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44–179 PDF 2008

H.R. 3268, GOVERNMENT ACCOUNTABILITY OFFICE

[GAO] ACT OF 2007

HEARING

BEFORE THE

SUBCOMMITTEE ON FEDERAL WORKFORCE,

POSTAL SERVICE, AND THE DISTRICT

OF COLUMBIA

OF THE

COMMITTEE ON OVERSIGHT

AND GOVERNMENT REFORM

HOUSE OF REPRESENTATIVES

ONE HUNDRED TENTH CONGRESS

SECOND SESSION

ON

H.R. 3268

TO MAKE CERTAIN REFORMS WITH RESPECT TO THE GOVERNMENT

ACCOUNTABILITY OFFICE, AND FOR OTHER PURPOSES

MARCH 13, 2008

Serial No. 110–71

Printed for the use of the Committee on Oversight and Government Reform

(

Available via the World Wide Web: http://www.gpoaccess.gov/congress/index.html

http://www.oversight.house.gov

(II)

COMMITTEE ON OVERSIGHT AND GOVERNMENT REFORM

HENRY A. WAXMAN, California, Chairman

EDOLPHUS TOWNS, New York

PAUL E. KANJORSKI, Pennsylvania

CAROLYN B. MALONEY, New York

ELIJAH E. CUMMINGS, Maryland

DENNIS J. KUCINICH, Ohio

DANNY K. DAVIS, Illinois

JOHN F. TIERNEY, Massachusetts

WM. LACY CLAY, Missouri

DIANE E. WATSON, California

STEPHEN F. LYNCH, Massachusetts

BRIAN HIGGINS, New York

JOHN A. YARMUTH, Kentucky

BRUCE L. BRALEY, Iowa

ELEANOR HOLMES NORTON, District of

Columbia

BETTY MCCOLLUM, Minnesota

JIM COOPER, Tennessee

CHRIS VAN HOLLEN, Maryland

PAUL W. HODES, New Hampshire

CHRISTOPHER S. MURPHY, Connecticut

JOHN P. SARBANES, Maryland

PETER WELCH, Vermont

——— ———

TOM DAVIS, Virginia

DAN BURTON, Indiana

CHRISTOPHER SHAYS, Connecticut

JOHN M. MCHUGH, New York

JOHN L. MICA, Florida

MARK E. SOUDER, Indiana

TODD RUSSELL PLATTS, Pennsylvania

CHRIS CANNON, Utah

JOHN J. DUNCAN, JR., Tennessee

MICHAEL R. TURNER, Ohio

DARRELL E. ISSA, California

KENNY MARCHANT, Texas

LYNN A. WESTMORELAND, Georgia

PATRICK T. MCHENRY, North Carolina

VIRGINIA FOXX, North Carolina

BRIAN P. BILBRAY, California

BILL SALI, Idaho

JIM JORDAN, Ohio

PHIL SCHILIRO, Chief of Staff

PHIL BARNETT, Staff Director

EARLEY GREEN, Chief Clerk

LAWRENCE HALLORAN, Minority Staff Director

SUBCOMMITTEE ON FEDERAL WORKFORCE, POSTAL SERVICE, AND THE DISTRICT OF

COLUMBIA

DANNY K. DAVIS, Illinois

ELEANOR HOLMES NORTON, District of

Columbia

JOHN P. SARBANES, Maryland

ELIJAH E. CUMMINGS, Maryland

DENNIS J. KUCINICH, Ohio, Chairman

WM. LACY CLAY, Missouri

STEPHEN F. LYNCH, Massachusetts

KENNY MARCHANT, Texas

JOHN M. MCHUGH, NEW YORK

JOHN L. MICA, Florida

DARRELL E. ISSA, California

JIM JORDAN, Ohio

TANIA SHAND, Staff Director

(III)

C O N T E N T S

Page

Hearing held on March 13, 2008 ............................................................................ 1

Text of H.R. 3268 ..................................................................................................... 6

Statement of:

Copeland, Curtis, Specialist in American National Government, Congressional Research Service; Shirley Jones, Employee Advisory Counsel,

U.S. Government Accountability Office; Janet C. Smith, president, Ivy

Planning Group, LLC; and Jacqueline Harpp, interim council representative, International Federation of Professional and Technical Engineers, AFL–CIO ......................................................................................... 70

Copeland, Curtis ........................................................................................ 70

Harpp, Jacqueline ..................................................................................... 122

Jones, Shirley ............................................................................................ 88

Smith, Janet C. .......................................................................................... 99

Coran, Paul, chairman, Personnel Appeals Board, U.S. Government Accountability Office; and Anne Wagner, General Counsel, Personnel Appeals Board, U.S. Government Accountability Office ................................ 49

Coran, Paul ................................................................................................ 49

Wagner, Anne ............................................................................................ 60

Dodaro, Gene, Acting Comptroller General, U.S. Government Accountability Office, accompanied by Gary Keplinger, General Counsel, U.S. Government Accountability Office ..................................................................... 25

Letters, statements, etc., submitted for the record by:

Copeland, Curtis, Specialist in American National Government, Congressional Research Service, prepared statement of ......................................... 73

Coran, Paul, chairman, Personnel Appeals Board, U.S. Government Accountability Office, prepared statement of ................................................. 51

Davis, Hon. Danny K., a Representative in Congress from the State

of Illinois, prepared statement of ................................................................ 4

Dodaro, Gene, Acting Comptroller General, U.S. Government Accountability Office, accompanied by Gary Keplinger, General Counsel, U.S. Government Accountability Office, prepared statement of .............................. 28

Harpp, Jacqueline, interim council representative, International Federation of Professional and Technical Engineers, AFL–CIO, prepared statement of ........................................................................................................... 124

Jones, Shirley, Employee Advisory Counsel, U.S. Government Accountability Office, prepared statement of ........................................................... 91

Smith, Janet C., president, Ivy Planning Group, LLC, prepared statement

of ..................................................................................................................... 101

Wagner, Anne, General Counsel, Personnel Appeals Board, U.S. Government Accountability Office, prepared statement of .................................... 62

(1)

H.R. 3268, GOVERNMENT ACCOUNTABILITY

OFFICE [GAO] ACT OF 2007

THURSDAY, MARCH 13, 2008

HOUSE OF REPRESENTATIVES, SUBCOMMITTEE ON FEDERAL WORKFORCE, POSTAL

SERVICE, AND THE DISTRICT OF COLUMBIA, COMMITTEE ON OVERSIGHT AND GOVERNMENT REFORM, Washington, DC.

The subcommittee met, pursuant to notice, at 2:10 p.m., in room

2154, Rayburn House Office Building, Hon. Danny K. Davis (chairman of the subcommittee) presiding.

Present: Representatives Davis, Norton, Clay, and Marchant.

Staff present: Tania Shand, staff director; William Miles, professional staff member; Lori J. Hayman, counsel; LaKeshia N. Myers,

clerk; and Alex Cooper, minority professional staff member.

Mr. DAVIS. The subcommittee will come to order.

Welcome, Ranking Member Marchant and members of the subcommittee and hearing witnesses and all of those in attendance.

Welcome to the Federal Workforce, Postal Service, and the District

of Columbia Subcommittee hearing on H.R. 3268, the Government

Accountability Office [GAO] Act of 2007.

The hearing will examine H.R. 3268, the Government Accountability Office [GAO] Act of 2007, and various other legislative proposals that may be introduced before the hearing that address certain GAO reforms. It will also examine the results of the survey

I requested last May that the Employee Advisory Council conduct

of all GAO employees on the Band II restructuring and the Watson

Wyatt compensation study and the Ivy Group study.

Hearing no objection, the Chair, ranking member and subcommittee members will each have 5 minutes to make opening

statements, and all Members will have 3 days to submit statements for the record.

Today the Government Accountability Office [GAO], has an opportunity: It has an opportunity to regain its footing as an agency

that not only touts that its employees are the best and the brightest, but treats them as if they are the best and the brightest. GAO

has an opportunity to hold itself to the same standards of accountability and forthrightness that it demands of other agencies. GAO

has an opportunity to work with, not against, the subcommittee

when it raises legitimate concerns about its personnel reforms and

other issues pertaining to the administration of the agency.

It appears that GAO is going to seize this opportunity. I have

met with Mr. Gene Dodaro, the Acting Comptroller General, and

he has indicated that he intends to work collaboratively with the

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subcommittee to address any concerns that we have, and the subcommittee is committed to doing the same. Mr. Dodaro has over 30

years of service with GAO, and I hope he will restore GAO’s legacy

as a model agency.

Mr. Dodaro, welcome to your first hearing as Acting Comptroller

General of the United States.

Mr. DODARO. Thank you.

Mr. DAVIS. That said, after 2 years of investigating GAO’s personnel reforms, the subcommittee has unfinished business to address.

I am pleased to announce that I will be introducing legislation

that restores the 2006 and 2007 across-the-board increase to all

GAO employees who met expectations but did not receive it. The

bill also includes a provision that establishes an across-the-board

full guarantee that will govern how pay adjustments are to be administered at GAO in the future. The legislation has the support

of GAO and its union, the International Federation of Professional

and Technical Engineers.

While the subcommittee is pleased that the proposal has the support of GAO, it is unfortunate that it took 2 years of employees

being demoralized and worrying about their pay before we received

it. Last winter, the best and the brightest at GAO finally had to

vote to unionize to get management’s attention. The compromise

legislation which will be discussed today will be introduced and

marked up when Congress returns from the March recess.

In November 2007, at my request, members of GAO’s Employee

Advisory Council surveyed all GAO employees on GAO’s personnel

reforms. Seventy-one percent of GAO employees responded to the

survey, and we will hear testimony about the results of that survey

today.

Another troublesome issue that the subcommittee will continue

to address at future hearings is the historic disparity between the

ratings of African Americans and their Caucasian counterparts at

GAO.

At a hearing the subcommittee held in November 2007 on diversity in legislative branch agencies, Ron Stroman, Managing Director of GAO’s Office of Opportunity and Inclusiveness, testified that

he alerted David Walker that if GAO went through with its personnel reforms of Band II restructuring that it would have a negative

impact on African Americans. When pressed as to why GAO would

go through with a restructuring that it knew would adversely impact African Americans, Mr. Stroman stated it was a decision that

the Comptroller General made.

Last August, almost a year and a half after the restructuring

took place, GAO hired the Ivy Group to research the rating disparities between African American and Caucasian employees at GAO.

The Ivy Group will not complete its final report until next month.

However, what they have learned to date is troubling and raises

serious questions about GAO’s performance management system.

Mr. Walker officially resigned from GAO yesterday. Therefore,

the question of why he moved forward with the restructuring,

given the disparity in ratings, cannot be posed to him directly. Nevertheless, the subcommittee will continue its oversight of this issue

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and is pleased that Mr. Dodaro has indicated that he is committed

to addressing the problem.

I thank you, all of you who have come, and look forward to hearing from the witnesses.

And now it is my pleasure to yield such time as he would consume to the ranking member, Mr. Marchant.

[The prepared statement of Hon. Danny K. Davis and the text

of H.R. 3268 follow:]

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Mr. MARCHANT. Thank you, Mr. Chairman.

The Government Accountability Office is a critical research arm

of the Federal Government which we rely on for unbiased, highquality information. This information is frequently instrumental in

our legislative process and can determine the course of ongoing

oversight and legislation.

Last year, the GAO presented a request for legislative improvements to Congress. That request is currently embodied in H.R.

3268, the Government Accountability Office Act of 2007, which was

introduced by Chairman Henry Waxman. This bill would require

the Comptroller General to appoint a Deputy Comptroller General

who shall serve at the Comptroller General’s pleasure; establish an

Office of Inspector General in the GAO; and require the Comptroller General’s annual report to Congress to assess the overall degree

of Federal agency cooperation with GAO audits. The bill would also

make certain adjustments to salary rules to increase retention and

improve recruitment.

I understand, Mr. Chairman, that you are planning to introduce

a new legislation that would incorporate the changes described

above as well as other changes that are in response to the subcommittee’s oversight hearings last year. I look forward to seeing

a final version of that new legislation.

And as we move forward, I hope that the chairman and members

of the committee will be open to some discussion on this legislation.

Again, I thank the chairman for holding this hearing and the

witnesses for being before us today. Thank you.

Mr. DAVIS. Thank you very much, Mr. Marchant.

I see that Mr. Clay has arrived.

Mr. Clay, let me ask, do you have any opening remarks?

Mr. CLAY. I will forego opening remarks in the interest of time.

Mr. DAVIS. Thank you very much, Mr. Clay.

And we will then proceed with the witnesses.

It is the committee’s policy that all witnesses are sworn in, so if

you would rise and raise your right hands.

[Witnesses sworn.]

Mr. DAVIS. The record will show that the witnesses answered in

the affirmative.

Gentlemen, of course you know the usual drill with these. The

green light indicates that you have 5 minutes in which to summarize your testimony. The full testimony is in the record. Of course,

the yellow light means that there is a minute left, and the red light

means it is time to stop. So thank you very much.

Let me, first of all, congratulate you, Mr. Dodaro, and indicate

that not only are we pleased that you are here today, but I certainly look forward to a solid working relationship over an extended period of time. And we are delighted to work with you and

to have you here today. So you may proceed.

STATEMENT OF GENE DODARO, ACTING COMPTROLLER GENERAL, U.S. GOVERNMENT ACCOUNTABILITY OFFICE, ACCOMPANIED BY GARY KEPLINGER, GENERAL COUNSEL, U.S. GOVERNMENT ACCOUNTABILITY OFFICE

Mr. DODARO. Thank you very much, Mr. Chairman. I appreciate

the kind words and introduction. I’m determined to live up to the

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commitments that I made to work collaboratively with this committee.

Mr. Marchant, it is a pleasure to see both of you here today. I

appreciate the opportunity to be here today to discuss legislative

proposals to bolster the ability of GAO to attract and retain a highly skilled and diverse work force and help improve our operations.

I also plan to update you on our evolving relationship with our

new union and to also underscore my commitment to making sure

there is equal and fair treatment for all GAO employees.

As backdrop for my remarks, I would like to point out that, over

the past several years, there have been many changes at GAO.

Some of those changes have strengthened the organizations. Other

changes have evoked controversy and, in some cases, created new

challenges. We’ve addressed some of these challenges, but many remain. And we’re committed to working to resolve those challenges,

in cooperation with our employees and with this subcommittee and

other parts of the Congress.

It is important to note, I think, that during this whole time period throughout the GAO people have continued to produce highquality work for the Congress and generate positive organizational

results. I think this is a real tribute to the professionalism of our

work force and their dedication to GAO’s mission to support the

Congress and to improve Government for the benefit of the American people.

And I’m committed to making sure that GAO not only maintains

the high quality of its work to support the Congress, but also to

confronting and resolving the challenges that are before us today.

Now, the legislative proposals before the subcommittee can help

us in this regard. We support the adding of the floor guaranteed

provision to govern annual pay increases for GAO by adding that

to our existing authorities. Under this approach, existing GAO people meeting expectations will at least receive the annual increase

for the GS annual adjustment for their locality that they’re in.

My statement provides details on how this would work. And the

bottom line of this floor guarantee provision, from our standpoint,

is this gives out employees greater certainty and a link to the executive branch for pay parity while preserving the incentives and rewards of the GAO performance appraisal system. So we think it is

a solid approach, and we are looking forward to working with the

committee to get this into the legislation.

I would also seek the subcommittee’s support for our proposal to

raise the GS–15 cap to Executive Level III. We think this is very

important. Currently, the agencies that are the financial institution

regulators, such as FDIC, have this authority to pay higher than

the GS–15 cap, as does DOD and DHS. So we are at a real competitive disadvantage by not having this authority, and we need it

in order to make sure we have the senior, experienced people in

order to best serve the Congress.

Now, turning to some of the operational improvements, there are

many in the bill. I’ll highlight three right now. One is the creation

of a statutory Inspector General to replace our administrative Inspector General that’s been in place for a number of years. This

would put our Inspector General on an equal footing with the InVerDate 11-MAY-2000 14:32 Sep 29, 2008 Jkt 000000 PO 00000 Frm 00030 Fmt 6633 Sfmt 6633 C:\DOCS\44179.TXT KATIE PsN: KATIE
27

spector Generals of other legislative branch agencies and provide

an appropriate level of independence and autonomy.

Second, we are seeking a requirement where GAO would issue

an annual report card on the cooperation that we received in executive branch agencies in carrying out our audit work, in terms of

their timely provision of records and access to people needed to

complete our work for the Congress. We think this would create

greater transparency over the level of cooperation we receive and,

ultimately, lead to more efficient GAO operations and timely services to the Congress.

And last, I would, in the operational area, seek your approval of

the provision by which we would receive reimbursement for audit

costs.

I’d quickly like to touch on two other work force issues.

First, we are committed to working constructively with our new

union to forge a positive labor management relations environment.

Since the union was voted in in September, we have provided a lot

of resources and training to create a good environment, and we

were pleased to negotiate a very prompt agreement with them on

pay decisions for 2008.

Also, we’re committed to ensuring fair and equal treatment for

our work force. As was mentioned, we have commissioned the Ivy

Group to come in and do a study. We are looking to them for insights, best practices and recommendations. We are looking forward to receiving a final report and have committed to following

up on the recommendations and keeping this subcommittee apprised of our progress going forward.

In closing, Mr. Chairman, since this is my first day as Acting

Comptroller General, I want to assure this subcommittee that I’m

committed to improving GAO and making sure we have the highest-quality work possible to support the Congress. And I am very

honored and privileged to lead such a highly skilled and talented

work force at the GAO, and I will be working with them, as with

this committee.

Thank you for your time and attention, and I’d be happy to take

any questions.

[The prepared statement of Mr. Dodaro follows:]

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Mr. DAVIS. Thank you very much, Mr. Dodaro. And we certainly

look forward to all of our follow-ups and follow-throughs.

As you know, pay adjustment has been at the top of the discussion list for a while now. And the subcommittee staff has been

working on a pay adjustment provision for the fiscal year 2006 and

2007 for GAO employees who met expectations but did not receive

them—that is, did not receive an across-the-board adjustment for

those years.

You’ve expressed some position, but would you reaffirm your

views on the retroactive vision that I have included in the legislation that I am going to introduce to address this problem, and also

rearticulate for us your views on the across-the-board floor guarantee?

Mr. DODARO. I would be happy to, Mr. Chairman.

First, on the 2006 and 2007 payments for those people who didn’t

receive the across-the-board adjustment, we believe the discussions

we’ve had with the subcommittee have been very fruitful. And we

have arrived at a practical and reasonable approach for addressing

that issue, should the Congress decide to legislate on that issue.

We are pleased that it contains the necessary legal authorities and

funding authorities for GAO to carry out that provision once enacted. And we would be very pleased to have this issue behind us

and moving forward.

As it relates to the floor guarantee, we think this is a really solid

approach going forward that preserves the intent of the pay-forperformance system at GAO but strikes a better balance with giving our employees some certainty going forward and a link to the

executive branch.

So we are supportive of these proposals and hope that they are

enacted.

Mr. DAVIS. Thank you very much.

As you know, last summer GAO contracted with the Ivy Group

to study why African American employees at GAO were receiving

lower ratings than their Caucasian counterparts. The Ivy Group

found that not only were there disparities in the ratings between

African Americans and Caucasians, but that GAO’s dropping of two

rated competencies in 2004, while not significant, were the two

competencies that African Americans performed better on.

What do these facts tell us about GAO’s performance management system, if anything? And once the Ivy Group completes its

final report, what steps do you intend to take to address the concerns raised in the report?

Mr. DODARO. First of all, Mr. Chairman, this study is very important to GAO, and I am personally committed to making sure that

we forthrightly address the recommendations out of the study.

Now, the competencies were realigned back in 2004, effective for

fiscal 2005 ratings. We went from 12 competencies down to 8. That

was largely based on input from our managers and our Employee

Advisory Council, at that point in time, that the new system we

had put in place in 2002 was burdensome and there was some

overlap in the competencies.

Now, the competencies themselves, the performance standards

and work activities were actually merged in with our competencies,

so it wasn’t eliminated. We did not have any reason to believe, at

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that time, that it would have a negative effect on any particular

group, but it was to streamline the system that we had in place

at that time and respond to concerns that were fairly broad-based

at that time in the agency.

Now, given the fact that Ivy has already raised this in their Task

1 briefing, I’ve already asked our human capital people to go back

and take a look at what we could do. That competency system was

validated by a large number of GAO people, and we may have some

ability to make some changes to that system. And, of course, you

know, we’ll have to work with the union to make any further

changes, but we are already looking at that issue.

Mr. DAVIS. We’re going to have to go and vote. But before I do,

let me ask you, how do you reconcile GAO’s second-place position

on the best-places-to-work ranking with the concerns employees expressed in the Employee Advisory Council’s restructuring survey?

Mr. DODARO. Well, the best-places-to-work survey is based upon

OPM questions that are asked throughout the Federal Government, and then there are comparisons made. And its questions we

incorporate in the GAO employee feedback survey, so that we can

be bench-marked against other agencies. They take a fairly broad

view of the workplace and the workplace environment, and on that

score we do very well. We ranked No. 2 in large Federal agencies

across the Government.

Now, the Employee Advisory Council survey that was conducted

was focused on some of the most controversial aspects of our

changes, which was the pay system and the Band II restructuring.

But it also had a section on organizational climate. And, in that

section, the results on the issues other than pay were very consistent with what we received in an employee feedback survey.

It was also conducted before we reached the agreement with the

union on 2008 pay adjustments and we developed this floor guarantee approach. And I also think, you know, in retrospect, if we would

have had the floor guarantee in place for 2006 and 2007, while we

would have had some issues to deal with, they wouldn’t have been

anywhere near as magnified as they were otherwise.

Mr. DAVIS. OK. So the controversy that, sort of, existed around

those issues in all likelihood helped to pull down how people

ranked the——

Mr. DODARO. In this particular survey that was just conducted

at the committee’s request by the Employee Advisory Council, I believe that was a contributing factor. There was some provision in

there that asked about the COLA, and a lot of people felt it was

unfair that wasn’t applied to everybody going forward.

I’m not saying that would have resolved all the controversies,

Mr. Chairman, but I do think it would have reduced the angst.

Mr. DAVIS. Mr. Keplinger.

Mr. KEPLINGER. Mr. Chairman, I also think that if we are successful in getting your legislation passed, it will be responsive to

a number of the concerns identified in the EAC survey.

And I would add to what Gene said, and I would second it too,

I think there is also a significant amount of pride amongst our

work force in the work that they do, and that comes through in

these surveys.

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So, hopefully, we can deal with the problems that we’ve had, get

those resolved and move forward.

Mr. DAVIS. Well, thank you both, gentlemen. We’re going to have

to recess for a minute and run and vote, and we’ll be back.

[Recess.]

Mr. DAVIS. We will return to session.

I’m going to go to Ms. Norton. Mr. Marchant hasn’t gotten back

yet, and we will just go to Ms. Norton for her questions.

Ms. NORTON. Thank you, Mr. Chairman. I think this is a very

important bill and one that you have done the kind of oversight

that is respected before changes are made in existing legislation.

I don’t have a great many questions for these witnesses. However, I would like to just say a word about the COLA adjustment,

which has come up time and again in our hearings.

I saw the appropriation committee of the Defense Department

adjust the COLA for DOD employees, some of whom, for various

reasons, were captured by the same problems, because of the new

pay system, as the GAO employees. So guess what? They went to

one of the most powerful committees, subcommittees, in the Appropriation Committee, and they got their COLA.

I want to know if you see any justification—I indicated, when we

were discussing the changes, that I had recommended for this bill

to equate the kinds of independence that the appointing authority

has in the executive branch with the kind of authority the Speaker

and the minority ought to have here and in the Senate.

I must say that I don’t—uniformity, for its own sake, doesn’t

work with me. But inequality doesn’t work either. There are good

reasons, sometimes, for changes, and if they are justified then, of

course, it seems to me if they are functionally justified, they should

occur.

Looking to the COLA, would either of you see any justification

for making people who did not receive their COLA in the years

that have been acknowledged without, at the same time, making

these employees whole for the entire period? Could that possibly be

justified?

Mr. DODARO. I——

Ms. NORTON. In other words, could you get a little bit pregnant?

If you concede that you must make them whole for a couple years,

aren’t you already pregnant? Go ahead and have the baby.

Mr. DODARO. With regard to the 2006–2007 situation, we think

we’ve worked with subcommittee staff and have come up with a

really reasoned and practical approach for providing the cost-of-living adjustment to those employees who did not receive the cost-ofliving adjustment at that time. That would be provided in a lumpsum payment to them, as well as their salaries adjusted going forward, and so their salaries would be brought up to the level going

forward that they would have been assuming they had received

those adjustments. So we think that’s a reasonable——

Ms. NORTON. Excuse me, OK, don’t—because reasonable people

can disagree on what’s reasonable. I just want to make sure we

have on the record whatever justification is appropriate.

Now, 2006 and 2007 you believe are appropriate.

Mr. DODARO. Yes.

Ms. NORTON. You believe they are reasonable.

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Mr. DODARO. Yes.

Ms. NORTON. That being the case, why is it not appropriate to

make these employees whole for the entire period? I can understand you may be limited——

Mr. DODARO. Right, right.

Ms. NORTON [continuing]. In what you can do. If that’s your answer, I would understand that. But is there any justification for not

making these employees whole for the years that they did not receive their COLA if they should have received them——

Mr. DODARO. Right.

Ms. NORTON [continuing]. For the 2 years that you believe clearly

they should have? I’m looking for a justification. I’m not looking for

what was reasonable.

Mr. DODARO. Right, right.

Ms. NORTON. I was looking for why it was reasonable or why it

is reasonable, if you think it is, to deny them their COLAs for the

years that proceeded it. It may have seemed reasonable at the

time. I’m now saying—that’s why I said ‘‘at this moment in time.’’

Mr. DODARO. Right, right.

Ms. NORTON. Could the Congress possibly justify giving back the

COLA for 2 years—and, by the way, isn’t this a part of the pension? Isn’t COLA included in the pension? Your COLA is part of

your wages and is included in your pension.

So you understand what I’m talking about here.

Mr. DODARO. Right, right.

Ms. NORTON. We’re not talking just about people’s salaries. We

are talking about their pensions as well, their base pay.

Mr. DODARO. Right.

Ms. NORTON. So I’m saying, that considered, what is the justification? I’m not saying at the time there may have seemed justification.

Mr. DODARO. Right, right.

Ms. NORTON. At this point in time, people get 2 years. Is there

any justification for saying you can have it for 2 years, but you cannot have it for the period, the entire period that you were denied

your COLA?

And, if so, I want to hear the justification, specifically, not that

it was reasonable. If your justification is it seemed reasonable at

the time, we understand the difference, fine. What would be the

justification now for making people partially whole?

Mr. KEPLINGER. Mrs. Norton, maybe I could take a crack at this.

When we considered these two issues of dealing with the past

and the pay decisions that were made with respect to 2006 and

2007, as Gene mentioned before, we want to prospectively adjust

their salary and we want to give them a lump sum.

The three principles that we brought to bear as we were talking

internally and with staff about how to approach this is that we

wanted to, one, have something that budgetarily we can afford; second, that it’s administratively doable and not overly burdensome;

and third, that it is fair.

Now, we have structured a proposal which, you know, in an ideal

sense it may not be everything that everybody wants and every detail, but we think, on balance, it’s a very fair proposal. And it also

deals with the retirement issue, too, through directions to OPM to

46

include the prospective pay adjustments in our employees’ high–3

going forward.

I hope that helps.

Ms. NORTON. Well, according to the staff memo, what we are

doing is authorizing—seeks to provide an opprobrium for those employees who were denied all or part of their annual adjustment for

2006 and 2007 or both years.

Are those the only years——

Mr. DODARO. Yes.

Ms. NORTON. Perhaps that makes them whole, but——

Mr. KEPLINGER. Yes, those are the only 2 years.

Mr. DODARO. This takes care of everything in the past.

Ms. NORTON. Thank you.

Mr. DODARO. Yeah. Prior to that, Congresswoman, I’m sorry, I

didn’t understand either. Basically up to 2005, we were giving the

same across the board as the executive branch.

Ms. NORTON. Only for those years.

Mr. DODARO. Only for those years. And the floor guarantee provision we’re seeking that’s also included in there——

Ms. NORTON. The what?

Mr. DODARO. It is a floor guarantee going forward; that would

take care of the issue going forward as well.

We’re hoping to never to talk about this issue again.

Ms. NORTON. Talk about putting an issue to rest.

Mr. DODARO. Yes, yes. That is our objective.

Ms. NORTON. So we are fully pregnant; the baby has been born.

Mr. DODARO. Yes.

Ms. NORTON. Thank you very much.

Mr. DODARO. As has been pointed out to me, I am not able to

do that. [Laughter.]

But I am able to be empathetic, and I can try.

Ms. NORTON. Well, like every father, you all were very necessary.

[Laughter.]

If you want to cutoff these metaphors, I’m perfectly willing to.

[Laughter.]

The part of me that still teaches law enjoyed our conversation on

the effort I’m seeking in the chairman’s bill to equate what happens in the executive agencies with GAO as well. And there was

some thought that maybe there were some agencies, smaller agencies, where the agency head may appoint the IG. Perhaps that is

the case.

I must say I’m familiar with many agencies, having headed one

myself, and am aware of no agency of any consequence where Congress hasn’t appointed a GAO. And that may be because Congress

looks at the size and importance of the agencies to public policy.

Surely it wouldn’t be the size alone, because agencies differ vastly

in size.

But I do want to get on the record that, in terms of the kinds

of work the GAO does, which depends upon your independence,

would you believe that, for an agency of consequence, whose policy

concerns were of importance to the public, that an independent IG

would help it or assist it in being credible to the Congress of the

United States and to the general public?

47

Mr. DODARO. We definitely support the IG concept and the principal. And we are prepared to have ourselves held to the same

standards as any other agency. And we believe firmly in that process.

I mean, that is why we’ve had an Inspector General created administratively for over a decade. So we have voluntarily put that

system in place, the way we have for many management principles

and laws that are applied to the executive branch that don’t normally apply to the legislative branch or GAO.

And so we are very committed to that. I mean, we have put forth

the statutory IG provision in our bill in an attempt to further enhance the independence and autonomy of that position. And, you

know, we’re willing to entertain discussions about the best way to

appoint that person to have credibility, you know.

There are only one political appointees, maybe two, in GAO all

together. One is the Comptroller General position, which the Congress creates a list of at least three people with a congressional

commission, sends names to the President; the President can ask

for additional names but has to pick from that list. Now, that’s different because we’re in the legislative branch than it would be for

just the President to pick somebody on their own, for a Presidential

appointee in a legislative branch agency. So there are differences.

The only other political appointed position in the GAO has been

Deputy Comptroller General, and that’s been vacant for a while,

because that has not worked, that process hasn’t worked. And

while we were originally seeking to change that process with this

legislative proposal, given the departure of Mr. Walker we think

those things ought to be held in abeyance for a while.

Mr. KEPLINGER. And, Mrs. Norton, I would be happy to supply

the committee, for the record, the list of the entities in the executive branch—I don’t want to pass judgment on whether they are or

are not of any consequence at this moment—where the heads of the

agencies point the IG.

In the legislative branch, the Architect of the Capitol, the Librarian of Congress and, I believe, the Public Printer all appoint the

Inspector Generals in their institutions.

Mr. DODARO. And I’m certainly open to having consultation with

our oversight committees as part of this process. I mean, I think

that just makes sense, so that you have confidence in that individual.

Ms. NORTON. Well, I certainly want to commend the GAO for understanding that, when Congress hadn’t appointed one, at the very

least he should appoint one. And I do want to indicate I certainly

have seen nothing to indicate that the lack of formal independence

has affected the PAB or has affected the IG or has affected the

Comptroller General. I really have not.

As I indicated to you, I am sick and tired of Congress waiting

until something happens before it then runs to do the obvious.

That, really, is all I’m about, because the chairman was doing a

number of other things in the bill. We don’t just shoot bills through

here, that seem the appropriate time. I certainly don’t think—far

be it from me to say that the Architect of the Capitol, Library of

Congress and the Public Printer are not agencies of consequence,

but you will forgive me if I do not equate them with the GovernVerDate 11-MAY-2000 14:32 Sep 29, 2008 Jkt 000000 PO 00000 Frm 00051 Fmt 6633 Sfmt 6633 C:\DOCS\44179.TXT KATIE PsN: KATIE
48

ment Accounting Office, which then gets to pass judgment on everybody in and the U.S. Government, much to their displeasure,

because whenever the GAO is talking about you, it normally isn’t

saying anything you want to hear. [Laughter.]

So I must say, if those are the agencies, they tend to prove my

point, that I—my own sense is that if a Member of Congress wants

to require things of their constituents, we have an Office of Compliance, and it says we’re going to apply the same laws to ourselves.

Those of us who sit in stations of power of one kind or the other

are most vulnerable, terribly vulnerable, if, in fact, we don’t live up

to the same standards or structure ourselves by the same standards.

So without meeting in fact-finding, I’ve sat in hearings and heard

General Counsel testify about the employee matters. That seemed

to me to be a straight-up-and-down counsel who looked at the law

and just called it as she saw it.

So the last thing I’m saying is that I see some evidence, but I

have to tell you, this committee is part of oversight and reform.

The reason that we have oversight and reform, a whole committee

on that, largest committee in the House, is precisely because there

are so many things that blow up, and then it is our job to look at

why it blew up. And then they say, why in the world didn’t somebody do something about it? The reason is it wasn’t broken. It

wasn’t broken.

In the global economy, the United States better figure out this

is not a world of ours any longer. This is not about economics. But

it is about the habit of the Congress of saying, unless it’s broken,

we aren’t going to do anything about it. So I would like to do something about it this time.

And I thank you, Mr. Chairman.

Mr. DAVIS. Thank you very much, Ms. Norton.

Gentlemen, I think that concludes our questions for you. And so

thank you very much, and we appreciate your being here.

Mr. DODARO. Thank you, Mr. Chairman.

Mr. DAVIS. We will now go to our second panel for the afternoon.

Panel two is Mr. Paul Coran. He is the chairman of the GAO’s

Personnel Appeals Board. The Personnel Appeals Board adjudicates personnel disputes involving employees or applicants to

GAO, as well as monitors equal employment opportunities at GAO.

Ms. Anne Wagner is the General Counsel for the GAO’s Personnel Appeals Board.

And I see that you are both standing, so I will just stand with

you and administer the oath.

[Witnesses sworn.]

Mr. DAVIS. The record will show that the witnesses answered in

the affirmative.

Thank you both for coming, and thank you both for being here.

Mr. Coran, we will begin with you. You’ve got 5 minutes to summarize your testimony. The yellow light indicates that you are

down to 4. And, of course, the red light means that we’ve exhausted the time.

Thank you very much, and you may begin.

49

STATEMENTS OF PAUL CORAN, CHAIRMAN, PERSONNEL APPEALS BOARD, U.S. GOVERNMENT ACCOUNTABILITY OFFICE; AND ANNE WAGNER, GENERAL COUNSEL, PERSONNEL

APPEALS BOARD, U.S. GOVERNMENT ACCOUNTABILITY OFFICE

STATEMENT OF PAUL CORAN

Mr. CORAN. Good afternoon, Chairman Davis and Representative

Norton. I am Paul Coran. I’ve served on the Personnel Appeals

Board since January 2005, and I’ve been the Chair since September 2007. I’m honored to be here today before you to share my impressions of the Board’s structure and processes.

The PAB is charged with all of the investigatory and adjudicatory functions of the MSPB, the EOC, the Office of Special Counsel,

and the FLRA. As an adjudicatory body, the PAB must be independent, impartial, informed, effective and efficient. The Congress

and GAO’s employees and managers are entitled to no less.

One might ask how the PAB may entertain such broad jurisdiction, exist in the GAO’s structure, and yet maintain strict standards of an adjudicatory body. The answer is that, in creating the

PAB, Congress was very careful to design the Board, its jurisdiction and structure in a way that would maintain the requisite independence and be both efficient and effective.

I believe that the PAB is structured to and has consistently performed its statutory mission very well by providing a just forum for

resolution of employment disputes and by providing independent

oversight of equal employment opportunity at GAO for nearly 30

years.

My perspective I derive from serving a term in the so-called

school of hard knocks. Before joining the PAB, I served for 36 years

in Federal employment in labor law capacities in both the executive

and legislative branches, as a neutral with the NLRB, the Department of Labor, the old Federal Labor Relations Council, and the

Office of Compliance. And I served in advocate roles at two ends

of the pole: as a president of a local labor organization and as a

management attorney with the Department of State.

These experiences allowed me to observe and participate before

an array of Federal-sector employment adjudication agencies with

governmentwide jurisdiction. I’ve also had the opportunity to observe and participate before boards which are limited to the executive branch foreign affairs agencies.

In preparing for today, I reviewed the excerpts from last year’s

hearing and noted Representative Norton’s concerns about Board

members’ independence, in particular how they are appointed. I

would like to address those concerns.

The PAB’s independence goes well beyond its separate physical

location in a building closer to Capitol Hill than it is to GAO. It

goes beyond its complete freedom to create its own personality,

such as in its own report covers not having the iconic GAO blue

covers. It goes beyond its ability to keep its employees in the GS,

general schedule, pay system, while the rest of GAO became paybanded. It goes beyond the fact that the PAB has its own logo and

its own Web site.

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In my 3 years with the PAB, I’ve had no reason to conclude anything but that my colleagues and I serve as totally free agents in

meeting our statutory responsibility.

As part of the GAO, we enjoy the excellent logistical resources

that GAO provides us for our administrative needs. In prior service, I have seen the small free-standing agency overburdened with

having to provide for nearly all of its administrative needs. I am

grateful that we are not so diverted from our mission.

At the same time, our autonomy evokes the sense of actual separateness throughout our staff and through the Board. I recognize

that the appearance of independence can be as important as the actuality. While the Comptroller General appoints the PAB members,

that act is the result of a nearly year-long collegial process.

I’m running short on time, and I want to summarize that process

just by saying that the process is exhausting. Employees and their

involvement is integrated throughout the process. And the Comptroller General may appoint the members, but it’s only after this

careful vetting process.

I’m sorry that I’ve gone past my time.

Mr. DAVIS. Go right ahead. You can finish up.

Mr. CORAN. Oh, OK.

I’d like to point out the people with whom I serve, which is indicative of the quality of appointments through this process. Throughout the history of the board, they have all been labor and employment law specialists. Some have represented management, some

been employee advocates, some have been neutral. I, myself, have

moved across those roles. But I’ve never worked with anyone on

the Board who would ever serve in a situation where doctrinaire

policies govern rather than applying the rule of law and equity to

cases on an individual basis.

I do believe that the Board has fulfilled its function through its

decisions and its oversight on EEO matters throughout its almost

30 years of existence. And I would be pleased to answer any questions the committee may have. Thank you.

[The prepared statement of Mr. Coran follows:]

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Mr. DAVIS. Thank you very much.

Ms. Wagner.

STATEMENT OF ANNE WAGNER

Ms. WAGNER. Thank you, Mr. Chairman. Good afternoon.

Good afternoon, Mrs. Norton.

I am here at your request, Mr. Davis, to answer your questions

concerning the Office of General Counsel’s investigations into a

number of charges that have been filed with the PAB General

Counsel’s Office dealing with GAO’s pay system.

As a preliminary matter, I would just like to reiterate what I had

stated in my previous testimony before the subcommittee, that the

PAB General Counsel, by statute and regulation, conducts investigations into charges that are brought before it, in order to make

a reasonable-grounds determination as to whether a violation has

been committed and, if so, to offer representation to the charging

party, to adjudicate that claim before the Personnel Appeals Board.

Therefore, the entire thrust for our investigation is really directed at determining whether that offer of legal representation is

to be made.

The ultimate decisionmaking with regard to those claims is, of

course, statutorily committed to the Personnel Appeals Board itself,

which makes findings of fact and draws conclusions of law with regard to the claims.

With regard to the status of the investigations, I would point out

that there were 274 charges that were filed in toto dealing with

various aspects of the GAO pay system. These charges can generally be characterized as having challenged a market-based pay

system that was established at GAO, the elimination of the 2006

and 2007 annual adjustment, otherwise known as the COLA.

The charges also raised the question or raised claims as to the

deviation of the GAO COLA in 2006 and 2007 from that which was

accorded the executive branch employees under the GS schedule.

Some of these charges also challenged the use of a standardized

ratings score in calculating the performance-based compensation

that is afforded employees at GAO.

In addition, some of these charges dealt with the calculation of

locality pay, the use of a ‘‘speed bump’’ with regard to some of the

band-level pay ranges, the lack of uniformity in the rating system

across the teams at GAO, as well as some challenge to the Band

II restructuring decisions.

In addition, there were 14 individuals who challenged the pay

decisions based on claims of discrimination. That is, some of them

have alleged that the pay decisions were unlawful based on discrimination due to age, race, as well as sexual orientation.

Since these charges have been filed, eight individuals have withdrawn, which has left us with 266 charges currently pending in our

office in investigation.

Our office has now completed its investigation, and I am particularly sensitive at this point to enter into any public disclosure with

regard to our preliminary assessment as to the merits of any or all

of those claims. However, the question as to the Comptroller General’s statutory authority to eliminate the COLA entirely in 2006

and 2007 was a question that was raised as part of the Band II

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restructuring cases that my office handled last year which settled

and which was the basis of the testimony that I gave last year. So

I do feel—I don’t feel constrained with regard to any issues of confidentiality in discussing that issue with you today.

My determination with regard to the statutory authority question has not changed since last year. I do believe that the plain language as well as the legislative history of Public Law 108–271

manifestly supports the conclusion that the Comptroller General

lacked statutory authority to eliminate the COLA entirely.

That said, and with due regard for the rights of the employees

whose claims are still pending in our office and still under investigation, I would be more than happy to answer any of the questions that you have with regard to the cases that we are handling.

Mr. DAVIS. Thank you very much, and thanks to both of you.

[The prepared statement of Ms. Wagner follows:]

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Mr. DAVIS. As you know, the subcommittee staff has been working on pay adjustment provisions for the fiscal year 2006 and 2007

for GAO employees who met expectations but did not receive an

across-the-board adjustment for those years. What I would like to

know is your views on the retroactive provision that I have included in the legislation that I will introduce to address the problem and also your views on the across-the-board floor guarantee

provision that will ensure that, in future years, GAO employees

will get the general schedule annual pay adjustment.

Ms. WAGNER. Mr. Chairman, I have to say that I don’t have a—

it would be entirely speculative to pass judgment or to address the

questions directly.

I was given a draft proposal, proposed language, Friday or Monday. I raised concerns about whether or not the language as it was

given to me at that point would fully redress the claims with regard to the COLA. I don’t—I have not seen any subsequent revisions, if, in fact, there have been. At that point, if there have been

revisions, I certainly would be happy to review that and provide

you with my assessment as to whether that would redress fully the

claims concerning the COLA.

Mr. DAVIS. All right. Let me ask you, also, what drives if you—

many of the appeals that you get? Many of the appeals that come

before the Board? I mean, what do you think actually drives them

or cause the individuals to appeal?

Ms. WAGNER. I think there are two aspects to that question, the

first being what drives people to our office filing a charge, and then

what would compel them to take a case forward to the Board.

I think that in my short experience as the General Counsel at

the Personnel Appeals Board, I have seen that employees uniformly come to our office because they genuinely feel that they

have—somehow, their rights have been violated or that they have

been wronged in some way. If they can’t articulate specifically how

their rights have been violated, I find that perfectly understandable, but it is genuinely that they feel that they have been

wronged.

After we have had an opportunity to do an investigation and to

examine the factual and legal grounds for that, their claim, they

then have to step back and analyze whether there is a viability

from a legal standpoint in terms of going forward. That is assuming, you know, whether or not we offer to represent them or not.

And at that point, I think that—again, I can only speculate—but

I suspect that the extent to which individuals take those cases forward or want to take them forward is probably a function of a

number of factors: how strong the case is, what personal toll they

anticipate this having on them.

Mr. DAVIS. Do you feel that passage of the provisions relative to

the claims before the PAB that pertain to the denial of across-theboard increases for 2006 and 2007 would decrease the number of

appeals that would in all likelihood come before the Board?

Ms. WAGNER. Again, without having the language to—having

really reviewed the language that may be currently under consideration, if I could simply state more sort of broadly and generally. If

the legislation that is being proposed plainly manifests congressional intent to make these individuals whole with regard to their

65

annual pay adjustments, then I think the—one could say that

much of the relief that the employees might have gotten through

the adjudicative process would have been afforded them through

the legislative process.

Mr. DAVIS. Thank you very much. I have no further questions.

Ms. Norton.

Ms. NORTON. Could I have your view, if a system may be used

to determine job-related matters, such as promotion, for example,

does that system have to be validated?

Mr. CORAN. Representative Norton, we only get it at the Board

level after it goes through the General Counsel’s investigative process. We get live cases where the employee has exhausted the administrative process and is—either the General Counsel represents

the employee, if the employee accepts, or else the employee comes

forward.

And what you are bringing up is a question of possible or legal

failing of a charge. Someone may claim that the standards by

which they were not promoted do not—they have an adverse impact and a prescribed basis, and they haven’t been validated. That

could be a case that could properly be brought before the Board

and would have to be adjudicated.

Ms. NORTON. I didn’t ask you about the outcome. I asked you

about the standard. I am asking about the standard of validation

of matters used for various decisions and an employee’s work have

to be validated. I am not asking you for the outcome. Obviously,

they have to show whether or not they are job related. I am asking

validated. Of course, validated means job related.

Mr. CORAN. I would be speaking just personally and not for the

Board. But from my dealing in these cases, particularly at the

State Department, where there was a women’s class action where

the written examination had an adverse effect on women and it

couldn’t be shown to be strictly job related, the Department settled

that case because the matter hasn’t been validated. Yes.

Ms. NORTON. Thank you.

Ms. Wagner, isn’t that the current state of the law, that terms

and conditions used for such matters as promotion—I just give an

OA system of ratings, you can name it, that—that, subject to challenge, if in fact the entity could be a private employer or Federal

agency cannot validate the use of the particular system?

Ms. WAGNER. The question as to whether—what factors must be

taken into account with regard to——

Ms. NORTON. Now, don’t answer another question I wasn’t asking

you. I wouldn’t begin to ask you what factors. I’m asking you a conclusion of law, based on what I presume you understand about the

existing case law.

That is all Mr. Coran gave me. He couldn’t give me anything pertaining to a specific case.

If I were to ask a Supreme Court Justice, do you—what does—

a conclusion of law, he could probably tell me what the law is.

What applied to a specific fact, he couldn’t tell me anything because you have to look at that set of circumstances.

I am simply asking whether the factors that an employer uses,

public or private, to make judgments about major aspects of a person’s employment such as promotion or how the person’s rating—

66

you can name it. I don’t know what it is, because I don’t know

what job I am talking about yet. I am simply asking. The bottomline question is, would not that system have to be validated as a

matter—does not the case law show that?

Ms. WAGNER. The case law talks specifically in terms of a Title

7 challenge to a personnel action. Oftentimes, the party will look

to whether the factors were validated. I don’t think that the law

supports the concept that there is any one particular method for

validating a particular system, and the only reason why I was

talking——

Ms. NORTON. I will grant you that. I wouldn’t ask you about any

of the specifics of validation. It is a very technical process. It varies

from job to job. It is a very difficult process. I am simply trying to

ask the bottom-line question about validation itself.

Ms. WAGNER. I think that it would—it is reasonable to say that

any decision, whether it is a promotion or pay, would have to be—

arise out of a system that is valid.

Ms. NORTON. That is all I am asking.

Let me understand—I understand your role, Mr. Coran. Your

role, obviously, is much like the adjudicatory role of any body, of

any similar body, for example, in the executive branch, where you

sit in judgment and you wait for the specific cases to come before

you.

Could I ask whether the General Counsel renders advice to anybody other than the PAB? Who renders advice to the Comptroller

General?

Ms. WAGNER. The PAB General Counsel does not render advice

to the Comptroller General, and I would assume that the Office of

General Counsel at GAO provides——

Ms. NORTON. So they have their own General Counsel?

Ms. WAGNER. Yes.

Ms. NORTON. Could I ask you—Ms. Wagner, I think it is probably the case—and I can’t find a way out of this. Apparently, 12

employees did file for the PAB and did get a remedy; and, of

course, that left everybody else out, and they didn’t get a remedy.

They hadn’t filed. That is why this action here has been necessary,

to make those people who did not file whole.

Is there anything that could have been done so that we did not

have to go through this laborious process? When there were 12 people who had shown for the class, there was an error made and most

of the class was left out because they haven’t filed——

Now, obviously, we are in Federal court. There is ways to deal

with those things. It is pretty formal, class actions and the like.

But here you have this anomalous situation where the PAB had

found, I believe, that—I believe you had argued, I believe you had

argued that the Comptroller General lacked the authority to deny

the COLAs. I believe Mr.—the PAB found to that effect and that,

as a result, 12 people who filed, they settled before it went to the

PAB.

Ms. WAGNER. Yes——

Ms. NORTON. You argued, and then they settled. Is that it? You

made the—you made the case that you believed he—he, the Comptroller General, lacked the authority. At that point, a settlement occurred. Is that how?

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Ms. WAGNER. If I can just address what I believe is the underlying concern, which is why the relief wasn’t extended more broadly

from the 12 to the rest of the 308 individuals who were denied

COLA in 2006.

At the time, that the 12 individuals—actually, there were more.

But at the time those individuals filed, the case, what they were

challenging, the personnel decisions that they were challenging had

to do with the restructuring. They all arose out of the split of the

Band II analysts and specialists work force. That—one of the effects of the split for some of those people was the elimination of

their COLA because they, having been placed in a Band II A, they

capped out and then, therefore, were denied a COLA.

But the fundamental thrust of those cases was then, and remained throughout, whether this restructuring process itself was

valid and whether those individuals—I mean, assuming—and, ultimately, the case—ultimately, though, the decisions had to do with

whether those individuals were demoted. And the factors that were

taken into account in that process with regard to whether those 12

individuals were demoted not only took into—not only involved sort

of general policy decisions that the Comptroller General made but,

ultimately, came down to their performance. So that, in assessing

whether this was the type of case that would be amenable to a

class action, I had to look at whether it was going to require individual evidentiary showings with regard to those—each particular

individual. And it just didn’t strike me that was going to be amenable to class action treatment.

The impact with regard to the COLA was, in fact, more broadbased, but the 12 cases that I had before me that we were investigating had to do with the demotions of 12 individuals. And, again,

it was a judgment call with regard to whether, ultimately, those

cases were going to be amenable to class certification. Because the

evidence was going to have to ultimately—in order to demonstrate

that they should not have been demoted, if all of my theories about

the policies were wrong, then ultimately we are going to have to

show that each of those people qualified to get into Band II B. And

so to do that on a broad basis was going to be—was beyond the

scope——

Ms. NORTON. Of course, that may be the case, Ms. Wagner. But

if the underlying issue was whether the system itself was job related, regardless of the individual differences in performance, those

individual differences would have to have been judged by a job-related system for each aspect of their performance that was involved. Is that not in fact the case?

Ms. WAGNER. What was at issue there was whether their ratings

over the last—the 3-year period prior to the restructuring were legitimate reflections of their qualifications to remain in Band II B.

The issue as to—there was an issue concerning, and we would

have been prepared to challenge the rating system as such to show

that these individuals’ ratings did not accurately reflect their performance. It did not—the challenges that we were looking at were,

again, specific to these particular individuals in that we were looking at issues, like did this individual’s performance manager accurately capture that individual’s performance during this period of

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time, as opposed to the sort of systemic issues that I think are implicated by your question.

Ms. NORTON. I just want to say for the record, Ms. Wagner, your

answer does not indicate that you are in touch with the complexity

of validation cases.

When somebody challenges the system for promoting—let’s just

give me a very simple-minded answer—but the way it has happened where these notions have been developed, in an entire corporation, with hundreds of thousands of employees, the complaint

will say, these people up and down the corporation who are black,

who are female—you name it—have systematically gotten performance ratings. There is a pattern of performance ratings reflected in

pay, etc., that is less than, let us say, white males.

If you want to see something complicated, much more complicated than 300-some employees who you say you have to capture

the individual job, their performance on the job, their qualifications, that is precisely the nomenclature, the words that describe

validation cases. And the reason that employers go to all the trouble to validate is, once you get into the morass of trying to explain

differences the way you are, you are out of court.

So you have to understand it is very complicated here. This is

based on whether you are capturing everything they do—and everything these women do is really different from what these men—

hey, fine. The burden shifts to the employer. And that is the point.

But once you show statistically the difference, don’t think that

employers haven’t been able, particularly with validated systems,

to overcome this. But once you show the difference, the burden

shifts entirely to the employer. Because, obviously, the employee

and its lawyer doesn’t have the information. It is you who are saying these women are being paid equal to men, if you knew what

I knew. OK, fine. Tell us what you know. All we have done is shift

the burden to you.

Now the thing that troubles me about your answer is that if employees challenged performance or ratings systems from some other

agency before—I don’t know—the EOC or some such agency,

MSBP, that system would be fully understood. So I am bothered

by the notion that, you know, that there is some difference here,

whether you are saying to me that there is some difference here

given your independence that we in the legislative branch have

granted you and the PAB, which we saw as no different from the

kind of application of the law that we would expect for other employees.

Ms. WAGNER. Mrs. Norton, I wasn’t suggesting that we treated

these cases any differently than how they would have been treated

by any other similar agency in the Federal Government. In fact,

there were cases, as I pointed out earlier, that—our office handled

12, but there were initially more cases, more individuals who filed

charges challenging the restructuring decisions. Which, again, I

want to point out, is different from the GAO order concerning pay,

to some extent. I mean, those were two separate processes.

The three individuals who filed discrimination allegations concerning the restructuring were, by virtue of the mechanism that is

set forth in the PAB regulations and GAO orders, were transferred,

in effect, to the GAO’s Office of Opportunity and Inclusiveness for

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investigation; and they are still there. So we did not take it upon

ourselves to examine these claims for the determination as to

whether reasonable grounds existed to believe that the restructuring process was discriminatory, because those questions were to be

addressed first at OOI. They can still come to the PAB once that

process is completed where——

Ms. NORTON. I understand this. That is why I asked you for the

law. And I asked Mr. Coran for the law, too. Frankly, I am at a

loss, Ms. Wagner.

Let me just ask both of you a final question. I am not asking you

anything that I think is outside of what you know, and I don’t

think saying what the black letter law is or that somebody settled

it—you know, you settled a case, too. I am not saying why you settled it—you, the GAO—but you settled a case after looking at the

law.

Let me ask both of you. Are you prepared to follow existing antidiscrimination law as it applies to other Federal employees?

Mr. CORAN. Absolutely. Unqualified.

Ms. NORTON. Ms. Wagner.

Ms. WAGNER. Yes.

Ms. NORTON. That is really all I am getting at. I want to make

sure that we are not still dealing with a different standard in the

GAO.

My final question is, would either of you have any objection to

the Speaker of the House, the majority leader of the Senate, together with the minority leader of the House and the minority

leader of the Senate, appointing the members of the PAB, the General Counsel, and the IG?

Mr. CORAN. Well, it is certainly, Representative Norton, within

the purview and the best judgment of Congress who should serve

in such positions that are under Congress. However, my view is

that the present system has worked extremely well because the

employees are so integral to the selection process, and the way the

screening has taken place has been——

Ms. NORTON. You notice, Mr. Coran, that I have been at great

lengths to say that I regarded both your work and—your work,

PAB’s work, and Ms. Wagner’s work to be above reproach during

the controversy that has been before us. So I am not indicating

whether it has worked well or not. I asked, would you object?

Would you see any problem to these four members being the appointing authority? That is my only question.

Mr. CORAN. I certainly couldn’t object to that.

Ms. NORTON. Ms. Wagner.

Ms. WAGNER. I have no objection to that.

Ms. NORTON. Thank you, Mr. Chairman.

Mr. DAVIS. Thank you very much.

I have no further questions and thank you all very much.

Our third panel is going to consist of Mr. Curtis Copeland. Mr.

Copeland is currently a Specialist in American Government at the

Congressional Research Service [CRS], within the U.S. Library of

Congress. His specific area of research expertise is Federal rulemaking and regulatory policy. He is also head of the Executive and

Judiciary Section with the CRS Government and Finance Division.

Mr. Copeland, thank you.

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Ms. Shirley Jones is the current president of the GAO Chapter

of Blacks in Government. She was first elected president in 2005

and was reelected January 2007. Ms. Jones is Assistant General

Counsel in the Office of General Counsel at the U.S. Government

Accountability Office. In this role, she is responsible for supervising

the legal support for the Strategic Issues [SI], Mission Team, work

related to tax policy and administration.

Ms. Jones, thank you.

Ms. Janet Crenshaw Smith is co-founder and president of Ivy

Planning Group, an 18-year-old management consulting and training company that specializes in diversity strategy and change management.

Ms. Smith, thank you very much.

Ms. Jacqueline Harpp is on GAO’s International Federation of

Professional and Technical Engineers Interim Counsel. She is a

senior analyst on GAO’s Education, Workforce and Income Security

Team. She has nearly 34 years of experience working at GAO.

Thank you all for being here. And, as you know, we swear all of

our witnesses in, so if you will raise your right hands.

[Witnesses sworn.]

Mr. DAVIS. The record will show that the witnesses answered in

the affirmative. Thank you all very much.

And, of course, you know that your testimony is included in the

record. If you would take 5 minutes and summarize. The green

light indicates that you have the full 5 minutes going. When it gets

down to yellow, you have a minute left. And, of course, the red

means that you have concluded your testimony and thank you very

much.

Dr. Copeland, we will begin with you.

STATEMENTS OF CURTIS COPELAND, SPECIALIST IN AMERICAN NATIONAL GOVERNMENT, CONGRESSIONAL RESEARCH SERVICE; SHIRLEY JONES, EMPLOYEE ADVISORY

COUNSEL, U.S. GOVERNMENT ACCOUNTABILITY OFFICE;

JANET C. SMITH, PRESIDENT, IVY PLANNING GROUP, LLC;

AND JACQUELINE HARPP, INTERIM COUNCIL REPRESENTATIVE, INTERNATIONAL FEDERATION OF PROFESSIONAL

AND TECHNICAL ENGINEERS, AFL–CIO

STATEMENT OF CURTIS COPELAND

Mr. COPELAND. Thank you, Mr. Chairman, members of the subcommittee. Thank you for inviting me today.

I am here to discuss several issues that CRS was asked to address related to the implementation of the new pay system under

the GAO Human Capital Reform Act of 2004.

The first such issue was whether the Comptroller General told

Congress and GAO employees during consideration of the legislation that all employees who received a ‘‘meets expectation’’ performance evaluation would receive annual adjustments in their

base pay. As I described in detail in my written statement and as

I testified before this subcommittee last year, the record indicates

that the Comptroller General gave such assurances in writing and

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ports on the legislation repeated the Comptroller General’s commitments.

GAO’s employees’ concerns were reportedly assuaged by those assurances; and documents published before and after the statute’s

enactment that are still on GAO’s Web site continue to indicate

that, ‘‘all GAO employees who perform at a satisfactory level will

receive an annual base pay adjustment.’’

However, the record indicates that 308 GAO analysts and specialists did not receive the 2.6 percent permanent increase that

other GAO employees received in January 2006. All of the 308 employees had meets expectations ratings or better on all relevant

performance dimensions.

In 2007, 138 GAO analysts and specialists with at least meets

expectations ratings did not receive any of the 2.4 percent permanent pay increases provided to other GAO employees, and 66 others received only partial increases. Thirteen GAO administrative

staff members with at least satisfactory ratings also did not receive

the full 2007 pay increase.

During the May 2007, hearing before this subcommittee, the

Comptroller General said his decisions to withhold those annual

pay increases were fully consistent with the authority provided him

in the GAO Human Capital Reform Act. GAO told CRS that the

act permitted the Comptroller General to determine the size of the

annual adjustments, including the option of providing no adjustment at all to some or all GAO employees. However, the General

Counsel of the GAO Personnel Appeals Board testified at the May

2007, and repeated just now that the Comptroller General appeared to have exceeded his statutory authority.

The General Counsel and a CRS attorney who also testified at

the May 2007, hearing testified that the legislative history of the

act indicated that Congress believed all GAO employees who met

performance expectations would receive an annual pay adjustment.

In February 2008, as a result of negotiations with union representatives, GAO agreed to provide all of its employees with a

meets expectations rating with at least a 4.49 percent increase that

was provided to General Schedule employees in the Washington,

DC, area. However, this action does not restore the salaries or income lost by the employees who did not receive the 2006 or 2007

annual adjustments.

For example, a table in my testimony illustrates, because those

two adjustments were not provided, a GAO employee who is making $110,000 a year in 2005 who was placed in Band II A, which

is roughly a grade 13 in General Schedule, will have foregone a

total of more than $14,000 in base pay increases by the end of

2008. If that employee then retires under the Civil Service Retirement System, her pension will be nearly $2,700 a year lower than

if she had received the 2006 and 2007 adjustments. Therefore, after

a 20-year retirement, the employee will have foregone nearly

$68,000 in wages and pensions since 2005.

A variety of factors can influence the size of the wage and pension differential, including the employee’s starting salary, whether

the PBC is started as base pay, and whether the employee receives

an annual increase in 1 year or the next.

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Mr. Chairman, that concludes my prepared statement. I would

be happy to answer any questions.

Mr. DAVIS. Thank you very much.

[The prepared statement of Mr. Copeland follows:]

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Mr. DAVIS. We will proceed to Ms. Jones.

STATEMENT OF SHIRLEY JONES

Ms. JONES. Mr. Chairman and Representative Norton, I am

pleased to be here today to discuss the results of the survey that

you requested on the Band II restructuring and the Watson Wyatt

market-based compensation study.

My name is Shirley Jones, and I am an Assistant General Counsel at GAO. I had the opportunity to testify before you last November in my capacity of the GAO chapter of Blacks in Government

to share the concerns that our chapter had previously raised regarding the impact of the Band II restructuring on African American staff in particular.

In addition to being Chapter president for the last 4 years, I

have also served as the attorney representative to the Employee

Advisory Counsel; and since your hearing last May, I have worked

with the EAC committee that conducted this survey.

I will highlight just a few points.

The survey was sent to all GAO employees except SES and interns. Seventy-one percent of eligible employees responded. To provide a picture of those responding, demographic questions were

asked regarding position, years at GAO, age, race, ethnicity, sex,

and location. Not surprisingly, the highest area of nonresponse to

the demographic questions was in the answer to the question about

race identification. In addition, the highest nonresponse to the survey itself was from Asian and African American employees.

Several survey questions asked about staff involvement, input,

and transparency with regard to the Watson Wyatt study.

Starting with the Watson Wyatt focus groups, 19 percent of administrative professional and support staff reported participating,

compared to only 4 percent of analysts and 8 percent of attorneys.

Only 4 percent of those responding reported being interviewed by

Watson Wyatt for the study. Of particular note, no Band I or Band

II respondents reported being interviewed by Watson Wyatt.

A much higher number of staff, 94 percent, reported that they

listened to CG Chats or attended town hall meetings. An overwhelming majority, 81 percent, of respondents reported that they

felt they were only slightly involved or not at all involved in providing input to management on the transition to market-based pay.

Similarly, 81 percent also felt that employee input was ultimately

only slightly or not at all considered.

A majority of those responding had concerns with the level of

transparency of the Watson Wyatt study and the GAO decisionmaking process.

We also asked about satisfaction with GAO’s market-based pay

system. There were notable differences based on position, age, and

race. Band II A’s and Band II B’s, respondents age 40 and over,

and African Americans had higher percentages of respondents who

said they were generally or very dissatisfied with GAO’s marketbased pay system. Eighty-one percent of respondents thought morale in general was worse or much worse now than before the transition. Forty-eight percent responded that their own morale was

worse or much worse now. A higher percentage of respondents age

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40 and over and African Americans reported that their morale was

worse or much worse.

Turning to the restructuring of Band II and to Band II A and

Band II B, 54 percent of respondents disagreed or strongly disagreed with the restructuring, while 29 percent strongly agreed or

agreed. Certain demographics disagreed or strongly disagreed at a

higher rate: African Americans again, Band II A staff, those at

GAO 10 years or longer, and employees 40 years or older.

Regarding the current general climate at GAO, lower percentages of Band II analysts and administrative professional and support staff, 33 percent and 38 percent respectively, felt their professional contributions at GAO were highly or very highly valued,

compared to attorneys and Band III staff, with that rate at 67 percent and 63 percent respectively.

A lower percentage of respondents with 10 or more years of service and respondents age 40 and older felt that their contributions

were highly valued. A lower percentage of African Americans, only

27 percent compared to other racial groups, felt that their contributions were highly valued.

1,113 survey respondents provided substantive narrative comments at the end of the survey, which we coded into 29 categories.

Although not generalizable to the overall GAO population, we

noted that more than twice as many respondents specifically commented that the Band II restructuring was damaging to employee

morale or otherwise provided disincentives than those that responded that it was the right thing to do, 217 compared to 74.

133 respondents commented that GAO’s pay for performance system is damaging to employee morale or otherwise provides disincentives, while 80 respondents said that they believed that PFP

at GAO is helpful or worthwhile.

108 respondents noted their belief that PFP ratings are inaccurate. 107 respondents noted their belief that GAO employees

should receive the same cost of living adjustment as employees at

executive branch agencies.

Staff also used the narrative comments to express other concerns, such as GAO losing talented staff because of the recent

changes, GAO’s overall processes being discriminatory, lack of trust

overall, locality pay decisions being flawed, concerns about the lack

of domestic partner benefits, and concerns about the treatment of

communications analyst positions under the restructuring.

It is important to note that some narrative comments conveyed

positive thoughts, including the belief that the Comptroller General

should be given credit for moving the agency in the right direction,

that GAO has excellent benefits, and that our work is cutting edge.

In conclusion, I would like to end with a personal observation,

having served on the EAC for over 4 years. From my perspective,

it wasn’t surprising that Band II A staff reported more unfavorable

responses, particularly as it relates to the compensation ranges and

the Band II restructuring. It is also not surprising that African

American staff generally had less favorable responses, since we

know that African American staff had expressed concerns with the

disparities in appraisal scores leading up to the restructuring.

But more than just confirming what was perhaps the obvious, it

is notable that staff at all levels and in all positions, not just Band

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II A and not just African American staff, expressed concerns about

transparency levels, the restructuring, COLAs, and locality pay decisions.

Having worked on the content analysis myself, it was striking to

me that while more Band III staff responded that they felt their

own personal contributions were highly or very highly valued compared to Band II A staff, Band III staff were also among those who

shared concerns with the PFP system and the Band II restructuring providing disincentives or otherwise being damaging to morale,

or that the PFP ratings are inaccurate.

It is clear from the survey’s high response rate and the voluminous narrative comments that staff at all levels and in all positions

and of all races that they appreciated the subcommittee’s interest

and the opportunities to share their thoughts, both positive and

negative, with you directly. On their behalf, I thank you.

This concludes my statement, and I am happy to answer any

questions.

Mr. DAVIS. Thank you very much, Ms. Jones.

[The prepared statement of Ms. Jones follows:]

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Mr. DAVIS. Ms. Smith.

STATEMENT OF JANET C. SMITH

Ms. SMITH. Chairman Davis and members of the subcommittee,

I am pleased to be here today to discuss the U.S. Government Accountability Office African American and Caucasian Analysts’ Performance Assessment Study, Tasks 1 and 2.

My name is Janet Crenshaw Smith, and I am president of Ivy

Planning Group.

In 2002, GAO issued a solicitation seeking a third-party assessment of the factors influencing the performance rating average differences between African American and Caucasian analysts. Ivy

Planning Group was retained by GAO as the prime contractor for

this contract; SRA International is the subcontractor to Ivy.

This project was divided into three tasks. We have completed the

first two.

Task one is an analysis of 2002 to 2006 performance data for African American and Caucasian analysts. The purpose of this task

is to confirm that there were differences between the ratings of African Americans and Caucasian analysts. The Ivy team performed

a statistical analysis to determine if there are significant differences in the performance ratings of the two groups.

Task two is an assessment and comparison of abilities, education, engagement roles, and performance of new GAO analyst

hires and onboard employees rated from 2002 to 2006. The purpose

of this task is to determine if African American analysts and Caucasian analysts have the same abilities and backgrounds when

they arrive at GAO and to begin to look at what happens to them

during their tenure at GAO.

The Ivy team evaluated key characteristics to determine if both

groups are equal at time of hire; controlled statistically for differences in education, experience, key roles and gender; assessed

rater demographics on outcomes; and reviewed human capital processes for consistency with agency goals.

Task three is an assessment of internal and external best practices in implementing performance management systems, and preparation of a final report that brings tasks one, two, and three together. Task three involved looking at best practices in the private

sector, the Federal sector, and within GAO; collecting qualitative

data from African American and Caucasian analysts and raters at

GAO; and presenting our overall recommendations to GAO. We are

scheduled to present our final report at the end of next month.

I will discuss tasks one and two today. However, as the project

is really the culmination of all three tasks, I look forward to having

the opportunity to return to discuss with you task three and the

final report and particularly Ivy’s recommendations in the future.

I will report where we are in the project, highlighting a few points

around what we have learned thus far.

First, yes, there are differences in ratings between African American analysts and Caucasian analysts in general. Also, by competency, pay band, team, location, and regardless of the race of the

rater. And the differences are statistically significant.

There are some differences between African American analysts

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ferent schools and proportionally do not have the same level of education. Please note that our data on school and degree are based

on the highest degree earned by the analyst and that, while most

analysts earned their highest degrees prior to being hired, some

analysts may have earned their highest degree after joining GAO.

We also learned that the same factor impacts African American

analysts and Caucasian analysts ratings differently. For example,

having a Ph.D. has a statistically significant positive effect for Caucasian analysts but no effect for African American analysts. Caucasian analysts receive a ratings benefit from being assigned to highrisk projects, compared to African American analysts who receive

no statistically significant effect of having been assigned to a highrisk project. African American analysts with some college but no

degree receive no statistically significant negative ratings correlation, compared with Caucasian analysts with some college but no

degree who do.

The final report will provide our full synthesis and analysis of

the data in the context of our overall findings and, more importantly, our recommendations to mitigate these differences.

I look forward to continuing the open communication with you

and your staff and reporting those findings. Thank you for the opportunity.

Mr. DAVIS. Thank you very much, Ms. Smith.

[The prepared statement of Ms. Smith follows:]

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Mr. DAVIS. We will proceed to Ms. Harpp.

STATEMENT OF JACQUELINE HARPP

Ms. HARPP. Thank you, Mr. Chairman.

Mr. Chairman and Ms. Norton and members of the subcommittee, my name is Jacqueline Harpp; and I am a senior analyst on

GAO’s Education, Workforce and Income Security Team. I am also

a representative of GAO’s newly elected union, including a bargaining unit of about 1,900 employees, affiliated with the International

Federation of Professional and Technical Engineers [IFPTE].

I am pleased to be here today to discuss GAO’s reforms and the

impact on staff of human capital transformation efforts, such as the

restructuring of one pay band under pay for performance, changes

to employee classification and compensation using a market-based

pay study, and proposed legislation that is before the Congress

today, referred to as the Government Accountability Office Act of

2007.

Over the past 2 years, GAO employees have experienced major

changes in the way we do our work and how we are compensated.

The restructuring of Pay Band II analysts and the use of a marketbased pay study have led to charges of unfair treatment as Federal

employees with respect to pay and discrimination based on race

and age in job classification and pay.

While GAO employees continue to have a tremendous respect for

the agency and the service GAO brings to the Congress and the

American people, GAO’s analysts have formed GAO’s first bargaining unit to address our concerns, and now we have a way to ensure

that our concerns are heard and actions are taken.

A summary of our major concerns are: GAO employees’ pay

should be on par with that of other Federal employees. Employees’

purchasing power should be protected, particularly since this has

been a longstanding promise and a key selling point for the pay for

performance initiative. Major changes in personnel systems should

be assessed to ensure that employees or groups of employees are

not harmed by the use of criteria that would put them at a distinct

disadvantage.

GAO has a long history that show disparities in performance appraisals of African Americans, and job leadership opportunities

have varied widely for all staff. Yet these two criteria were central

to restructuring positions and pay of about 800 employees, leading

to charges of discrimination based on race and prohibited personnel

practices because employees believed they had been demoted without cause.

We applaud GAO’s efforts to examine the reasons for disparities

in ratings, and we look forward to a briefing on the results of the

study. We appreciate and endorse the legislation proposed to remedy concerns raised with GAO’s implementation of its new authorities, pay parity and protection of employees’ purchasing power. The

minimum requirement of a floor guarantee to ensure pay parity

will be very helpful as the GAO Employees’ Organization and GAO

management bargain for future negotiated pay agreements.

We endorse retroactive compensation to those employees denied

full annual pay adjustments in 2006 and 2007 as provided in this

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ployee grievances or discrimination complaints involving issues in

addition to or other than the denial of past annual adjustments be

held harmless in this legislation.

We also support the legislative provision for a statutory Inspector

General, along with requirements to ensure independence of the Inspector General, the Office of Opportunity and Inclusiveness, and

the Personnel Appeals Board.

The GAO Employees’ Organization stands ready to work with

GAO management to ensure that the needs of the agency, the Congress, and the American people are met. We appreciate the opportunity to testify before you today and look forward to working with

you to help ensure that GAO continues to improve its transparency, employee communications, as well as its pay and performance management systems.

Mr. Chairman, I want to thank the members of this subcommittee, other Members of Congress, and your staff for the support you

have provided GAO employees from the time the first person contacted you about individual concerns over 2 years ago through the

entire unionizing efforts. Members of this committee and others

made it clear that our rights to organize would be protected, and

for that we are especially grateful. We appreciate the Members and

staff who were empathetic to our concerns and did not brush us

aside as just a few disgruntled staff.

Today is an historic occasion for GAO employees, since it is the

first time a member of GAO’s newly formed union is testifying before a congressional committee.

This concludes my statement, and I will be happy to answer any

questions.

Mr. DAVIS. Thank you very much.

[The prepared statement of Ms. Harpp follows:]

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Mr. DAVIS. I want to thank each one of you for your testimony.

Mr. Copeland, let me ask you. You have testified before the subcommittee regarding the personnel reforms and Band II restructuring at the Government Accountability Office. In your opinion,

would the lump sum payments and the pension changes in my

draft legislation make whole the GAO employees who met expectations but did not receive their annual across-the-board increases in

2006 and 2007?

Mr. COPELAND. Mr. Chairman, I would first like to point out that

CRS doesn’t take a position on any legislation. But, technically, I

have reviewed it; and it appears that, in general, the lump sum

payments and the pay adjustment provisions would, in general,

make those employees whole vis-a-vis other GAO employees who

had their PBC as annual—as bonus payments in those years. That

is correct.

Mr. DAVIS. Also let me ask you, if GAO employees received the

floor guarantee in the future, which is similar to what GAO and

the union agreed to implement this year, what impact do you think

it would have on GAO’s overall performance-based compensation

program?

Mr. COPELAND. In 2006 and 2007, GAO funded the performancebased compensation program in part by reducing the size of the annual adjustments. And so the annual adjustments are provided on

par with the GS increases, and the amount of funds available for

performance-based compensation would be less, which means either the performance-based compensation bonuses would become

less, fewer people would receive them, or both.

Mr. DAVIS. In H.R. 3268, GAO included a provision that would

remove the current Executive Level IV cap and allow GAO employees to be paid up to Executive Level III. As a result non-SES GAO

employees’ maximum salaries would go from $149,000 to $158,000.

What do you think of this provision?

Mr. COPELAND. I would note that the Executive Level IV cap currently affects GS employees in 12 locality pay areas across the government. So GAO is not the only agency that is affected by the Executive Level IV cap. And next year if current trends continue,

then five more pay areas will be covered. If GAO is granted this

relief, then it is likely that other agencies will seek similar types

of relief.

Mr. DAVIS. Thank you very much.

Ms. Jones, I thank you for your testimony. Let me ask you, what

was the survey response and how many respondents took the time

to write comments for the open ended survey question and how

meaningful are the survey’s response rates?

Ms. JONES. The overall survey response rate was 71 percent,

which is almost identical to the survey response rate for GAO’s employee feedback survey. And we consider that a very good response

rate, especially considering employees’ previous concerns with survey confidentiality.

We had 1,113 respondents to actually provide narrative comments to the open ended question. And having been a part of the

two-person team that did the content analysis, I can tell you that

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ize many of them as passionate. It was clear to me in reading them

that they really wanted the Congress to hear their concerns.

Mr. DAVIS. In your opinion why was there a higher non-response

rate for Asian and African-American employees?

Ms. JONES. Well, as I mentioned in my testimony, my oral testimony, I wasn’t surprised at that fact at all. As I mentioned a few

moments ago, there have been previous concerns with survey confidentiality across the board at GAO, but that concern is always

heightened for minority staff because generally there are fewer of

them on the teams. And so there is the concern that they can more

readily be identified personally. And so often they choose to not respond to surveys at all or they choose not to respond to the demographic questions.

Mr. DAVIS. Are you saying that in your experiences that minority

staff have a tendency to have a higher level of concern about retribution?

Ms. JONES. Yes.

Mr. DAVIS. And that may mitigate against revealing information?

Ms. JONES. Right, I believe that to be true. And even though in

our testimony, our full written statement and the products that we

previously supplied to your staff, we noted concerns with under

representation of the staff and we noted concerns with the missing

demographic information. However, since our response rate is essentially identical to the employee feedback survey response rate,

I’m not sure—I have no evidence that it is any different for our

survey than it is for any other survey at GAO or for that matter

any survey at another agency. I think that’s a concern that is

across the board with minority staff that they can be personally

identified and in some instances they fear retribution and retaliation.

Mr. DAVIS. How do you reconcile the majority of negative comments to the survey with the previous high marks on the GAO employee feedback survey that in 2007 led to GAO being second place

on the best place to work survey?

Ms. JONES. I think GAO staff were very honest. I think they answered questions with integrity. They can give credit when credit

is due. And when there are concerned they can provide negative

feedback. I think that was the case with our survey. We asked—

we touched a nerve, so to speak, by asking questions about very

sensitive topics such as the Band II restructuring and the PFP system and the lack of COLAs, and the staff stood up and expressed

their concerns about those issues.

On the other hand, the best places to work survey has a much

more limited focus and essentially asks considering everything how

satisfied are you with your job. And GAOers, they are very satisfied with their work, they feel that they are providing a great service to the Congress and to the taxpayer. So it is clear that on the

one hand they could be very satisfied with their job, but still have

very serious concerns with a Band II restructuring and with loss

of COLAs and the PFP system.

Mr. DAVIS. Thank you very much.

Ms. Smith, let me ask you, the Ivy Group consulting/training

company that specializes in diversity strategy and change management, would you recommend an agency implement personnel reVerDate 11-MAY-2000 14:32 Sep 29, 2008 Jkt 000000 PO 00000 Frm 00144 Fmt 6633 Sfmt 6633 C:\DOCS\44179.TXT KATIE PsN: KATIE
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forms that would impact employees’ promotions and pay if it had

evidence of rating disparities based on race?

Ms. SMITH. Well, Mr. Chairman, we will be making recommendations next month after we have fully synthesized the information.

But certainly if we find that there are differences that we can attribute to race that are unfair, we will make recommendations to

the agencies to address any of those disparities.

Mr. DAVIS. And those findings would then obviously at least raise

a red flag in your mind or in the mind of you and your colleagues?

Ms. SMITH. Would you repeat the question, please?

Mr. DAVIS. If you found such disparities, would they at the very

least raise what I will call a red flag in the minds of you and your

colleagues?

Ms. SMITH. Well, in task 1 and task 2 we have already found

that there are differences in the performance ratings of African

American analysts and Caucasian analysts. However, we have not

found answers to the why. In fact the data can say that there is

a difference, the data doesn’t necessarily explain the differences. So

our recommendations can address those differences and performance ratings without necessarily understanding why the differences

exist.

Mr. DAVIS. Would you view that information as certainly being

helpful and directive for management as it continues to program

and make decisions?

Ms. SMITH. I do believe that our recommendations will be helpful

to management and to the analysts in terms of assisting them in

their career, their transition and actually delivering the work.

Mr. DAVIS. Thank you very much.

Ms. Harpp, let me ask you, the subcommittee staff has been

working on pay adjustment provisions for fiscal year 2006 and

2007, the GAO employees who met expectations but did not receive

an across-the-board adjustment for those 2 years. What are your

views on the retroactive provision that we’ve included in the legislation that I’m introducing, and do you think it will effectively address the problem?

Ms. HARPP. Mr. Chairman, while we believe that a full remedy

would have been to include the across-the-board increase that staff

had in addition to the performance-based pay that they have received, we feel that the retroactive provision provided in the legislation represents a compromise that will provide additional compensation to our employees now and in the future, and we support

it and thank you for providing that to the employees.

Our understanding in the legislation also is that it will not effect

any outstanding claims that GAO employees have that relate to

discrimination and/or placements or promotions that have—that

are included in these claims. And so employees are happy to support the legislation.

Mr. DAVIS. Thank you very much. And let me ask you, what are

your views on the across-the-board floor guarantee?

Ms. HARPP. We support the floor guarantee. We feel this concept

gives us a minimum threshold to ensure that GAO employees,

through a combination of GAO across-the-board and increase in

performance-based pay, will receive the percentage of their salary

that many Federal employees received just by coming to work

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every day. So we are very pleased with the floor guarantee and

that it assures that everyone who performs satisfactorily at GAO,

which is a high standard, will have their purchasing power not

eroded as was the case with management decisions made in 2006

and 2007.

Mr. DAVIS. Do you have the same feeling that was expressed

with the hope that it might put to rest the anxiety or controversy

surrounding whether or not individuals can simply expect with a

tremendous amount of reliability that if they meet expectations

that they will and shall indeed receive their cost of living adjustment?

Ms. HARPP. Yes, sir, Mr. Chairman. We do believe that will go

a long way to relieving the anxiety of staff, because in the past

with the Comptroller General’s discretion as to how he would divide the pot of money for pay staff were concerned particularly

with the ranges, where some staff would not be subject to getting

any across-the-board, so this will greatly assist staff and relieve

their anxiety.

Mr. DAVIS. Well, let me thank all of you for your participation,

as well as your patience. Our hearings seem to be getting longer

and longer and it requires an amount of patience to be a part of

them, but we certainly thank you and we look for to seeing you

again soon. And this hearing is adjourned.

[Whereupon, at 5 p.m., the subcommittee was adjourned.]

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