In response to concerns about the effectiveness of VA’s policy of “zero

tolerance” for sexual harassment and its handling of discrimination

complaints, the Congress enacted and the President approved legislation

in November 1997 designed to improve VA’s EEO system. The new law,

entitled the “Veterans’ Benefits Act of 1997 (P.L. 105-114, Nov. 21, 1997),

requires VA to (1) establish a new employment discrimination complaint

resolution system to encourage timely and fair resolution of concerns and

complaints, including those related to allegations of sexual harassment;

and (2) submit reports to Congress on the implementation and operation

of the new EEO system on April 1, 1998; January 1, 1999; and January 1,

2000.

The law establishes an Office of Employment Discrimination Complaint

Adjudication within VA. The Director of this office is to be responsible for

Page 31 GAO/GGD-98-92 VHA’s Handling of Performance and Conduct Issues
B-276217 

making final agency decisions on the merits of any unlawful employment

discrimination complaints filed by a VA employee, a function that is

currently performed by VA’s OGC. The Director is also to be responsible for

submitting reports to the Secretary of VA and to Congress on the

implementation and operation of the Office of Employment Discrimination

Complaint Adjudication. The law requires the Secretary of VA to enter into

an agreement with a private entity to review and report to the Senate and

House Committees on Veterans’ Affairs on the employment discrimination

complaint resolution system within VA.

VA is establishing a new organization, the Office of Resolution Management

(ORM), to replace OEO’s Discrimination Complaint Service. Establishing ORM

will effectively separate the function for adjudicating complaints from the

line management function, according to the former Deputy Assistant

Secretary for EEO, thereby providing greater assurances that VA employees

perform the EEO complaint counseling and investigating functions in a

professional and independent manner. The new organization eventually

will establish 12 field offices located around the United States. ORM is

expected to begin operation in April 1998 with the opening of 2 of the 12

field offices, according to the VA official responsible for coordinating the

transition to the new EEO structure and process. Plans call for completing

the implementation of ORM by the end of 1998.

VA’s current process for handling sexual harassment complaints and other

EEO discrimination complaints will change under the planned ORM

framework. For example, VA’s Assistant Secretary for Human Resources

and Administration, the Deputy Assistant Secretary for Resolution

Management, ORM District Managers, and ORM Field Managers will serve as

VA’s EEO officers, and the newly designed complaint resolution

management structure will be linked to them. VA facility directors and

heads of VA Central Office organizations will no longer serve as EEO

officers under the new structure, which situates them outside the EEO

complaint process. However, these officials will continue to be held

accountable for maintaining a workplace free of discrimination.

Also, the directors of VHA’s networks and medical centers, as well as

directors of other headquarters and field offices, will no longer have

authority to establish administrative review boards to investigate

discrimination and sexual harassment complaints filed against members of

the senior management teams, such as medical center directors, associate

directors, assistant directors, and chiefs of staff, according to VA’s Deputy

Assistant Secretary for Human Resources. Instead, these complaints and

Page 32 GAO/GGD-98-92 VHA’s Handling of Performance and Conduct Issues
B-276217 

other complaints of serious misconduct will be investigated by rapid

response teams, a concept that has been in use since the spring of 1997.

These teams will be deployed by the Assistant Secretary for Human

Resources and Administration. Procedures regarding the use of rapid

response teams are under development, according to this VA official. As of

March 4, 1998, the procedures had not been finalized.

Depending on the nature of the allegations, the rapid response teams will

generally consist of human resource specialists, attorneys, EEO specialists,

and other officials deemed appropriate for the investigation, according to

the VA official responsible for coordinating the transition to the new EEO

structure and process. This VA official also said that the rapid response

team, on the basis of its findings, will be responsible for identifying a range

of penalties for management officials to consider in determining the

appropriate disciplinary or adverse action. However, the final decision on

what disciplinary action to take against the employee will be made by the

appropriate supervisory official.

This VA official also said that VA’s OIG authority to investigate complaints

received directly from employees about sexual harassment,

discrimination, and other activities that constitute a violation of law, rule,

or abuse of authority will continue under VA’s new EEO process. According

to this VA official, OIG prefers not to be involved in individual EEO cases,

because it does not have authority to grant relief to complainants or take

specific types of disciplinary or adverse actions. However, this VA official

said that to the extent permissible, OIG and ORM will coordinate the

investigation of EEO complaints more closely.

Conclusions VHA officials did not officially rate any triad member as less than Fully

Successful during the 1994 through 1996 rating periods. At first glance, this

fact would suggest that either VHA experienced no performance problems

among its medical center executives during that period, or that VHA

officials were not addressing performance problems. Our work has shown

that neither is true.

Rather, VHA network directors responsible for triad members

acknowledged that the record of performance ratings did not capture the

actual performance of all triad members and that poor performers did

exist. But the network directors collectively held that identifying poor

performers in official ratings is not an effective way to address the

problem because, among other things, it necessitates formal actions that

Page 33 GAO/GGD-98-92 VHA’s Handling of Performance and Conduct Issues
B-276217 

they perceived to be time-consuming, burdensome, and unlikely to

produce the desired results. Instead, the network directors believed they

had effectively managed poor performance through informal means.

The network directors’ recognition that poor performers do exist, but are

not identified as such on official ratings because of negative perceptions

toward the formal system, raises an important question. Was the attempt

in 1978 with the Civil Service Reform Act to make performance

management systems more “user friendly” to managers in identifying and

dealing with poor performers successful? When the Reform Act was

passed, there was general recognition that managers rarely gave

unsatisfactory ratings, because the system was viewed as time-consuming

and aggravating to all parties. Our “case study” at VHA, our 1990

governmentwide study, and MSPB’s 1995 and 1997 surveys all suggest that

little has changed in the 20 years since enactment of the Reform Act.

We do not know for certain whether executives in other government

agencies share the VHA network directors’ perceptions and also rely on an

informal system to address performance. However, governmentwide OPM

statistics and our prior work, which showed that far less than 1 percent of

employees received less than Fully Successful ratings, suggest that such

perceptions are not limited to VHA.

Our overall impression is that VHA has taken seriously its responsibility to

identify and deal with performance problems among triad members.

However, our findings also suggest a problem exists. The problem is not

necessarily with VHA or the network directors but with the federal

performance management systems. Research has shown that when

systems do not work, or are perceived not to work, employees find ways

to work around the systems. This appears to be what is occurring at VHA.

The network directors have adapted and worked around a system they

have deemed to be a failure. Although this adaptation has apparently

enabled network directors to take performance-based actions, it carries

with it some significant implications for policymakers who are again

considering civil service reform. Performance appraisal system

requirements call for honest and accurate appraisals. A system that

discourages such appraisals contradicts the fundamental premise of

performance management and compromises the integrity of federal

personnel management.

OPM’s strategic plan for fiscal years 1997 through 2002 calls for, among

other things, continuing OPM efforts to improve the capacity of managers

Page 34 GAO/GGD-98-92 VHA’s Handling of Performance and Conduct Issues
B-276217 

to effectively identify and resolve performance problems. As part of this

effort, OPM has distributed instructional materials to federal managers on

how to identify and resolve performance problems. These are important

efforts that may help alter managers’ existing perceptions that the formal

performance management systems are not helpful in this regard. To

facilitate its efforts, it would be useful for OPM to develop and monitor data

showing the extent to which such negative perceptions change over the

6-year period covered by the strategic plan.

OPM might use positive results showing that managers’ perceptions have

improved to encourage other federal managers to make greater use of the

formal performance management system for identifying and dealing with

performance problems. Negative results showing that managers continue

to believe that the system is not working as intended could form the basis

for OPM, working with Congress, to develop and test alternative

approaches to identifying and dealing with performance problems.

VHA has also taken actions to discipline triad members who have engaged

in misconduct. However, some of the actions that VHA took resulted in

much controversy and concern about how effectively misconduct,

especially sexual harassment, is dealt with at the senior management

levels within VHA. Thus, VA implemented a new policy and process for

handling conduct problems that involve VA senior management. However,

we believe that VA needs to change the wording of its policy to clarify that

all triad members are covered by it. VA also is in the process of establishing

a new office and process for handling employment discrimination

complaints as a result of legislation enacted in November 1997. We believe

that VA’s final policy regarding the use of administrative review boards

should clearly reflect, as currently intended by VA, that complaints of

sexual harassment and discrimination made against any triad member

cannot be investigated by an administrative review board. The changes VA

is making in its EEO process, as well as those we suggest here, should lead

to improvements in how VHA responds to and resolves misconduct at the

senior management levels.

Recommendations Although OPM has developed training materials to help improve managers’

performance in identifying and dealing with poor performers, we believe

that data are needed to show whether the training changes managers’

negative perceptions of the formal performance management system.

Thus, we recommend that the Director of OPM develop data to show by

2002 whether managers’ perceptions of the formal performance

Page 35 GAO/GGD-98-92 VHA’s Handling of Performance and Conduct Issues
B-276217 

management system improve following training and experience in proper

use of the system. If perceptions improve, we recommend that the

Director of OPM advertise this information and further encourage managers

to use the formal performance management system. However, if the data

developed by OPM continue to show that managers perceive that the formal

system is too burdensome and unlikely to produce the desired results, we

recommend that the Director of OPM work with Congress to develop and

test alternative approaches that may be more effective than the existing

performance management system.

Although the intent of VA’s March 1997 policy on handling instances of

misconduct that involve VA senior management is to include all triad

members, in practice this may not occur. Thus, to avoid any potential

confusion on which positions in the management triad are covered by the

March 1997 policy, we recommend that the Secretary of VA revise the

policy to specifically include all chiefs of staff who are appointed under

Title 38 and associate and assistant medical center directors who are at

the GS-13 and GS-14 levels. We also recommend that the Secretary’s policy

on the use of administrative review boards clearly reflect that VHA officials

cannot convene such boards to investigate employment discrimination

complaints made against any triad member.

Agencies’ Comments We provided a draft of this report to the Acting Secretary of VA and the

Director of OPM for comment. On March 31, 1998, we met with the director

of VHA’s Office of Management and Administrative Support and other VA

officials to obtain oral comments. In a letter dated April 6, 1998, the

Director of OPM provided comments on a draft of our report. (See app. I.)

The VA officials said that VA agrees with the two recommendations we

made to the Secretary and considers both recommendations to be

consistent with the policy direction in which VA is moving. The VA officials

characterized our report as fair, objective, balanced, and thorough. They

also commented that VHA managers, like managers elsewhere in the federal

government, know how to use the formal system to deal with performance

problems but are reluctant to use it and instead rely on the informal

measures.

The Director of OPM said that our findings showing that VHA managers tend

to deal with employees who have performance and conduct problems in

Page 36 GAO/GGD-98-92 VHA’s Handling of Performance and Conduct Issues
B-276217 

an informal manner before invoking formal systems are not surprising.11

She recognized that prior studies by us, MSPB, and OPM have shown that

managers and supervisors in many agencies avoid taking formal actions,

because they perceive the formal system as administratively burdensome,

time-consuming, and not as effective as informal methods. She pointed

out, however, that regardless of how simple or how well-designed a

system is, it can be effective only if it is used.

The Director of OPM said that our recommendation that OPM assess the

effectiveness of its recently developed training materials aimed at helping

to improve managers’ performance in identifying and dealing with poor

performers is a good one, and OPM will assess the effectiveness of these

and other materials used to help managers address performance and

conduct issues. The Director said that OPM is working with its stakeholders

to improve individual and organizational performance, including

strengthening ways to hold executives and managers accountable for

producing results and providing them tools to identify and rectify

performance deficiencies. She said that OPM is encouraged that VHA

managers are addressing performance and conduct problems.

We are sending copies of this report to the Acting Secretary of VA and the

Director of OPM. We are also sending copies to the Ranking Minority

Member of the House Committee on Veterans’ Affairs, the Chairman and

Ranking Minority Member of the Senate Committee on Veterans’ Affairs,

other appropriate congressional committees, and other interested parties.

Copies will be made available to others on request.

11Although our report did not specifically depict VHA’s handling of misconduct as informal, the manner

in which some incidents of misconduct were resolved—employees deciding to voluntarily resign or

retire—avoided the formal system.

Page 37 GAO/GGD-98-92 VHA’s Handling of Performance and Conduct Issues
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The major contributors to this report are listed in appendix IV. Please

contact Michael Brostek, Associate Director, or me at (202) 512-8676 if you

have any questions.

L. Nye Stevens

Director, Federal Management

 and Workforce Issues

Page 38 GAO/GGD-98-92 VHA’s Handling of Performance and Conduct Issues
Page 39 GAO/GGD-98-92 VHA’s Handling of Performance and Conduct Issues
Contents

Letter 1

Appendix I 

Comments From the

Office of Personnel

Management

42

Appendix II 

Disposition of

Misconduct Charges

Involving VHA

Management Triad

Members—Fiscal

Years 1994 Through

1996

44

Appendix III 

Range of Misconduct

Penalties at VA

Compared With

Ranges at Agriculture

and Commerce

46

Appendix IV 

Major Contributors

and

Acknowledgments

48

Tables Table 1: Actions Taken to Address Performance Problems of 19

Triad Members

13

Table 2: Reasons Cited by the Network Directors for Not Using

Formal Means to Identify and Deal With Poor or Marginal

Performers

16

Page 40 GAO/GGD-98-92 VHA’s Handling of Performance and Conduct Issues
Contents

Table 3: Distribution of Medical Center Directors’ Performance

Ratings—1994 Through 1997

24

Abbreviations

CPDF Central Personnel Data File

EEO equal employment opportunity

GS general schedule

MSPB Merit Systems Protection Board

OEO Office of Equal Opportunity

OGC Office of General Counsel

OHRM Office of Human Resources Management

OIG Office of Inspector General

OPM Office of Personnel Management

ORM Office of Resolution Management

PIP performance improvement plan

SES Senior Executive Service

U.S.C. United States Code

VA Department of Veterans Affairs

VHA Veterans Health Administration

Page 41 GAO/GGD-98-92 VHA’s Handling of Performance and Conduct Issues
Appendix I 

Comments From the Office of Personnel

Management

Page 42 GAO/GGD-98-92 VHA’s Handling of Performance and Conduct Issues
Appendix I 

Comments From the Office of Personnel

Management

Page 43 GAO/GGD-98-92 VHA’s Handling of Performance and Conduct Issues
Appendix II 

Disposition of Misconduct Charges

Involving VHA Management Triad

Members—Fiscal Years 1994 Through 1996

Position title Nature of misconduct Disposition

Director Verbal sexual harassment; abusive language Demoted and reassigned out of state to another facilitya

Director Improperly lobbied local congressman to provide funds

to renovate buildings on the medical center’s grounds

to be turned over to university medical school named

for the same congressman

Counseled

Engaged in wasteful spending on quarters renovations,

improper spending on a (golf course) putting green,

and installing video cameras in a restroom

Admonishment was issued citing poor judgment in

installing camera. Other allegations were not

substantiated.

Director Used government vehicle for personal use while on

temporary duty

Reprimanded

Chief of Staff Conflict of interest: represented the medical center in

contracting negotiations with university where he was

on staff

Resigned after counseling and removal of contracting

authority

Associate Director Sexual and racial harassment: permitted establishment

of hostile environment

Admonished and put under an action plan

Director Committed reprisal by terminating a registered nurse

with whom he had engaged in a consensual affair

Retired

Associate Director Physical altercation with a police officer; hostile

environment

Demoted and reassigned out-of-state to another facility

Director Violated the Privacy Act by disclosing information to

officials of veterans group regarding an employee’s

status in the workers’ compensation program

Counseled

Director Violation of merit principles; travel irregularities Admonisheda

Associate Director Sexual harassment: established hostile environment via

consensual relationships with subordinates

Retired

Director Made inappropriate comments regarding members of

the clerical staff

Retired

Associate Director Sexual harassment Counseled

Associate Director Sexual harassment: requested “quid pro quo” sexual

favors from staff

Resigned

aAlthough the misconduct occurred within our fiscal year 1994 through 1996 review period, VHA’s

disposition of the misconduct occurred during fiscal year 1997.

Source: GAO’s analysis of data provided by VHA.

Page 44 GAO/GGD-98-92 VHA’s Handling of Performance and Conduct Issues
Page 45 GAO/GGD-98-92 VHA’s Handling of Performance and Conduct Issues
Appendix III 

Range of Misconduct Penalties at VA

Compared With Ranges at Agriculture and

Commerce

VAa

Nature of misconduct First Second Third

Sexual harassment Reprimand

to discharge

5-day

suspension to

discharge

10-day

suspension to

discharge

Inappropriate comments about staff Reprimand

to discharge

10-day

suspension to 

discharge

Discharge

Improperly lobbied local

congressman to earmark funds for

building renovations

N/A N/A N/A

Used government vehicle for

personal use

Mandatory

30-day

suspension to

discharge

Discharge b

Inappropriately installed video

camera in restroom

N/A N/A N/A

Conflict of interest: Represented VA

in contract negotiations with

university where he was on faculty

Admonishment to

discharge

10-day

suspension to

discharge

Discharge

Engaged in a physical altercation

with policeman

Reprimand

to discharge

10-day

suspension to

discharge

Discharge

Violated Privacy Act: Disclosed

information regarding workers’

compensation case

Reprimand

to 10-day

suspension

10-day

suspension to

discharge

Discharge

Violated merit principles: Promoted

employees before they had 1 year

in grade

Reprimand to

discharge

10-day

suspension to

discharge

Discharge

Page 46 GAO/GGD-98-92 VHA’s Handling of Performance and Conduct Issues
Appendix III 

Range of Misconduct Penalties at VA

Compared With Ranges at Agriculture and

Commerce

Agriculture Commerce

First Second Third First Second Third

Letter of reprimand to

discharge

14-day suspension

to discharge

b N/A N/A N/A

Letter of reprimand to

discharge

5-day suspension to

discharge

b Written reprimand to

10-day suspension

5-day suspension to

discharge

30-day suspension

to discharge

N/A N/A N/A N/A N/A N/A

Mandatory 30-day

suspension to

discharge

Discharge b Mandatory 30-day

suspension to

discharge

Discharge b

N/A N/A N/A N/A N/A N/A

Letter of reprimand to

discharge

Discharge b N/A N/A N/A

5-day suspension to

discharge

14-day suspension

to discharge

b Written reprimand to

discharge

5-day suspension to

discharge

30-day suspension

to discharge

Letter of reprimand to

discharge

Discharge b N/A N/A N/A

Letter of reprimand to

discharge

Discharge b Written reprimand to

10-day suspension

5-day suspension to

discharge

30-day suspension

to discharge

Note: The N/A designation represents charges or allegations that are not expressly listed in the

departments’ tables of penalties. However, the tables are designed to be broad enough to

include most, but not all, types of offenses, and appropriate penalties for the unlisted charges

could be imposed that are consistent with the range of penalties for comparable offenses.

aVA’s table of penalties, dated October 18, 1994, applies to all VA employees appointed under

Title 5, such as GS and SES employees; and under sections 7401(2) and 7401(3) of Title 38, such

as psychologists and pharmacists, respectively. VHA’s supplement to this table applies to

employees appointed under section 7401(1) of Title 38, such as nurses, physicians, and

optometrists. The range of penalties listed in VHA’s supplemental table is generally the same as

the range in VA’s table of penalties.

bThe tables of penalties do not list a penalty for a third offense of these types of misconduct.

Source: GAO’s analysis of the tables of penalties available at VA, the Department of Commerce,

and the Department of Agriculture.

Page 47 GAO/GGD-98-92 VHA’s Handling of Performance and Conduct Issues
Appendix IV 

Major Contributors and Acknowledgments

General Government

Division

Michael Brostek, Associate Director

Richard Caradine, Assistant Director

Mary Martin, Assignment Manager

Gerard Burke, Evaluator in Charge

Gregory Wilmoth, Supervisory Social Science Analyst

Ruth Kassinger, Writing Consultant

Office of the General

Counsel

Alan Belkin, Assistant General Counsel

Bruce Goddard, Senior Attorney

Acknowledgements In addition to those named above, the following individuals from the

General Government Division made important contributions to this report:

Ernestine Burt, Issue Area Assistant; Donna M. Leiss, Communications

Analyst; Michael O’Donnell, Senior Evaluator; and William Trancucci,

Senior Evaluator.

(410090) Page 48 GAO/GGD-98-92 VHA’s Handling of Performance and Conduct Issues
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