Personnel Practices: Actions Needed to Improve Documentation of OPM Decisions on Conversion Requests
Published: 2017-08-28T00:00:00

Fast Facts:
Political appointees at federal agencies serve at the pleasure of the President. However, agencies can select appointees on their merits to "convert" them to career civil service positions.
Some conversions can raise questions of favoritism or unfair advantage, so the Office of Personnel Management reviews all conversion requests to ensure compliance with civil service laws.
While agencies seem to have followed the laws for OPM-approved conversions, most of the case files we looked at didn't have enough evidence. For example, if OPM reviewed evidence online, it wasn't copied or saved.
We recommended ways to improve OPM's documentation.

Highlights:
section_title: Why GAO Did This Study
paragraphs: Federal agencies must use appropriate authorities and follow proper procedures in converting political appointees to career positions, including obtaining prior approval from OPM.
GAO was asked to provide information on political conversions and examine the implementation and effectiveness of OPM's policy for reviewing them. GAO, as part of its review, examined (1) conversion requests submitted by agencies and reviewed by OPM, (2) whether agencies used appropriate authorities and proper procedures in conversions approved by OPM, and (3) conversion requests denied by OPM and referred to OSC.
GAO obtained and corroborated OPM data on the number of political conversions OPM reviewed and agencies intended to complete from January 1, 2010, through March 17, 2016. GAO also assessed OPM's reviews of all approved political conversion requests during the same period.
section_title: What GAO Found
paragraphs: The Office of Personnel Management (OPM) approved 78 of 99 requests to convert political appointees to career positions agencies proposed to complete from January 1, 2010, through March 17, 2016. OPM denied 21 requests for varying reasons, such as bypassing qualified veterans, and referred 9 denied cases to the Office of Special Counsel (OSC). Of the 78 approved requests, agencies followed through and converted 69 political appointees to career positions. During the period, agencies completed 7 conversions without obtaining OPM approval; OPM completed post-appointment reviews for 4 of these 7 conversions, denying all 4. For each of the 4 denied cases, the agencies undertook various remedies, such as readvertising positions, in response to OPM's concerns. OPM did not complete a review for the 3 other conversions because the appointees were no longer in the career positions to which they were converted.
Agencies appeared to have used appropriate authorities and followed proper procedures for each of the 78 OPM approved requests. GAO's review of OPM's case files and additional documentation from agencies supported OPM's conclusion that each of these conversions appeared to be free of political influence and complied with merit system principles. However, for 55 of the 78 requests, OPM's case files did not provide enough information for GAO to initially support OPM's approvals of the requests. GAO could only decide after obtaining and reviewing supporting documentation directly from involved agencies.
OPM's procedures for reviewing political conversion requests do not specify which agency documents it should save into case files. Further, OPM's procedures do not require its staff to verify they have reviewed agency documentation required by OPM checklists. OPM officials told GAO that it is drafting a records schedule to be completed by the end of calendar year 2017 for maintaining political conversion files. Without this schedule, OPM risks not maintaining complete documentation to justify conversion request decisions.
section_title: What GAO Recommends
paragraphs: GAO recommends that OPM (1) ensure its finalized records schedule lists all documentation that must be saved in OPM's case files, and (2) establish a policy requiring its staff to verify they reviewed all documentation required by OPM checklists before recommending approval or denial of a conversion request. OPM partially concurred with both recommendations, but believes it has a process to thoroughly review conversion requests. GAO continues to believe the recommendations are valid, as discussed in the report.

section_title: Letter
paragraphs: Political appointees in the federal government sometimes seek  appointments to career competitive and other positions that, unlike  political appointments, do not terminate at the end of an administration.  As we have previously noted, political appointees can bring valuable skills  and experience to the federal workforce. The merit-based conversion of  political appointees to career positions can be useful in achieving a highly  qualified workforce. However, these conversions should conform to merit  system principles and must adhere to the statutes and regulations  governing the appointment contemplated. Sometimes, circumstances  surrounding conversions can raise questions as to whether the individuals  selected experienced favoritism or enjoyed an unfair advantage in the  selection process. Any appearance of this could compromise the merit  system’s integrity.
You asked us to provide information on conversions of political  appointees to career positions, and to examine the implementation and  effectiveness of the Office of Personnel Management’s (OPM) policy for  reviewing these conversions, which took effect in January 2010. This  report examines (1) conversion requests submitted by agencies and  reviewed by OPM, (2) whether agencies used appropriate authorities and  proper procedures in conversions approved by OPM, (3) conversion  requests denied by OPM and referred to the Office of Special Counsel  (OSC), and (4) the extent to which OPM has complied with  governmentwide reporting requirements stipulated by the Edward “Ted”  Kaufman and Michael Leavitt Presidential Transitions Improvements Act  of 2015 (Transitions Act). For the purposes of our review, we included  conversions OPM reviewed and agencies intended to complete from  January 1, 2010, through March 17, 2016. This time period begins with  the implementation of OPM’s January 2010 policy requiring its prior  approval of all conversions of current or recent appointees to competitive  or nonpolitical excepted service positions. March 17, 2016, marks the day  before the Transitions Act was enacted and OPM began reporting to  Congress requests by agencies to appoint political appointees or former  political appointees to covered civil service positions.
In selecting the executive branch departments and agencies for this  review, we looked at all agencies that OPM reported as having requested  its approval of proposed appointments of political appointees to career  positions during the time period referenced above.
To address our first objective, we obtained data from OPM on its reviews  of agency requests to convert political appointees to career positions. In  addition, we obtained from agencies the number of approved cases  where they proceeded to hire political appointees. According to OPM  data, 30 departments and agencies requested OPM’s approval for at  least one conversion during the period. We then asked each of these 30  departments and agencies to corroborate (1) the number of requests to  convert employees from political to career positions each agency made to  OPM, and (2) the number of these conversions the agencies completed  during the period of our review. To assess the reliability of the data that  OPM and the agencies provided, we examined the data for obvious errors  and inconsistencies. We also queried OPM and the agencies to  understand the data systems they respectively used to collect, store, and  report such data, as well as the quality of data entered into their  system(s). We found the conversion data from both OPM and agencies to  be sufficiently reliable for the purposes of our reporting objectives. See  appendix I for data on political conversion requests reviewed by OPM,  and conversions completed by the 30 departments and agencies from  January 1, 2010, through March 17, 2016.
To address our second objective, we assessed OPM’s reviews of all  conversion requests in our scope that OPM approved. Specifically, we  examined OPM’s review checklists, OPM case files documenting steps  agencies took to convert political appointees, and additional  documentation provided by individual agencies. Our review was designed  to determine (1) whether appropriate authorities and proper procedures  were followed in making and reviewing conversions; and (2) for requests  approved by OPM, whether we could support OPM’s decision that agency selections were free of political influence and conformed to merit system  principles. One GAO analyst applied professional judgment after  reviewing submitted checklists and documentation, appropriate laws and  regulations, and the circumstances for each conversion request. To  ensure the reliability of our reviews, a second GAO analyst then reviewed  and validated the first analyst’s evaluation of each conversion request.  The second analyst either independently evaluated the conversion  request, or traced findings from the first analyst’s review back to  supporting audit documents. We identified conversion review cases with  significant differences between our and OPM’s reviews of the cases by  comparing differences we identified to selected merit system principles  and prohibited personnel practices. We then collected additional  information from OPM on such cases and determined whether agencies  involved in the cases violated merit system principles and proper  procedures, or engaged in prohibited personnel practices.
To address our third objective, we identified the number of conversion  requests in our scope that OPM denied, and why they denied them. We  reviewed conversion requests referred to OSC for investigation, and  described the outcome of its reviews of the cases. We also summarized  cases where OPM directed agencies to implement corrective actions after  reviewing conversion requests.
To address our fourth objective, we reviewed revisions OPM made to its  pre-appointment review policies and procedures following enactment of  the Transitions Act. We also reviewed data elements the Transitions Act  requires OPM to include in its reports to Congress on agency personnel  requests to appoint current or former political appointees to covered civil  service positions. We then compared these data elements with  information from reports on conversion requests OPM had submitted to  Congress.
We conducted this performance audit from January 2016 to August 2017  in accordance with generally accepted government auditing standards.  Those standards require that we plan and perform the audit to obtain  sufficient, appropriate evidence to provide a reasonable basis for our  findings and conclusions based on our audit objectives. We believe that  the evidence obtained provides a reasonable basis for our findings and  conclusions based on our audit objectives. Further details about our  objectives, scope, and methodology are provided in appendix II.
subsections: section_title: Background
paragraphs: Each administration makes political appointments to support and  advocate the President’s political goals and policies. These positions are  noncareer excepted service appointments made without regard to the  statutory and regulatory provisions governing career appointments in the  competitive, excepted, or senior executive service. Consistent with how  we have reported related data in the past, for the purpose of this review,  we defined political appointees as those who were appointed in one of the  six categories of positions defined below.
Schedule C: Appointments are generally noncompetitive and are for  excepted service positions graded General Schedule (GS)-15 and  below. These positions involve determining policy or require a close,  confidential relationship with the agency head or other key officials of  the agency. Schedule C appointees serve at the pleasure of the  department or agency head.
Noncareer Senior Executive Service (SES): Appointments are to  positions with responsibility for formulating, advocating, and directing  administration policies. Noncareer SES appointees serve at the  pleasure of the department or agency head.
Limited-term SES: Appointments may be made to a position with  duties that will last for a specified period of 36 months or less.
Limited-emergency SES: Appointments may be made for up to 18  months to a position established to meet a bona fide, unanticipated,  urgent need.
Presidential appointees, including executive level and noncareer  ambassadors: Appointments are made by the President, generally to  fill high-level executive positions. Appointees support and advocate  the President’s goals and policies.
Noncareer legislative branch: Appointments are primarily to  positions in member and committee offices.
Also consistent with our past work on conversions, we identified three  categories of career positions as defined below.
Career-Conditional/Career (competitive service): Appointments  are to permanent positions in the competitive service and are  generally made through open competitive examination. Competitive  examination includes recruitment through a published or “all sources”  announcement. It also includes the rating and ranking of eligible  candidates using OPM-created or approved qualification standards  and agency-developed, job-related assessment tools to identify the  most qualified applicants. Generally, the initial competitive service  appointment is career conditional. Appointees must complete a 1-year  probationary period and a total of 3 years of continuous creditable  service to become a career employee.
Career (SES): Appointments are into SES under 5 U.S.C. § 3393 to  top-level policy, executive, supervisory, and managerial positions  above GS-15. Appointments into career SES positions require a  further review and certification of the executive/managerial  qualifications of the proposed selectee by an OPM-administered SES  Qualifications Review Board.
Career excepted service (Non-Schedule C): Some appointments  are to positions excepted from the competitive examination  requirements in Title 5 of the U.S. Code by OPM. Other appointments  are to positions or in agencies not subject to competitive examination  requirements in Title 5. Agencies have the authority to establish their  own hiring procedures to fill excepted service vacancies. Such  procedures must comply with statutory requirements such as merit  system principles and veterans’ preferences, when applicable.
Federal agencies must use appropriate authorities and follow proper  procedures in converting political appointees to career positions. The  majority of authorities and procedures governing appointments to career  positions are outlined in Title 5 of the U.S. Code. Merit systems principles  are one of the fundamental statutory rules applying to civil service  appointments. These principles require that agencies follow a selection  process that is fair, open, and based on skills, knowledge, and ability.  Another key statute under Title 5 prohibits certain personnel practices  (known as prohibited personnel practices). These practices include  granting any individual a preference or advantage in the application  process. This could include defining the manner of competition or  requirements for a position to improve the prospects of any particular  applicant, or failing to fulfill veterans’ preference requirements. In  addition to these and other statutory requirements, agencies must follow  OPM’s regulations in Title 5 of the Code of Federal Regulations. These  regulations outline required procedures for making appointments to  career positions, such as providing public notice of all vacancies in the  career SES. For career-excepted service (non-Schedule C) positions,  agencies are not required to follow OPM’s hiring regulations for the  competitive service; however, they must apply veterans’ preference and  follow merit system principles and OPM’s regulations on excepted service  hiring when making most of these appointments.
OPM has oversight authority to ensure that federal agencies are following  the merit system principles when hiring. It also has authority to order  agencies to take corrective actions regarding any agency hiring when it  determines the action was contrary to any law, rule, regulation, or  standard established by OPM; in turn, agencies are required to comply  with such orders. As one aspect of carrying out these duties, OPM has  traditionally required that agencies seek its pre-appointment approval for  the appointment of certain noncareer appointees (Schedule C and  noncareer SES) into certain career positions (competitive service and  career SES) during a presidential election period. However, in a  November 5, 2009, memorandum to heads of executive departments and  agencies, OPM expanded the requirements for pre-appointment approval;  beginning January 1, 2010, OPM conducted pre-appointment reviews of  political conversions on a continuing basis, rather than just during the  year leading up to a presidential election. OPM also required agencies to  seek its approval before appointing a current or recent political appointee  to a competitive or nonpolitical excepted service position at any level  under the provisions of Title 5 of the U.S. Code. According to this  memorandum, OPM will (1) review these proposed appointments to  ensure they comply with merit system principles and applicable civil  service laws, and (2) continue to conduct merit staffing reviews for all  proposed career SES selections involving a political appointee before the  SES selections are presented to OPM’s Qualifications Review Board for  certification of executive qualifications.
To implement its policy of requiring agencies to seek its approval before  completing political conversions, OPM established standard operating  procedures for reviewing political conversions requests by agencies. For  each conversion request review, OPM’s lead coordinator on political  conversions is expected to ensure that the agency submitting the  conversion request has submitted all required documentation, saves the  documents onto an OPM shared drive and sends each case to the  relevant lead office. An OPM evaluator assigned by the lead office is  expected to ensure that all requested information is received, and  requests missing or additional information from the agency. Next, the  evaluator reviews the agency’s documentation and completes a review  checklist to determine whether the agency’s request complies with merit  system principles and appropriate laws, rules, and regulations, and if it is  free of political influence. After completing each review, the evaluator and  his or her supervisors recommend the approval or denial of the  conversion request. The lead office reviewing the request transmits a  draft decision letter, the checklist, and supporting documentation to  OPM’s Merit Systems Accountability and Compliance (MSAC) Division.  OPM’s lead coordinator on political conversions reviews the case for  consistency in findings, recommendations, required actions, and referrals  to OSC. Then, the MSAC Associate Director and Deputy Associate  Director review the recommendation from the lead office. The Associate  Director makes the final decision whether to approve or deny the  conversion request. See figure 1 for additional details on the processes  OPM uses to review political conversion requests and collect data post- approval.
section_title: OPM Approved 78 of 99 Political to Career Conversion Requests Agencies Intended to Complete from January 1, 2010, through March 17, 2016
paragraphs: As shown in figure 2 below, OPM reviewed 99 agency requests to convert  individuals from political to career positions. The agencies proposed to  complete these conversions during the period of our review. OPM denied  21 and approved 78 of the 99 political conversion requests. Of the 78  approved conversion requests, agencies followed through and converted  69 political appointees to career positions.
In 9 cases, agencies did not complete conversions approved by OPM. In  some instances, the political appointee did not accept the agency  position; in other instances, OPM’s Qualifications Review Board did not  certify the executive qualifications of the applicant, so the conversion was  not completed.
During the period, agencies also completed 7 conversions without  obtaining OPM approval. Once OPM identified these conversions, it took  specific actions for each. According to OPM, it conducts post-appointment  reviews for cases where agencies convert political appointees to career  positions without seeking OPM approval. OPM conducted post- appointment reviews for 4 of these 7 conversions, denying all 4. For each  of the 4 denied cases, agencies undertook various remedies, such as  readvertising positions, in response to OPM’s concerns.
OPM did not complete a review for the 3 other conversions because the  appointees were no longer in the career positions to which they were  converted. In 2 instances, OPM determined that reviews were not needed  because the appointed individuals were no longer employed by the  government at the time OPM discovered the conversions. In 1 instance,  the involved agency returned the appointed individual to the previous  political position instead of submitting conversion documents to OPM for  a post-appointment review.
subsections: section_title: OPM Is Taking Steps to Better Identify Political Conversions Completed by Agencies without Prior OPM Approval
paragraphs: We reported in September 2016 that some agencies converted political  appointees to career positions without first obtaining OPM approval. OPM  informed us at that time that it was improving its oversight of political  conversions by enhancing its monitoring processes and increasing the  frequency of checks of Enterprise Human Resources Integration (EHRI)  data. At the time of our September 2016 review, we could not determine  a way to reliably identify political conversions within the scope of OPM’s  review using queries of EHRI data alone, given the complexity involved in  defining political conversions in scope of OPM’s review. Since our review,  however, OPM officials said that OPM has transitioned from using a  mainframe for querying EHRI data and generating reports to a new EHRI  reporting platform.
The EHRI queries from the new reporting platform generate a history of  political appointments, terminations and resignations, intervening  appointments, and career appointments for every current or former  political appointee identified for a specific time period. According to OPM  officials, the new reporting query also allows OPM staff to export data to  Microsoft Excel, and provides for greater access to sorting and reviewing  data.
As of May 2017, OPM officials said they have access to sufficient  personnel data from EHRI. They also identified instances from data  queries where they could identify conversions reviewed or not reviewed  by OPM. The officials added that they are still refining the query process  and validating data queries from the new reporting platform. OPM also  expects the new EHRI reporting platform to allow it to review EHRI data  monthly as they become available, instead of quarterly, as they previously  did. These measures, if effectively implemented, may help OPM to better  identify in a timely manner conversions completed by agencies, including  those implemented without prior OPM approval.
section_title: Agencies Converted 76 Political Appointees to Career Positions from January 1, 2010, through March 17, 2016
paragraphs: According to 30 agencies we reviewed, 28 agencies converted 76  individuals from political to career positions—with or without OPM  approval—during the period of our review. The other 2 agencies reported  making no conversions during this time. Eight agencies accounted for 44,  or more than half of the completed conversions. As shown in figure 3, the  Department of Homeland Security had the highest number of conversions  (9) during the review period, followed by the Departments of Justice (8),  Defense (6), the Treasury (5), Agriculture, Commerce, and Health and  Human Services, and the Federal Deposit Insurance Corporation (4  each). Twenty other agencies each completed 3 or fewer political  conversions during the scope of our review.
Of the 76 reported conversions, individuals were converted from the  following categories of noncareer positions:
44 Schedule C positions,
27 noncareer SES positions,
3 presidential appointee positions,
1 limited-term SES position, and
1 administratively determined position.
The 76 reported conversions were made to the following categories of  career positions:
31 career SES positions,
30 competitive service positions, and
15 career excepted service positions.
Appendix III provides more specific details on characteristics of the  political and career positions to which agencies converted individuals.  This includes titles and offices, types of political and career appointments,  grades, salaries, and appointment dates.
section_title: While Agencies Appeared to Have Acted Appropriately, OPM Case Files Lacked Supporting Documents for Most Approved Conversion Requests
paragraphs: For the 78 OPM-approved agency requests, agencies appeared to have  used appropriate authorities and followed proper procedures in converting  political appointees to career positions. Additionally, we determined that  OPM evaluators and management sufficiently reviewed all 78 approved  requests. More specifically, for each of the 78 cases, our review of OPM’s  case files and additional documentation from individual agencies  supported OPM’s conclusion that each of these conversions appeared to  be free of political influence. We determined that the conversions  complied with merit system principles, applicable civil service law, and  regulations. For example, agencies converting 28 political appointees to  competitive service positions in our scope generally followed the  competitive service examination process. The process includes notifying  the public that the government will accept applications for a position;  rating applications against minimum qualification standards; and  assessing applicants’ competencies or knowledge, skills, and abilities  against job-related criteria to identify the most qualified applicants. The  process also involves determining which applicants are eligible to claim  veterans’ preference, and using a certificate of eligibles identifying the  best qualified applicants to fill the position.
subsections: section_title: OPM’s Conversion Case Files Lacked Key Supporting Documentation to Support Its Decisions on Most Approved Requests
paragraphs: As stated above, OPM reviewed and approved 78 agency requests to  appoint a political appointee to a career position. However, supporting  documentation in its case files for more than 70 percent (55 of 78) of  approved conversions lacked sufficient information for us to initially  determine the accuracy of its conclusion that the proposed conversions  appeared free of political influence and conformed to merit system  principles. We were only able to make our determination after obtaining  and reviewing documents from involved agencies. Examples of  documentation OPM checklists required agencies to submit with a  conversion request—but not provided in OPM’s case files—include but  are not limited to descriptions of candidates’ current or former political appointments  crediting plans used to score applicants’ responses to assessment  questions and determine applicants’ qualifications, and  referral lists issued to the selecting official and the completed referral  list documenting the tentative selection.
To complete our reviews and to assess OPM’s assertion, we requested  additional case documentation directly from the involved agencies. The  lack of documentation contained in OPM case files does not conform with  Standards for Internal Control in the Federal Government. Internal control  standards require agency management to design control activities—such  as maintaining appropriate documentation of transactions and internal  control—to achieve objectives and respond to risks.
OPM officials agreed that its case files might not always include copies of  all documents OPM reviewed. In commenting on a draft of this report,  OPM stated that in situations involving extensive file transactions, it  allows agencies the flexibility to grant its evaluators access to automated  hiring systems to conduct pre- or post-appointment reviews. OPM also  stated that it exercises discretion and provides exceptions to maintaining  voluminous or large sized files reviewed in automated hiring systems,  when it is burdensome or impractical to store them in OPM’s files. OPM‘s  standard operating procedures for reviewing political conversion requests  —which were provided to us after OPM submitted comments on a draft of  this report—include a description of the file organization and broad  categories of information to be stored in each case file, such as contents  for pre-appointment checklists submitted by agencies and additional  documents reviewed. However, the procedures do not list the specific  documents obtained from agency submissions and automated hiring  systems OPM should save in its case files. For example, the procedures  do not list specific agency documents described in review checklists used  by evaluators to review conversion requests, such as job opportunity  announcements used to solicit applications or documentation used to  adjudicate veterans’ preference. OPM officials told us that OPM is  developing guidance to identify and clarify specific agency documents  OPM staff should maintain in its case files. As part of this effort, OPM’s  Agency Records Office is drafting a records schedule for maintaining  political conversion files, which OPM expects to be completed by the end  of calendar year 2017. Once completed, OPM plans to submit the draft  schedule to the National Archives and Records Administration for review,  public comment, and approval. Without a finalized records schedule that  lists all documents OPM must save from reviews of agencies’ conversion  requests, OPM risks not maintaining sufficient or complete documentation  available to justify decisions to approve or deny such requests.
Additionally, OPM’s procedures do not require its staff to verify they have  reviewed documentation required by OPM checklists. In cases where  OPM does not maintain all documentation used to review a conversion  request, such verification would require OPM staff to certify they reviewed  required documentation before recommending approval or denial of a  conversion request. Without such verification, reviewers of OPM case  files often are unable to determine whether OPM staff reviewed all  documentation OPM requires from agencies to make an informed  recommendation.
section_title: OPM Denied Over 20 Percent of Conversion Requests and Referred Several Cases to the Office of Special Counsel for Investigation
paragraphs: OPM denied 21 of the 99 agency conversion requests agencies intended  to complete from January 1, 2010, through March 17, 2016. In these  cases, OPM could not conclude that agencies adhered to merit system  principles or that the conversions were free of political influence. In some  cases, OPM identified deficiencies linked to inappropriate handling of  applicants with veterans’ preference as reasons for the denial. These  include applying overly restrictive definitions of specialized experience to  applicants with veterans’ preference, making the applicant ineligible  for the position; bypassing qualified veterans and pursuing a Schedule A  noncompetitive appointment process to appoint a political appointee;  and  in two cases, not seeking OPM approval to pass over qualified,  compensably disabled veterans.
OPM also cited the following reasons for denying the requests:  the absence of critical documentation to conduct delegated  examination for position; agencies assessing the qualifications of the selectee, other  applicants, or both improperly; using inappropriate qualification standards or selective placement  factors to select applicants; and agencies taking clear steps to ensure that political appointees were  selected for the career position, such as interviewing only one  candidate or requesting the political appointee by name for the  position in recruitment documentation.
Further, OPM determined, in 9 of the 21 denied cases, there was  evidence in the agency’s submission suggesting the agency may have  committed a prohibited personnel practice. OPM referred these cases to  the Office of Special Counsel (OSC) to determine if agencies committed  such practices. The outcomes of OSC investigations varied:
OSC determined that 3 conversion cases were the result of agency  officials committing prohibited personnel practices. In 2 of these  cases, employees found to be involved in prohibited personnel  practices retired before facing an OSC interview or disciplinary action  by agencies. OSC did not pursue disciplinary action in 1 case. For all  3 cases, OSC recommended that the agencies provide additional  training to its human resources staff, formalize internal policies and  procedures, or both.
In 1 investigation, OSC filed a complaint with the Merit Systems  Protection Board (MSPB) alleging that the agency employee  discriminated in favor of certain political appointees when the  employee approved proposed actions to convert the political  appointees to permanent civil service appointments. OSC requested  the MSPB impose disciplinary action against the agency employee.  The initial decision of the MSPB administrative judge ruled against the  OSC and OSC thereafter filed a petition for review with the full board.  In January 2017, the full board affirmed the initial decision and held  that there was no basis for disciplinary action against the employee. In  so concluding, it stated that OSC failed to prove that the employee  intentionally committed an unlawful hiring practice.
In 3 cases, OSC said it either lacked sufficient evidence to conclude  that the hiring process was manipulated or that it lacked jurisdiction  over the case. In these instances, OSC closed the cases.
OSC was continuing its investigation of the other 2 cases as of July  2017.
subsections: section_title: OPM Directed Agencies to Take Corrective Actions in Over 10 Percent of the Conversion Cases It Reviewed
paragraphs: As discussed earlier, OPM has authority to order agencies to take  corrective actions regarding any agency hiring when it determines the  action was contrary to any law, rule, regulation, or OPM-established  standard. Agencies are required to comply with such orders. In over 10  percent (11 of 99) of conversion requests OPM reviewed during our  period of review, OPM directed agencies to take one or more corrective  actions after identifying deficiencies in their handling of the respective  cases. For 8 of these 11 requests, OPM directed agencies to take  corrective actions after denying them. For the 3 other requests, OPM  approved them but instructed agencies to take corrective actions to  remedy identified deficiencies. Examples of corrective actions OPM  directs an agency to implement include cancelling personnel actions,  readvertising positions, separating the individual who was selected, or  appointing another individual (e.g., a priority referral from the agency’s  displaced employee program).
In cases where preference eligibles lost employment consideration due to  improper agency action, OPM may further require agencies to identify  such individuals and provide them with priority consideration. It may also  impose certain conditions on an agency (or a unit), including but not  limited to, decertification of staff (OPM certification is required to conduct  delegated examining), close monitoring and approval of activities at  various steps of the hiring process, periodic follow-up activities, and staff  training until OPM is satisfied with the corrective actions taken. Finally,  OPM may withdraw an agency's delegated examining hiring authority—or  decertify the staff of a specific delegated examining unit—if the agency  (or unit) has demonstrated systematic problems executing the authority,  including in handling political conversions.
section_title: OPM Reported Political Conversion Requests as Mandated
paragraphs: The Edward “Ted” Kaufman and Michael Leavitt Presidential Transitions  Improvements Act of 2015 (Transitions Act) requires OPM to report  annually to Congress, and during certain periods quarterly, on agency  requests to appoint political appointees or former political appointees to  covered civil service positions. Enacted in March 2016, the Transitions  Act requires such reports to include data elements for each conversion  request, such as  the date on which the request was received by OPM,  the political position held by the individual,  the proposed career position, whether OPM approved or denied the request, and  the date the agency appointed the political appointee into the covered  civil service position.
The Transitions Act also defines covered civil service positions and  political positions included under its new reporting requirements.
From September 2016 through February 2017, OPM has provided five  reports to Congress on conversion requests submitted by agencies from  March 18, 2016, to January 20, 2017. The reports incorporate all data  elements required by the Transitions Act. Although not specifically  required under the act, the reports also include OPM post-appointment  reviews of conversions that occurred without seeking OPM approval. To  comply with the Transitions Act’s new reporting requirements, OPM  reshaped its pre-appointment review coverage. Specifically, in an August  2016 memorandum to agencies, OPM provided information on covered  political positions and expanded the scope of its conversion reviews to  include current or former political appointees in positions listed in the  Executive Schedule. OPM must report these reviews under the  Transitions Act.
OPM’s August 2016 memorandum also lists revised procedures. For  example, OPM revised its pre-appointment checklists to include requests  for the rate of basic pay of the current or former political appointee, and  the proposed rate of basic pay of the proposed civil service position. As  part of its revised procedures, OPM also requires agencies to provide  information on whether the agency appointed the individual to the  covered position and, if so, the date the appointment took place. The  additional information that OPM is requesting from agencies provides  OPM with the data it needs to comply with the reporting requirement.
OPM does not require agencies to seek pre-appointment approval to  convert political appointees to career positions when using certain  noncompetitive and direct-hire authorities. However, as we pointed out  to OPM officials, under the Transitions Act, appointments under these  authorities are within the scope of OPM’s reporting obligation. OPM  agreed and told us that, going forward, they will notify agencies that they  must request OPM’s approval to convert political appointees using such  authorities. OPM officials said they would also include data on these  conversions in subsequent political conversion reports to Congress. By  reviewing proposed political conversions made under these  noncompetitive and direct-hire authorities, and including them in its  reports, OPM will be able to enhance its oversight of political conversions  and provide a more complete representation of political appointee  conversion activity to Congress.
section_title: Conclusions
paragraphs: The merit-based conversion of political appointees to career positions can  be useful in achieving a highly qualified workforce. We found that OPM’s  reviews of proposed political conversions are helping to ensure that  agencies are using appropriate authorities and following proper  procedures in making these conversions. In a number of cases, OPM  directed agencies to take corrective actions and denied conversion  requests where it could not conclude that agencies adhered to merit  system principles or that the conversions were free of political influence.  In addition, OPM is taking steps to better identify instances where  agencies may complete political conversions without prior OPM approval.  It has enhanced its monitoring processes and plans to increase the  frequency of its checks of data collected through its EHRI database.
However, OPM’s review process and supporting documentation must  also be transparent, and include and maintain the appropriate  documentation to support its review decisions. For the majority of OPM’s  approved cases, there was not sufficient information in OPM’s case files  for us to initially support its determination that proposed conversions  appeared free of political influence and conformed to merit system  principles. We were, however, able to support OPM’s decisions with  additional documentation obtained directly from involved agencies. As  OPM drafts a records schedule for maintaining files from conversion  requests, it can specify documents that must be saved from both agency  submissions and agencies’ automated systems to ensure such  documentation is available for subsequent review. Additionally, to provide  greater assurance that its staff reviewed all documentation required by  OPM checklists to support a conversion request, OPM can incorporate a  process requiring its staff to verify they have reviewed such  documentation before recommending approval or denial of agencies’  conversion requests.
section_title: Recommendations for Executive Action
paragraphs: We are making the following two recommendations to OPM:  The Associate Director of Merit System Accountability and Compliance  should ensure that OPM’s finalized records schedule on retaining  conversion case files specifically lists all documentation that must be  saved in its case files. (Recommendation 1)
The Associate Director of Merit System Accountability and Compliance  should establish a policy requiring that its staff verify they have reviewed  all documentation required by OPM checklists before recommending  approval or denial of a conversion request. OPM may incorporate such a  verification requirement as part of checklists completed by its staff when  reviewing conversion requests. (Recommendation 2)
section_title: Agency Comments and Our Evaluation
paragraphs: We provided a draft of this report to OPM for its review and comment. In  its written comments, reproduced in appendix IV, OPM partially concurred  with both of our recommendations.
With respect to our first recommendation, OPM stated that it agrees that  finalized guidance on retaining conversion case files should specifically  list information that must be documented in OPM’s case files. However,  OPM stated that it does not agree with the implication that its current  guidance lacks information about the material that must be maintained in  case files. OPM noted that its political conversion standard operating  procedures provide a description for the file organization and lists the  contents to be stored in each case file, including a file for contents for the  pre-appointment checklists. It also noted that while its guidance does not  list each individual document to file, OPM maintains the documents  submitted by the requesting agency and additional information obtained  during the review process to support OPM’s decision. OPM stated that in  situations involving extensive file transactions, it allows agencies the  flexibility to grant its evaluators access to automated hiring systems to  conduct pre- or post-appointment reviews. It also stated it exercises  discretion and provides exceptions to maintaining voluminous or large  sized files reviewed in automated hiring systems, when it is burdensome  or impractical to store them in OPM’s files. Finally, OPM stated that its  evaluators review checklists, which are filed in the case file, and capture  the review and analysis of that documentation.
We acknowledge OPM’s standard operating procedures include  information about documents that must be maintained in case files. These  procedures—which OPM provided after submitting comments on a draft  of this report—include a description of the file organization and broad  categories of information to be stored in each case file, such as contents  for pre-appointment checklists submitted by agencies and additional  documents reviewed. OPM’s procedures also describe roles and  responsibilities for staff involved in political conversion reviews. For  example, OPM’s lead coordinator for political conversions and an  evaluator assigned to the case are expected to ensure that OPM has  received all documentation from the agency submitting the conversion  request. An evaluator also reviews the agency’s documentation and  completes a review checklist to determine whether the request complies  with merit system principles and appropriate laws, rules, and regulations,  and if it is free of political influence. However, the procedures do not list  the specific documents obtained from agency submissions and  automated hiring systems OPM should save in its case files. For  example, the procedures do not list specific agency documents described  in review checklists used by evaluators to review conversion requests,  such as job opportunity announcements used to solicit applications or  documentation used to adjudicate veterans’ preference.  As noted above,  as OPM drafts the records schedule on retaining conversion case files for  maintaining files from conversion requests, it can specify information that  must be saved from agencies’ automated systems to ensure such  documentation is available for subsequent review. Thus, we believe our  recommendation remains valid. We have clarified our recommendation to  specify that OPM should ensure that the finalized records schedule it is  drafting specifically lists all documentation it must save in its files.
With respect to our second recommendation, OPM agreed to add a box  to the checklist for evaluators to indicate they have reviewed all required  documentation, and for their reviewers to add their concurrence. OPM did  not agree with what they believed was an implication that it lacks a policy  or process to ensure a thorough review of required information to conduct  a pre- or post-appointment review of current or recent political appointees  to covered civil service positions. According to OPM, the process involves  experienced evaluators and multiple levels of management review prior to  issuing a final decision of approval or denial. OPM also stated that the  thoroughness of its review process is also evident by the fact that GAO  agreed with all of its decisions for cases reviewed.
We acknowledge that OPM has a process to review conversion requests.  As discussed above and illustrated in figure 1, OPM’s process involves  both evaluators and multiple levels of management review prior to making  final decisions on conversion requests. Additionally, as noted above, we  determined that OPM evaluators and management sufficiently reviewed  all 78 OPM-approved agency requests included in the scope of our  review. Specifically, for each of the 78 cases, our review of OPM’s case  files and additional documentation from individual agencies supported  OPM’s conclusion that each of these conversions appeared to be free of  political influence. We also determined that these conversions complied  with merit system principles, applicable civil service law, and regulations.  However, OPM’s procedures do not require its staff to verify they have  reviewed all documentation OPM requires from agencies to make an  informed recommendation. While evaluators may have reviewed all  required documentation, reviewers of OPM case files often cannot  confirm such reviews took place without verification. Thus, we believe our  recommendation remains valid.
OPM also provided technical comments, which we incorporated in our  report, as appropriate.
As agreed with your offices, unless you publicly announce the contents of  this report earlier, we plan no further distribution until 30 days from its  issue date. At that time, we will send copies of this report to the Acting  Director of the Office of Personnel Management, as well as to the  appropriate congressional committees and other interested parties.
In addition, the report will be available at no charge on GAO’s website at  http://www.gao.gov.
If you or your staff have any questions about this report, please contact  me at (202) 512-2717 or jonesy@gao.gov. Contact points for our Offices  of Congressional Relations and Public Affairs may be found on the last  page of this report. GAO staff who made key contributions to this report  are listed in appendix V.
section_title: Appendix I: Political Conversions Reviewed and Completed from January 1, 2010, through March 17, 2016
subsections: section_title: Number of conversion requests reviewed by OPM 1
section_title: Appendix II: Objectives, Scope, and Methodology
paragraphs: The objectives of this engagement were to provide information on  conversions of political appointees to career positions, and examine the  implementation and effectiveness of the Office of Personnel  Management’s (OPM) 2010 policy for reviewing these conversions.  Specifically, this report examines (1) conversion requests submitted by  agencies and reviewed by OPM, (2) whether agencies used appropriate  authorities and proper procedures in conversions approved by OPM, (3)  conversion requests denied by OPM and referred to the Office of Special  Counsel (OSC), and (4) the extent to which OPM has complied with  governmentwide reporting requirements stipulated by the Edward “Ted”  Kaufman and Michael Leavitt Presidential Transitions Improvements Act  of 2015 (Transitions Act). For the purposes of our review, we included  conversions OPM reviewed and agencies intended to complete from  January 1, 2010, through March 17, 2016. This period begins with the  implementation of OPM’s January 2010 policy requiring its prior approval  of all conversions of current or recent appointees to competitive or  nonpolitical excepted service positions. The period continues through  March 17, 2016. This is the day before the Transitions Act was enacted  and OPM began reporting requests by agencies to appoint political  appointees or former political appointees to covered civil service  positions. In selecting the executive branch departments and agencies for  this review, we looked at all agencies that OPM reported as having  requested its approval of proposed appointments of political appointees to  career positions during the time period referenced above.
For the purpose of this review, we defined political appointees as those  appointed to positions in one of six categories: Schedule C; noncareer  Senior Executive Service (SES); limited-term SES; limited-emergency  SES; presidential appointees (including executive level and noncareer  ambassadors); and noncareer legislative branch. We excluded from our  review conversions of limited-term SES and limited-emergency SES  appointees who were career employees prior to being appointed to the  noncareer positions listed above. We identified three categories of career  positions appointments: career-conditional/career (competitive service);  career (SES); and career excepted service (non-Schedule C). Definitions  of these political and career positions can be found in the background  section of this report. They are identical to those covered in our  September 2016 report. The types of current or former political  appointees whose career conversion was subject to OPM’s pre- appointment review under OPM’s November 2009 guidance was not as  extensive as the categories of political appointees used in this report.  However, this variance in scope did not result in a difference between  what agencies gave OPM to review and what those agencies  subsequently provided us. For example, although not specifically under  OPM’s 2010 pre-appointment review guidance, conversion actions  involving one current and three former presidential appointees subject to  Senate confirmation were submitted to OPM for review and were  approved. Additionally, a conversion action involving a current noncareer  legislative branch appointee was also reviewed and approved by OPM.  However, OPM’s guidance does not specify it would subject conversions  involving legislative branch employees to its pre-appointment review.
To address our first objective, we obtained data from OPM on its reviews  of agency requests to convert political appointees to career positions. In  addition, we obtained from agencies the number of approved cases  where they proceeded to hire political appointees. According to OPM  data, 30 executive branch departments and agencies requested OPM’s  approval for at least one conversion during the period; the departments  and agencies are listed in appendix I. We then asked each of these 30 departments and agencies to corroborate (1) the number of requests to  convert employees from political to career positions each agency made to  OPM, and (2) the number of these conversions the agencies completed  during the period of our review. Additionally, we reviewed relevant OPM  documents and interviewed OPM officials charged with administering  OPM’s political conversion review procedures. This allowed us to better  understand the steps OPM has taken to enhance its processes for  identifying conversions completed by agencies, including those  conversions agencies may have completed before obtaining OPM’s  approval.
To assess the reliability of OPM and agency conversion data, we  examined them for obvious errors and inconsistencies. We also sent  questionnaires to OPM and all 30 departments and agencies identified by  OPM as submitting conversion requests during the review period. We  asked them to submit information on the data systems they respectively  used to collect, store, and update conversions data, and the quality of  data entered into their system(s). We determined that political conversion  data provided by OPM and agencies for the time period of our review are  sufficiently reliable for the purposes of our reporting objectives.
To address our second objective, we assessed OPM’s reviews of all  conversion requests in our scope that OPM approved. Specifically, we  examined OPM’s review checklists, individual OPM case files  documenting steps agencies took to convert political appointees, and  additional documentation provided by individual agencies. This was  designed to (1) ensure that appropriate authorities and proper procedures  were followed in making and reviewing conversions; and (2) determine,  for requests approved by OPM, whether we could support OPM’s  decision that conversions appeared to be free of political influence and  complied with merit system principles, applicable civil service law, and  regulations. One GAO analyst applied professional judgment after  reviewing submitted checklists and documentation, appropriate laws and  regulations, and the circumstances for each conversion request. A  second analyst then reviewed and validated the first analyst’s evaluation  of each conversion request. The second GAO analyst either  independently evaluated the conversion request, or traced findings from  the first analyst’s review back to supporting audit documents. We  identified conversion review cases with significant differences between  our and OPM’s reviews of the cases by comparing differences we  identified to selected merit system principles and prohibited personnel  practices. We then collected additional information from OPM on such  cases and determined whether agencies involved in the cases violated  merit system principles and proper procedures, or engaged in prohibited  personnel practices.
To address our third objective, we identified the number of conversion  requests in our scope that OPM denied, and why they denied them. We  reviewed conversion requests referred to OSC for investigation, and  described the outcome of OSC’s reviews of the cases. We also  summarized cases where OPM directed agencies to implement corrective  actions after reviewing conversion requests.
To address our fourth objective, we reviewed revisions OPM made to its  pre-appointment review policies and procedures following enactment of  the Transitions Act. We also reviewed the data elements the Transitions  Act requires OPM to include in its reports to Congress on agency  personnel requests to appoint current or former political appointees to  covered civil service positions. We then compared these data elements  with information from reports on conversion requests OPM had submitted  to Congress.
We conducted this performance audit from January 2016 to August 2017  in accordance with generally accepted government auditing standards.  These standards require that we plan and perform the audit to obtain  sufficient, appropriate evidence to provide a reasonable basis for our  findings and conclusions based on our audit objectives. We believe that  the evidence obtained provides a reasonable basis for our findings and  conclusions based on our audit objectives.
section_title: Appendix III: Agency Conversions of Political Appointees to Career Positions from January 1, 2010, through March 17, 2016
subsections: section_title: Conversions to career positions in the Export-Import Bank of the United States Executive Secretary Export-Import Bank of the United States
section_title: Conversions to career positions in the Federal Communications Commission Chief Information Officer Small Business Administration
section_title: Conversions to career positions in the Federal Retirement Thrift Investment Board Deputy Commissioner for Communications Social Security Administration
section_title: Conversions to career positions in the Federal Trade Commission Director Office of Policy Planning Federal Trade Commission
section_title: Conversions to career positions in the Social Security Administration General Counsel Merit Systems Protection Board
section_title: Appendix V: GAO Contact and Staff Acknowledgments
subsections: section_title: GAO Contact
section_title: Staff Acknowledgments
paragraphs: In addition to the contact named above, Clifton G. Douglas, Jr., Assistant  Director; Colleen Corcoran; Ann Czapiewski; Karin Fangman; Ulyana  Panchishin; Mark Ryan; Cynthia Saunders; and Albert Sim made key  contributions to this report. Michelle Batie; Ellen Grady; Ted Hu; Cale  Jones; Donna Miller; LaSonya Roberts and Stewart W. Small also  provided assistance.