[Senate Hearing 112-417]
[From the U.S. Government Publishing Office]





                                                        S. Hrg. 112-417

           LABOR-MANAGEMENT FORUMS IN THE FEDERAL GOVERNMENT

=======================================================================

                                HEARING

                               before the

                  OVERSIGHT OF GOVERNMENT MANAGEMENT,
                     THE FEDERAL WORKFORCE, AND THE
                   DISTRICT OF COLUMBIA SUBCOMMITTEE

                                 of the

                              COMMITTEE ON
                         HOMELAND SECURITY AND
                          GOVERNMENTAL AFFAIRS
                          UNITED STATES SENATE


                      ONE HUNDRED TWELFTH CONGRESS

                             FIRST SESSION

                               __________

                            OCTOBER 11, 2011

                               __________

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                        and Governmental Affairs







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        COMMITTEE ON HOMELAND SECURITY AND GOVERNMENTAL AFFAIRS

               JOSEPH I. LIEBERMAN, Connecticut, Chairman
CARL LEVIN, Michigan                 SUSAN M. COLLINS, Maine
DANIEL K. AKAKA, Hawaii              TOM COBURN, Oklahoma
THOMAS R. CARPER, Delaware           SCOTT P. BROWN, Massachusetts
MARK L. PRYOR, Arkansas              JOHN McCAIN, Arizona
MARY L. LANDRIEU, Louisiana          RON JOHNSON, Wisconsin
CLAIRE McCASKILL, Missouri           ROB PORTMAN, Ohio
JON TESTER, Montana                  RAND PAUL, Kentucky
MARK BEGICH, Alaska                  JERRY MORAN, Kansas

                  Michael L. Alexander, Staff Director
               Nicholas A. Rossi, Minority Staff Director
                  Trina Driessnack Tyrer, Chief Clerk
            Joyce Ward, Publications Clerk and GPO Detailee


  OVERSIGHT OF GOVERNMENT MANAGEMENT, THE FEDERAL WORKFORCE, AND THE 
                   DISTRICT OF COLUMBIA SUBCOMMITTEE

                   DANIEL K. AKAKA, Hawaii, Chairman
CARL LEVIN, Michigan                 RON JOHNSON, Wisconsin
MARY L. LANDRIEU, Louisiana          TOM COBURN, Oklahoma
MARK BEGICH, Alaska                  JERRY MORAN, Kansas

                Lisa M. Powell, Majority Staff Director
                       Bryan G. Polisuk, Counsel
               Rachel R. Weaver, Minority Staff Director
                Sean Kennedy, Professional Staff Member
                      Aaron H. Woolf, Chief Clerk



















                            C O N T E N T S

                                 ------                                
Opening statement:
                                                                   Page
    Senator Akaka................................................     1
    Senator Johnson..............................................     2
Prepared statement:
    Senator Akaka................................................    35

                               WITNESSES
                       Tuesday, October 11, 2011

Hon. John Berry, Director, U.S. Office of Personnel Management...     4
Hon. W. Scott Gould, Deputy Secretary, U.S. Department of 
  Veterans Affairs...............................................     5
Pasquale (Pat) M. Tamburrino, Jr., Deputy Assistant Secretary of 
  Defense for Civilian Personnel Policy, U.S. Department of 
  Defense........................................................     7
Gregory J. Junemann, President, International Federation of 
  Professional & Technical Engineers, AFL-CIO....................    19
William R. Dougan, National President of the National Federation 
  of Federal Employees...........................................    21
Patricia Niehaus, President, Federal Managers Association........    23
George Nesterczuk, President, Nestercsuk and Associates..........    24

                     Alphabetical List of Witnesses

Berry, Hon. John:
    Testimony....................................................     4
    Prepared statement...........................................    37
Dougan, William R.:
    Testimony....................................................    21
    Prepared statement...........................................    76
Gould, Hon. W. Scott:
    Testimony....................................................     5
    Prepared statement...........................................    42
Junemann, Gregory J.:
    Testimony....................................................    19
    Prepared statement...........................................    66
Nesterczuk, George:
    Testimony....................................................    24
    Prepared statement...........................................   103
Niehaus, Patricia:
    Testimony....................................................    23
    Prepared statement...........................................    89
Tamburrino, Pasquale (Pat) M., Jr.:
    Testimony....................................................     7
    Prepared statement...........................................    46

                                APPENDIX

Background.......................................................   108
Statement for the Record from:
    The National Aeronautics and Space Administration (NASA).....   115
    David J. Holway, National President of National Association 
      of Government Employees. NAGE/SEIU Local 5000..............   118
    The Laborers' International Union of North America (LIUNA)...   124
    Carol Bonosaro, President, Senior Executives Association.....   128

 
           LABOR-MANAGEMENT FORUMS IN THE FEDERAL GOVERNMENT

                              ----------                              


                       TUESDAY, OCTOBER 11, 2011

                                 U.S. Senate,      
              Subcommittee on Oversight of Government      
                     Management, the Federal Workforce,    
                            and the District of Columbia,  
                      of the Committee on Homeland Security
                                        and Governmental Affairs,  
                                                    Washington, DC.
    The Subcommittee met, pursuant to notice, at 2:34 p.m., in 
Room SD-342, Dirksen Senate Office Building, Hon. Daniel K. 
Akaka, Chairman of the Subcommittee, presiding.
    Present: Senators Akaka and Johnson.

               OPENING STATEMENT OF SENATOR AKAKA

    Senator Akaka. This hearing will come to order. Aloha and 
good afternoon, everyone. I would like to thank you all for 
joining us today for this hearing examining labor-management 
partnerships in the Federal Government.
    In December 2009, President Obama signed an Executive Order 
(EO) to improve government services by creating Federal labor-
management forums. The Executive Order, which was similar to my 
2007 bill on labor-management partnerships and a previous 
Executive Order during the Clinton Administration, established 
the National Council on Federal Labor-Management Relations 
Association. It also required Federal agency heads to establish 
labor-management forums of employee representatives and agency 
officials.
    President Obama's Executive Order emphasizes a critical 
point about government performance: That a non-adversarial 
forum for employees, managers, and agency officials to discuss 
government operations will improve the services our government 
provides. Employees are in the best position to inform 
executives about the details of operational problems or 
inefficiencies. In addition, labor-management partnerships 
improve employee morale, which also helps drive better 
performance.
    Data has shown that, once established, effective labor-
management partnerships will reduce costs. In 1998, the U.S. 
Customs Service obtained an independent cost/benefit analysis 
of its labor-management partnership with the National Treasury 
Employees Union (NTEU). This analysis showed that the 
partnership produced $3 million in net savings between 1993 and 
1998. For every dollar the Customs Service invested in its 
labor-management partnership, it received a 25 percent return 
on its investment.
    More recently, we have seen examples of cost savings and 
increased government efficiency as a result of labor-management 
partnerships at the Pearl Harbor Naval Shipyard--in my home 
State of Hawaii--and at the United States Forest Service. I 
look forward to hearing about these recent success stories 
today. As labor-management partnerships are re-established 
throughout the Federal Government, I expect that we will learn 
of many more partnerships creating short-and long-term cost 
savings.
    I have long understood that its employees are the Federal 
Government's greatest asset. A fair, efficient, and effective 
government requires that Federal employees have a voice in 
their workplace.
    I am looking forward to hearing from Director Berry about 
the recent work of the National Council on Federal Labor-
Management Relations. I know that he has worked hard in his 
role as co-chair of that body, and I commend him for his 
dedication to this issue.
    I am also excited to learn more about the current efforts 
at the Department of Defense (DOD) where labor and management 
are working together to establish a new performance management 
system and hiring process. As our Nation's largest agency--
performing critical functions--I believe that DOD can serve as 
an example to the rest of the Federal Government on how 
employees and management can work together to achieve positive 
results.
    With that, I ask my friend and colleague, Senator Johnson, 
for any opening remarks he may have. Senator Johnson.

              OPENING STATEMENT OF SENATOR JOHNSON

    Senator Johnson. Well, thank you and aloha, Mr. Chairman.
    Senator Akaka. Aloha.
    Senator Johnson. Just quickly, my own background is in 
manufacturing and accounting, so I am definitely going to be 
keying in on numbers and looking for metrics. So I appreciate 
that part of your testimony.
    I just want to open up, first of all, by saying that I 
think it is pretty obvious that a good relationship between 
labor and management is a key to good operational efficiency. 
There is absolutely no doubt about it that the workers on the 
front line probably have the best ideas in terms of how to 
efficiently and effectively operate and either produce products 
or provide the service that they are required to do. So I think 
that is pretty well understood now in the private sector. I 
think most successful managers understand that and are working 
hard toward having those good, cooperative relationships with 
employees.
    I would also say that private unions have played a key role 
in making sure that the balance of power between management and 
employees became a little bit more in balance certainly than 
what it was in the early 20th century.
    But there is a big difference between private sector unions 
and public sector unions. In the private sector you actually 
have a market discipline. If unions go too far, if they bargain 
for too high wages, too high benefits, they put their business 
at risk. And if the business goes out of business, they lose 
their jobs. So you have that market discipline.
    That same discipline does not operate within public sector 
unions, which is why people like Franklin Delano Roosevelt 
(FDR), certainly a friend of the labor movement, had the 
following quote. He said, ``All government employees should 
realize that the process of collective bargaining, as usually 
understood, cannot be transplanted into the public service. It 
has distinct and insurmountable limitations when applied to 
public personnel management. The very nature and purpose of 
government make it impossible for administrative officials to 
represent fully or to bind the employer in mutual discussions 
with government employee organizations.''
    Even the AFL-CIO's George Meany in 1955 said, ``It is 
impossible to bargain collectively with the government.'' Let 
us face it. Public sector employees are a reality, and I think 
we need to figure out how we can deal with them effectively so 
that they actually work cooperatively and help our Federal 
Government become more fiscally responsible.
    I would like to just quote a few financial facts here. I do 
not want to turn this into a budget meeting, but I think this 
really does drive our discussion here.
    Ten years ago, under Bill Clinton, his final budget, the 
Federal Government in total spent $1.8 trillion. Ten years 
later, this last year, we doubled that amount. We spent $3.6 
trillion. In President Obama's 2012 budget, he projected out 10 
years, and according to his budget, we will be spending $5.7 
trillion in another 10 years. So, again, we are not cutting 
government. We are just trying to limit the growth of 
government.
    Our Nation's debt right now stands at $14.7 trillion, and 
that would not be a problem if our economy was $100 trillion 
large. But it is about $14.5 trillion large. And just like a 
family that is in too much debt and is having a hard time 
growing its own personal economy because they are just spending 
all their money servicing the debt, they cannot increase 
consumption, the same exact fiscal reality faces our Nation 
because we have too much in debt.
    So we are faced with financial realities here that are 
pretty ugly, and, again, that is why it is very important that 
we work cooperatively with the Federal workforce to make sure 
that we have an efficient government sector.
    I think with that I will stop. I will probably have some 
other comments a little bit later on, but, again, I have a very 
open mind coming in here. Again, I think it is exactly 
important to have a good, cooperative relationship with the 
Federal workforce. And I am going to be looking forward to the 
testimony to see what some of those examples are.
    Thank you, Mr. Chairman.
    Senator Akaka. Thank you very much, Senator Johnson.
    On our first panel, it is my pleasure to welcome the 
Honorable John Berry, the Director of the Office of Personnel 
Management (OPM); the Honorable Scott Gould, the Deputy 
Secretary at the Department of Veterans Affairs (VA); and Pat 
Tamburrino, Jr., the Deputy Assistant Secretary for Civilian 
Personnel Policy at the Department of Defense.
    It is the custom of the Subcommittee to swear in the 
witnesses, and I ask you to stand and raise your right hands. 
Do you solemnly swear that the testimony you are about to give 
this Subcommittee is the truth, the whole truth, and nothing 
but the truth, so help you, God?
    Mr. Berry. I do.
    Mr. Gould. I do.
    Mr. Tamburrino. I do.
    Senator Akaka. Thank you. Let the record show that the 
witnesses answered in the affirmative.
    I want you to know that although your remarks are limited 
to 5 minutes, your full statements will be included in the 
record.
    Director Berry, will you please proceed with your 
statement?

   TESTIMONY OF HON. JOHN BERRY,\1\ DIRECTOR, U.S. OFFICE OF 
                      PERSONNEL MANAGEMENT

    Mr. Berry. Mr. Chairman, thank you for the opportunity to 
be here with you and the Ranking Member today. It is an honor 
to be here with you, and it is also an honor to be here with 
Deputy Secretary Gould and Pat, who have been great partners in 
this effort, along with many other efforts to make our 
government better and more efficient.
---------------------------------------------------------------------------
    \1\ The prepared statement of Mr. Berry appears in the appendix on 
page 37.
---------------------------------------------------------------------------
    As the President stated when he signed this Executive 
Order, Federal employees and their union representatives are an 
essential source, as Senator Johnson said, of front-line ideas. 
The Administration believes that a strong partnership between 
the Federal Government and our employee unions is critical to 
delivering better results for the American people.
    Our labor partners are an essential source of ideas and 
information. They provide valuable insight to improve working 
conditions for all employees, and they provide innovative ideas 
for delivering services to the American taxpayer in a more 
efficient and cost-effective way.
    The National Council on Federal Labor-Management Relations 
includes representatives of our major large departments 
throughout the agency from the management side, usually the 
Deputy Secretary level, like Secretary Gould. It also includes 
representatives from our management associations, senior 
executives associations, front-line supervisors, and all of our 
national labor unions.
    In the first year, we focused on getting the process of 
labor-management discussions set up. To date, thanks to the 
Federal Labor Relations Authority and the Federal Mediation and 
Conciliation Service (FMCS), more than 350 training sessions 
have been held, reaching over 10,000 managers and union 
representatives. Labor-management forums are now up and 
running; 769 have been established, covering approximately 
770,000 bargaining unit employees.
    At OPM, for instance, our partnership with our unions is 
strengthened by an open table where we allow any issue to come 
for pre-decisional discussions before we have to reach the 
mandatory bargaining table, and that collaboration has allowed 
us to improve speed and efficiency of our mission. It allowed 
us to reorganize ourselves so that we could streamline, and 
control costs, while still providing better services. It also 
allowed us to increase our training for our employees, and 
working with our employees, we developed some very innovative 
training and mentorship programs that have been of great 
assistance to us.
    Another thing is we survey each year throughout the Federal 
Government our employees. When I got here, the Office of 
Personnel Management was not in the top 10. In the 2011 
Employee Viewpoint Survey, amongst all the agencies OPM is now 
ranked in the top 10 in all of the category areas: Ninth in 
leadership and knowledge management, seventh in results-
oriented performance culture, tenth in talent management, and 
fifth in job satisfaction.
    Let me point out again, the year before we were not in the 
top 10 in any of those areas. I would credit our strong 
partnership with our unions for the dramatic improvements that 
we have been able to achieve in a very fast period of time 
together.
    Improving performance management is something I think both 
parties and all parties can come to agree on, and that is, 
making sure that we are getting the most out of our employees.
    Over the last decade, we have spent millions of dollars 
implementing different performance personnel systems, and most 
of them have largely failed because they did not have the buy-
in of the employee groups that were working--they were 
developed without their effective partnership. The No. 1 lesson 
of those experiences is that employee engagement for 
performance management reforms is essential for their success.
    To that end, the National Council took on a work group with 
our Chief Human Capital Officers (CHCO) Council, Mr. Chairman, 
that you and Senator Voinovich formed to improve Federal 
employee performance accountability, and just at our last 
meeting we received the work product from that group. And I 
have to tell you, it is very impressive.
    The Council is now looking to roll this out in pilot form. 
The Department of Defense is using it to inform their efforts 
on performance management review. And I believe it is going to 
achieve greater accountability for our employees and the 
American public.
    By working with our labor unions who represent our front-
line employees, we believe that we can be successful in 
improving delivery of those results to the American people.
    Even with the progress that has been made, there is still 
much to do. Again, I thank you for the opportunity to testify 
and will be ready to answer and discuss any questions that you 
might have.
    Senator Akaka. Thank you very much, Director Berry.
    Secretary Gould, please proceed with your statement.

  TESTIMONY OF HON. W. SCOTT GOULD,\1\ DEPUTY SECRETARY, U.S. 
                 DEPARTMENT OF VETERANS AFFAIRS

    Mr. Gould. Chairman Akaka, Ranking Member Johnson, thank 
you for the opportunity to appear here today alongside my good 
friend and colleague John Berry and Pat Tamburrino to discuss 
implementation of Executive Order 13522. It is a privilege for 
me to be here today to represent Secretary Eric Shinseki and 
the hard-working VA workforce, over 300,000 good people who 
each and every day provide veterans and their families with 
care and benefits.
---------------------------------------------------------------------------
    \1\ The prepared statement of Mr. Gould appears in the appendix on 
page 42.
---------------------------------------------------------------------------
    Our mission at VA is to provide the best possible health 
care and services to veterans wherever they reside. To 
accomplish that common mission, both labor and management must 
work together as collaborative members of the same team.
    VA has a long history of working jointly with its labor 
partners. For the past 15 years, we have maintained a 
successful VA Partnership Council, which has been key to our 
progress in implementing the Executive Order. To date, we have 
successfully stood up over 150 of the 200 labor-management 
forums we expect to have at the local and network levels within 
the next couple of years.
    We are doing what leading private sector firms in America 
are doing today to improve performance and achieve positive 
results for their shareholders. And we are recognizing what 
good leaders and managers have always known: That employees 
have more to contribute to the mission when they are asked for 
their ideas. The result is greater pride, positive morale, and 
better quality.
    Our greatest challenge in getting started at VA was making 
sure that everyone shared the same understanding of the 
Executive Order. To address concerns of both labor and 
management, we developed mandatory Web-based training for 
managers and supervisors, 25,000 of whom have completed this 
requirement. We have also had over 820 labor and management 
employees attend joint training outside of VA, which has helped 
build trust between them.
    In consultation with our labor partners, VA has also 
developed metrics to track changes in customer, employee, and 
manager satisfaction, as well as organizational outcomes that 
can be linked back to the work of our labor-management forums. 
Our metrics have been approved by the National Council on 
Federal Labor-Management Relations and will be included in our 
progress report to the Council in December.
    Our bottom line is whether improved labor-management 
relationships have a positive, measurable impact on the 
delivery of government services--in this case, our Nation's 
veterans.
    The logic is inescapable. Good two-way communication with 
front-line employees helps managers make better decisions, and 
the early engagement boosts employee buy-in, which eases 
implementation of VA transformation initiatives and avoids 
unnecessary litigation.
    In sum, Executive Order 13522 has already contributed 
directly to stronger labor-management relations at VA. There is 
still work to be done, but working with our labor partners will 
improve mission outcomes for our veterans by creating a more 
efficient and effective environment for all employees.
    Finally, we expect the overall improvement in the labor-
management climate to lead to less conflict, fewer grievances, 
and smoother, speedier negotiations of needed changes in the 
Department.
    Mr. Chairman, Members of the Subcommittee, this concludes 
my remarks. Thank you again for the opportunity to testify. I 
will be happy to answer questions at a later point in time.
    Senator Akaka. Thank you very much, Secretary Gould, for 
your statement.
    And now please proceed, Mr. Tamburrino.

   TESTIMONY OF PASQUALE (PAT) M. TAMBURRINO, JR.,\1\ DEPUTY 
 ASSISTANT SECRETARY OF DEFENSE FOR CIVILIAN PERSONNEL POLICY, 
                   U.S. DEPARTMENT OF DEFENSE

    Mr. Tamburrino. Chairman Akaka, Ranking Member Johnson, 
thank you for inviting the Department of Defense to appear at 
this hearing today to discuss our efforts to implement 
Executive Order 13522. We have involved our labor partners in 
the development of recommendations for the design of a new 
performance management system and discussion of methods to 
improve the Federal hiring process called ``New Beginnings.'' I 
am pleased to share with you DOD's progress, the challenges and 
rewards of pre-decisional involvement (PDI), and our way ahead.
---------------------------------------------------------------------------
    \1\ The prepared statement of Mr. Tamburrino appears in the 
appendix on page 46.
---------------------------------------------------------------------------
    The Department of Defense embraces the provisions of the 
Executive Order as a means of facilitating the success of our 
labor-management objectives. We have established over 450 
labor-management forums and are engaging in pre-decisional 
involvement at all levels of the Department. DOD has 
approximately 450,000 bargaining unit employees in 1,500 
bargaining units.
    As I am sure you can appreciate, implementing any program, 
especially in an organization as complex as DOD, is a daunting 
task. Nonetheless, as DOD follows the Executive Order's mandate 
to establish labor-management forums, we are experiencing 
measurable success. The 450 forums established in the 
Department of Defense represent approximately 60 percent of all 
the forums established in the Federal Government.
    DOD has been engaged with the unions that represent DOD 
bargaining unit employees over the past 18 months in the New 
Beginnings process. At the outset, the Department recognized 
that it needed to rebuild relations with the unions following 
the dissolution of the National Security Personnel System 
(NSPS). DOD leadership engaged with the unions who enjoy 
national consultation rights to repair relationships before 
embarking on creating alternative solutions.
    Working with the unions, DOD hosted its first New 
Beginnings conference in September 2010, bringing together a 
broad representation of diverse stakeholder groups. The 
conference was a free-flow of ideas, with participants 
generating over 800 recommendations with respect to performance 
management and over 600 suggestions for the hiring process.
    DOD hosted a second New Beginnings conference in February 
2011 to launch the design team effort. Following the 
conference, three teams--Performance Management, Hiring 
Flexibilities, and the Civilian Work Incentive Fund--began 
their work in earnest. Each team had approximately 25 members, 
all DOD employees, equally represented by labor and management. 
Labor and DOD leadership designated their team members, with a 
view toward ensuring a diverse group, reflective of all skill 
levels and seniorities.
    In September of this year, the teams completed their final 
recommendations for delivery to DOD leadership. We expect to 
deliver a comprehensive report by year's end. While the pre-
decisional process used with our design team has worked well, I 
think it is fair to say that the process is challenging for 
both management and labor. We need to do more to identify 
topics that are worthy of discussion at all levels so that 
trends and common best practices can be identified and shared.
    Training is also critical to the success of forum 
implementation. We have taken advantage of the Federal 
Mediation and Conciliation Service Executive Order Train-the-
Trainer program. In fiscal year (FY) 2012, we will continue to 
leverage training opportunities, particularly those delivered 
by the Federal Labor Relations Authority.
    We should be supportive of the time required to allow for 
meaningful pre-decisional involvement. This includes time for 
both training as well as the actual time to conduct pre-
decisional involvement discussions. However, my experience is 
effective engagement between labor and management significantly 
contributes to the successful execution of DOD's mission.
    The time in pre-decisional discussion may reduce the time 
required for formal negotiations. Traditionally, collective 
bargaining has involved significant amounts of time required by 
labor officials to obtain information relative to the issues at 
hand. Involving labor in the development of the solutions from 
the onset reduces the time on information gathering, typically 
found at the back end of the traditional bargaining model.
    As the Department moves forward, we plan to continue our 
collaborative effort. The Executive Order requires each agency 
to conduct a baseline assessment of the state of labor 
relations. The preliminary results of our assessment indicates 
that when joint labor-management forums exist and meet 
regularly, all parties see the relationship as more positive 
and results-oriented.
    Thank you again for your interest in this critical area and 
for the opportunity to speak with you today. I am pleased to 
take your questions.
    Senator Akaka. Thank you very much, Mr. Tamburrino.
    Director Berry, as I mentioned in my opening statement, I 
would like to commend you on all of your hard work on this 
issue. I know that you believe in effective partnerships 
between employees and management in the Federal workforce. Now 
that the National Council has been meeting for well over a 
year, what do you believe is its most important accomplishment 
to date as well as its greatest challenge moving forward?
    Mr. Berry. Mr. Chairman, you will remember at my 
confirmation hearing we discussed two things that had stymied 
human resources for the past 50 years. The first was a hiring 
system that was as broken as broke could be. And second was we 
did not have strong performance accountability in the Federal 
Government. I promised you I would work hard on both of those 
issues.
    The first one we are moving in the right direction on every 
front. Time to hire is down and all of those issues. But I 
think the best hope--and it is one that we have just started, 
but the one that I believe is going to have the farthest reach 
and the greatest impact is the joint effort that we have taken 
at the national partnership table between our unions and our 
managers on performance management and accountability in that 
it will create a new framework for doing this from top to 
bottom, from our senior executives to our front-line workers 
where we will have accountability, mission alignment, and 
strong communication on a regular basis. It sounds so simple 
but some of the great reforms are those that are such strong 
common sense that you wonder why they have not been done 
before.
    But the essence of this program being developed from the 
bottom up gives it its greatest chance of success, and so I 
think, Mr. Chairman, the greatest hope I have is it will allow 
us to make solid progress toward an issue that has stymied--and 
as we all know, NSPS, Pat could tell you the amount of money 
that was spent standing it up and then taking it down.
    Homeland Security did the exact same thing. They put in 
place a performance management system. They stood it up, and 
they had to take it down. A lot of money was wasted.
    By doing this and focusing on the performance system in the 
right way and building it from the bottom up, we are saving 
those millions of dollars, and I believe are going to be doing 
it right. And so that is going to be the longest-run 
investment.
    The second I would say, Mr. Chairman, is innovation, and it 
goes, Senator Johnson, to your point. We had a hearing. Pat and 
Scott will remember this. We had a gentleman from Pearl Harbor, 
from the shipyard in Pearl Harbor, and he said that the people 
came to him and said, ``How do we save money?'' to his workers. 
He said, ``Well, fire my supervisor.'' They said, ``How do I 
save time?'' He says, ``Then my union members will give you a 
hundred different ways to do it faster and better.''
    Well, of course, time is money, and no one had spent the 
time to ask them, ``Do you have a way to do this faster?'' And 
when we did at that table, it is amazing what they have done. 
Pat can go into more examples of this, but they shaved the time 
of which you could turn around a submarine, and every day in 
dry dock that you can save translates into millions of dollars 
saved for the taxpayer.
    By going to the front line, we have been able to do that, 
and I think that opening that spirit of innovation, Mr. 
Chairman, is going to produce great fruit for the taxpayers for 
years to come.
    Senator Akaka. Thank you very much, Director Berry.
    Pat Tamburrino, I would like to thank you for your nearly 
already 30 years of military and civilian Federal service. 
Thank you.
    Mr. Tamburrino. Thank you.
    Senator Akaka. I believe that the National Security 
Personnel System ultimately failed because it was imposed on 
employees who had very little input into the system that it 
designed. I appreciate the attention DOD is paying to 
rebuilding strong labor-management relationships.
    Do you believe costs could have been saved had DOD engaged 
employees in the design of NSPS from the outset?
    Mr. Tamburrino. Thank you, Mr. Chairman. In hindsight, 
absolutely. When I reflect on the past 18 months of New 
Beginnings, where we have had at points in time more than 70 
labor and management people working in those three design teams 
together, they have come to a common understanding of what that 
performance management system should look like and the 
principles that it should embrace. And you will find that 
detailed in our report.
    If we had done that in NSPS to begin with, in hindsight, we 
would have had the buy-in of both sides of the table, and we 
would not have had to spend those resources to go into the 
system, train people, only to bring the same 226,000-plus 
people back out of the system.
    So I find that people as a result of this New Beginnings 
process on both sides understand what performance management is 
about better. They understand the concerns of both labor and 
management. And I can tell you the recommendations we will 
bring forward to the Congress are truly joint recommendations 
of both parties. And I think based on that alone, we will be 
very successful.
    Senator Akaka. Thank you.
    Secretary Gould, first, I want to thank you. Through my 
service on the Senate Veterans' Affairs Committee, I know how 
hard you work to improve the lives of our Nation's veterans. 
One of the most important roles of the National Council is to 
ensure that forums develop metrics to evaluate their 
effectiveness and report on progress.
    Please discuss the concept of metrics, their value, and 
what recommendations you have for any agency that is struggling 
with how to evaluate the effectiveness of their forums.
    Mr. Gould. Mr. Chairman, thank you. As a prior businessman, 
well, a former executive at the International Business Machines 
(IBM), I really appreciate the value of getting your metrics 
right and deciding what it is you are going to measure your 
success against.
    One of the strongest aspects of the Executive Order is its 
focus on metrics, and there is a hierarchy of metrics that is 
laid out for us. The most important is mission accomplishment. 
Are we making a difference for the taxpayers that we serve? And 
those things at my own agency include the care and well-being 
of the veterans that we serve, and the quality of the benefits 
that we deliver.
    Next most important is the well being of all employees that 
are involved in public service. Better morale and better 
employee satisfaction, I think generally translate into an 
organization with stronger esprit de corps, morale, and pride.
    And, last, the third measure that we are focused on is the 
quality of the labor-management relations itself. We have all 
seen where union-management relationships do not work 
effectively, and I personally believe that a lot of time and 
effort can be attenuated in a confrontational process. Our goal 
is to move that to more of a collaborative and cooperative 
effort.
    So our performance measures are focused on the mission, on 
achieving results for taxpayers, and then the people who make 
the organizations go, and, last, the labor-management relations 
itself.
    Senator Akaka. Thank you very much.
    We will have a second round, but at this time we will hear 
from Senator Johnson with his questions.
    Senator Johnson. Thank you, Mr. Chairman, and I would like 
to thank all of you for your service.
    As I was reading through the written testimony, there were 
a couple of questions that popped into my brain. First of all, 
it sounds great. As I said in my opening statement it is just 
true that working with the people who work with you is going to 
improve your effectiveness and efficiency. But the question I 
kept coming back to is where can it go wrong.
    There was something similar instituted under Bill Clinton, 
and President Bush rescinded that Executive Order. Now 
President Obama has reissued an even more wide sweeping order. 
Why is that? Can you just kind of address the shift? What was 
the thinking?
    Mr. Berry. Mr. Johnson, I think I will take a crack at 
that. I think the President took the approach--it was building 
on--not creating something new but building on what was 
actually in existence in the law. And bargaining in the Federal 
Government is established under the law, and it is very 
different from the private sector in that Federal employees 
cannot bargain over pay and benefits like they can in the 
private sector. They do not have the right strike as they do in 
the private sector. So it is a very different labor statute 
that governs Federal standards.
    But what the President said is, what will make our 
bargaining table more productive is the notion of talking 
beforehand. And it is certainly something I have found works 
well at OPM, that pre-decisional engagement where you can talk 
about ideas before you have fleshed them out, before you have 
gotten into it, and it gets to just what Pat was saying. You 
can identify where the weak spots are, and you can work 
together on them rather than sort of crafting it all in 
management's mind and then unfurling it and saying this is the 
road.
    And so the gist of the Executive Order is to drive that 
pre-decisional discussion and to create forums where that kind 
of conversation could happen. So it builds on the law. It does 
not change the bargaining table. It does not change any of the 
legal standard. It just says before you get to the bargaining 
table, have an open conversation. And that was the spirit that 
drove the Executive Order.
    Senator Johnson. As I was reading through the materials 
here, that seems to be the crux of one of the concerns, the 
pre-decision involvement. You said that Federal employees 
cannot strike, but they could certainly in that process do 
something that is almost similar to a strike and just simply 
not allow good ideas to move forward if they have an objection 
to them.
    Mr. Berry. But, again, Senator, that I think is exactly why 
we might actually get somewhere with this new performance 
management system, is because they were brought in on the 
shaping of it and the understanding of it and helped to design 
the structure on which it will be built.
    Senator Johnson. They will now be involved in decisions 
that are basically outside their bargaining rights, correct? 
They are going to be brought in pre-decision in terms of budget 
preparation, in terms of potentially taking a look at what the 
size of the workforce might be. Isn't that a potential inherent 
conflict of interest? And I think that was one of the concerns 
of the people as I was reading through the testimony.
    Mr. Berry. Well, the law is pretty clear in that they 
cannot bargain over pay and benefits. What you are talking 
about is bargaining over the technology that might affect 
numbers and how that might be implemented.
    For example, at OPM we installed a new phone system. We had 
a phone system when I got there, they told me the day I arrived 
on the job, ``Your phone system could fail at any minute.'' 
Well, we, management, could have just gone out and picked one, 
but we went and instead met with our employees at the table 
about this. And we looked at it as an opportunity to expand 
telework, and it could use technology more effectively so that 
people could work and have distant conferences and we would 
save money on travel so that people would not necessarily have 
to fly to an area. They could use the technology.
    In fact, that has happened, and we have saved about $1.5 
million a year by putting in this new phone system. The union 
would have had the right to slow that down if we had not talked 
to them. They could have taken the approach you said of filing 
suits and other things that could have slowed things down. But 
because we worked it out at the table with them, they instead 
were supportive of it. We got the thing installed on time, 
under budget, and it is saving us money each year for the 
taxpayers.
    So I think it is a great example of the other thing we have 
done which is we have controlled the cost on this. We have been 
very mindful that people were going to be looking at how much 
money we are spending on this. We are spending--the National 
Partnership Council (NPC) costs have been almost half of what 
they were during the Clinton years. And so we have been very 
careful on conserving these resources, spending them wisely, 
and using them effectively.
    Senator Johnson. We will come back to costs.
    Mr. Tamburrino, one of the things, I think, in your 
testimony you talked about is Project Moonshine or Moonshine 
Initiative. That was prior to these labor-management forums, 
correct?
    Mr. Tamburrino. The first instance we cite, yes, sir, it 
was, approximately 5 years ago. But that project continues 
today.
    Senator Johnson. OK. Again, so I guess my question is: Why 
did we need a sweeping Executive Order to encourage a best 
practice where it was already occurring? And why wouldn't other 
people in the Federal Government take a look at that example 
and say, ``That makes sense. Let us start implementing it the 
way we would like to do it in our agency'' ?
    Mr. Tamburrino. I think you are right Senator. What we face 
in the Department of Defense is we have to come up with 
efficiencies. We are under as much budget pressure as any other 
Executive Agency, and we find things like the ``Moonshine 
Project'', which has had multiple ideas, are a great way for us 
to attack those efficiencies.
    If only management thinks of the efficiencies, then labor 
may or may not be inclined to adopt them. But if I get some of 
the ideas from the shop floor or the depot floor, I am much 
better off, because the amount of efficiencies we have to come 
up with are enormous.
    So things like the ``Moonshine Project'' just 
institutionalize this partnership, and I think the pre-
decisional involvement allows a lot earlier identification of 
the challenges that both labor and management face. I think it 
helps us provide a structure to attack the problem.
    Senator Johnson. I think that in your written testimony you 
talked about one of the concerns was cost.
    Mr. Tamburrino. Correct, sir.
    Senator Johnson. But you said it was outweighed by the 
benefits. But what concerns you about the cost? Do we actually 
know the cost of this within the Department of Defense?
    Mr. Tamburrino. We are not collecting those metrics right 
now, but your questions cause me to pause: Do I need to do 
that?
    But what we find and what has been relayed to me by my 
labor partners is if we wait to talk about the problems that 
face us both in the execution of the DOD mission, labor spends 
a lot of time trying to find out the facts. And in the pre-
decisional involvement, we expose them to all the facts we 
understand a lot earlier, so we get to the substance of how do 
we solve this problem as opposed to let us spend hours in fact 
finding where guarding the information too closely is not in 
anyone's best interest.
    But I think to your concern at the end of the day, I think 
everybody appreciates, at least in the Department of Defense, 
the commander, the commanding officer, the responsibility at 
the end of the day rests with that individual. And this pre-
decisional involvement does not change that. It helps inform 
that. I think it may help us make better decisions at the end 
of the day.
    Senator Johnson. OK. Thank you.
    Senator Akaka. Thank you, Senator Johnson.
    Director Berry, telework and work-life programs have been 
priorities for the labor-management forums as well as for OPM 
more broadly. Would you please discuss how improving labor-
management cooperation is helping to advance OPM's telework and 
work-life initiatives?
    Mr. Berry. Mr. Chairman, thank you. I would say that the 
partnership table has allowed us to move much faster and more 
effectively in implementing the law that you all passed, the 
Telework Enhancement Act. And I believe that as we implement 
that and get that stood up and get the technologies in place 
and have the employees designated, that is another place where 
we are just going to save money and be smarter. People, rather 
than having to spend 2 hours each way commuting, can now spend 
that time with their families and still deliver 8 hours to the 
taxpayer and do it effectively, securely, at their home 
location.
    So it is a great law that you all put in place, and the 
Partnership Council has allowed us to stand it up more quickly, 
and I think that had we not had the Partnership Council, it 
certainly would have been one you would have had to almost 
informally create something like it to allow us to get the 
standards in place and to put in place what the law required us 
to do.
    Senator Akaka. Thank you.
    Secretary Gould, I am a long-time supporter of investing in 
workforce training and, in particular, the training of 
supervisors. As a result of joint efforts between the FLRA and 
the FMCS and the Department of Veterans Affairs, thousands of 
labor-management officials have been trained on the Executive 
Order. They are not represented here today, but for the record, 
I want to commend FLRA for its extensive work on training with 
very limited resources.
    I would like to hear more about these training efforts and 
your agency's role in providing such training.
    Mr. Gould. Mr. Chairman, thank you. I share your view that 
the two most important things that a leader can do in an agency 
is develop and train the next generation of leaders behind 
them. And the reason why that training is important is directly 
related to business value: a more efficient, more effective 
organization, and the elimination of waste. It comes from 
people who really know their jobs and have gone that extra mile 
to learn in the community and draw lessons from the private 
sector and other agencies that are doing it well. And that 
happens on the job, it happens in a classroom, but it has to 
happen.
    It is also true that in the environments that we're working 
in today, complexity is increasing, and taxpayer demand to 
deliver new results is not shrinking. So we have to train our 
people to do that.
    So it was very natural for us together in the Labor-
Management Council to go figure out a way where we could 
leverage training assets across the government, and the first 
place that we went to find the richest content, the deepest 
expertise, was at FLRA and FMCS. There is no question that 
these are the folks that have a lot of the insight, the 
professionalism, and the knowledge to make that happen. And we 
at VA volunteered to leverage our ability to create Web-based 
training using their expertise together. And what we have done 
is to create a number of Web-based training courses that really 
are an effort for us to work as colleagues in a community and 
to support the provision of those training assets that all 51 
agencies can now draw upon, and they are posted on the Web and 
available for everyone to use.
    Senator Akaka. Thank you. Director Berry.
    Mr. Berry. Mr. Chairman, if I could just also shout out a 
thanks not only to those two great organizations but also to 
Scott and Secretary Shinseki. This is being done within budget, 
this entire operation. There are no separate appropriations for 
any of this that is provided. And without the assistance of the 
VA to stand up and help us to put these training programs on 
the Web, we would not have had the resources to do that.
    It was a great partnership in terms of using both the 
capacity and the resources to get the job done so we could 
reach it out, and then Scott has made that available to all the 
agencies of the Federal Government. So rather than having to 
have Pat pay twice or someone else to have to pay for the same 
thing, we have shared it. And so I think we have been very 
careful, and I just want to express my deep thanks to Scott for 
his leadership on this important issue, sir.
    Senator Akaka. Thank you.
    Mr. Tamburrino, I would like to hear from you on this as 
well. I believe that educating and training the DOD workforce, 
particularly its supervisors, will be critical to the success 
of a new performance management system.
    What steps are being taken by agency officials and employee 
representatives to ensure that a strong training program is in 
place when the time comes to implement DOD's new performance 
management system?
    Mr. Tamburrino. Mr. Chairman, thank you for that question. 
Currently, DOD has new supervisory training courses for anybody 
who becomes a supervisor for their very first time. So we offer 
that across the components.
    In the report that we will give you, we emphasize the fact 
that one of the keys to successes for our new performance 
management system is that supervisors have objectives which 
rate them on their ability to supervise; that when we pick new 
supervisors, we do that with some conscious activity that the 
person that we are about to pick has some aptitude to do it; 
and we equip that person with the knowledge, skills, and 
abilities to become a supervisor through some formal training.
    So I think you will see in our final recommendations we 
have current training, but we will bring it to a higher level; 
and we will emphasize that part of the supervisory 
responsibility is to conduct good dialog with your employees 
every day, make sure they understand what their 
responsibilities are, and, more importantly, what their 
contribution to the mission is, and enable them to make the 
most effective contribution possible.
    The design teams will write, I believe, at great length on 
that particular item in their report because they found that to 
be a critical ingredient going forward.
    Senator Akaka. Thank you. Senator Johnson, do you have any 
questions?
    Senator Johnson. Thank you, Mr. Chairman.
    Mr. Berry, why in the top three goals of this effort don't 
we list cost savings? I understand more effective mission, but 
with the fact that we are bankrupting this Nation, why isn't 
that an incredibly high-level goal?
    Mr. Berry. It is, and, in fact, it is married, Senator, 
exactly with the first one. The first metric that we are 
looking at is both mission and service delivery, and service 
delivery being expressed specifically in metrics of costs, 
cycle time, error rate cost savings, return on investment, so 
that the breakdown when you get into that, the standards of the 
metrics are under one are very strongly focused on time and 
dollar savings. It is too early--in other words, I do not have 
enough of the reports back in. Those reports are not even due 
until the end of this calendar year, so I will not be able to 
give you a full analysis of this until later. But, the early 
stuff we are seeing, it is definitely showing up on the cost 
meter.
    Senator Johnson. OK. Again, I realize this is early in the 
process and we do not have a whole lot of examples to be 
talking about. But, again, I think that the concern is in 
bringing basically union negotiators in some respect early into 
the decisionmaking process, there is an inherent conflict of 
interest there, where, appropriately so, people representing 
the union really are there to get larger benefits, higher 
wages, higher benefits. How do you guard against that conflict 
of interest?
    Mr. Berry. Well, two important things, Senator.
    First, in the Federal place, in terms of at our bargaining 
table, wages and benefits are not negotiable, so that 
traditional thing that is in the private sector is not at play 
for us.
    Senator Johnson. But in the pre-decision involvement, they 
are being brought in on the budgetary preparation, correct? As 
a matter of fact, isn't it also true that those discussions are 
not even open and available under Freedom of Information Act 
(FOIA) requests?
    Mr. Berry. Well, sir, the pre-decisional discussions are 
still governed by the law, and the law requires no pay and 
benefits, no right to strike and no mandatory union dues. So it 
is very different from the private sector negotiations, and 
management under pre-decisional waives none of its rights. And 
so I think it is very important to remember that at that pre-
decisional tables, managers still reserve all of their rights, 
which are very strong under Federal law.
    Senator Johnson. Why are those discussions confidential and 
not available under Freedom of Information Act requests?
    Mr. Berry. Senator, I will have to get back to you, if I 
can, for the record on that. As many discussions happen in the 
Executive Branch that are not subject to Freedom of Information 
Act, not everything in a discussional sense is.
    Senator Johnson. That would help allay my fears if those 
were available.
    Mr. Berry. Yes, sir.


                       information for the record


    In a January 19, 2011 memorandum, the Co-Chairs of the 
National Council on Federal Labor Management Relations reminded 
heads of departments and agencies that Executive Order 13522 
requires agencies to allow pre-decisional involvement with 
unions in all workplace matters to the fullest extent 
practicable, without regard to whether those matters are 
negotiable subjects to bargaining under 5 U.S.C. 7106. The 
memorandum noted that one example of an opportunity for pre-
decisional involvement is during the budget development phase. 
If management chooses to solicit input from employee 
representatives at this stage, the memorandum stresses that 
such input should be limited to high-level discussions of goals 
and strategies. Additionally, employee representatives may 
provide input on implementation of proposals in the President's 
budget and on use of budgetary resources to carry out agency 
missions; however, pre-decisional input does not obligate 
agency management to make specific decisions or take specific 
actions.
    Release of information during the budget development period 
is governed by the Freedom of Information Act, including FOIA 
exemptions; the memorandum issued by the President on January 
21, 2009 concerning compliance with FOIA\1\; Justice guidance 
interpreting the President's memorandum; and section 22 of the 
Office of Management and Budget (OMB) Circular A-11, 
``Communications with Congress and the Public and Clearance 
Requirements,'' which sets out longstanding OMB policies on 
preserving the confidentiality of pre-decisional budget 
deliberations. Agency budget documents may be exempt from FOIA 
depending on the nature of the record requested. In particular, 
the deliberative process privilege incorporated within 
Exemption 5 of the FOIA may protect agency records which are 
pre-decisional and deliberative in nature from public release, 
in order to preserve the quality of agency decisionmaking. If 
the request falls within one of the categories that OMB has 
directed agencies not to produce, the OMB guidance will 
control.
---------------------------------------------------------------------------
    \1\ http://www.whitehouse.gov/the--press--office/Freedom--of--
Information--Act/

    Senator Johnson. That would help allay my fears if those 
were available.
    Mr. Berry. Yes, sir.
    Senator Johnson. One thing that surprised me, again, 
preparing for this, is I did not realize the extent that the 
Federal Government and really the taxpayers subsidize union 
activity. Our figures, showing how difficult to get this 
information is, are between 5,000 and 10,000 offices are 
provided to public sector unions at a cost of about $250 
million. I also did not realize that union representatives 
basically can work and do their union job on Federal pay, and 
that also could be $130 to $25 million worth.
    So I want to throw it open to Mr. Gould here. One of the 
figures I got was that there are 600 full-time union 
representatives working at the VA for 150 hospitals. That is 
about four per hospital. Why do we need four union 
representatives basically being paid by the taxpayer? Can you 
explain that to me?
    Mr. Gould. Senator, obviously, cost is an important part of 
the mission-oriented metrics that we established as the most 
important set of metrics that we are focused on. I think Mr. 
Berry gave a good summary of the operational, financial 
performance, customer satisfaction, and people-related measures 
that constitute a balanced scorecard, and you are focused in on 
cost.
    What I believe we need to look at is cost and benefit 
together, so when we look at our official time, the time that 
union managers work under government pay, it is a tiny fraction 
of the total amount of labor that is available to our agency. 
And what we get in return for that is better-quality decisions 
and more streamlined implementation. And if you had a moment, I 
could give you two or three examples of where that work, I 
believe, has created greater value for the taxpayer.
    The first is faster review of appeals claims. Our veterans 
are able to appeal claims that they disagree with back to the 
government, and 2 years ago we were stuck. It was taking us too 
long to process those appeals. We sat down in pre-decisional 
involvement with our unions. We came up with a process that 
doubled the productivity of the teams on the ground, No. 1.
    No. 2, we are working together now to create a new 
certification process to ensure the quality of our vocational 
rehab counselors. These are individuals who sit down one-on-one 
with a veteran and you want to know that they are trained, 
certified, and ready to deliver high-quality service.
    We needed to develop a new training program and 
certification program to do that. We are sitting down with pre-
decisional involvement with our unions, and we are quickly 
moving through that.
    The last example I would give--you may be aware that 
Secretary Shinseki has 16 major initiatives to help transform 
the VA. All 16 have engaged pre-decisional involvement. I am 
just going to pick one, and it has to do with the 
implementation of the new GI bill, which I am sure affects 
people in your own home State. That new GI bill says that a 
youngster who has gone down range and served 3 or more years in 
the military can come back and go to any public or private 
institution in America, full tuition, with an additional 
stipend for room and board. That system to deliver those 
benefits was just an idea 2 years ago. Today there are over 
600,000 people who received checks under the new GI bill since 
it began and $14 billion worth of tuition has been paid.
    We sat down with our union colleagues. We worked through 
that using pre-decisional involvement, and the result was no 
attenuation, no limitation on our speed to be able to deliver 
that new capability.
    So those three examples are just ways of my communicating 
that it is the benefit net of cost that really is important 
here, and unbelievable value is being created by this 
initiative.
    Senator Johnson. OK. Thank you. I do need to give a shout 
out to the Milwaukee VA hospital I visited a couple of times, 
really highly qualified individuals really working hard to 
deliver services to our veterans. So that is appreciated.
    Mr. Gould. Thank you, Senator. That means a lot.
    Senator Johnson. If I could just beg your indulgence, one 
more question for Mr. Berry. In Ms. Niehaus' testimony, the 
representative for the Federal Managers Association (FMA), she 
was concerned about the fact that the Federal Managers 
Association is not present in some of these labor-management 
forums on the agency level. Can you explain why that would be 
the case? There seems to be some real conflict on that?
    Mr. Berry. Yes, sir. Essentially, on both sides of the 
table--we have to leave that up to each of the units to decide, 
because under the law it allows clearly for managers and labor 
to be at the table. Associations are not clearly defined in the 
law, and in some places managers are not comfortable having 
another group representing, if you will, management at the 
table.
    Now, management associations do have the right for 
consultation with management, and so separate from the 
bargaining process, they do have the ability for consultative 
and pre-decisional engagement and involvement. We leave that 
sort of to the discretion of each agency to follow to their 
best--as long as they are following the law within their units. 
But at this point in time, the law does not mandate for the 
management associations to be present at the table in such a 
way.
    And so, we do not have the ability, if you will, at the 
Partnership Council to go beyond what the law provides.
    Senator Johnson. Thank you.
    Senator Akaka. Thank you very much, Senator Johnson.
    I would like to thank our first panel for their testimony 
and responses.
    I would now like to call up the second panel of witnesses. 
On our second panel this afternoon, we welcome Mr. Greg 
Junemann, President of the International Federation of 
Professional and Technical Engineers (IFPTE); Mr. William 
Dougan, President of the National Federation of Federal 
Employees (NFFE); Ms. Patricia Niehaus, President of the 
Federal Managers Association; and Mr. George Nesterczuk with 
Nesterczuk and Associates. Mr. Nesterczuk also held positions 
in the Office of Personnel Management during the Reagan and 
George W. Bush Administrations.
    It is the custom of the Subcommittee to swear in the 
witnesses, so I will ask you to please stand and raise your 
right hand. Do you solemnly swear that the testimony you are 
about to give this Subcommittee is the truth, the whole truth, 
and nothing but the truth, so help you, God?
    Mr. Dougan. I do.
    Mr. Junemann. I do.
    Ms. Niehaus. I do.
    Mr. Nesterczuk. I do.
    Senator Akaka. Thank you. Let the record show the witnesses 
answered in the affirmative.
    I want you all to know that although your remarks are 
limited to 5 minutes, your full statements will be included in 
the record.
    Mr. Junemann, please proceed with your statement.

 TETIMONY OF GREGORY J. JUNEMANN,\1\ PRESIDENT, INTERNATIONAL 
   FEDERATION OF PROFESSIONAL & TECHNICAL ENGINEERS, AFL-CIO

    Mr. Junemann. Thank you, Mr. Chairman. Good afternoon. I am 
Gregory Junemann. I am the President of the International 
Federation of Professional and Technical Engineers. I would 
like to thank the Chairman and Ranking Member Johnson for 
allowing me the invitation to testify today.
---------------------------------------------------------------------------
    \1\ The prepared statement of Mr. Junemann appears in the appendix 
on page 66.
---------------------------------------------------------------------------
    Before going further, I would also like to extend my 
personal appreciation on behalf of my union to Chairman Akaka. 
At the conclusion of this Congress, Senator Akaka will cap off 
a distinguished career serving the citizens of Hawaii and this 
Nation, which includes, of course, my local. On behalf of IFPTE 
Local 121's Local President Jamie Kobayakawa, and IFPTE 
Executive Vice President Ben Toyama, again, I would extend my 
formal appreciation to you for your service to this Nation.
    Of course, the issue before us today deals with labor and 
management forums in the Federal Government through partnership 
and how effective they have been for taxpayers, workers, and 
managers alike. IFPTE applauded the President's Executive Order 
13522 when it was initially announced in December 2009, and we 
continue to stand by our initial support, and we remain firmly 
committed to Federal Government partnerships.
    At the same time, I would like to say we are not blindly 
led cheerleaders for the Executive Order and its programs; 
rather, we like to see ourselves as critiquingly optimistic as 
we participate in moving the programs forward.
    With the Executive Order, of course, also came the creation 
of the National Council on Partnership for Labor and Management 
Relations. The Council is compromised of both labor and 
management officials, and as President of IFPTE, I am quite 
proud to serve on this distinguished panel.
    IFPTE represents thousands of scientists, engineers, 
technicians, and other highly educated professional employees, 
and these are the people who essentially run my union. These 
people basically get paid for thinking very deeply. That is 
what they do. My members are problem solvers, and it is because 
of that we are so strongly committed to partnership within the 
Federal Government.
    My written testimony shows concrete examples of where 
partnership has and continues to produce significant benefits 
for taxpayers and Federal workers alike, and my testimony also 
points to areas that remain essentially behind the times.
    Of course, we all know that the U.S. Government is 
operating under a tremendous financial deficit, and in response 
to our Nation's looming financial woes, we believe it is 
incumbent upon every person within the Federal Government, all 
employees and all managers, union representatives alike, to do 
everything they can to streamline the efficient operations and, 
to quote from Executive Order 13522, ``make a good-faith 
attempt to resolve issues concerning proposed changes in 
conditions of employment.''
    We reject the heavy-handed, top-down, old-school autocratic 
style of management that only pretended to work when it seemed 
as though money was no object. Instead, we embrace the notion 
that a working partnership will much better serve the American 
people.
    IFPTE remains fully supportive of the Executive Order and 
the Obama Administration's commitment to making the Executive 
Order work because we believe that there exists concrete 
evidence of benefits to taxpayers. This is particularly true, 
as has been mentioned, at the Pearl Harbor Naval Shipyard, in 
the Chairman's State of Hawaii, where, again, as has been 
discussed, the implementation of Moonshine Program has saved 
tens of millions of dollars for the American taxpayers. The 
Moonshine Program, which was presented to the National Council 
by IFPTE Executive Vice President Ben Toyama, has, again, saved 
the taxpayers millions of dollars and countless man-hours. And 
this is only one example of how well partnership works within 
the Federal Government.
    Along with this partnership at Pearl Harbor, IFPTE is also 
proud of the newly established partnership within NASA. I have 
a joint letter that is signed by Deputy Director Lori Garver of 
NASA and IFPTE National Council President Lee Stone,\1\ and I 
would ask to submit that joint letter for the record. It was 
only signed on Friday. They were, of course, being scientists, 
working out the language of the letter. But it basically 
endorses in full their complete support for partnership within 
NASA.
---------------------------------------------------------------------------
    \1\ The joint letter appears in the appendix on page 115.
---------------------------------------------------------------------------
    Again, it is just starting. That program is just underway, 
and cost savings we work will just pile upon themselves as this 
goes forward.
    Mr. Junemann. It would be nearly impossible for me, again, 
as has been discussed, to talk about the benefits of labor-
management partnership without discussing the issue of 
training. And, again, we do acknowledge the very, very 
important role that was made by the Federal Labor Relations 
Authority and the Federal Mediation Conciliation Service, FLRA 
and FMCS, in doing joint training for labor and management at--
I do not know how many facilities, but it seems like it is 
something like 6,000 labor and management employees have been 
trained. This training goes basically two ways. It is done on a 
person-by-person basis onsite, and also the training is offered 
online. It is a 90-minute training that is available to all 
Federal employees. We not only encourage our members, we have 
actually put the link of the IFPTE Web site to make sure that 
our members have access to it. And, again, I should acknowledge 
that this was apparently partially paid for by the Veterans 
Administration since FMCS and FLRA and OPM did not have the 
money to put this all together.
    I am getting ahead of myself a little bit here.
    Again, in conclusion, we are strongly grateful to the 
President for his continuation of the Executive Order under 
partnership. We saw how it worked, when it worked under 
President Clinton. We continued to operate--since President 
Bush did not exactly prohibit partnership, we continued to 
operate some levels of partnership within some agencies, and 
then when President Obama reissued the Executive Order, we 
stood strongly behind it, and we still do today.
    That concludes my remarks, and I would be more than happy 
to answer any questions that the Subcommittee has. Thank you.
    Senator Akaka. Thank you very much, Mr. Junemann.
    Mr. Dougan, will you please proceed with your statement?

    TESTIMONY OF WILLIAM R. DOUGAN,\1\ PRESIDENT, NATIONAL 
                FEDERATION OF FEDERAL EMPLOYEES

    Mr. Dougan. Thank you, Chairman Akaka and Ranking Member 
Johnson, for inviting me to testify today. I am here on behalf 
of the National Federation of Federal Employees and the 110,000 
Federal workers we represent at 40 different agencies 
throughout the government.
---------------------------------------------------------------------------
    \1\ The prepared statement of Mr. Dougan appears in the appendix on 
page 76.
---------------------------------------------------------------------------
    In these lean budget times, downsizing in many agencies is 
a fact of life. Belt tightening has become unavoidable, and 
accordingly, lawmakers have the critical task of scrubbing the 
budget looking for ways to cut costs without adversely 
impacting critical agency missions.
    But let me make one point absolutely clear. If you are 
serious about trimming budgets and finding ways to make 
government run more efficiently, you should make certain that 
agencies are working with employees to find solutions. It is 
employees that do the work every day, and they know better than 
anyone how to get the work done better, faster, and more 
economically.
    In order for the know-how of Federal workers to be 
leveraged into government efficiency, they need a legitimate 
voice in the process. It is through labor-management forums and 
extension of the collective bargaining relationship that 
Federal workers are provided that essential voice.
    I am pleased to say that the Obama Administration has made 
great strides in establishing labor-management forums. His 
Executive Order led to a change in policy that is transforming 
the labor-management culture throughout the government for the 
better.
    The re-establishment of labor-management forums has been a 
breath of fresh air in a majority of agencies where forums are 
established. In these agencies forums are being used to 
facilitate smarter, leaner, and more efficient government by 
including some of the most important stakeholders of all--the 
employees who actually carry out the missions of the agencies.
    I can say from my 30-year career as a Federal employee that 
labor-management forums do improve agency performance. 
Regardless of what an agency's objective is, be it cost 
savings, faster processing, better workplace safety, et cetera, 
employees are often the best source of information for how to 
make the agency work better. Through forums, employees have a 
real voice in offering alternatives and ideas on how to better 
accomplish the work.
    There is no more fertile ground for improved agency 
performance than listening to the ideas and concerns of 
workers. This is particularly true when unions are engaged 
early in the decisionmaking process through pre-decisional 
involvement, a key tool that leads to better decisionmaking by 
agency leaders.
    I can also say from my experience that labor-management 
forums save agencies money. By discussing problems early and 
allowing the union to share workers' concerns and possible 
solutions, it allows management to make better decisions, 
thereby saving time and effort involved in implementation.
    A major component of that increased efficiency is improved 
buy-in from workers. The use of forums can also result in less 
need to bargain once an agency decision is made, resulting in 
significant potential cost savings. Communication through 
forums allows the parties to reach an understanding about why 
agencies are taking certain actions and what it means for 
employees.
    Forums also allow for plans to be modified to mitigate some 
adverse impacts on employees when the alternative--failing to 
hear workers' concerns--could lead to far greater problems 
associated with a workforce that is uninvolved in agency 
decisions.
    You have heard the saying, ``An ounce of prevention is 
worth a pound of cure.'' The same concept applies to labor-
management relations. Labor-management forums are very 
effective at preventing far greater costs that agencies might 
incur by not involving employees.
    I would like to talk about one specific example of how the 
Forest Service labor-management forum improved agency 
performance and saved millions of dollars per year. In 
partnership, the Forest Service and NFFE collaborated on a 
firefighting workforce succession planning process. As a result 
of a decision to reclassify many firefighter jobs into a 
different job series, the current firefighting workforce faced 
the need to be retrained in subjects completely unrelated to 
their firefighting duties in order to qualify for their jobs 
they had been performing for years.
    The union identified that the agency faced spending $15 
million per year for the sole purpose of retraining the 
workforce to address the unintended technical glitch. This 
became a key item for partnership meetings between the NFFE, 
Forest Service Council, and the agency. In the end, the agency 
realized the tremendous negative impact this was going to have 
and wisely committed to changing course. Union and agency 
leadership collaborated on an alternative plan that avoids 
these negative effects and reduces costs and are working now to 
implement it.
    Without partnership and the meaningful and detailed 
technical collaboration that allowed it to happen, the agency 
faced losing a sizable portion of current fire leadership as 
well as the pipeline for our leaders of tomorrow. The agency 
would also have continued to incur $15 million per year in 
meaningless expenses.
    This is just one example of the kind of good decisionmaking 
and savings that can be achieved through effective labor-
management forums.
    I appreciate the Subcommittee's decision to hold a hearing 
on this matter, and I thank you for the opportunity to provide 
testimony.
    Senator Akaka. Thank you very much for your statement, Mr. 
Dougan.
    Ms. Niehaus, will you please proceed with your statement?

 TESTIMONY OF PATRICIA NIEHAUS,\1\ PRESIDENT, FEDERAL MANAGERS 
                          ASSOCIATION

    Ms. Niehaus. Chairman Akaka and Ranking Member Johnson, 
since being elected FMA president in March 2010, I have been 
serving as FMA's representative on the National Council on 
Federal Labor-Management Relations. I would like to thank you 
for the opportunity to present our views on the Council and 
labor-management relations across the government.
---------------------------------------------------------------------------
    \1\ The prepared statement of Ms. Niehaus appears in the appendix 
on page 89.
---------------------------------------------------------------------------
    FMA was honored to have a seat on the Council from its 
onset and viewed our involvement as a testament to the 
important role of first-and second-line supervisors in carrying 
out agency initiatives and fostering better employee-management 
relations. We believe that when you bring all the stakeholders 
together, each of whom bring unique and respective viewpoints 
to the table, you ultimately end up with a more meaningful, 
successful labor-management relationship.
    In order to achieve the goals set out in the Executive 
Order and ensure the Council tackled all the issues, even the 
tough ones, Council members divided into several working groups 
over the last year and a half. The subjects examined by these 
groups include issues specific to the Executive Order but also 
go beyond the order, and working on issues beyond the scope of 
the Council's initial charter, stakeholders were able to 
collaborate with decisionmakers to make a stronger product and 
ultimately a stronger government.
    At the national level, FMA has been involved in several of 
the initiatives undertaken by the Council, including the 
Performance Management Working Group, which is on track to 
release its final report at the next Council meeting. Overall, 
while we at FMA would have preferred the group tackle the issue 
of whether or not the General Schedule speaks to today's 
workers and job seekers, we believe the document is a good 
first step in ensuring agency leaders take performance 
management seriously and ensuring agency leaders consider 
strong performance management business as usual. Implementing 
an agency culture based on strong performance management must 
come from the top down and hold all managers and supervisors 
accountable for performance.
    In my written testimony, I provide background information 
on the partnerships of the 1990s and offer suggestions on how 
this Council could improve upon what we learned then. I also 
detailed FMA's position on the various subjects the Council is 
tackling: permissive bargaining, metrics, and pre-decisional 
involvement. In many cases, I am pleased with the progress the 
Council has made, and in others, I believe more can be done. 
One such issue is the involvement of managers and supervisors 
on the labor-management forums. I would like to take this 
opportunity to share with you the challenges FMA is 
experiencing at the agency level.
    To date, over 750 labor-management forums have formed at 
the agency or facility level. It is the primary concern of FMA 
that management associations have been left out and in some 
cases actively excluded from participating in the forums. Under 
Title V, agencies are to provide a framework for consulting and 
communicating with non-labor organizations representing Federal 
employees on matters related to agency operations and Federal 
personnel management. Federal management associations, 
including FMA, have these consultation rights which were 
afforded with the belief that management associations and the 
employees they represent have a unique perspective that is not 
necessarily represented by agency leadership. Members of 
management associations work closely with employees and agency 
leadership and are directly affected by the issues addressed in 
labor-management forums, and our exclusion means agencies are 
missing out on the experience of a crucial stakeholder when 
making decisions in these forums.
    At the May 2010 Council meeting, SEA and FMA raised the 
issue of management association participation in forums, and 
many members of the Council expressed support for our 
participation. Since that time, FMA and other management groups 
have been working with the agencies where we have a strong 
membership base to join the newly-formed forums. Unfortunately, 
with the exception of one forum where FMA has had a seat on the 
local council since 1995, not a single association has been 
allowed to participate in the forums, and in some cases our 
associations have been actively excluded. More troubling, the 
associations are not notified of the forums' decisions in a 
timely manner, despite the fact that our members are directly 
responsible for carrying out the decisions of the forums.
    As pre-decisional involvement, (b)(1) bargaining pilot 
programs, and labor-management forums grow in importance, 
allowing management associations to participate can be useful 
to agencies and union members in ensuring communication at all 
levels. Additionally, having the managers' viewpoints and buy-
in expressed early in the decisionmaking process allows 
managers to be better equipped when they carry out and relay 
these new procedures to their employees.
    In conclusion, as we saw in the 1990s and over the last 
year and a half, many factors must be met to create cooperative 
relationships between management and labor. This is no easy 
feat, but the dedication of the Council members to improve 
relations through this avenue has proven successful thus far. 
However, FMA remains discouraged that our participation is 
viewed as valuable on a national level but not at the agency or 
local level.
    Thank you again for the opportunity to express our views 
here today, and I am happy to answer any questions you may 
have.
    Senator Akaka. Thank you very much, Ms. Niehaus.
    Mr. Nesterczuk, please proceed with your statement.

 TESTIMONY OF GEORGE NESTERCZUK,\1\ PRESIDENT, NESTERCZUK AND 
                           ASSOCIATES

    Mr. Nesterczuk. Thank you, Senator. Good afternoon, 
Chairman Akaka and Ranking Member Johnson. Thanks for inviting 
me to testify on labor-management forums in the Federal 
Government, a subject that I consider both important and 
timely.
---------------------------------------------------------------------------
    \1\ The prepared statement of Mr. Nesterczuk appears in the 
appendix on page 103.
---------------------------------------------------------------------------
    Permit me to sound perhaps a discordant note this afternoon 
on this subject. Executive Order 13522, issued on December 9, 
2009, opened government decisionmaking to non-governmental 
entities in an unprecedented fashion. Although the labor 
management councils created under the Executive Order are 
reminiscent of the partnership councils during the Clinton 
Administration, they are Clinton partnerships on steroids. One 
has to wonder what management crisis called for such a radical 
escalation of the role of Federal unions. Of particular concern 
are the pursuit of pre-decisional involvement that expands 
union activity into previously non-bargainable areas such as 
budget preparation and the allocation of resources that this 
entails. At a time of perhaps the most severe peacetime 
budgetary constraints we have ever experienced, when Federal 
programs face cuts and employee pay has been frozen, it is not 
an ideal time to launch a radical initiative that is certain to 
drive up the cost of governing. We should be streamlining 
government management for greater efficiency and lower cost 
rather than overlaying additional burdensome procedures.
    Now, of particular concern, pre-decisional involvement, as 
promoted under labor-management forums, weakens the chain of 
accountability by which agency management is held responsible 
for the stewardship of government. The President and his 
appointees set priorities for the allocation of resources based 
on his publicly stated agenda and congressional intent. 
Allowing non-government entities to participate in agency 
decisions affecting all ``workplace matters'' is unprecedented, 
especially since the scope of issues falling within the rubric 
of ``workplace matters'' is undefined and, therefore, open to 
the broadest interpretation.
    The Office of Government Ethics promulgates extensive rules 
to prevent Federal officials from engaging in activities and 
contacts that create conflicts of interest or even have the 
appearance of conflicts of interest. This is important in order 
for the public to retain confidence in their government, 
confidence that rules are applied fairly and equally to 
everyone, and that decisions are not skewed for the benefit of 
special interests.
    Unions are a special interest. They exist to maximize the 
extraction of benefits from employers on behalf of their 
members, and Federal unions were not created for the purpose of 
maximizing the efficiency of governance. To place them in a 
position where they can influence public policy for their own 
benefit is a clear conflict of interest and should not be 
tolerated.
    And what is a succeeding Administration to do when saddled 
with a labor-management arrangement adamantly opposed to its 
agenda? The labor-management forums are not good government; 
rather, they represent a pandering to special interests.
    As far as costs, the new labor regime envisioned in the 
forum concept can only drive up costs of government. According 
to OPM reports, annual use of official time overwhelmingly--
that is, about 75 percent--goes to general labor-management 
issues, not to dispute resolution or bargaining. And the 
forums, when fully implemented, will only add more issues to 
meet over and discuss.
    Since its inception last year, the National Council 
overseeing the labor-management forums has already spent over 
$1 million in monthly meetings, and this will multiply 20-or 
30-fold as individual agencies become more involved.
    Unions are already heavily subsidized by the taxpayers for 
the use of official time, which, according to recent OPM 
reports, compromise about 2 million man-hours per year at a 
cost of at least $130 million. The burden of paying for office 
space, equipment, and supplies adds an additional $250 million 
a year.
    The most compelling argument OPM has advanced for this new 
labor initiative was the need to ``reset: labor relations after 
the ``bad feelings: created by the previous Administration. 
Surely there were other, cheaper ways for the Administration to 
reach out to this constituency.
    What should we do about this? The reset under the forums 
unfortunately results in further politicization of the civil 
service. Unions in general are very political and highly 
partisan. That is their choice. It is also their right to be 
so. However, elevating these non-government entities to 
partnership status with career managers in government 
undermines the perception of political neutrality that the 
career civil service has nurtured since its inception over a 
century ago. And how is the next administration to deal with 
the ``fox in the chicken coop'' that the unions have come to 
represent? For the sake of maintaining the neutrality of 
Federal civil service, I would recommend that Congress consider 
defunding the labor-management forums.
    Second, Congress should consider reinforcing the provisions 
of Chapter 71 of 5 USC that stipulate non-negotiable agency 
rights in order to place these agency rights beyond reach of 
temporal political pressures in the agencies.
    Finally, Congress should undertake defunding the subsidies 
that distort the true worth of unions in the Federal sector. 
Federal unions should be subjected to a market test of their 
viability and value to Federal employees. Unions collect dues 
from their members, and these should be used by unions to pay 
their own way. Self-sufficiency will give unions the incentive 
to better focus on member services and issues that are relevant 
and important to their members, not necessarily the next 
election.
    I will conclude with that, and I will be happy to answer 
any questions that you might have. Thank you.
    Senator Akaka. Thank you very much, Mr. Nesterczuk.
    Senator Johnson, will you please proceed with your 
questions?
    Senator Johnson. Thank you, Mr. Chairman.
    Ms. Niehaus, you said that you have been excluded, FMA has 
been excluded from these forums, but you have not answered the 
question why. Can you just tell me why is that happening? I 
would imagine there are probably various reasons at different 
agencies.
    Ms. Niehaus. We have heard overwhelmingly, not citing 
either of my colleagues at the table, that the unions object to 
a management association being involved, and that in some 
agencies the unions have indicated it would be a deal-breaker 
and they would not participate if FMA was allowed to 
participate.
    Senator Johnson. Can you speculate as to why they would be 
objecting to that?
    Ms. Niehaus. The only reason I can think of is they would 
see it as a second management seat at the table or an 
additional management seat at the table; whereas, we would not 
be representing the agency, we would be representing the 
management personnel who are our members.
    Senator Johnson. So it would be a matter of being 
outnumbered.
    Ms. Niehaus. Yes.
    Senator Johnson. Mr. Dougan or Mr. Junemann, would you have 
a comment on that as to why?
    Mr. Dougan. Yes, I think the basic issue is labor-
management forums are essentially an extension of the 
collective bargaining agreement between labor and management. 
It is a vehicle that we can use to enhance our collective 
bargaining relationship, and it allows us the ability to talk 
as equals at the table in a pre-decisional mode, to discuss 
issues which management then is going to exercise their 
management right to make that decision. So I want to make that 
point clear. There has been, I believe, some misclarification 
of exactly what pre-decisional involvement is.
    Pre-decisional involvement is not co-management; it is not 
the case that labor is making decisions with management in a 
labor-management forum in a pre-decisional involvement setting. 
Pre-decisional involvement is nothing more than communication 
and sharing information, sharing concerns, sharing 
alternatives, sharing options between labor and management to 
hopefully better allow management to make a more informed and 
better decision. It is management's decision to make. It is not 
labor's decision to make.
    Senator Johnson. Well, let me interrupt you here. So, 
again, the purpose for these things, as is being laid out here, 
is just it is kind of warm and fuzzy, we get everybody at the 
table that can really help improve effectiveness and 
efficiency. But we have really the first-line supervisors that 
unions are basically excluding from that process. Does that not 
run counter to the stated purpose of the forums?
    Mr. Dougan. As I stated before, by law there is a different 
relationship that exists between labor and management as 
opposed to between management and other employee groups, which 
Ms. Niehaus' group is one of many. There are many employee 
groups within any Federal agency that represent various groups 
of employees. They are not sanctioned and do not exist by law. 
They exist through agency policy and through the agency's 
willingness or unwillingness to recognize them as a group to 
communicate with and to seek input. But the problem with labor-
management forums at a local level, that is where the rubber 
meets the road. That is where the decisions get made that 
ultimately are going to impact on the need to either 
collectively bargain--to bargain further on those decisions or 
not bargain further on those decisions. And I believe it puts 
labor in a difficult place when there are parties other than 
labor and agency management sitting at the table discussing----
    Senator Johnson. Well, you seem to be confirming my worst 
fears that this really is a quasi-negotiating session as 
opposed to something else.
    Mr. Nesterczuk, you made the statement that these forums 
will certainly drive up costs. Can you explain why you feel 
that way? Why are these forums absolutely certain to drive up 
costs?
    Mr. Nesterczuk. The more issues that you put before the 
unions, the more official time will be used to deal with those 
issues, the more opportunities they get to become involved with 
policy matters, policy decisions in the agency, the more staff 
will be assigned to those matters, all on official time. These 
are not things that happen for free. There may not be 
additional budget allocations for that purpose, but those are 
funds that are taken away from other activities, activities 
that are supposed to be directed at delivering services to the 
taxpayer.
    Senator Johnson. So you are saying that these forums 
basically open up a can of worms where they will basically 
metastasize in terms of maybe four or five issues become 20 
become 100?
    Mr. Nesterczuk. Absolutely.
    Senator Johnson. That is your primary concern?
    Mr. Nesterczuk. Yes.
    Senator Johnson. Mr. Junemann, you look like you are 
anxious to hop in here.
    Mr. Junemann. I have that look on my face, and it has 
nothing to do with----
    Senator Johnson. The Brewers. [Laughter.]
    Mr. Junemann. First of all, on the question with the 
management associations, our union does not really have a stand 
on that. In fact, I heard about that issue the first time this 
morning, that this was an issue. Obviously, they have a 
responsibility to advocate for management, for front-line 
supervisors. We have a different one. Ours is, I think more 
governed by laws than theirs. But they have a responsibility to 
theirs, and we have not taken a stand like I have heard this 
morning.
    On this thing about that these forums will lead to more--
sort of like marijuana leading to stronger stuff or something, 
right? That these forums will lead----
    Senator Johnson. I did not say that.
    Mr. Junemann [continuing]. To more problems. [Laughter.]
    I know. I kind of did. No, I did. I have that way of 
talking. But I really see just the opposite. As a matter of 
fact, in talking to our folks at NASA--I just met with our NASA 
Council people last week. They had issues--for instance, there 
was--and I would like to tell you exactly. I could get it for 
you, the issues behind it. There was a grievance at Goddard 
Space Flight Center, Goddard Research Center, that has been 
going on since the mid-1990s. And it is a grievance and it is a 
charge and it is a suit, and it goes on and on and on. And they 
brought it up at a labor-management forum, and it is done, it 
is resolved, and it will never be brought up again.
    Senator Johnson. OK.
    Mr. Junemann. This is supposed to be solving problems, and 
that is what it is for.
    Senator Johnson. OK. Because my time is running short in a 
number of ways, let me just quickly go to a broader question 
directed to the union representatives here, because it does 
strike at the heart of my concern in terms of the 
politicization of management and really how effective are these 
going to be at trimming costs, where we ran a $1.3 trillion 
deficit last year, we are borrowing $3.5 to $4 billion a day. 
But the fact of the matter is that the taxpayer really through 
payment to Federal workers and those wages are turned to a 
certain extent into dues and those dues are funneled back into 
political contributions. In the last 20 years, labor unions 
have contributed $384 million into Federal campaigns in terms 
of Federal public employee unions--$45 million from the 
American Federation of State, County and Municipal Employees 
(AFSCME), $31 million from the National Education Association 
(NEA), $29 million from the Service Employees International 
Union (SEIU). Ninety-five percent of those contributions go to 
one party, the Democratic Party. So you can maybe understand 
how there may be just a little concern about the conflict of 
interest of unions being at the table when certainly one party 
is trying to instill some fiscal discipline in this country. So 
I guess I will just open that up.
    Mr. Dougan. First I would like to address the issue of 
union dues going to political candidates. That is absolutely 
not correct. There is not one dime of union dues that is spent 
in political contributions to any candidate from any party. 
Those dues cannot be spent by law----
    Senator Johnson. Where is that $384 million going in terms 
of Federal campaigns then?
    Mr. Dougan. Our individual members, should they decide to 
make political contributions, are certainly free, just like any 
other citizens of the country, to make contributions either 
individually or through a PAC fund that many unions have, just 
like other corporations, to help support the candidates. But it 
is not from dues money. It is from their own contributions 
should they so choose to do that. There is no decision on the 
part of union leadership as to how much money will be 
contributed. It is up to each individual member whether they 
want to contribute something or nothing.
    Senator Johnson. OK. Thank you.
    Mr. Chairman, thanks for indulging me so I could leave 
early. Thank you.
    Senator Akaka. I have a question for both Mr. Junemann and 
Mr. Dougan. As we have discussed today, DOD has worked closely 
with employees throughout the process of designing a new 
performance management system, a critical difference from NSPS. 
Do you believe the process for designing the new system will 
improve its implementation? Mr. Junemann.
    Mr. Junemann. Yes, Senator. Absolutely I do believe that it 
will be improved simply because when the employees are involved 
at the inception point of the performance management system, 
when they are designed and putting it together, they will be 
invested into it because of the resources, simply because of 
the time and energy that they have put into the program, it 
will be more successful simply because they will be 
participating in it.
    To Senator Johnson's question--and I am sorry he had to 
leave--my union is very concerned, as am I, on cutting costs at 
every level of the Federal Government. We think that is one of 
the primary reasons to have an Executive Order on partnership, 
because I think it is up to the President, it is up to the 
Congress to go the Federal employees and say, ``It is your duty 
as workers and as patriotic citizens to cut costs wherever we 
can.'' We are very, very concerned with shipyards potentially 
being closed, with bases potentially being closed. So each one 
of these people, each one of these leaders wants to make sure 
that they have wrung out every nickel out of their operation, 
and partnership is the best way to do that.
    But on your question of the workplace performance 
initiatives, certainly if the unions are involved--and, again, 
my union does not bring in professional negotiators into these 
talks. They bring in just everyday workers who get elected to a 
responsible position, and they go into these talks, and based 
on their members' input, that is where these initiatives and 
programs get designed. And once they get designed with these 
people's input, then they are invested and they are going to 
make them successful.
    Senator Akaka. Mr. Dougan.
    Mr. Dougan. Thank you, Senator. Before I answer your 
question, I would like to be granted just a moment to speak to 
a quote that Senator Johnson gave in his opening remarks. He 
quoted a letter from FDR where he said,``. . . the process of 
collective bargaining, as usually understood, cannot be 
transplanted into the public service.'' I know this letter well 
because the letter hangs outside my office, the original 
letter. This letter was addressed by FDR to Luther Steward, the 
president of NFFE, my union, in 1937. And Senator Johnson 
accurately quoted FDR, but he did not present the quote in its 
proper context.
    When FDR said ``collective bargaining, as usually 
understood,'' he was talking about the right to strike. There 
was no collective bargaining at that time that did not include 
the right to strike, and the portion of the letter that he did 
not quote talks about ``as usually understood,'' meaning that 
public workers would not be allowed to strike. That is what FDR 
was talking about and that is what he meant by collective 
bargaining, as usually understood, not translating to the 
public sector, and nothing else. And I just want to set the 
record straight on that.
    But to address your question, I think, what we saw with 
NSPS, the National Security Personnel System, and what we have 
seen with the New Beginnings effort in DOD is night and day. 
And just to set the record straight, Mr. Nesterczuk wrote a 
report in 2001 called ``Taking Charge of Federal Personnel,'' 
and this report served essentially as the template, as the 
guiding document for the Department of Defense to inflict the 
National Security Personnel System upon the DOD workforce and 
the rest of the Federal Government.
    This report recommended bypassing workers and their union 
in order to give Federal executives full authority to move 
those who remained into a highly subject merit-based pay 
system. Those recommendations in that report were followed 
almost verbatim in the creation of NSPS. As a result, NSPS 
ultimately failed, was seen as an abject failure, was seen as 
essentially the largest failed personnel system effort. It has 
proved to be the biggest waste of taxpayers' money in personnel 
reform history. And there are really two reasons for that:
    One was because the employees and their elected 
representatives were completely cut out of the process. The 
process and the system lacked transparency. Nobody could figure 
out how it worked. Therefore, there was no buy-in and people 
were suspect and people just did not know how this thing 
worked. And so it is hard to have credibility when you do not 
understand the system. And ultimately it was determined that 
the system was discriminatory. It discriminated against varying 
classes of employees.
    These are fundamental problems that ultimately made NSPS 
unsalvageable, and I would note that the Chairman of this 
Subcommittee at the time, Senator Collins, was a key supporter 
in calling for the full repeal of NSPS. So this is not a 
partisan issue. This is not a Democrat-versus-Republican issue. 
This is doing what is right, as opposed to what we did in New 
Beginnings, a completely transparent process. Labor was brought 
in early, fully engaged, was given an equal seat at the table. 
We were able to put--much like Mr. Junemann, all of labor 
offered folks from the field that actually know the work, that 
live under these rules and these systems, and offered them as 
the team members of these work groups. And because of that, we 
have a product that can stand the test of whether it is 
transparent or not. We have a product that can be supported by 
labor as well as management and hopefully can be supported by 
Congress when they get the results in the next few months.
    Mr. Nesterczuk. Senator, surely I could be given an 
opportunity to respond? May I comment on your question?
    Senator Akaka. Yes, please comment.
    Mr. Nesterczuk. Mr. Dougan's points sort of bring to kind 
the maxim that in this town the difference between truth and a 
lie is that you have to tell the lie more often before people 
accept it.
    As far as the status of NSPS, it was not a failed system. 
It was a system that was meant to serve the Department of 
Defense, at its own choosing, based on 25 years' prior 
experience with demonstration projects. They knew fully well 
what they were doing. Employees were beginning to learn it. We 
knew from experience it takes 3 to 5 years for the workforce to 
accept such a significant change in a personnel system, and 
that was based on the experience in the various demonstration 
projects, 3 to 5 years.
    So the unions were very anxious to kill that thing before 
it ever reached the 5-year maturation point where employees 
were buying in, and the degree of buying was increasing 
exponentially at the time that the plug was pulled on NSPS.
    The notion that only a system that is blessed by the unions 
can flourish in the Federal Government is what has kept us 
working with a Model T compensation system--and that is the 
General Schedule--at a time when we have hybrid engines 
available to power our workforce. The initiative today on the 
part of the Councils to build a new personnel management 
system, a performance management system built on that rickety 
structure of the General Schedule is doomed to fail.
    Yes, I wish them well in their efforts. They will spend 
gross amounts of money in the process. They will foist this on 
a workforce that will have to accept it. No question of that. 
But it will not have the beneficial results that NSPS was 
beginning to provide the Department of Defense.
    If the Administration had been really honest and sincere in 
their desire to explore performance management, they would have 
done their best to keep NSPS going to learn from it. If there 
were faults and flaws in it, there was a wonderful opportunity 
to learn from it in a system that was unique at the time--over 
200,000 employees covered across various kinds of DOD 
activities from coast to coast. We could have learned a lot, 
and instead you killed it. And now you have to start from 
scratch, again falling back to ancient technology. I wish you a 
lot of luck with that. Thank you.
    Senator Akaka. Thank you.
    Ms. Niehaus, thank you for your comments about the 
importance of training to effective implementation of labor-
management partnerships and of supervisor training more 
broadly. As you know, improving training is a priority for me.
    Ms. Niehaus. Yes, sir.
    Senator Akaka. I would like to hear your thoughts on the 
training that is being provided on implementation of the 
Executive Order. What have your members told you about training 
they have received on this issue?
    Ms. Niehaus. In that particular respect, I can also speak 
from personal experience. My day job is as the Labor Relations 
Officer at Travis Air Force Base; I am not expressing DOD or 
Air Force opinions but strictly my own. I attended the FLRA 
training with our local union president from the installation, 
and I was very impressed with the training provided by the FLRA 
regional director and his staff for the implementation of the 
Executive Order. It was very thorough and included exercises 
that were very helpful to understanding the various aspects of 
this.
    Senator Akaka. Thank you.
    Mr. Junemann, I am proud of the Moonshine Program to 
improve collaboration and innovation at the Pearl Harbor Naval 
Shipyard and the positive results it is achieving for our 
military and taxpayers.
    What lessons does the Moonshine Program hold that could be 
replicated in other locations where partnerships may not be as 
advanced?
    Mr. Junemann. Well, I think the lesson is--I will quote 
Scott Gould, what he said at one of our National Partnership 
Council meetings, a very short statement. He said, ``This stuff 
works.''
    I think the lesson that can be learned is they have very, 
very short meetings, unlike what has been stated by some of the 
detractors of partnership and its progresses. They have very 
short meetings. They have 1-hour meetings on Monday, Wednesday, 
and Friday morning, and those are only to talk about 
efficiency, productivity, and safety. That is it. And then they 
go forward, and they get it done.
    As Director Berry said in his testimony--and you know Ben 
Toyama. It was Ben Toyama who made that statement, and what he 
said was, ``If you ask one of my members how can I save some 
money, they will say, `Get rid of my boss,' '' because they do 
not really know. That is not their job. But if you say how can 
I save some time, they have a hundred ideas.
    So the lesson that can be learned and the lesson that can 
be replicated is--and this is the thing that I really think 
that the Subcommittee should look at, is exactly what you are 
saying, Senator Akaka. We should take the benefits that have 
happened under Moonshine at Pearl and say, ``Why isn't it being 
done at Philly? Why isn't it being done at Norfolk and at 
Portsmouth?'' And call in the decisionmakers and say this is 
makes a whole lot of sense, that the workers, the stewards, the 
supervisors, the managers get together for one hour, one short 
hour, and say let us get this done better than we have ever 
done it before. And you have seen the statistics, sir. The 
benefits, the efficiency, the man-hours that have been saved, 
the millions of dollars are incredible. And when we are facing 
the sort of deficits that this Nation is facing, those things 
should be capitalized upon.
    And, Senator, I agree with you, they should be replicated, 
and where they are not, really the question should go out to 
the players involved and say, ``Why aren't you doing this?'' 
Because that is actually what Ben Toyama from Pearl Harbor 
Naval Shipyard is asking others: Why isn't this being done 
elsewhere? So, Senator, I really believe it should.
    If I could just make a statement about FMA, it seems to me 
that the reason that they have a separate agency for managers 
is because, I guess according to law, you cannot belong to 
unions. Even that needs to be changed. [Laughter.]
    Senator Akaka. Mr. Dougan, your written testimony discusses 
an Inspector General report which found that a firefighting 
workforce succession planning process developed through 
partnership between your union and the U.S. Forest Service 
saves $15 million per year. Will you please describe this 
planning process and how it saves taxpayers' money?
    Mr. Dougan. Sure. As I stated in my oral testimony, what 
happened in the Forest Service was there was an attempt to 
``professionalize'' the wildland firefighting workforce in that 
agency. And as a result of that decision, there was a 
determination made that many of the fire leadership positions 
within the agency needed to be in a professional occupation 
series. Much of the current firefighting workforce is in a 
technical series.
    Professional occupations require positive education 
requirements, and in the case of the series that they were 
looking at for these firefighters, it required everyone that 
was in one of those positions to have a bachelor degree or 
higher with a minimum of 24 hours in very specific types of 
college course work. Much of the firefighting workforce comes 
up through the ranks, and basically their university is out on 
the fire lines. Many of these people do not have college 
educations. Many of them have taken some college classes but do 
not hold degrees. But yet they have been doing the work and 
leading the firefighting efforts in the Federal Government for 
a number of years.
    As a result of that reclassification, there was a 
determination made that these people had to be sent back to 
school to get that training in order to qualify for those jobs, 
and that is where the $15-million-a-year figure comes from. It 
is the cost of sending these folks back to school either 
through distance learning or actually physically having to go 
enroll in colleges and take classes in order to qualify for the 
very jobs that they have been doing for, in many cases, the 
last 30 or 40 years of their careers.
    So the union had a concern over that because, obviously, we 
represented many of these people, and it is very difficult for 
people, unless you are very early in your career and you are 
not married and you do not have kids, to just pick up all your 
belongings and go back to school. So we had concerns about how 
we were going to make this happen, and when we got to looking 
into the facts, there were other opportunities, it appeared to 
us, other types of job series that they could be placed into 
that would meet the agency's requirements of a more 
professional workforce, but yet the training that they would 
receive would be more fully directed at the work that they are 
actually doing in firefighting. And so we proposed that change 
to agency management and worked with OPM and working with many 
Members of Congress, many congressional committees, to drum up 
support, and we are finally able to get the support in Congress 
and through OPM that we needed to change the job series from a 
professional series to an administrative series, which 
eliminated the positive education requirement, the degree, and 
yet protected ensuring that these folks still maintained the 
knowledge, skills, and abilities that they needed to do their 
jobs. It was an effort that took several years. It was carried 
on through the Forest Service Partnership Council and through 
various work groups that were spun off of this Council.
    It is one of many examples, I think, across government 
where there are positive results being seen from the labor-
management forums. In many cases I think labor-management are 
sometimes our own worst enemies because we do not do a good job 
of championing these victories when we have them and telling 
these stories. And it should not take a hearing like this for 
this kind of word to get out there to folks about some of the 
benefits of labor and management collaboration.
    Senator Akaka. Well, thank you very much. I want to thank 
the witnesses for attending this hearing. As we have heard 
today, the Federal Government can increase productivity and 
reduce costs through the establishment of effective labor-
management partnership. I am also pleased that DOD is engaging 
with the employees and their representatives in a genuine 
collaboration to design a new performance management and hiring 
system. Employee buy-in will reduce costs and make the new 
system more effective.
    I look forward to working with all of the witnesses in the 
coming months on the important issues we discussed today. 
Again, thank you for being here.
    The hearing record will be open for one week for additional 
statements or questions other Members may have pertaining to 
the hearing.
    This hearing is adjourned.
    [Whereupon, at 4:29 p.m., the Subcommittee was adjourned.]



                            A P P E N D I X

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