Military Personnel: Considerations Related to Extending 	 
Demonstration Project on Servicemembers' Employment Rights Claims
(31-OCT-07, GAO-08-229T).					 
                                                                 
The Uniformed Services Employment and Reemployment Rights Act of 
1994 (USERRA) protects the employment and reemployment rights of 
federal and nonfederal employees who leave their employment to	 
perform military or other uniformed service. Under a		 
demonstration project from February 8, 2005, through September	 
30, 2007, and subsequently extended through November 16, 2007,	 
the Department of Labor (DOL) and the Office of Special Counsel  
(OSC) share responsibility for receiving and investigating USERRA
claims and seeking corrective action for federal employees. In	 
July 2007, GAO reported on its review of the operation of the	 
demonstration project through September 2006. This testimony	 
describes the findings of our work and actions taken to address  
our recommendations. In response to the request from Congress,	 
GAO also presents views on (1) factors to consider in deciding	 
whether to extend the demonstration project and the merits of	 
conducting a follow-up review and (2) options available if the	 
demonstration is not extended. In preparing this statement, GAO  
interviewed officials from DOL and OSC to update actions taken on
recommendations from our July 2007 report and developments since 
we conducted that review.					 
-------------------------Indexing Terms------------------------- 
REPORTNUM:   GAO-08-229T					        
    ACCNO:   A77807						        
  TITLE:     Military Personnel: Considerations Related to Extending  
Demonstration Project on Servicemembers' Employment Rights Claims
     DATE:   10/31/2007 
  SUBJECT:   Claims						 
	     Claims processing					 
	     Claims settlement					 
	     Databases						 
	     Executive agencies 				 
	     Federal employees					 
	     Investigations into federal agencies		 
	     Policy evaluation					 
	     Program evaluation 				 
	     Reemployment					 
	     Veterans employment programs			 
	     Policies and procedures				 

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GAO-08-229T

   

     * [1]USERRA Claims Processing under the Demonstration Project
     * [2]Key Findings on the Demonstration Project and Actions Taken

          * [3]Agencies Used Two Models for Processing USERRA Claims
          * [4]VETS Is Taking Action to Help Ensure That It Consistently No
          * [5]Number of Claims and Average Processing Time under the Demon
          * [6]Data Limitations at Both Agencies
          * [7]DOL Has a Lengthy Two-Phase Review Process before Claims Are

     * [8]Considerations Related to Extending the Demonstration Projec
     * [9]GAO's Mission
     * [10]Obtaining Copies of GAO Reports and Testimony

          * [11]Order by Mail or Phone

     * [12]To Report Fraud, Waste, and Abuse in Federal Programs
     * [13]Congressional Relations
     * [14]Public Affairs
     * [15]PDF6-Ordering Information-Young-10-25-07.pdf

          * [16]GAO's Mission
          * [17]Obtaining Copies of GAO Reports and Testimony

               * [18]Order by Mail or Phone

          * [19]To Report Fraud, Waste, and Abuse in Federal Programs
          * [20]Congressional Relations
          * [21]Public Affairs

Testimony

Before the Committee on Veterans' Affairs, U.S. Senate

United States Government Accountability Office

GAO

For Release on Delivery
Expected at 9:30 a.m. EDT
Wednesday, October 31, 2007

MILITARY PERSONNEL

Considerations Related to Extending Demonstration Project on
Servicemembers' Employment Rights Claims

Statement of George H. Stalcup, Director
Strategic Issues

GAO-08-229T

Chairman Akaka, Senator Burr, and Members of the Committee:

I am pleased to be here today to discuss the results from our review of a
demonstration project established by the Veterans Benefits Improvement Act
of 2004 (VBIA),1 related to servicemember rights under the Uniformed
Services Employment and Reemployment Rights Act of 1994 (USERRA),2 which
protects the employment and reemployment rights of federal and nonfederal
employees who leave their employment to perform military or other
uniformed service. USERRA also prohibits discrimination in employment
against individuals because of their uniformed service, obligation to
perform service, or membership or application for membership in the
uniformed services. USERRA further prohibits employer retaliation against
any individual who engages in protected activity under USERRA, regardless
of whether the individual has performed service in the uniformed services.
USERRA applies to a wide range of employers, including federal, state, and
local governments as well as private sector firms. The demonstration
project authorized the Office of Special Counsel (OSC) along with the
Department of Labor (DOL) to receive and investigate certain federal
employee USERRA claims. DOL's Veterans' Employment and Training Service
(VETS) investigates and attempts to resolve USERRA claims. In July, we
issued a report responding to a mandate in VBIA on our evaluations of the
demonstration project.3 Our report focused on agency (1) processes, (2)
outcomes, and (3) major changes during the demonstration project.

For today's hearing, I will discuss

           o USERRA claims processing under the demonstration project for
           servicemembers of federal executive branch agencies,4 
           o the findings of our work and actions taken to address our
           recommendations, and

           o considerations related to extending the demonstration project.

           For our July 2007 report, we reviewed relevant documentation and
           interviewed knowledgeable DOL and OSC officials on their policies
           and procedures for processing federal employees' USERRA claims
           under the demonstration project. We also reviewed and analyzed
           data from VETS's database, the USERRA Information Management
           System,5 and OSC's case tracking system, OSC 2000,6 from the start
           of the demonstration project on February 8, 2005, through fiscal
           year 2006. We also assessed the reliability of selected data
           elements on federal employee claims from VETS's database and OSC's
           case tracking system by tracing a statistically random sample of
           data to source case files.7 We did not assess the quality of the
           claims' investigations or the quality of the outcomes of those
           investigations. Considerations related to extending the
           demonstration are based on our knowledge of the demonstration
           project and requirements for effective program evaluation. We
           conducted our work for this statement in October 2007 in
           accordance with generally accepted government auditing standards.
			  
			  USERRA Claims Processing under the Demonstration Project

           Under a demonstration project established by VBIA, from February
           8, 2005, through September 30, 2007, and subsequently extended
           through November 16, 2007,8 OSC and DOL share responsibility for
           receiving and investigating USERRA claims and seeking corrective
           action for federal employees. While the legislation did not
           establish specific goals for the demonstration project, the
           language mandating that GAO conduct a review suggested that
           duplication of effort and delays in processing cases were of
           concern to Congress.9

           The demonstration project gave OSC, an independent investigative
           and prosecutorial agency, authority to receive and investigate
           claims for federal employees whose social security numbers end in
           odd numbers. VETS investigated claims for individuals whose social
           security numbers end in even numbers. Under the demonstration
           project, OSC conducts an investigation of claims assigned to
           determine whether the evidence is sufficient to resolve the
           claimants' USERRA allegations and, if so, seeks voluntary
           corrective action from the involved agency or initiates legal
           action against the agency before the Merit Systems Protection
           Board (MSPB).10 For claims assigned to DOL, VETS conducts an
           investigation, and if it cannot resolve a claim, DOL is to inform
           claimants that they may request to have their claims referred to
           OSC.11

           OSC's responsibility under USERRA for conducting independent
           reviews of referred claims after they are investigated but not
           resolved by VETS remained unchanged during the demonstration
           project. Before sending the referred claim to OSC, two additional
           levels of review take place within DOL. After OSC receives the
           referred claim from DOL, it reviews the case file, and if
           satisfied that the evidence is sufficient to resolve the
           claimant's allegations and that the claimant is entitled to
           corrective action, OSC begins negotiations with the claimant's
           federal executive branch employer. According to OSC, if an
           agreement for full relief via voluntary settlement by the employer
           cannot be reached, OSC may represent the servicemember before
           MSPB. If MSPB rules against the servicemember, OSC may appeal the
           decision to the U.S. Court of Appeals for the Federal Circuit. In
           instances where OSC finds that referred claims do not have merit,
           it informs servicemembers of its decision not to represent them
           and that they have the right to take their claims to MSPB without
           OSC representation. Figure 1 depicts USERRA claims' processing
           under the demonstration project.

1See section 204 of Pub. L. No. 108-454, 118 Stat. 3598, 3606-3608, 38
U.S.C. S 4301 note.

2Pub. L. No. 103-353, 108 Stat. 3149, 38 U.S.C. SS 4301-4334.

3GAO, Military Personnel: Improved Quality Controls Needed over
Servicemembers' Employment Rights Claims at DOL, [22]GAO-07-907
(Washington, D.C.: July 20, 2007).

4USERRA rights extend to servicemembers who are federal employees, prior
employees of, and applicants to federal executive branch agencies.
Servicemembers include members of the National Guard and Reserves. For
purposes of this testimony, we are using the term servicemember, although
individuals who are not servicemembers (or who have merely applied to
become a servicemember) may also be protected by USERRA's discrimination
and retaliation prohibitions.

5The USERRA Information Management System is a Web-based case management
and reporting tool implemented by VETS in October 1996 that allows for
automated collection and investigator input of information regarding
USERRA claims and generation of reports for analysis of USERRA operations
and outcomes.

6OSC 2000 was implemented by OSC in July 1999 and was designed to capture
and record data from the initial filing of a claim until the closure and
archiving of the case file and allows for queries that create a number of
management and workload reports.

7The period of the sample was from the start of the demonstration project
on February 8, 2005, through July 21, 2006. Unless otherwise stated, the
data were sufficiently reliable for the purposes of our review.

8See section 130 of Pub. L. No. 110-92 (Sept. 29, 2007).

9See section 204 of Pub. L. No. 108-454, 118 Stat. 3598, 3606-3608, 38
U.S.C. S 4301 note.

10An independent, quasi-judicial agency in the executive branch, MSPB
serves as the guardian of federal merit principles.

11DOL is also to inform claimants that they may file a complaint directly
with the MSPB. If DOL/VETS cannot resolve nonfederal USERRA claims, DOL is
to inform claimants that they may request to have their claims referred to
the U.S. Attorney General. The Department of Justice prosecutes nonfederal
sector USERRA claims.

Figure 1: USERRA Claims Processing under the Demonstration Project

Note: VBIA did not change VETS's formal investigative process or the
referral phase under the demonstration project.

aOSC is also authorized to handle any USERRA claim where OSC has authority
to handle a related claim--that is, one alleging a related prohibited
personnel practice--brought by the USERRA claimant.

Key Findings on the Demonstration Project and Actions Taken to Address
Recommendations

Under the demonstration project, VETS and OSC used two different models to
investigate federal employee USERRA claims. Both DOL and OSC officials
have said that cooperation and communication increased between the two
agencies concerning USERRA claims, raising awareness of the issues related
to servicemembers who are federal employees. In addition, technological
enhancements have occurred, primarily on the part of VETS since the
demonstration project. For example, at VETS, an enhancement to its
database enables the electronic transfer of information between agencies
and the electronic filing of USERRA claims. However, we found that DOL did
not consistently notify claimants concerning the right to have their
claims referred to OSC for further investigation or to bring their claims
directly to MSPB if DOL did not resolve their claims. We also found data
limitations at both agencies that made claim outcome data unreliable. DOL
agreed with our findings and recommendations and has begun to take
corrective action.

Agencies Used Two Models for Processing USERRA Claims

Since the start of the demonstration project on February 8, 2005, both
DOL/VETS and OSC had policies and procedures for receiving, investigating,
and resolving USERRA claims against federal executive branch employers.
Table 1 describes the two models we reported DOL and OSC using to process
USERRA claims.

Table 1: Characteristics of DOL's and OSC's USERRA Claims' Processing
Models

Characteristic      DOL                            OSC                     
Structure of office Nationwide network with over   Centralized USERRA Unit 
                       100 investigators working      within OSC headquarters 
                       together on fact-finding at    with the Unit Chief,    
                       VETS's offices in each state,  three investigators,    
                       six regional offices, and one  and three attorneys     
                       national office.               working together on     
                                                      fact-finding and legal  
                                                      analysis at the time of 
                                                      our review.a            
Responsibilities of Investigators process both     Investigators and       
staff               federal and nonfederal USERRA  attorneys process       
                       and veteran's preference       federal employees'      
                       claims,b provide outreach and  USERRA claims, process  
                       education to servicemembers    prohibited personnel    
                       (at mobilizations and          practice claims filed   
                       demobilizations) and employers by servicemembers, and  
                       (federal and nonfederal), and  provide outreach and    
                       respond to informal requests   education to employees  
                       for information.               and employers.          
Investigative       Investigators are to           Investigators or        
approach            investigate and attempt to     attorneys are to        
                       resolve claims, prepare an     investigate and attempt 
                       investigative plan for claims  to resolve claims,      
                       taking more than 30 days, and  prepare a summary of    
                       send a letter notifying        investigation with      
                       claimant of the determination. supporting              
                       For referrals, investigators   documentation, and      
                       prepare a memorandum of        provide a detailed      
                       referral with supporting       letter to each claimant 
                       documentation. Attorneys from  (and for a claim with   
                       the Office of the Solicitor    merit, to the agency)   
                       are available for              containing the factual  
                       consultations during an        and legal basis for its 
                       investigation if an            conclusions.            
                       investigator has a question or                         
                       needs legal assistance, but                            
                       attorneys are not assigned to                          
                       every case.c                                           
Oversight           There is no required internal  At the time of our      
                       review of investigative        review, the USERRA Unit 
                       findings and closure letters   Chief provided ongoing  
                       prior to closure letters being guidance, reviewed all  
                       sent to the claimant.          work products in a      
                                                      case, and reviewed and  
                       VETS senior investigators are  approved the letter     
                       to review claims taking longer notifying the claimant  
                       than 90 days and a random      of OSC's determination  
                       sample of 25 percent of all    and, in a case with     
                       closed claims and 10 percent   merit, the letter to    
                       of all open claims at the      the agency, prior to    
                       regional level.                sending the letters.    

Source: GAO.

Note: VBIA did not change VETS's formal investigative process or the
referral phase under the demonstration project.

aSince our report was issued, OSC now has seven attorneys and two
investigators. bUnder the Veterans Employment Opportunities Act of 1998,
Pub. L. No. 105-339 (Oct. 31, 1998), an individual who believes his or her
preference rights have been violated may file a complaint with VETS within
60 days after the alleged violation, and if VETS's efforts do not result
in resolution of the complaint, the individual may appeal the matter to
MSPB, 5 U.S.C. S 3330a. cAn official from DOL's Office of the Solicitor
said that attorneys from the office are only assigned when contacted by
VETS investigators or when a regional office is contacted by the public.
He added that an attorney from the Office of the Solicitor is assigned to
every case that is a referral, which involves a legal review of a
completed case file.

VETS Is Taking Action to Help Ensure That It Consistently Notifies Claimants of
the Right to Referral

Once a VETS investigator completes an investigation and arrives at a
determination on a claim, the investigator is to contact the claimant,
discuss the findings, and send a letter to the claimant notifying him or
her of VETS's determination. When VETS is unsuccessful in resolving
servicemembers' claims, DOL is to notify servicemembers who filed claims
against federal executive branch agencies that they may request to have
their claims referred to OSC or file directly with MSPB. Our review of a
random sample of claims showed that for claims VETS was not successful in
resolving (i.e., claims not granted or settled), VETS (1) failed to notify
half the claimants in writing, (2) correctly notified some claimants, (3)
notified others of only some of their options, and (4) incorrectly advised
some claimants of a right applicable only to nonfederal claimants--to have
their claims referred to the Department of Justice or to bring their
claims directly to federal district court. In addition, we found that the
VETS USERRA Operations Manual failed to provide clear guidance to VETS
investigators on when to notify servicemembers of their rights and the
content of the notifications. VETS had no internal process to routinely
review investigators' determinations before claimants are notified of
them. According to a VETS official, there was no requirement that a
supervisor review investigators' determinations before notifying the
claimant of the determination. In addition, legal reviews by a DOL
regional Office of the Solicitor occurred only when a claimant requested
to have his or her claim referred to OSC. A VETS official estimated that
about 7 percent of claimants ask for their claims to be referred to OSC
or, for nonfederal servicemembers, to the Department of Justice.

During our review, citing our preliminary findings, DOL officials required
each region to revise its guidance concerning the notification of rights.
Since that time, DOL has taken the following additional actions:

           o reviewed and updated policy changes to incorporate into the
           revised Operations Manual and prepared the first draft of the
           revised Manual;

           o issued a memo in July 2007 from the Assistant Secretary for
           Veteran's Employment and Training to regional administrators,
           senior investigators, and directors requiring case closing
           procedure changes, including the use of standard language to help
           ensure that claimants (federal and nonfederal) are apprised of
           their rights; and

           o began conducting mandatory training on the requirements
           contained in the memo in August 2007.

           In addition, according to DOL officials, beginning in January
           2008, all claims are to be reviewed before the closure letter is
           sent to the claimant. These are positive steps. It is important
           for DOL to follow through with its plans to complete revisions to
           its USERRA Operations Manual, which according to DOL officials is
           expected in January 2008, to ensure that clear and uniform
           guidance is available to all involved in processing USERRA claims.
			  
           Number of Claims and Average Processing Time under the Demonstration
			  Project

           Our review of data from VETS's database showed that from the start
           of the demonstration project on February 8, 2005, through
           September 30, 2006, VETS investigated a total of 166 unique
           claims. We reviewed a random sample of case files to assess the
           reliability of VETS's data and found that the closed dates in
           VETS's database were not sufficiently reliable. Therefore, we
           could not use the dates for the time VETS spent on investigations
           in the database to accurately determine DOL's average processing
           time. Instead, we used the correct closed dates from the case
           files in our random sample and statistically estimated the average
           processing time for VETS's investigations from the start of the
           demonstration project through July 21, 2006--the period of our
           sample. Based on the random sample, there is at least a 95 percent
           chance that VETS's average processing time for investigations
           ranged from 53 to 86 days. During the same period, OSC received
           269 claims and took an average of 115 days to process these
           claims. We found the closed dates in OSC's case tracking system to
           be sufficiently reliable.

           In his July 2007 memo discussed above, the Assistant Secretary for
           Veteran's Employment and Training also instructed regional
           administrators, senior investigators, and directors that
           investigators are to ensure that the closed date of each USERRA
           case entered in VETS's database matches the date on the closing
           letter sent to the claimant.
			  
			  Data Limitations at Both Agencies

           We found data limitations at both agencies that affected our
           ability to determine outcomes of the demonstration project and
           could adversely affect Congress's ability to assess how well
           federal USERRA claims are processed and whether changes are
           needed. At VETS, we found an overstatement in the number of claims
           and unreliable data in the VETS's database. From February 8, 2005,
           through September 30, 2006, VETS received a total of 166 unique
           claims, although 202 claims were recorded as opened in VETS's
           database. Duplicate, reopened, and transferred claims accounted
           for most of this difference. Also, in our review of a random
           sample of case files,12 we found

           o the dates recorded for case closure in VETS's database did not
           reflect the dates on the closure letters in 22 of 52 claims
           reviewed, so using the correct dates from the sample, we
           statistically estimated average processing time, and

           o the closed code, which VETS uses to describe the outcomes of
           USERRA claims (i.e., claim granted, claim settled, no merit,
           withdrawn) was not sufficiently reliable for reporting specific
           outcomes of claims.

           At OSC, we assessed the reliability of selected data elements in
           OSC's case tracking system in an earlier report and found that the
           corrective action data element, which would be used for
           identifying the outcomes of USERRA claims, was not sufficiently
           reliable.13
			  
			  DOL Has a Lengthy Two-Phase Review Process before Claims Are
			  Referred to OSC

           We separately reviewed those claims that VETS investigated but
           could not resolve and for which claimants requested referral of
           their claims to OSC. For these claims, two sequential DOL reviews
           take place: a VETS regional office prepares a report of the
           investigation, including a recommendation on the merits and a
           regional Office of the Solicitor conducts a separate legal
           analysis and makes an independent recommendation on the merits.
           From February 8, 2005, through September 30, 2006, 11 claimants
           asked VETS to refer their claims to OSC. Of those 11 claims, 6
           claims had been reviewed by both a VETS regional office and a
           regional Office of the Solicitor and sent to OSC.14 For those 6
           claims, from initial VETS investigation through the VETS regional
           office and regional Office of the Solicitor reviews, it took an
           average of 247 days or about 8 months before the Office of the
           Solicitor sent the claims to OSC.15 Of the 6 referred claims that
           OSC received from DOL during the demonstration project, as of
           September 30, 2006, OSC declined to represent the claimant in 5
           claims and was still reviewing 1 of them, taking an average of 61
           days to independently review the claims and determine if the
           claims had merit and whether to represent the claimants.

12The period of the random sample covered February 8, 2005, through July
21, 2006.

13GAO, Office of Special Counsel Needs to Follow Structured Life Cycle
Management Practices for Its Case Tracking System, [23]GAO-07-318R
(Washington, D.C.: Feb. 16, 2007).

14The remaining five claims were still at DOL as of September 30, 2006.

15Because of the data limitations concerning the reliability of
investigations' closed dates in VETS's database, it was not possible to
isolate the length of time for the two additional reviews.

           Considerations Related to Extending the Demonstration Project

           You asked us about factors that could be considered in deciding
           whether to extend the demonstration project and to conduct a
           follow-up review. If the demonstration project were to be
           extended, it would be important to have clear objectives.
           Legislation creating the current demonstration project was not
           specific in terms of the objectives to be achieved. Having clear
           objectives would be important for the effective implementation of
           the extended demonstration project and would facilitate a
           follow-on evaluation. In this regard, our report provides baseline
           data that could inform this evaluation. Given adequate time and
           resources, an evaluation of the extended demonstration project
           could be designed and tailored to provide information to inform
           congressional decision making.

           Congress also may want to consider some potential benefits and
           limitations associated with options available if the demonstration
           is not extended. Table 2 presents two potential actions that could
           be taken and examples of potential benefits and limitations of
           each. The table does not include steps, such as enabling
           legislation that might be associated with implementing a
           particular course of action.

Table 2: Examples of Potential Actions and Potential Benefits and
Limitations with Respect to Processing Federal USERRA Claims

Potential action        Potential benefit       Potential limitation       
Return to               DOL has an              DOL is taking a number of  
pre-demonstration       infrastructure in       actions to correct         
status (i.e., DOL       place.                  deficiencies in notifying  
receives and                                    servicemembers of their    
investigates all        All USERRA claims,      rights and to implement    
claims)                 federal and nonfederal, controls to help improve   
                           would be processed by   the quality of the data on 
                           the same agency.        the number of cases,       
                                                   outcomes, and the time to  
                                                   investigate claims. The    
                                                   effectiveness of these     
                                                   actions has not been       
                                                   determined.                
Give OSC authority to   OSC has institutional   OSC would need to "stand   
receive and investigate experience from         up" a more robust          
all federal claims      enforcement of statutes infrastructure to handle   
                           to protect federal      all USERRA cases, which    
                           employees from          may include hiring and     
                           prohibited personnel    training additional staff  
                           practices, which        as well as additional      
                           according to OSC, are   operating expenses.        
                           similar to USERRA                                  
                           claims.                 A significant increase in  
                                                   the number of claims to be 
                           This eliminates two     processed may also         
                           extra reviews at DOL    necessitate a change to    
                           under current system    the oversight structure    
                           for referrals of        that OSC used during our   
                           federal claims.         review of the              
                                                   demonstration project,     
                                                   which relied heavily on    
                                                   the actions of one         
                                                   individual.                

Source: GAO analysis.

At a time when the nation's attention is focused on those who serve our
country, it is important that employment and reemployment rights are
protected for federal servicemembers who leave their employment to perform
military or other uniformed service. Addressing the deficiencies that we
identified during our review, including correcting inaccurate and
unreliable data, is a key step to ensuring that servicemembers' rights
under USERRA are protected. While DOL is taking positive actions in this
regard, it is important that these efforts are carried through to
completion.

Chairman Akaka, Senator Burr, and Members of the Committee, this concludes
my prepared statement. I would be pleased to respond to any questions that
you may have.

For further information regarding this statement, please contact George
Stalcup, Director, Strategic Issues, at (202) 512-9490 or
[24][email protected] . Contact points for our Offices of Congressional
Relations and Public Affairs may be found on the last page of this
testimony. Individuals making key contributions to this statement included
Belva Martin, Assistant Director; Karin Fangman; Tamara F. Stenzel; Kiki
Theodoropoulos; and Greg Wilmoth.

(450638)

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To view the full product, including the scope
and methodology, click on [25]GAO-08-229T .

For more information, contact George H. Stalcup at (202) 512-9490 or
[email protected].

Highlights of [26]GAO-08-229T , a testimony before the Committee on
Veterans' Affairs, U.S. Senate

October 31, 2007

MILITARY PERSONNEL

Considerations Related to Extending Demonstration Project on
Servicemembers' Employment Rights Claims

The Uniformed Services Employment and Reemployment Rights Act of 1994
(USERRA) protects the employment and reemployment rights of federal and
nonfederal employees who leave their employment to perform military or
other uniformed service.

Under a demonstration project from February 8, 2005, through September 30,
2007, and subsequently extended through November 16, 2007, the Department
of Labor (DOL) and the Office of Special Counsel (OSC) share
responsibility for receiving and investigating USERRA claims and seeking
corrective action for federal employees.

In July 2007, GAO reported on its review of the operation of the
demonstration project through September 2006. This testimony describes the
findings of our work and actions taken to address our recommendations. In
response to your request, we also present GAO's views on (1) factors to
consider in deciding whether to extend the demonstration project and the
merits of conducting a follow-up review and (2) options available if the
demonstration is not extended.

In preparing this statement, GAO interviewed officials from DOL and OSC to
update actions taken on recommendations from our July 2007 report and
developments since we conducted that review.

Under the demonstration project, OSC receives and investigates claims for
federal employees whose social security numbers end in odd numbers; DOL
investigates claims for individuals whose social security numbers end in
even numbers. Among GAO's findings were the following:

           o DOL and OSC use two different models to investigate federal
           USERRA claims, with DOL using a nationwide network and OSC using a
           centralized approach, mainly within its headquarters. 
           o Since the demonstration project began, both DOL and OSC
           officials have said that cooperation and communication increased
           between the two agencies concerning USERRA claims, raising
           awareness of the issues related to servicemembers who are federal
           employees. 
           o DOL did not consistently notify claimants concerning the right
           to have their claims referred to OSC for further investigation or
           to bring their claims directly to the Merit Systems Protection
           Board if DOL did not resolve their claims. 
           o DOL had no internal process to routinely review investigators'
           determinations before claimants were notified of them. 
           o Data limitations at both agencies made claim outcome data
           unreliable.

DOL officials agreed with GAO's findings and recommendations and are
taking actions to address the recommendations. In July 2007, DOL issued
guidance concerning case closing procedures, including standard language
to ensure that claimants (federal and nonfederal) are apprised of their
rights,and began conducting mandatory training on the guidance in August
2007. In addition, according to DOL officials, beginning in January 2008,
all claims are to be reviewed before the closure letter is sent to the
claimant. These are positive steps and it will be important for DOL to
follow through with these and other actions.

If the demonstration project were to be extended, it would be important
that clear objectives be set. Legislation creating the current
demonstration project was not specific in terms of the objectives to be
achieved. Clear project objectives would also facilitate a follow-on
evaluation. In this regard, GAO's July 2007 report provides baseline data
that could inform this evaluation. Given adequate time and resources, an
evaluation of the extended demonstration project could be designed and
tailored to provide information to inform congressional decision making.
GAO also presents potential benefits and limitations associated with
options available if the demonstration project is not extended.

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References

Visible links
  22. http://www.gao.gov/cgi-bin/getrpt?GAO-07-907
  23. http://www.gao.gov/cgi-bin/getrpt?GAO-07-318R
  24. mailto:[email protected]
  25. http://www.gao.gov/cgi-bin/getrpt?GAO-08-229T
  26. http://www.gao.gov/cgi-bin/getrpt?GAO-08-229T
  27. http://www.gao.gov/
  28. http://www.gao.gov/
  29. http://www.gao.gov/fraudnet/fraudnet.htm
  30. mailto:[email protected]
  31. mailto:[email protected]
  32. mailto:[email protected]
*** End of document. ***