Federal Employees: OPM Data Do Not Identify if Temporary Employees Work for Extended Periods
Released: 2002-04-02T00:00:00

Letter

Background

Temporary limited appointments are appropriate for meeting a range of staffing requirements when an agency expects there will be no permanent need for an employee. Temporary employees can work on a full-time, part- time, seasonal, or intermittent basis. Federal employers are prohibited from using temporary employees to avoid the costs of employee benefits or ceilings on permanent employment levels. Federal employers also cannot use temporary employment as a “tryout” or trial period prior to permanent employment. In addition, federal employers cannot circumvent the competitive examining process by appointing an individual on a temporary basis when that individual is not among the list of qualified applicants certified for permanent appointment. Finally, under OPM regulations, federal employers generally cannot use a temporary appointment to refill positions that were previously filled with such an appointment for an aggregate of 24 months over the preceding 3 years.

OPM states that although agencies have the basic authority to make temporary limited appointments, agencies must document the reason for each such appointment in an employee’s official personnel folder. Agencies can use the appointing authority to: (1) fill a short-term position that is not expected to last longer than 1 year; (2) meet an employment need that is scheduled to be terminated within 24 months for such reasons as abolition, reorganization, contracting of the function, anticipated reduction in funding, or completion of a specific project or peak workload; or (3) fill positions temporarily when the positions are expected to be needed for the eventual placement of permanent employees who would otherwise be displaced from other parts of the organization.

Various changes in regulation have been made over the years restricting the length of service of temporary limited employees. Beginning in 1938, temporary employees generally could not continue past 30 days unless OPM’s predecessor, the Civil Service Commission, approved the extension. In 1960, the time a temporary appointment could remain in effect was extended, so that appointments could be made for as long as 1 year. In 1984, OPM increased the length of time an appointment could remain in effect, so that agencies could extend a temporary employee’s service for a total of 4 years from the date of initial appointment without OPM’s approval. In response to this change in policy, MSPB reported in 1987 that although the expanded authority was a positive addition to the management tools available to federal managers, such flexibility could lead to poor management practices that result in continuing staffing needs being met with temporary employees because they were easier to hire administratively.

Beginning in 1991, several hearings were held before subcommittees of the House Committee on Post Office and Civil Service to receive complaints of temporary employees. The hearings confirmed that federal agencies were retaining employees in an ongoing series of temporary appointments for long periods (8 to 10 years) without benefits or tenure. In a tragic example, a National Park Service employee, James A. Hudson, who had worked in an ongoing series of temporary limited appointments for 8 years, died on July 5, 1993, after suffering a fatal heart attack after working three shifts over a 2-day period during the July 4 weekend. Mr. Hudson, who was a decorated Vietnam War veteran, was a full-time temporary worker whose survivors were not entitled to a pension or government-subsidized health or life insurance benefits. In response to his death, the Congress, as part of the Department of the Interior and Related Agencies Appropriations Act of 1994, gave Mr. Hudson’s widow a lump-sum payment of $38,400, the amount his family would have received as life insurance benefits had he been a permanent federal employee.

In 1994, responding to these hearings and information from other sources, OPM revised its regulations governing agencies’ use of temporary appointments by reducing the time limit from a maximum of 4 years to 2 years and made the requirements uniform for temporary appointments in both the competitive and excepted services. For an extension beyond 2 years, agency officials must request and obtain approval from OPM.

Ten Agencies Were Predominant Users of Temporary Limited Employees

In fiscal year 2000, 10 agencies—the departments of Agriculture, Commerce, Defense, HHS, the Interior, Justice, State, the Treasury, and VA and FEMA—were the predominant users of temporary limited employees. These agencies also employed 84 percent of all federal employees in that year. Figure 1 shows the percentage of temporary limited employees hired in fiscal year 2000 by the 10 agencies and all other agencies.

Over the 10-year period, these 10 agencies accounted for slightly over 90 percent of all temporary limited employees hired governmentwide. Table 1 shows the number and percentage of temporary limited hires that the 10 agencies used each year.

The number of temporary limited employees hired governmentwide declined by about 47 percent from fiscal year 1991 to fiscal year 2000. By comparison, CPDF data show that for permanent federal employees, the decline was about 19 percent over the same 10 years. Except for small year-to-year increases in fiscal years 1995, 1997, and 1998, the hiring of temporary limited employees declined annually over these 10 years.

Temporary Limited Employees Were Mainly Full-Time

Over the 10-year period, the majority of temporary limited employees were full-time hires in white-collar occupations. These employees received some benefits, including annual pay adjustments, overtime pay, and premium pay.

Work Schedule

Temporary limited employees can work a full-time, part-time, seasonal, or intermittent work schedule. From fiscal years 1991 through 2000, the majority of temporary limited employees were full-time hires. Figure 2 contains data on temporary limited employees hired governmentwide for fiscal years 1991 through 2000 by work schedule.

Occupations and Grade Levels

Over the 10-year period, the majority of temporary limited employees hired were in white-collar occupations. White-collar occupations include professional, administrative, technical, and clerical occupations. The remaining occupations were blue collar, comprising the trades, crafts, and manual labor. Blue-collar occupations include foreman and supervisory positions entailing trade, craft, or laboring experience and knowledge as the paramount requirement. For fiscal year 2000, about 65 percent of temporary limited employees belonged to 10 occupational series: (1) the miscellaneous clerk and assistant series; (2) fabric and leather, instrument, machine tool, metalwork, audio visual/television/video, etc. series; (3) miscellaneous administrative and program series; (4) forestry technician series; (5) office automation clerical and assistant series; (6) general education and training series; (7) biological science and technician series; (8) educational and vocational training series; (9) education and training technician series; and (10) park ranger series. Figure 3 shows the percentage of temporary limited employees hired governmentwide by occupation category for the 10-year period.

Most of the white-collar occupations were in the general schedule (GS) pay plan, which consists of 15 grades of annual rates of basic pay. Table 2 shows the numbers of white-collar GS temporary limited employees hired governmentwide by grade level.

Benefits

Temporary limited employees receive some rights and benefits but are not entitled to many of the rights and benefits available to permanent federal employees. Temporary limited employees, like permanent employees, receive full salary based on the grade and step of the position they occupy, annual pay adjustments, and overtime and premium pay. They also generally earn annual and sick leave if they work a full-time or part-time schedule. Part-time employees earn annual and sick leave on a prorated basis. Seasonal employees can work full time or part time. Because intermittent employees have no fixed work schedule, they do not earn annual and sick leave. Temporary limited employees are not eligible for military leave or family and medical leave.

Retirement and life insurance benefits are not provided to temporary limited employees. These employees cannot participate in the Thrift Savings Plan. To be eligible for health insurance benefits, they must complete 1 year of current continuous employment, excluding any break in service of 5 days or less. Once eligible, they must pay the entire cost of the insurance premium. The government does not contribute toward the cost of health insurance for temporary limited employees as it does for permanent federal employees.

Temporary limited employees in the GS pay plan also do not receive within- grade pay increases. However, some blue-collar temporary limited employees are eligible for within-grade pay increases. Temporary limited employees cannot be converted to permanent positions, and the time served in a temporary limited position is not creditable service for federal retirement.

Agency Officials’ Responses Indicate Seasonal Work Was the Primary Reason for Using Temporary Limited Employees

According to the results of our survey of the 10 agencies that were the predominant users of temporary limited employees, seasonal work was the primary reason agency officials gave for using such employees. Agency officials’ responses indicate that 37 percent of the temporary limited employees hired in fiscal year 2000 in their agencies were for seasonal work. Those officials’ responses indicate that 20 percent of temporary limited employees were hired in fiscal year 2000 because of peak workload. Overall, 18 percent of the temporary limited employees hired in fiscal year 2000 were students, including students in associate, graduate, or professional degree programs. Figure 4 shows the percentage of temporary limited employees hired in fiscal year 2000 for each reason provided.

Figure 5 shows, by reason, the most prevalent occupations identified by our survey of the 10 agencies that were the predominant users of temporary limited employees. The most often reported occupational series for fiscal year 2000 was the office automation clerical and assistance series.

Studies Indicate Reasons Public and Private Sectors Use Temporary Employees Are Generally Similar

We reviewed reports and studies published over the past 15 years that discussed aspects of temporary employment in the public and private sectors. Although studies indicate that some differences exist between the federal government’s use of temporary limited employees and that of the private sector, they also indicate that the reasons federal agencies and private sector firms use temporary employees are generally similar. The primary use for both sectors concern scheduling flexibility for staffing so that employers could use temporary employees in such instances as to fill in for absent regular employees; to fill seasonal needs; and to provide needed assistance at times of unexpected increases in business or to meet fluctuations in workload. Differences between the sectors include reasons that are acceptable uses of temporary employees in the private sector (e.g., to screen/recruit for filling permanent positions and to save on wage and benefit costs) but not allowed under the regulations governing temporary employees in the federal government. Other differences include reasons that are associated with aspects of federal hiring, such as temporarily employing candidates awaiting final security clearances and using temporary help in continuing positions that could not be filled permanently due to budget cuts.

In June 1997, an employer study was published based on a survey designed to be representative of employment in private sector establishments with five or more employees in the United States. This study directly addressed why private sector employers used temporary employees and divided the reasons into two categories. The first category consisted of reasons concerning staffing levels, including filling vacancies until regular employees are hired; filling in for absent regular employees who are sick, on vacation, or on filling seasonal needs; providing needed assistance during peak-time hours of the day or week; providing needed assistance at times of unexpected increases in staffing special projects; and providing needed assistance during hours not covered by full-time shifts.

The second category consisted of varied reasons, including screening job candidates for regular jobs, saving on wage and/or benefit costs, providing needed assistance during company restructuring or merger, filling positions with temporary workers for more than a year, saving on training costs, gaining special expertise possessed by this type of worker, accommodating employees’ wishes for part-time hours, and hiring part-time workers because of an inability to find qualified full- time workers.

No comparable study has been done recently for the federal sector. However, in 1987, MSPB issued a report on temporary appointments in the federal government in which MSPB included the responses of 21 departments and independent agencies that, among other things, included a discussion of the reasons agencies cited for using temporary appointments. According to the MSPB report, most agencies expressed their responses in general terms concerning positions not expected to last more than 1 year, seasonal positions, part-time and intermittent positions that are not clearly of a continuing continuing positions when temporarily vacated for periods of less than 1 year.

In addition, some agencies provided specific examples, including hiring postgraduate students to work on research projects that will last temporarily placing candidates in less sensitive positions while they wait for final security clearances; placing workers in continuing positions that could not be filled permanently due to budget cuts; filling shortage category and hard-to-fill positions, pending certification preventing a loss of candidates to private industry in occupations like computer specialist by having the ability to hire such candidates in 2 or 3 weeks with conversion to permanent employment at a later date.

According to the MSPB report, the last two reasons, in particular, indicated possible merit system concerns.

Other studies that provide reasons agencies cited for using temporary employees concern specific agencies or agency components. These reasons included using temporary employees to meet fluctuations in workload, to address uncertain funding, and to screen candidates before hiring them permanently.

According to OPM, the last two reasons are not appropriate uses of temporary limited employees in the federal government.

OPM Revised Its Regulations to Ensure the Appropriate Use of Temporary Limited Appointments, but Long-Term Use May Still Exist

As with its other regulations, OPM is responsible for ensuring that agencies adhere to its regulations concerning temporary employees. In 1994, OPM revised its regulations governing temporary appointments. OPM stated that its intention in revising the regulations was to ensure that temporary limited employees were used to meet truly short-term needs and were not serving for years under a series of temporary appointments without many of the benefits afforded other long-term employees. The 10 agencies that are the predominant users of temporary limited employees stated that they have been ensuring the need for individual temporary appointments and monitoring the time limits imposed on such appointments. According to OPM and agency officials, however, neither OPM nor any of the 10 agencies have been monitoring the total years of continuous temporary employment by these individuals. CPDF data, the best available information, show that of those temporary limited employees hired governmentwide in fiscal year 2000, about 16,000, or about 11 percent, had 5 or more years of federal service. However, limitations in the CPDF data prevent a determination of the number of individuals who spend long periods of continuous federal service in temporary limited positions without many of the benefits afforded other long-term employees.

OMSOE Reviews Not Normally Designed to Assess Temporary Limited Appointments in Detail

In 1994, OPM revised its regulations governing the use of temporary limited appointments to help ensure that such employees are used to meet truly short-term needs. Congressional hearings and information from other sources prompted OPM to act because some temporary limited employees were serving for years under a series of temporary limited appointments without many of the benefits afforded other long-term employees. For example, a 1992 OPM study reported that many nonpermanent seasonal employees in the land management agencies were “making a career” out of temporary work. The revised regulations reduced the time limit for individual temporary limited appointments from 4 to 2 continuous years of temporary service in a position.

OPM’s revised regulations governing temporary appointments also generally limit agencies from refilling any position or its successor (i.e., a position that replaces and absorbs the original position) with a temporary appointment if that position had been filled by a temporary appointment in either the competitive or excepted service for a total of 2 years during the preceding 3 years. Positions involving seasonal work (i.e., work that involves annual recurring periods of less than 6 months) or intermittent work (i.e., work that involves sporadic or irregular intervals) are exceptions to such limits and restrictions. Under its regulations governing temporary limited appointments in the competitive service, OPM requires the supervisor of each position filled by temporary limited appointment to certify that the employment need is truly temporary and that the proposed appointment meets the regulatory time limits. The regulations do not require such certification for excepted service temporary limited appointments.

We contacted the 10 agencies that we identified as the predominant users of temporary limited employees to identify steps that they were taking to ensure the appropriate use of such employees. Officials from the 10 agencies generally stated that they monitor the time limits on individual temporary limited appointments to ensure that such appointments adhere to the regulatory time limits and that they rely on the supervisors of such employees to ensure that the employment needs are truly temporary.

According to an OPM official, holding agencies accountable for compliance with OPM’s temporary limited employment regulations is necessary for sound human resources administration. The official stated that OPM monitors agencies’ compliance with temporary limited employment during the evaluation visits conducted by OMSOE, which assesses agencies’ effectiveness in ensuring compliance with personnel laws and regulations. According to OMSOE, each of the departmental agencies and independent agencies with larger numbers of employees is subject to review every 4 years, and each of the smaller independent agencies is reviewed every 5 years.

An OPM official said that OMSOE routinely includes some individual temporary appointments in its periodic oversight reviews but generally does not look at the work history of temporary limited employees serving in those appointments. The officials said that unless OMSOE knew in advance or saw a problem based on prior audit reports or other sources, it would not focus on temporary limited employees. Because of the typically limited nature of its reviews of temporary limited appointments, OMSOE’s reviews of agencies are unlikely to uncover instances of long-term temporary limited employment. In reviewing authorities used by an agency, OMSOE follows a standard audit procedure of selecting a judgmental sample of appointments for review. OMSOE uses a “problem oriented” sampling to select appointments. That means that if OMSOE officials have identified problems with a specific type of appointment through such sources as employee complaints and periodic employee attitude surveys, the audit team will include some of those appointments in the sample of appointments it reviews. If temporary limited appointments were suspected of being a problem area, the review might involve more work in this area. For example, because of an indication of possible inappropriate use of the appointing authority for temporary limited employees at the Department of the Interior, OMSOE did an assessment of seasonal employment at the National Park Service. In 1998, after completing its review, OMSOE reported that a number of parks in the Department of the Interior’s National Park Service with seasons lasting longer than 6 months were improperly filling seasonal positions with temporary limited appointments. However, according to an OMSOE official, OMSOE normally looked at the appropriateness of individual appointments and other aspects of compliance with OPM regulations.

Regulations Include Provisions That Could Result in Long-Term Use of Temporary Limited Employees

There are several ways that temporary limited employees can work for more than the 2-year limit on individual temporary appointments. In its regulations, OPM recognizes circumstances when agencies may require the service of temporary limited employees beyond the allowed 2 years. To extend a temporary limited appointment in the same position beyond the maximum of 2 years, agency officials must request and obtain approval from OPM. According to OPM, in fiscal year 1998, it approved 110 requests covering 332 employees; in fiscal year 1999, 165 requests covering 426 employees; and in fiscal year 2000, 180 requests covering 418 employees.

Moreover, temporary limited employees can serve for continuous years under different temporary appointments or in the same appointment without an extension from OPM. If it involves a break in service of 3 days or less, an agency can reappoint or convert a temporary limited employee from one temporary appointment to another temporary appointment many times over a period of years and not conflict with OPM’s regulations. In addition, after 3 days have elapsed after a temporary appointment ends, an agency can rehire the employee using a new temporary limited appointment as long as it does not involve the same basic duties, the same major subdivision of the agency, and the same local commuting area as the original appointment. However, the CPDF does not contain the necessary information to identify whether new temporary appointments were formerly temporary limited employees.

As shown in table 3, CPDF data show that from fiscal years 1991 through 2000, between 30 and 46 percent of the temporary limited employees hired annually governmentwide were conversions within an agency.

According to an OPM official, there is no limit on the number of times that an agency can convert a temporary limited employee to another temporary limited appointment within the same agency as long as two conditions are met. First, conversions to competitive temporary appointments must be accomplished using a competitive selection method or must be based on noncompetitive eligibility. Second, the regulatory provisions limiting appointments to successor positions must be met.

Finally, agencies can also exceed the general time limits of some temporary limited employees. Under OPM regulations, an agency can appoint and extend an employee in a seasonal or intermittent temporary limited position without regard to the 2-year general time limit as long as the time the employee worked annually was less than 6 months, or 1,040 hours. It is also permissible for different subunits of an agency to hire the same person for more than one seasonal appointment lasting for up to 6 months. Thus, a seasonal temporary limited employee could work full time for two subunits in an agency under two different 6-month temporary limited appointments in the same year. CPDF data show that from fiscal years 1991 through 2000, between 25 and 36 percent of temporary limited employees hired had a seasonal or intermittent work schedule.

These scenarios could, as OPM reported in 1992, result in nonpermanent employment—which is intended for short-term staffing needs—becoming quasipermanent. In that report, OPM focused on seasonal temporary employment at land management agencies and stated that many nonpermanent employees were making a career out of temporary work in these agencies. OPM reported that thousands of park rangers on temporary seasonal appointments work the summer season in one park and the winter season in another, working virtually full time on temporary appointments. An OPM official said that OPM’s oversight policy is to look at each park as a separate employer. This would permit such situations to continue today.

In addition, OPM reported that more than 20 percent of the temporary workforce at land management agencies had held 10 or more temporary appointments or extensions to existing appointments. According to a September 1994 MSPB report, retaining temporary employees for extended periods (8 or 10 years or more) through the use of temporary appointments is directly contrary to the explicit intent of the temporary employment authority and denies employees involved many of the benefits available to other long-term employees.

We analyzed CPDF data to estimate the extent to which individuals may be spending long periods in federal service as temporary limited employees without many of the benefits afforded other long-term employees. Our analysis showed that of the temporary limited employees hired in fiscal year 2000, 78 percent had federal service of 2 years or less. However, CPDF data also showed about 16,000, or about 11 percent, had 5 or more years of federal service. Table 4 shows a breakdown by type of temporary limited employee.

The information in table 4, however, is imprecise because of limitations in the data available in the CPDF, specifically in service computation dates. A service computation date allows OPM and agencies to track an employee’s creditable years of federal service (civilian and military) toward retirement and other benefits. For each federal employee, this date is adjusted with every transfer, separation, or reinstatement experience over the course of the employee’s career. The purpose of having a service computation date is so that at any point in time there is a reasonably accurate measure of an employee’s length of service. The service computation date includes permanent federal employment as well as temporary service without regard to when such service was performed. For example, a current temporary limited employee’s service computation date indicating 10 years of service could include years of prior military service, permanent federal civilian service, and temporary limited employment over an extended period with substantial gaps between appointments. Although CPDF data are the best available information and show that some temporary limited employees had been working for long periods in federal service, it is not possible to determine how many temporary limited employees actually worked for continuous extended periods in temporary limited appointments.

Most of the 16,232 temporary limited employees hired in fiscal year 2000 who had 5 or more years in federal service were hired under seasonal appointments. As mentioned earlier, as long as employees hired under seasonal appointments work less than 1,040 hours per appointment, OPM’s regulations allow agencies to hire and extend such employees for years. Because agencies reported to us that they were monitoring only individual appointments, they would not necessarily know whether seasonal or other temporary limited employees might have been working for 5 or more years. They also might not know whether employees serving in seasonal appointments could have been hired for more than one seasonal appointment in any given year. As was the case with the park ranger example cited earlier, such employees could be working on two separate 6- month seasonal appointments—virtually full time on temporary appointments—without an agency or OPM being aware of it and without many of the benefits afforded other long-term employees.

According to officials from OPM and the 10 agencies that we identified as the predominant users of temporary limited employees, neither OPM nor the agencies monitor the total length of service for temporary limited employees. According to OPM officials, identifying the total length of continuous service of temporary limited employees would require doing a “longitudinal,” or historical study tracing the service of individual employees back in time.

Conclusions

From fiscal years 1991 through 2000, the majority of temporary limited employees were full-time hires in white-collar occupations, eligible to receive annual pay adjustments, overtime, and premium pay and generally earning annual and sick leave. These employees did not receive retirement and life insurance benefits but could buy health insurance after they worked for more than 1 continuous year if they were willing to pay the full cost of the insurance.

In 1994, OPM revised its regulations governing temporary limited employees, generally creating a 2-year limit for each temporary appointment. OPM stated that its intention in revising the regulations was to help ensure that temporary limited employees would be used to meet truly short-term needs and not serve for years without many of the benefits afforded other long-term employees. However, the regulations do not preclude agencies from hiring temporary limited employees to work in a series of extensions, reappointments, and appointments. Thus, there seems to be an inconsistency between OPM’s stated intent and what is permissible under the provisions of its regulations. The regulations allow agencies to continue a pattern of repetitive temporary appointments that result in long-term temporary limited employees not receiving many of the benefits available to other long-term employees.

CPDF data on the total years of service of temporary limited employees show that of such employees hired governmentwide in fiscal year 2000, about 16,000, or 11 percent, had 5 or more years of federal service. However, the limitations of these data combined with the fact that neither OPM nor agencies monitor the total years of temporary employment by temporary limited employees raise a concern that temporary limited employees could be serving for many years under a series of appointments. In addition, OMSOE reviews of agencies are unlikely to uncover incidents of long-term temporary limited employment because they typically look only at individual appointments but not the work history of temporary limited employees serving in those appointments.

The CPDF data available to OPM and agencies for determining the time federal employees spend in federal service include all federal service, both temporary and permanent federal employment, without regard to the total length of time over which such service was performed. Neither OPM nor agencies collect the necessary information that would identify whether, in fact, temporary limited employees were working continuously for years. There is no way to tell from the CPDF whether employees might be serving in temporary limited appointments for continuous extended periods or how many may be receiving benefits, for example, as a result of retiring from prior federal service. Identifying the total length of continuous service of temporary limited employees would require doing a “longitudinal,” or historical study tracing the service of individual employees back in time.

Recommendations

We recommend that the director of OPM direct OMSOE to conduct a study to identify the number of temporary limited employees who have been working for continuous extended periods in temporary limited appointments and the reasons and conditions that permitted such cases to occur. The director should use the results of this study to modify the regulations governing temporary limited employees to address any problem areas found. In addition, the director should require OMSOE to include a sample of temporary limited employees and their work histories as part of its periodic oversight reviews of agencies.

Agency Comments

We sent a draft report to OPM in which we proposed that the director of OPM clarify regulations on temporary limited employees so that they address the amount of time such employees may serve in a series of temporary appointments and better track compliance with the revised regulations. We discussed this draft with OPM officials, who did not believe that enough information was available to determine the nature of any problems related to temporary limited employees working for extended periods and how to revise the regulations. Therefore, we revised the draft report to recommend that the director of OPM direct the agency to conduct a study to identify the number of temporary limited employees who have been working for continuous extended periods in temporary limited appointments and the reasons and conditions that permitted such cases to occur. We also recommended that the director require OMSOE to include a sample of temporary limited employees and their work histories as part of its periodic oversight reviews of agencies. In a letter dated February 19, 2002, (see app. III) the director of OPM provided comments on the revised draft of this report. OPM agreed with both of these recommendations and said that they would be implemented.

Our other recommendation was that the director should use the results of the recommended study to modify the regulations governing temporary limited employees to address any problem areas found. OPM did not specify precisely what it would do in response to this recommendation but said that any problems identified would be addressed through recommended or required corrective actions.

As agreed with your offices, unless you publicly announce the contents of this report earlier, we plan no further distribution until 30 days from the date of this letter. At that time, we will send copies of this report to the chairman and ranking member, Senate Committee on Governmental Affairs; the chairman and ranking member, House Committee on Government Reform; and the director of the Office of Personnel Management. We will also send copies of this report to the heads of the 10 agencies that participated in our survey and other interested parties. We will also make copies available to others on request.

Please contact me on (202) 512-6806 if you or your staff have questions. Key contributors to this report are listed in appendix IV.

Agency Questionnaire on Temporary Limited Employees

The General Accounting Office has been asked by Senators Barbara Mikulski and Paul Sarbanes to obtain information on the federal government’s use of temporary employees. Specifically, the requestors are interested in the use of temporary limited employees, as defined in the Code of Federal Regulations (5 C.F.R. 316.401), excluding those with provisional appointments (5 C.F.R. 316.403). Federal agencies may also hire temporary limited employees under agency-specific hiring authority. Temporary limited employees are used to fill short-term needs (that is, the initial appointment may not exceed 1 year and generally may be extended up to a maximum of 1 additional year), although temporary limited appointments that involve intermittent and seasonal work may exceed the 2-year limit. We are sending this questionnaire to 10 federal agencies whose selected components are the major users of temporary limited employees. The information that we are requesting is not available from either the Office of Personnel Management (OPM) or its Central Personnel Data File (CPDF).

Please provide this questionnaire to the agency component indicated below on this page and have the component complete the questionnaire. Then, return the completed questionnaires for all of the components in a single group to us, along with any additional requested information, within 15 working days of receipt to the address listed below. You may fax your response to us on (202) 512-4516, to the attention of Kiki Theodoropoulos, and follow up with copies of any additional information by mail or courier.

The return address is: U.S. General Accounting Office Attention: Kiki Theodoropoulos 441 G Street, N.W., Room 2908 Washington, D.C. 20548 If you have any questions, please contact Kiki Theodoropoulos on (202) 512-4579 or at theodoropoulosv@gao.gov or Molly Gleeson on (202) 512-4940 or at gleesonm@gao.gov.

Thank you for your cooperation.

Please provide the following information: Name of person completing questionnaire: __________________________________ Title of person completing questionnaire: __________________________________ Telephone number: (_____)_____________ Fax number: (_____)_____________ E-mail address: ____________________________ According to OPM’s Central Personnel Data File (CPDF), _____________ hired _________ temporary limited employees, as defined in 5 C.F.R. 316.401, during fiscal year 2000. Not included are temporary limited employees with provisional appointments under 5 C.F.R. 316.403. For each of the reasons listed below, please provide: the approximate number of temporary limited employees who were hired by your agency component during fiscal year 2000 for each of the reasons listed below and the six most prevalent (in terms of number hired) occupations of temporary limited employees hired for each reason. (Enter occupational series code and title.

Enter a maximum of six occupations.)

According to the CPDF, ______________ hired the following numbers of temporary limited employees, as defined in 5 C.F.R. 316.401, for fiscal years 1995 through 2000. Temporary limited employees with provisional appointments under 5 C.F.R. 316.403 were excluded.

Please explain the reason(s) for any increases, decreases, fluctuations, or static situations in the above data.

In addition to the temporary hires identified in question 1, did your agency hire under authorities other than 5 C.F.R. 316.401 temporary employees whose initial appointment may not exceed 1 year and generally may be extended up to a maximum of 1 additional year (excluding provisional appointments under 5 C.F.R. 316.403)? These other authorities could include excepted service and agency specific authorities. (Check one.) 1. ❒ Yes ➜ Continue with questions 4 through 6. 2. ❒ No ➜ Questionnaire is now complete.

Please provide the following information for the temporary employees hired in fiscal year 2000 under authorities other than 5 C.F.R. 316.401: the approximate number of temporary employees who were hired by your agency during fiscal year 2000 for each of the reasons listed below and the six most prevalent (in terms of number hired) occupations of temporary limited employees hired for each reason. (Enter occupational series code and title.

Enter a maximum of six occupations.)

Please provide the following information for the temporary employees hired in fiscal year 2000 under authorities other than 5 C.F.R. 316.401: the nature of action code the legal authority code the title of the legal authority the number of employees hired under this legal authority, and the benefits (if any) that are available to these employees.

Benefits available (Check all that apply. If none, check “Other” and specify “none”.) ❒ Retirement ❒ Health Insurance ❒ Life insurance ❒ Other - specify below: _____________________________________ ❒ Retirement ❒ Health Insurance ❒ Life insurance ❒ Other - specify below: _____________________________________ ❒ Retirement ❒ Health Insurance ❒ Life insurance ❒ Other - specify below: _____________________________________ ❒ Retirement ❒ Health Insurance ❒ Life insurance ❒ Other - specify below: _____________________________________ ❒ Retirement ❒ Health Insurance ❒ Life insurance ❒ Other - specify below: _____________________________________ ❒ Retirement ❒ Health Insurance ❒ Life insurance ❒ Other - specify below: _____________________________________ ❒ Retirement ❒ Health Insurance ❒ Life insurance ❒ Other - specify below: _____________________________________ ❒ Retirement ❒ Health Insurance ❒ Life insurance ❒ Other - specify below: _____________________________________ In addition to the authorities in question 5, does your agency have additional agency-specific regulations, instructions, or guidance for hiring and providing benefits for such temporary employees? 1. ❒ Yes ➜ Please return a copy of the instructions or guidance with the completed Thank you very much for your assistance.

Objectives, Scope, and Methodology

Senators Barbara A. Mikulski and Paul S. Sarbanes asked us to gather information on federal civilian temporary employees, specifically temporary limited employees. Our objectives were to (1) identify the federal agencies that are the predominant users of temporary limited employees and the job characteristics of such employees (including work schedules, occupations, grade levels, and benefits); (2) discuss the primary reasons agencies give for using temporary limited employees; and (3) compare the federal government’s use of temporary limited employees with that of the private sector. In addition, we agreed to identify steps OPM has taken to ensure the appropriate use of temporary limited employees and whether long-term use of temporary limited employees still exists.

To identify the federal agencies that are the predominant users of temporary limited employees and the job characteristics of such employees, OPM initially provided us with summary data listing temporary limited employment by agency on a quarterly basis from March 1999 through March 2000. On the basis of OPM’s list, we identified agencies as predominant users of temporary limited employees if they had 1,000 or more temporary limited employees on-board as of March 30, 2000. Ten agencies met our criterion for being predominant users: the departments of Agriculture, Commerce, Defense, HHS, the Interior, Justice, State, the Treasury, and VA and FEMA. These 10 agencies accounted for 94 percent of the executive branch’s temporary limited workforce on-board as of March 30, 2000, according to data provided by an OPM official.

We then reviewed temporary limited employment data contained in OPM’s CPDF, a database that contains personnel data for most of the executive branch agencies, including all of the cabinet departments, independent agencies, commissions, and councils. To analyze CPDF data, we used an approach that an OPM official said would extract data from the CPDF on temporary limited employees. During our analysis, we found that OPM’s approach extracted data on other types of temporary employees (who can be appointed for more than 1 year and are entitled to the same benefits as permanent employees) as well as temporary limited employees. The OPM official later confirmed that OPM’s approach captured other types of temporary employees.

Because OPM’s approach captured more than just temporary limited employee data, we had to use another approach and criteria to select data from the CPDF on competitive service temporary limited employees and excepted service employees who meet the temporary limited criteria. As there is no code in the CPDF to identify which current federal employees are temporary limited employees, we reviewed temporary limited appointments and conversions, which are identifiable. For the competitive service, we reviewed the nature of action codes (NOAC) and legal authorities for temporary limited appointments defined in OPM’s Guide to Processing Personnel Actions and were able to clearly identify the applicable NOACs and legal authorities for these employees. We checked these codes and authorities in our later discussions with OPM and agency officials and agencies’ responses to our questionnaires. For the excepted service employees who met the temporary limited criteria, we identified the most likely NOACs and legal authorities from information we obtained from (1) our contacts with OPM and agency officials and (2) agency responses to our questionnaire in which we asked the agencies to provide us with NOACs and legal authorities for excepted service temporary limited employees for fiscal year 2000. We did not verify the reliability of the nature of action and legal authority data in the CPDF used to identify temporary limited employees.

For the excepted service, we used NOACs and legal authorities reported to us in the questionnaires except where they appeared to be in error. This occurred in a very few instances. We also reviewed OPM’s Guide to Processing Personnel Actions to identify any additional NOACs or legal authorities to include. We identified no other NOACs. We included only those legal authorities with not-to-exceed (NTE) dates, and we excluded those legal authorities where we could not determine if they were for permanent or temporary appointments and the authorities were not listed in the questionnaire responses.

We analyzed the temporary limited employment data contained in the CPDF from fiscal year 1991 through 2000, and included those employees hired throughout the year. We defined hires to include appointments (i.e., when the person is not already an employee of an agency) and conversions (i.e., appointments when a person is employed by an agency in a different position or under a different hiring authority). We did not analyze employees on-board as of a specific date (e.g., September 30) because such employees may work for short periods of time, and the end of the fiscal year would only capture a moment in time, according to agency human resources officials we interviewed.

To identify the job characteristics of temporary limited employees governmentwide, we reviewed data available in the CPDF on work schedules and grade levels for fiscal years 1991 through 2000 and occupations for fiscal year 2000. To identify the benefits available to these employees, we interviewed OPM officials and reviewed studies from OPM and MSPB and applicable laws and regulations.

To identify the primary reasons agencies give for using temporary limited employees, we designed and pretested with 2 agencies a questionnaire that we later sent to the 10 agencies that we identified as being the predominant users of such employees based on data provided by an OPM official. (See app. I for a copy of the questionnaire.) In designing the questionnaire, we discussed the questionnaire contents with OPM officials and reviewed reports and studies on temporary employees in the federal government.

For 7 of the 10 agencies, we asked their five components that were the largest users of temporary limited employees to respond to the questionnaire. For the remaining three agencies, including the four components of Defense, the questionnaire responses covered the entire agency. Table 5 lists the 41 agencies and components to which we sent the questionnaire. During the pretests, agency human resource officials told us that they could not provide the information we were requesting on an agencywide basis. We identified the components that were the largest users of temporary limited employees based on information provided by OPM officials and CPDF data as of September 30, 1999. We received completed questionnaires from all 41 agencies and components.

The information in this review applies only to those agencies and agency components to which we sent questionnaires. For three agencies, the departments of Defense and State and FEMA, the information applies to the entire agency. For seven agencies, their five components comprised 73 to 98 percent of total temporary limited employees hired in fiscal year 2000. We used this information to represent the 10 agencies surveyed, but the information cannot be projected to these 7 agencies or governmentwide. We did not report on the reasons for increases, decreases, or fluctuations in temporary limited employees hired from fiscal years 1995 through 2000 because the reasons were so varied that an analysis would not be meaningful. Only one agency and one agency component reported having additional agency-specific instructions for their excepted service temporary limited employees. We did not verify the accuracy of the data provided by the agencies.

To compare the federal government’s use of temporary limited employees with that of the private sector, we conducted a literature search to identify studies on federal and private sector uses of temporary employees. To ensure that we identified all relevant studies, we also contacted OPM, MSPB, and CRS officials, because their agencies had previously conducted studies concerning temporary limited employees. We analyzed the reasons cited in the studies as to why employers use temporary employees and compared similarities and differences for both sectors.

To identify steps OPM has taken to ensure the appropriate use of temporary limited employees, we analyzed CPDF data, reviewed OPM and MSPB studies on temporary employment, interviewed OPM officials, and reviewed current and prior OPM regulations and guidance on temporary employees. We also asked the 10 agencies that we identified as being predominant users of temporary limited employees about the steps they were taking to ensure the appropriate use of such employees. For 8 of the 10 agencies, we asked the component that was the largest user of temporary limited employees in fiscal year 2000 to respond to our inquiries. The eight agencies’ components were the Forest Service, Bureau of Census, Defense components other than the military services, National Institutes of Health, National Park Service, Executive Office for U.S. Attorneys, Internal Revenue Service, and Veterans Health Administration. The two agencies were the Department of State and FEMA. All responded to our inquiries.

To identify whether long-term use of temporary limited employees still exists, we first had to determine how many employees appointed to temporary limited positions had more than 2 years of prior creditable service; to do so, we used the service computation dates in the CPDF. We subtracted military service from the total creditable service. Because creditable civilian service includes all prior civilian federal service, including any permanent federal employment, and because there may be gaps between federal service, creditable service as reflected in the service computation date for temporary limited employees cannot be used by itself to identify continuous years of service under a series of appointments.

We did our work in Washington, D.C., from October 2000 through February 2002, in accordance with generally accepted government auditing standards.

Comments From the Office of Personnel Management

GAO Contact and Staff Acknowledgments

GAO Contact

Acknowledgments

In addition to the individual named above, Richard W. Caradine, Ronald J. Cormier, Thomas G. Dowdal, V. Bruce Goddard, Robert J. Heitzman, Stuart M. Kaufman, Michael J. O’Donnell, Molly K. Gleeson, Rebecca Shea, Kiki Theodoropoulos, and Gregory H. Wilmoth, made key contributions to this report.

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