49–010 

Calendar No. 240 

114TH CONGRESS REPORT " ! SENATE 1st Session 114–148 

A BILL TO REQUIRE THE SECRETARY OF VETERANS AFFAIRS TO REVOKE 

BONUSES PAID TO EMPLOYEES INVOLVED IN ELECTRONIC WAIT LIST 

MANIPULATIONS, AND FOR OTHER PURPOSES 

SEPTEMBER 28, 2015.—Ordered to be printed 

Mr. ISAKSON, from the Committee on Veterans’ Affairs, 

submitted the following 

R E P O R T 

together with 

MINORITY VIEWS 

[To accompany S. 627] 

The Committee on Veterans’ Affairs (hereinafter, ‘‘the Committee’’), to which was referred the bill (S. 627), to amend title 38, 

United States Code (hereinafter, ‘‘U.S.C.’’), to prohibit awarding bonuses to employees of the Department of Veterans Affairs (hereinafter, ‘‘VA’’ or ‘‘Department’’) with respect to whom an adverse finding has been made by the Secretary, and for other purposes, having 

considered the same, reports favorably thereon with amendment 

and recommends that the bill, as amended, do pass. 

INTRODUCTION

On March 3, 2015, Senator Kelly Ayotte introduced S. 627, a bill 

to require the Secretary of Veterans Affairs to revoke bonuses paid 

to employees involved in electronic wait list manipulations. Senators Crapo, Flake, Klobuchar, McCaskill, Moran, Shaheen, and 

Thune are original cosponsors. Senators Cassidy and Toomey were 

later added as cosponsors of the bill. The bill was referred to the 

Committee. 

On June 3, 2015, Senator Bill Cassidy introduced S. 1496, the 

proposed Ensuring Department of Veterans Affairs Employee Accountability Act, which would require the Department of Veterans 

Affairs to retain a copy of any reprimand or admonishment received by an employee of the Department in the permanent record 

of the employee. The bill was referred to the Committee. 


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COMMITTEE HEARING

On May 13, 2015, the Committee held a hearing on pending benefits legislation. Testimony on S. 627 as introduced was offered by: 

David R. McLenachen, Acting Deputy Under Secretary for Disability Assistance, Department of Veterans Affairs; Anthony Kurta, 

Deputy Assistant Secretary of Defense, Military Personnel Policy, 

Department of Defense; Teresa W. Gerton, Deputy Assistant Secretary of Policy, Veterans’ Employment and Training Service, Department of Labor; Alphonso Maldon, Jr., Chairman, Military Compensation and Retirement Modernization Commission; Jeffrey E. 

Phillips, Executive Director, Reserve Officers Association; and 

Aleks Morosky, Deputy Legislative Director, National Legislative 

Service, Veterans of Foreign Wars. 

COMMITTEE MEETING

After carefully reviewing the testimony from the foregoing hearing, the Committee met in open session on July 22, 2015, to consider, among other legislation, an amended version of S. 627, consisting of provisions from S. 627 as introduced and S. 1496 and 

changes suggested during the testimony noted above. The Committee voted, by voice vote, to report favorably S. 627 as amended. 

SUMMARY OF S. 627 AS REPORTED

S. 627, as reported (hereinafter, ‘‘the Committee bill’’), consists of 

two sections, summarized below: 

Section 1 would add a section to title 38, U.S.C., providing that, 

notwithstanding any other provision of law, in a case in which the 

Secretary of Veterans Affairs makes an adverse finding relating to 

a VA employee, the Secretary may not award a bonus to that employee until the earlier of: 

1. The date 5 years after the end of the fiscal year in which the 

adverse finding was made; or 

2. The date the finding is found to have been made in error. 

Section 1 would provide authorization to the Secretary to base 

such an adverse finding on an investigation by, determination of, 

or information provided by the VA Inspector General or another 

senior ethics official from VA or the Comptroller General of the 

United States in connection with that official carrying out an official activity, authority, or function. 

If the Secretary makes an adverse finding, the Secretary must, 

after notice and an opportunity for a hearing, issue an order directing the employee to repay the amount of any bonus awarded during the year during which the adverse finding is made, unless the 

finding is found to have been made in error. 

For purposes of that authority, section 1 of the Committee bill 

would set forth the following definitions: 

1. An ‘‘adverse finding’’ for these purposes would be defined to 

mean a determination that the conduct of the employee: 

a. Violated a VA policy for which the employee may be removed or suspended, or 

b. Violated a law for which the employee may be imprisoned 

for more than 1 year. 


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1Testimony of the Honorable Kelly Ayotte, during a hearing entitled, ‘‘Pending Benefits Legislation,’’ before the Senate Committee on Veterans’ Affairs, May 13, 2015. 

2. A ‘‘bonus’’ for these purposes would be defined to include an 

award under chapter 45 of title 5, U.S.C., an award under section 

5384 of title 5, U.S.C., and a retention bonus under section 5754 

of title 5, U.S.C. 

Section 2 would add a section to title 38, U.S.C., providing that, 

if any VA employee receives a reprimand or admonishment, the 

Secretary must retain a copy of the reprimand or admonishment in 

the permanent record of the employee as long as the employee is 

employed by VA. 

BACKGROUND AND DISCUSSION

Sec. 1. Prohibition on award of bonuses to employees subject to 

adverse findings. 

Section 1 of the Committee bill, which is derived from S. 627 as 

introduced, would prohibit awarding bonuses to employees of the 

Department of Veterans Affairs with respect to whom an adverse 

finding has been made by the Secretary, by amending chapter 7 of 

title 38, U.S.C., by adding a new section, ‘‘Section 714. Prohibition 

on award of bonuses to employees subject of adverse findings.’’ 

Background. In spring 2014, reports revealed that not only were 

veterans waiting months to receive health care at the Phoenix VA 

Medical Center but VA employees were manipulating the medical 

appointment system to make it appear as though timely health 

care was being provided. The delay had huge implications in terms 

of the health of the veteran and negatively impacted timely care. 

Further, it exposed not just an isolated issue but systemic failures 

throughout the VA health care system. 

In response to the scandal, Senator Ayotte introduced S. 627, bipartisan legislation aimed at improving accountability at VA. In a 

statement for the record before the Committee on May 13, 2015, 

Senator Ayotte stated, ‘‘To make matters worse, in the aftermath 

of the wait list scandal, the VA failed to sufficiently hold those who 

manipulated the wait lists responsible. It is outrageous that VA 

employees who deliberately manipulated wait lists receive bonus 

pay at taxpayers’ expense.’’ 1

In 2013, according to VA, the Secretary issued $2,827,377 in bonuses to Senior Executive Service employees. VA based employee 

bonuses, among other factors, on wait time metrics thereby creating an incentive to misrepresent data in order to maximize one’s 

bonus. Many of the employees that received performance awards 

were responsible for the negligence at Phoenix and other VA medical facilities around the country. 

During the consideration of the Committee bill, Senator Cassidy 

stated, 

‘‘Question: Why do we need this bill? When the VA scandal 

erupted in Phoenix last year, then-VA Secretary Eric 

Shinseki rescinded the performance award given in 2013 

to the career Senior Executive who ran the VA’s Phoenix 

Health Care System, a bonus that the Department said 

was awarded because of an administrative error. The employee appealed and a Federal judge directed the VA to 


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2Statement by the Honorable Bill Cassidy, during a business meeting entitled, ‘‘Business 

Meeting: Markup of Pending Legislation,’’ before the Senate Committee on Veterans’ Affairs, 

July 22, 2015. 

repay the bonus, despite the fact that the employee had 

improperly accepted more than $13,000 in gifts from lobbyists and failed to report them and manipulated data to 

conceal excessive wait times for veterans seeking health 

care. The judge determined, however, that the VA did not 

have the authority to rescind her bonus. 

‘‘This is why people do not trust the VA. Here is a 

woman who, again, took $13,000 in gifts from lobbyists, 

did not report, and then manipulated data, and nonetheless she gets a bonus. Now, if we want to improve the VA 

system, we need to focus on the quality of the workforce, 

and workforce morale is seriously affected by those who 

have failed to do their jobs, yet nonetheless receive bonuses, or do not have information on reprimands retained 

in their permanent record.’’ 2

The problems that plague VA go beyond wait lists manipulation; 

therefore, the Committee bill prohibits the awarding of bonuses for 

any adverse finding relating to a VA employee. The Committee 

worked closely with Senator Ayotte to ensure a prospective solution 

to prevent VA from awarding bonuses to employees who are negligent in their duties. The Committee bill does not give the Secretary the authority to retroactively revoke bonuses but upon enactment of the legislation provides the authority to revoke bonuses 

from employees for which an adverse finding was made. The Committee believes that prospectively, if a VA employee undermines 

the mission of the Department and violates its policies then at the 

very least, the employee should be directed to repay the amount of 

the bonus he/she received. Malfeasance at VA cannot be tolerated, 

much less rewarded. 

Committee Bill. Section 1 would add a section to title 38, U.S.C., 

providing that, notwithstanding any other provision of law, in a 

case in which the Secretary of Veterans Affairs makes an adverse 

finding relating to a VA employee, the Secretary may not award a 

bonus to that employee until the earlier of: 

1. The date 5 years after the end of the fiscal year in which the 

adverse finding was made; or 

2. The date the finding is found to have been made in error. 

Section 1 would provide authorization to the Secretary to base 

such an adverse finding on an investigation by, determination of, 

or information provided by the VA Inspector General or another 

senior ethics official from VA or the Comptroller General of the 

United States in connection with that official carrying out an official activity, authority, or function. 

If the Secretary makes an adverse finding, the Secretary must, 

after notice and an opportunity for a hearing, issue an order directing the employee to repay the amount of any bonus awarded during the year during which the adverse finding is made, unless the 

finding is found to have been made in error. 

For purposes of that authority, section 1 of the Committee bill 

would set forth the following definitions: 


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3Department of Veterans Affairs, VA Handbook 5021, Employee/Management Relations, 

http://www1.va.gov/vapubs/viewPublication.asp?Pub_ID=778&FType=2 4 VA Handbook 5021, http://www.va.gov/vapubs/viewPublication.asp?Pub_ID=686&FType=2 

1. An ‘‘adverse finding’’ for these purposes would be defined to 

mean a determination that the conduct of the employee: 

a. Violated a VA policy for which the employee may be removed or suspended, or 

b. Violated a law for which the employee may be imprisoned 

for more than 1 year. 

2. A ‘‘bonus’’ for these purposes would be defined to include an 

award under chapter 45 of title 5, U.S.C., an award under section 

5384 of title 5, U.S.C., and a retention bonus under section 5754 

of title 5, U.S.C. 

The Committee has heard from veterans, VA employees, and the 

American taxpayer on the need for employee accountability at VA. 

These are common sense solutions that should be enacted to protect taxpayer dollars from wasteful bonuses and put an end to the 

practice of rewarding bad behavior at VA. 

Sec. 2. Retention of records of reprimands and admonishments received by employees of the Department of Veterans Affairs. 

Section 2 of the Committee bill, which is derived from S. 1496, 

would require the Secretary to retain a copy of any reprimand or 

admonishment received by an employee of the Department in the 

permanent record of the employee, by amending chapter 7 of title 

38, U.S.C., by adding a new section, ‘‘Section 715. Record of reprimands and admonishments.’’ 

Background. Federal agencies have a number of ways, including 

reprimands and admonishments, to address misconduct among 

their employees and ensure a high quality workforce. According to 

VA, a reprimand is a ‘‘written statement of censure given to an employee for misconduct’’ while an admonishment is a ‘‘written statement of censure given to an employee for a minor act of misconduct.’’ 3 Under VA policy, if an employee receives a ‘‘reprimand’’ 

for a certain offense, it remains in his/her employee file for 3 years 

and, if an employee receives an ‘‘admonishment,’’ it remains in his/ 

her file for 2 years.4 By only temporarily maintaining records of 

misconduct, it creates a blind spot for the Department and reduces 

its ability to hold employees accountable. The Committee bill is a 

common sense solution to ensure that complete records of offenses 

are kept and any continued pattern of misconduct is easily identifiable. 

Committee Bill. Section 2 of the Committee bill would amend 

chapter 7 of title 38, U.S.C., to require the Secretary to retain any 

reprimand or admonishment received by an employee in his/her 

permanent record as long as the employee is employed by VA. 

The Committee believes that maintaining a permanent record of 

a VA employee’s previous misconduct serves as a powerful deterrence mechanism for future misconduct. Further, if an employee’s 

misconduct warrants removal, a record may help to substantiate 

the case and increase accountability. 


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COMMITTEE BILL COST ESTIMATE

In compliance with paragraph 11(a) of rule XXVI of the Standing 

Rules of the Senate, the Committee, based on information supplied 

by the Congressional Budget Office (hereinafter, ‘‘CBO’’), estimates 

that enactment of S. 627 as amended would, relative to current 

law, not affect direct spending or revenues. Enactment of the Committee bill would not affect the budget of state, local, or tribal governments. 

The cost estimate provided by CBO, setting forth a detailed 

breakdown of costs, follows: 

CONGRESSIONAL BUDGET OFFICE, 

Washington, DC, July 30, 2015. 

Hon. JOHNNY ISAKSON, 

Chairman, 

Committee on Veterans’ Affairs, 

U.S. Senate, Washington, DC. 

DEAR MR. CHAIRMAN: The Congressional Budget Office has prepared the enclosed cost estimate for S. 627, a bill to require the 

Secretary of Veterans Affairs to revoke bonuses paid to employees 

involved in electronic wait list manipulations, and for other purposes. 

If you wish further details on this estimate, we will be pleased 

to provide them. The CBO staff contact is Dwayne M. Wright. 

Sincerely, 

KEITH HALL, 

Director. 

Enclosure. 

S. 627—A bill to require the Secretary of Veterans Affairs to revoke 

bonuses paid to employees involved in electronic wait list manipulations, and for other purposes 

S. 627 would prohibit the Department of Veterans Affairs (VA) 

from paying awards and bonuses to employees who have violated 

certain laws or VA policies. In addition, such employees would be 

required to repay any awards or bonuses received during a year in 

which VA makes a determination of such a violation. 

The bill also would require VA to retain records of all admonishments and reprimands in employees’ permanent records for the duration of their employment by the department. CBO estimates that 

implementing S. 627 would increase spending subject to appropriation by less than $500,000 over the 2016–2020 period; such spending would be subject to the availability of appropriated funds. 

Enacting S. 627 would not affect direct spending or revenues; 

therefore, pay-as-you-go procedures do not apply. 

S. 627 contains no intergovernmental or private-sector mandates 

as defined in the Unfunded Mandates Reform Act. 

The CBO staff contact for this estimate is Dwayne M. Wright. 

The estimate was approved by H. Samuel Papenfuss, Deputy Assistant Director for Budget Analysis. 


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REGULATORY IMPACT STATEMENT

In compliance with paragraph 11(b) of rule XXVI of the Standing 

Rules of the Senate, the Committee on Veterans’ Affairs has made 

an evaluation of the regulatory impact that would be incurred in 

carrying out the Committee bill. The Committee finds that S. 627 

would not entail any regulation of individuals or businesses or result in any impact on the personal privacy of any individuals and 

that the paperwork resulting from enactment would be minimal. 

TABULATION OF VOTES CAST IN COMMITTEE

In compliance with paragraph 7(b) of rule XXVI of the Standing 

Rules of the Senate, the following is a tabulation of votes cast in 

person or by proxy by members of the Committee on Veterans’ Affairs at its July 22, 2015, meeting. One amendment was offered by 

Senator Brown to modify the bonus prohibition language and strike 

the section on retaining reprimands. This amendment was not 

agreed to by a roll call vote. 

Yeas Senator Nays 

Mr. Moran X 

Mr. Boozman X 

Mr. Heller X 

Mr. Cassidy X 

Mr. Rounds X 

Mr. Tillis X 

Mr. Sullivan X 

X Mr. Blumenthal 

X Mrs. Murray 

X Mr. Sanders 

X Mr. Brown 

X Mr. Tester 

X Ms. Hirono 

X Mr. Manchin 

Chairman Isakson X 

7 TALLY 8 

On that date, the Committee voted by voice vote to order favorably reported with amendments S. 627, a bill to prohibit the 

Secretary of Veterans Affairs from awarding bonuses to employees 

of the Department of Veterans Affairs with respect to whom an adverse finding has been made by the Secretary, and for other 

purposes. 

AGENCY REPORT

On May 13, 2015, David R. McLenachen, Acting Deputy Under 

Secretary for Disability Assistance, Veterans Benefits Administration, appeared before the Committee on Veterans’ Affairs and submitted testimony on, among other things, S. 627. Excerpts from 

this statement are reprinted below: 


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PREPARED STATEMENT OF DAVID R. MCLENACHEN, ACTING DEPUTY UNDER SECRETARY FOR DISABILITY ASSISTANCE, U.S. DEPARTMENT OF VETERANS AFFAIRS 

Chairman Isakson and Members of the Committee, thank you for 

the opportunity to present VA’s views on several bills that are 

pending before the Committee. As you just mentioned, Mr. Chairman, I am accompanied by Ms. Szybala. She is our Assistant General Counsel. She will address any questions that you may have 

with regard to S. 627 on revocation of bonuses. 

* * * * * * * 

S. 627

S. 627 would require VA to identify VA employees who, during 

fiscal years 2011 through 2014, contributed to the purposeful omission of the name of one or more Veterans from a VA medical facility’s electronic wait list or supervisors of these employees who knew 

or reasonably should have known about the employee’s actions and 

received a ‘‘bonus’’ in part as a result of the purposeful omission. 

The bill would further require VA to identify these responsible individuals within 180 days after VA’s Office of the Inspector General 

(OIG) submits a report to Congress about inappropriate scheduling 

practices at VA medical facilities, if such report is based on investigations carried out by the OIG in calendar year 2014. VA would 

also be required, after providing notice and an opportunity for a 

hearing, to order that these individuals repay bonuses that they received as a result of a purposeful omission. An individual who has 

been ordered to repay a bonus may appeal that order to the Merit 

Systems Protection Board (MSPB). 

VA has numerous constitutional concerns about the bill, including concerns arising under the Fifth Amendment Takings Clause, 

the Due Process Clause, and the Ex Post Facto Clause. VA also has 

policy and procedural concerns about the bill. VA looks forward to 

working with the Committee in order to address these concerns. 

S. 627 is a bill for which there is no precedent. No Federal agencies have the authority to require employees to repay past monetary performance awards or bonuses that were given in accordance 

with law and without conditions or contractual obligations. This 

legislation threatens a number of core constitutional rights related 

to property and due process that the Framers of the Constitution 

sought to protect,—and the bill would likely give rise to litigation. 

VA believes that employees should not be penalized by legislation 

that attaches new penalties on the basis of past behavior and 

transactions and should have protection from deprivation of life, 

liberty, or property without due process of law. Further, performance awards are intended to be a key tool in motivating employees 

to provide outstanding service to Veterans, and the value of that 


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tool should not be undermined by measures that would limit employee confidence in the performance award system. By singling 

out VA employees for punitive measures, the legislation would likely serve to demoralize a workforce dedicated to serving Veterans 

and hurt VA’s efforts to recruit and retain high performing employees. VA is concerned that S. 627, if passed, would give rise to numerous lawsuits challenging the constitutionality of the provisions 

and VA’s actions pursuant to it. 

For these reasons, and as further explained in the below discussion, VA strongly opposes this legislation. 

Implementing the bill, as written, would also be impractical for 

the government. First, the bill does not define the term ‘‘bonus’’ as 

a ‘‘performance award.’’ In accordance with law, VA does not give 

‘‘bonuses,’’ but rather awards an employee based on his or her performance. Second, the type of hearing that needs to be provided to 

an employee before a repayment order must be issued is not specifically addressed in the bill. While the bill states that hearings 

‘‘shall be conducted in accordance with regulations relating to hearings promulgated by the Secretary under chapter 75 of title 5, 

United States Code,’’ chapter 75 references various types of hearings. Consequently, the type of hearing that would need to be provided is not addressed in the bill. Third, the bill raises a number 

of tax questions. For example, should the Department of Treasury 

treat a repayment of a performance award as adjustments to prior 

year compensation, even though the award may have been paid a 

number of years ago? This tax question, while not addressed in the 

bill, would have to be addressed. 

As noted above, the bill would raise a number of constitutional 

issues. First, the bill may run afoul of the Fifth Amendment’s 

Takings Clause by requiring employees to return property that was 

given to them unconditionally by the government. The Takings 

Clause prevents the government from ‘‘depriving private persons of 

vested property rights except for a ‘‘public use’’ and upon payment 

of ‘‘just compensation.’’ Landgraf v. USI Film Products, 511 

U.S. 244, 266 (1994). In the case of an employee who has already 

been paid a bonus by the government, that bonus is the property 

of the employee. The taking would occur if the government collects 

the bonus or even a portion thereof without just compensation. See, 

e.g., Nat’l Educ. Bd. v. Ret. Bd. of R.I., 172 F.3d 22, 30 (1st Cir. 

1999) (the Takings Clause protects ‘‘[p]ension payments actually 

made to retirees’’). 

The bill may have a ‘‘retroactive effect’’ by increasing an employee’s liability for conduct that preceded the enactment of the bill. 

See Landgraf, 511 U.S. at 280 (a bill has a ‘‘retroactive effect’’ if 

it ‘‘increases a party’s liability for past conduct’’). ‘‘ ‘The retroactive 

aspects of legislation, as well as the prospective aspects, must meet 

the test of due process, and the justifications for the latter may not 

suffice for the former.’ ’’ Pension Ben. Guar. Corp. v. R.A. Gray & 

Co., 467 U.S. 717, 730 (1984) (quoting Usery v. Turner Elkhorn 

Mining Co., 428 U.S. 1, 16–17 (1976)). Under the bill, an employee 

must repay a bonus based on conduct that preceded the enactment 

of the bill. Because the employee was not aware that he or she 

would have to repay the bonus at the time of the conduct, the bill 

may have a ‘‘retroactive effect’’ and may implicate the employees’ 


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due process rights to fair notice. See BMW of N. Am., Inc. v. Gore, 517 U.S. 559, 570 (1996) (‘‘Elementary notions of fairness enshrined in our constitutional jurisprudence dictate that a person receive fair notice not only of the conduct that will subject him to 

punishment, but also of the severity of the penalty that a State 

may impose.’’). 

Finally, the legislation may raise constitutional Ex Post Facto 

Clause concerns. The Ex Post Facto Clause prohibits laws that 

‘‘impose[ ] a punishment for an act which was not punishable at the 

time it was committed; or impose[ ] additional punishment to that 

then prescribed.’’ Cummings v. Missouri, 71 U.S. (4 Wall.) 277, 

325–26 (1867). In Hiss v. Hampton, 338 F. Supp. 1141, 1147–48 

(D.D.C. 1972), a three judge panel in the U.S. District Court for the 

District of Columbia held that a law denying payment of pensions 

to former employees who falsely testified with respect to Government service was an ex post facto law as it pertained to the conduct of those employees which preceded the passage of the law. Id. 

at 1148. According to the court in Hiss, ‘‘[t]he proper function of 

[law] is to guide and control present and future conduct, not to penalize former employees for acts done long ago.’’ Id. at 1148–49; see 

also Peugh v. United States, 133 S. Ct. 2072, 2085 (2013) (noting 

that ‘‘the [Ex Post Facto] Clause ensures that individuals have fair 

warning of applicable laws and guards against vindictive legislative 

action’’). As currently drafted, the bill could potentially raise some 

of the same issues as the provision at issue in Hiss. Based on the implementation concerns discussed above, VA is 

unable to determine the costs for this bill. It is important to note, 

however, that apart from costs to investigate and identify the employees, as required by the bill, VA would also have to expend significant resources to conduct a hearing prior to issuing a repayment order, defend its repayment order before the MSPB, and assist the Department of Justice in defending the order before the 

U.S. Court of Appeals for the Federal Circuit. 

* * * * * * * 


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MINORITY VIEWS OF HON. RICHARD BLUMENTHAL, RANKING MEMBER, HON. PATTY MURRAY, HON. BERNARD 

SANDERS, HON. SHERROD BROWN, HON. JON TESTER, 

AND HON. MAZIE K. HIRONO ON S. 627, AS REPORTED BY 

THE VETERANS’ AFFAIRS COMMITTEE 

On July 22, 2015, the Senate Committee on Veterans’ Affairs 

(hereinafter, ‘‘the Committee’’) voted, by voice vote, to approve 

S. 627, as amended, a bill to prohibit awarding bonuses to employees of the Department of Veterans Affairs (hereinafter, ‘‘VA’’ or 

‘‘Department’’) subject to adverse findings (hereinafter, ‘‘S. 627’’). 

We fully support bringing greater accountability to VA, and that 

includes ensuring that an employee does not receive a bonus as a 

result of misconduct. We have concerns, however, with S. 627 as reported out of Committee, which we will outline in these supplemental views. 

Section 1(a)(1) of S. 627 would provide that in a case in which 

the VA ‘‘Secretary makes an adverse finding relating to an employee of the Department, the Secretary may not award a bonus’’ 

to a VA employee. Section 1(a)(2) of S. 627 would provide that the 

Secretary of Veterans Affairs ‘‘may’’ base an ‘‘adverse finding’’ on 

an investigation by, a determination of, or information provided by 

the VA Office of the Inspector General, a senior VA ethics official, 

or the Comptroller General of the United States. We are concerned 

that section 1 of S. 627 does not require the Secretary to base an 

adverse finding on the determination of an independent decisionmaker. Moreover, S. 627’s definition of ‘‘adverse finding’’ includes 

conduct inconsistent with ‘‘a policy of the Department for which the 

employee may be removed or suspended.’’ We are concerned that 

this definition is vague and could lead to abuse. To cure these two 

defects, Senator Brown offered an amendment during the Committee’s July 22, 2015 business meeting. Senator Brown’s amendment, 

which was supported by all the Minority Members of the Committee, would set appropriate limits on section 1 of S. 627 by requiring that the Secretary base an adverse finding on the determination of an independent decisionmaker and by requiring that 

an independent decisionmaker also determine whether the employee violated a policy of the Department. These two technical corrections would ensure that bonus bans are not arbitrarily imposed 

by VA managers. Unfortunately, the Brown amendment was 

rejected. 

In addition to setting appropriate limits to section 1 of S. 627, 

the Brown amendment would have struck section 2 of S. 627. Section 2 of S. 627 would require VA to retain a copy of admonishment 

or reprimand by a VA employee in the employee’s permanent 

record as long as the employee is employed by VA. Currently, letters of reprimand and admonishment are only held in a VA employee’s record for a limited time: letters of admonishment norVerDate Sep 11 2014 23:53 Sep 28, 2015 Jkt 049010 PO 00000 Frm 00011 Fmt 6604 Sfmt 6604 E:\HR\OC\SR148.XXX SR148

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1See testimony of Robert Worley, Director, Education Service, Veterans Benefits Administration, during a legislative hearing before the Subcommittee on Economic Opportunity of the 

House Committee of Veterans Affairs, March 24, 2015, available at http://veterans.house.gov/ 

sites/republicans.veterans.house.gov/files/Testimony%20WorleyIIUSAFR.pdf 2 Id. 

3 Id. 

4 Id. 

5 Id. 

6 Id. 

mally remain in an employee’s Official Personnel File (hereinafter, 

‘‘OPF’’) for two years, and letters of reprimand normally remain in 

the employee’s OPF for three years.1 In testimony before the House 

Committee of Veterans’ Affairs, VA noted that it is the standard 

practice across the Federal Government, including the Department 

of Defense, for letters of reprimand and/or admonishment to be retained on a time-limited basis.2 According to VA, making letters of 

reprimand or admonishment permanent would prevent VA managers from ‘‘settling workplace grievances with employees with 

terms that would limit the amount of time these documents remain 

in the employee’s permanent record,’’ and it would restrict VA 

managers from removing these documents as a ‘‘term of settlement.’’ 3 Both of these tools are frequently used by VA managers 

to ‘‘resolve complaints before they go into costly and high-risk’’ litigation.4 These tools also allow VA managers to promote good performance of employees ‘‘because they are usually conditioned upon 

no further misconduct of the type that initially led to the reprimand or admonishment.’’ 5 Moreover, making letters of reprimand 

or admonishment permanent in an employee’s OPF may: 

‘‘ * * * have an unintended chilling effect on managers 

who, when faced with a decision to issue a letter of admonishment or reprimand for a minor infraction or to let the 

matter drop with just an oral warning, may elect to choose 

the lesser action in order to avoid leaving the employee 

with a permanent stain on his or her record.’’ 6

Besides the substantive issues with the provision that we have 

identified, section 2 of S. 627 was derived from S. 1496, a bill that 

has not been considered in a legislative hearing. For a significant 

and controversial provision like section 2 of S. 627, the Committee 

should have held a legislative hearing to give all Members the opportunity to hear from witnesses and fully understand the consequences of this provision. 

* * * * * * * 


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CHANGES IN EXISTING LAW

In compliance with paragraph 12 of rule XXVI of the Standing 

Rules of the Senate, changes in existing law made by the bill, as 

reported, are shown as follows (existing law proposed to be omitted 

is enclosed in black brackets, new matter is printed in italic, existing law in which no change is proposed is shown in roman). 

Title 38. Veterans’ Benefits 

* * * * * * * 

Part I. General Provisions 

* * * * * * * 

Chapter 7. Employees 

Sec. 

701. Placement of employees in military installations. 

* * * * * * * 

[712. Repealed.] 

713. Senior executives: removal based on performance or misconduct. 

714. Prohibition on award of bonuses to employees subject of adverse findings. 

715. Record of reprimands and admonishments. 

* * * * * * * 

SEC. 714. PROHIBITION ON AWARD OF BONUSES TO EMPLOYEES SUBJECT OF ADVERSE FINDINGS 

(a) PROHIBITION.—(1) Notwithstanding any other provision of 

law, in a case in which the Secretary makes an adverse finding relating to an employee of the Department, the Secretary may not 

award a bonus to such employee until the earlier of— 

(A) the date that is five years after the end of the fiscal year 

in which the adverse finding was made; or 

(B) the date that the finding is found to have been made in 

error. 

(2) The Secretary may base an adverse finding under paragraph 

(1) on an investigation by, determination of, or information provided by the Inspector General of the Department or another senior 

ethics official of the Department or the Comptroller General of the 

United States in connection with the carrying out by such official 

of an activity, authority, or function under a provision of law other 

than this section. 

(b) PREVIOUSLY AWARDED BONUSES.—If the Secretary makes an 

adverse finding relating to an employee under subsection (a), the 


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Secretary, after notice and an opportunity for a hearing, shall issue 

an order directing the employee to repay the amount of any bonus 

awarded to the employee during the year during which the adverse 

finding is made, unless such finding is found to have been made in 

error. 

(c) DEFINITIONS.—In this section: 

(1) The term ‘‘adverse finding’’ relating to an employee means 

a determination that the conduct of the employee— 

(A) violated a policy of the Department for which the employee may be removed or suspended; or 

(B) violated a law for which the employee may be imprisoned for more than 1 year. 

(2) The term ‘‘bonus’’ means any bonus or cash award, including— 

(A) an award under chapter 45 of title 5; 

(B) an award under section 5384 of such title; and 

(C) a retention bonus under section 5754 of such title. 

SEC. 715. RECORD OF REPRIMANDS AND ADMONISHMENTS 

If any employee of the Department receives a reprimand or admonishment, the Secretary shall retain a copy of such reprimand or 

admonishment in the permanent record of the employee as long as 

the employee is employed by the Department. 

Æ 


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