United States General Accounting Office

GAO Testimony

Before the Subcommittee on Civil Service,

Committee on Government Reform and Oversight,

House of Representatives

For Release on Delivery

Expected at

9:00 a.m., EDT

Thursday

May 23, 1996

GAO’s DOWNSIZING

EFFORTS

Statement of John H. Luke, Deputy Assistant

Comptroller General for Human Resources

G O A

years

1921 - 1996

GAO/T-OCG-96-4

Mr. Chairman and Members of the Subcommittee:

I am pleased to be here today to discuss GAO’s downsizing efforts,

including our ongoing reduction in force (RIF). Specifically, as you

requested, I will address (1) our strategic planning process to restructure

our workforce, (2) the development and implementation of our new RIF

rules, and (3) the differences between our RIF rules and appeal rights and

those for executive branch agencies. In addition, I would like to discuss

the impact of our downsizing efforts on our veteran workforce.

In summary, we believe that we used a thorough and rational process to

guide our downsizing efforts and to develop new RIF procedures. While

the changes we made to our RIF rules were not dramatic departures from

those governing the executive branch, they provided us with the tools

required to meet our needs. These new rules also eased the burden for

some staff who were affected by the RIF.

GAO’s Downsizing Plans In 1992, GAO began a gradual reduction in its staff levels. At that time, GAO

had about 5,300 staff on board; on July 31, 1995, we had around 4,350 staff.

Over the three-year period, this reduction was accomplished principally

through a general hiring freeze (which remains in effect today), buyouts,

and normal attrition.

Last year, the Congress directed a 25 percent reduction in our

funding—15 percent to be accomplished in fiscal year 1996 and an

additional 10 percent in fiscal year 1997. Because nearly 80 percent of our

budget pays for salaries and personnel-related costs, we reached the

unavoidable conclusion that the agency could not absorb these reductions

without significantly downsizing our workforce.

In response to this budget situation, the Comptroller General established a

team of senior level managers to assess the impact of the funding

reductions and develop a plan for achieving these reductions. In July 1995,

the Comptroller General approved the team’s plan to reduce GAO’s

workforce by about 850 employees over 14 months. Under the plan, GAO’s

workforce would be reduced to about 3,500 by the beginning of fiscal year

1997. The goal of the plan was to achieve large reductions in a way that

would avoid major disruptions in our workplace, while leaving us with the

skills required to carry out our mission and maintain current production

levels.

Page 1 GAO/T-OCG-96-4
These reductions were to be achieved in three phases.

• Phase 1 was a separation incentive program that ended in September 1995.

During this program, 393 employees left GAO. Of those, 179 were from

headquarters mission offices, 149 from field offices, and 65 from

headquarters support offices.

• Phase 2 was the November 1995 closure of three field offices—New York,

Cincinnati, and Detroit. A total of 143 staff were separated from these

offices, including 104 evaluators.

• Phase 3 is the ongoing RIF of support staff agency wide. Under this RIF,

which will be completed in June 1996, 143 employees will be separated.

In addition, we anticipate that 171 staff will be off our rolls by October 1,

1996. This includes staff to be transferred with GAO’s claims function to

other agencies and normal attrition. In all, as shown in table 1, since

July 1995, 850 staff will have left GAO. At this level of operation, we believe

we will be able to maintain productivity while avoiding major disruptions

and imbalances in our staff mix.

Table 1: Staff Leaving GAO July 31,

1995 - October 1, 1996 HQ

Mission

Offices

Field

Offices

HQ

Support

Offices

GAO-Wide

Total

Sept. 1995 Buyout 179 149 65 393

Nov. 1995 RIF 0 143 0 143

Jun. 1996 RIF 46 19 78 143

Other Attrition 107 30 34 171

Totals 332 341 177 850

Note: Other attrition includes 37 staff being transferred with the Claims function to other agencies,

as well as anticipated attrition through October 1, 1996.

To summarize, by October 1, 1996, GAO’s staff will have been reduced from

about 5,300 in 1992 to 3,500 — a reduction of nearly 35 percent.

Developing and

Implementing New Rif

Rules

The 1996 Legislative Branch Appropriations Act granted GAO authority to

develop and implement its own RIF regulations. We were to minimize

disruption and promote efficiency in GAO, while using the same retention

criteria as the executive branch. As you are aware, those criteria are

tenure, veterans preference, length of service and performance.

Page 2 GAO/T-OCG-96-4
A draft RIF order was developed with employee and management input by

a group of experts under the general direction of a top management team.

Staff and managers were briefed on the new rules, given a draft of the

order and the opportunity to review it and provide written comments.

Many comments were received, and to the extent feasible, changes were

made to the order to address concerns. The order was finalized and

distributed to all staff in February 1996. To implement our support staff

reductions, in April 1996 we issued 154 RIF notices, (143 separations, and

11 downgrades/reassignments).

In implementing the order GAO followed procedures standard in the

executive branch, such as

• maintaining existing organizational structure

• freezing staff transfers

• reviewing position descriptions

• verifying staff personnel data

• establishing job groups

• developing retention registers

• identifying positions to be eliminated

• releasing staff in inverse order of their standing on the retention registers.

In addition, we are providing our separated staff with considerable

assistance in starting new careers. We have expanded our career

counseling offices to provide staff with computer-based access to job

information. We are also providing training in resume preparation and

interviewing skills, and offering individual counselling as needed.

Differences Between GAO

and Executive Branch Rif

Regulations and Appeal

Rights

GAO’s RIF rules differ very little from executive branch rules. As previously

discussed, our legislation required that we give due effect to tenure,

veterans preference, performance, and length of service — the same

factors used in the executive branch. Additionally, the Comptroller

General made a commitment to the Congress to maintain veterans rights

in RIF as they are provided in the executive branch. Among the major

differences in our new RIF rules are the following:

• GAO staff are in four different pay systems, thusly we decided to recognize

this condition by separating them in our new RIF rules. This is not

currently possible in the executive branch. This allowed us to reduce our

support staff and bring it in line with a staff level of 3,500 without

disrupting audit operations.

Page 3 GAO/T-OCG-96-4
• We developed a more graduated system for granting performance credit

than the steep step system used in the executive branch. However, the

maximum performance credit of 20 years available under executive

branch rules was retained.

• We included permanent full-time and part-time employees in the same

competitive grouping in order to minimize the impact of employee work

schedules on retention.

• We allowed employees within 1 year of retirement eligibility to defer the

effective date of separation until their first date of retirement eligibility.

This prevented staff from losing retirement benefits.

Further, GAO made only limited changes to the procedures governing

challenges to its RIF actions. As before, a GAO employee who receives a

RIF notice and believes that the RIF action was improper may file an

appeal with GAO’s Personnel Appeals Board (PAB), rather than with the

Merit Systems Protection Board, which hears executive branch appeals.

Two changes were made in the appeals procedures. First, the period for

filing an appeal was extended from 20 to 30 days, to be consistent with

timeliness requirements governing other PAB appeals. Second, as directed

in the legislation, the revised RIF regulations now provide that the PAB is

not authorized to stay a RIF action pending resolution of the appeal. The

PAB has established special procedures for considering appeals on an

expedited basis.

Impact of Downsizing on

Veterans

Our downsizing strategy has had little impact on our veteran workforce. In

July 1995, GAO employed 761 veterans, about 17.3 percent of our total

population. As of May 1996, we have 623 veterans on board, or

16.6 percent of our total population. This reduction is due primarily to the

120 veterans who voluntarily left through the most recent buyout program.

As discussed, because of funding cuts by the Congress, GAO has conducted

two RIFs since November 1995. The first, which occurred in November

1995, resulted in the closure and separation of all staff in three field

offices. Of the 143 staff who were separated, 13 were veterans (9.1%). In

the second RIF, which will be completed in June 1996, 143 staff will also

be separated. Of these, 5 (3.4%) are veterans.

In addition to the RIFs, veterans took part in our most recent buyout

program. Congress authorized GAO to offer buyouts to all staff and a total

of 120 veterans (30.5 percent of the total veteran population) took

Page 4 GAO/T-OCG-96-4
advantage of this program. The vast majority of the veterans who left

under this program were eligible for retirement.

In closing, Mr. Chairman, I would like to publicly recognize our staff, those

being involuntarily released as well as those remaining. They have made

the best of a very difficult situation. We are proud of them.

Thank you for the opportunity to be here to discuss these matters with

you. I will be glad to answer any questions you may have.

Page 5 GAO/T-OCG-96-4
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