Civil Service Reform: Redress System Implications of the Omnibus Civil
Service Reform Act of 1996 (Testimony, 07/16/96, GAO/T-GGD-96-160).
GAO discussed the implications of the Omnibus Civil Service Reform Act
of 1996 on the redress system for federal employees. GAO noted that: (1)
the proposed legislation would eliminate jurisdictional overlap between
the Merit Systems Protection Board (MSPB) and the Equal Employment
Opportunity Commission (EEOC); (2) EEOC would be in charge of
investigating the merits of individual EEOC complaints and deciding
whether to argue these complaints before MSPB; (3) MSPB would adjudicate
discrimination complaints that are not associated with adverse actions;
(4) the proposed legislation would give complainants' the opportunity to
take their case before the U.S. district court, but it would deny them
the right to pursue formal adjudication within the federal redress
system; (5) the number of discrimination complaints reaching the formal
adjudicative stage would be lessened; (6) changes in EEOC and MSPB
adjudicatory responsibilities would require major organizational changes
in both agencies; (7) basic changes in the adjudicatory redress system
would have repercussions for individual federal agencies; (8) a
transition period would be needed to ensure an orderly changeover from
the old redress system to the new system; and (9) alternative dispute
resolution is a good way to avoid the time and expense of employee
litigation, but this procedure is in its preliminary stages of
development.
--------------------------- Indexing Terms -----------------------------
REPORTNUM: T-GGD-96-160
TITLE: Civil Service Reform: Redress System Implications of the
Omnibus Civil Service Reform Act of 1996
DATE: 07/16/96
SUBJECT: Personnel management
Employment discrimination
Administrative hearings
Federal employees
Proposed legislation
Administrative remedies
Jurisdictional authority
Civil rights law enforcement
Federal personnel administrative law
IDENTIFIER: Walter Reed Army Medical Center Early Dispute Resolution
Program
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Cover
================================================================ COVER
Before the Subcommittee on Civil Service, Committee on Government
Reform and Oversight, House of Representatives
For Release on Delivery
Expected at
1:00 p.m. EDT
Tuesday
July 16, 1996
CIVIL SERVICE REFORM - REDRESS
SYSTEM IMPLICATIONS OF THE OMNIBUS
CIVIL SERVICE REFORM ACT OF 1996
Statement of
Timothy P. Bowling, Associate Director
Federal Management and Workforce Issues
General Government Division
GAO/T-GGD-96-160
GAO/GGD-96-160t
(410065)
Abbreviations
=============================================================== ABBREV
ADR - alternative dispute resolution
CSRA - Civil Service Reform Act of 1978
EEOC - Equal Employment Opportunity Commission
FLRA - Federal Labor Relations Authority
MSPB - Merit Systems Protection Board
OSC - Office of Special Counsel
CIVIL SERVICE REFORM: REDRESS
SYSTEM IMPLICATIONS OF THE OMNIBUS
CIVIL SERVICE REFORM ACT OF 1996
==================================================== Chapter STATEMENT
Mr. Chairman and Members of the Subcommittee:
I am pleased to be here today to discuss the implications of the
Omnibus Civil Service Reform Act of 1996 on the redress system for
federal employees. When we testified before this Subcommittee in
November 1995, we stated that the complexity of the system and the
variety of redress mechanisms it affords federal employees make it
inefficient, expensive, and time-consuming.\1 Our view remains
unchanged. We feel that congressional actions that would reduce this
inefficiency, save money, and shorten the time involved in employee
redress would be beneficial, provided these actions upheld two
fundamental principles: that of fair treatment for federal employees
and of an efficiently managed federal government.
Although the legislation was still being drafted as this statement
was being prepared, the Subcommittee staff provided us with a
narrative outline of the bill. My comments are based on our review
of that outline. I will remark briefly on the current redress
system, then comment on the following three aspects of the proposed
legislation that we feel could have significant implications if
enacted:
-- eliminating the "mixed case" scenario,
-- moving toward the private sector model in handling federal
sector discrimination complaints, and
-- promoting the use of alternative dispute resolution (ADR) to
reduce the number of formal discrimination complaints.
--------------------
\1 Federal Employee Redress: An Opportunity for Reform
(GAO/T-GGD-96-42, Nov. 29, 1995).
AN INEFFICIENT, EXPENSIVE, AND
TIME-CONSUMING SYSTEM
-------------------------------------------------- Chapter STATEMENT:1
The purpose of the current redress system, which grew out of the
Civil Service Reform Act of 1978 (CSRA) and related legal and
regulatory decisions that have occurred over the past 16 years, is to
uphold the merit system by ensuring that federal employees are
protected against arbitrary agency actions and prohibited personnel
practices, such as discrimination or retaliation for whistleblowing.
While one of the purposes of CSRA was to streamline the previous
redress system, the scheme that has emerged is far from simple.
Today, four independent adjudicatory agencies can handle employee
complaints or appeals: the Merit Systems Protection Board (MSPB),
the Equal Employment Opportunity Commission (EEOC), the Office of
Special Counsel (OSC), and the Federal Labor Relations Authority
(FLRA). While these agencies' boundaries may appear to have been
neatly drawn, in practice the redress system forms a tangled scheme.
To begin with, a given case may be brought before more than one of
these agencies--a circumstance that adds time-consuming steps to the
redress process and may result in the adjudicatory agencies reviewing
each other's decisions. Moreover, each of the adjudicatory agencies
has its own procedures and its own body of case law. Each varies
from the next in its authority to order corrective actions and
enforce its decisions.
Further, the law provides for additional review of the adjudicatory
agencies' decisions--or, in the case of discrimination claims, even
de novo\2 trials--in the federal courts. Beginning in the employing
agency, proceeding through one or more of the adjudicatory bodies,
and then carried to its conclusion in court, a single case can take
years.
Even the typical case can take a long time to resolve--especially if
it involves a claim of discrimination. Among discrimination cases
closed during fiscal year 1994 for which there was a hearing before
an EEOC administrative judge and an appeal of an agency final
decision to the Commission itself, the average time from the filing
of the complaint with the employing agency to the Commission's
decision on the appeal was over 800 days.\3
Just how much the government's multilevel, multiagency redress system
costs is impossible to ascertain. We know that in fiscal year
1994--the last year for which data on all four adjudicatory agencies
are available--the share of the budgets of the four agencies that was
devoted to individual federal employees' appeals and complaints
totaled $54.2 million. We also know that in fiscal year 1994,
employing agencies reported spending almost $34 million investigating
discrimination complaints. In addition, over $7 million was awarded
for complainants' legal fees and costs in discrimination cases
alone.\4 But many of the other dollar costs cannot be pinned down,
such as the direct costs accrued by employing agencies while
participating in the appeals process, arbitration costs, the various
costs tied to lost productivity in the workplace, employees'
unreimbursed legal fees, and court costs. All these costs either go
unreported or are impossible to clearly define and measure.
Moreover, many of the real implications of this system cannot be
measured in dollars. The redress system's protracted processes and
requirements can also divert federal managers from more productive
activities and inhibit some of them from taking legitimate actions in
response to performance or conduct problems. It is also important to
observe that under this system, federal workers have substantially
greater employment protections than do private sector employees.
Federal employees file workplace discrimination complaints at roughly
6 times the per capita rate of private sector workers. And while
some 47 percent of discrimination complaints in the private sector
involve the most serious adverse action--termination--only 18 percent
of discrimination complaints among federal workers are related to
firings.
--------------------
\2 In a de novo trial, a matter is tried anew as if it had not been
heard before.
\3 EEOC processed requests for hearings before an administrative
judge in an average of 154 days. The Commission processed appeals of
agency final decisions in an average of 185 days. Cases before MSPB
are processed more quickly but still take a long time. In fiscal
year 1994, MSPB processed initial appeals in an average of 81 days
and processed appeals of initial decisions to the three-member Board
in an average of 162 days.
\4 This number includes legal fees and costs (1) paid by agencies in
discrimination complaints resolved by administrative procedures and
(2) paid from the Judgment Fund for settlements and judgments arising
out of lawsuits.
ELIMINATING THE "MIXED CASE"
SCENARIO
-------------------------------------------------- Chapter STATEMENT:2
The most frequently cited example of jurisdictional overlap in the
redress system is the so-called "mixed case," under which a career
employee who has experienced an adverse action appealable to MSPB,
and who feels that the action was based on discrimination, can
essentially appeal to both MSPB and EEOC. The employee would first
appeal to MSPB, with hearing results further appealable to MSPB's
three-member Board. If the appellant is still unsatisfied, he or she
can then appeal MSPB's decision to EEOC. If EEOC finds
discrimination where MSPB did not, the two agencies try to reach an
accommodation. If they cannot do so--an event that has occurred only
three times in 16 years--a three-member Special Panel is convened to
reach a determination. At this point, the employee who is still
unsatisfied with the outcome can file a civil action in U.S.
district court, where the case can begin again with a de novo trial.
The proposed legislation would eliminate the mixed case scenario.
This would appear to make good sense, especially in light of the
record regarding mixed cases. First, few mixed cases coming before
MSPB result in a finding of discrimination. In fiscal year 1994, for
example, MSPB decided roughly 2,000 mixed case appeals. It found
that discrimination had occurred in just eight. Second, when EEOC
reviews MSPB's decisions in mixed cases, it almost always agrees with
them. Again during 1994, EEOC ruled on appellants' appeals of MSPB's
findings of nondiscrimination in 200 cases. EEOC disagreed with
MSPB's findings in just three. In each instance, MSPB adopted EEOC's
determination.
Under the mixed case scenario, an appellant can--at no additional
risk to his or her case--have two agencies review the appeal rather
than one. MSPB and EEOC rarely differ in their determinations, but
an employee has little to lose in asking both agencies to review the
issue. Eliminating the possibility of mixed cases would eliminate
both the jurisdictional overlap and the inefficiency that accompanies
it.
MOVING TOWARD THE PRIVATE
SECTOR MODEL
-------------------------------------------------- Chapter STATEMENT:3
When a private sector worker complains of discrimination to EEOC,
EEOC investigates the complaint and, if it finds that it has merit,
will argue the case on behalf of the complainant in U.S. district
court. This treatment is less comprehensive than the treatment
afforded executive branch federal workers. The fundamental
difference is in EEOC's role. First, under EEOC's authority to
mandate agency discrimination complaint procedures, the federal
employee's agency must investigate the employee's assertion. Second,
the complainant is entitled to have EEOC adjudicate the case. A
federal employee who is unsatisfied with the outcome is still
entitled to seek a trial in U.S. district court.
The proposed legislation, which would bring discrimination complaint
processes more in line with the private sector model, would
fundamentally change EEOC's role. Today, cases involving both an
adverse action appealable to MSPB and a claim of discrimination
become "mixed cases" in which MSPB's determination can be opposed by
EEOC, and even brought before the Special Panel at EEOC's insistence.
Under the proposed legislation, EEOC would not review MSPB decisions.
Instead, it would have the authority to petition the Court of Appeals
for the Federal Circuit to review MSPB decisions in which EEOC
believed that MSPB misinterpreted EEO case law.\5 EEOC's role, then,
would essentially shift from adjudicator to watchdog.
Similarly, in cases involving only a claim of discrimination, EEOC's
role would also change. Today, EEOC mandates that agencies perform
investigations of their employee's discrimination claims, while EEOC
itself adjudicates formal complaints. Under the proposed
legislation, EEOC would no longer mandate agencies' discrimination
complaint procedures. EEOC would investigate complaints itself, and
then determine if the cases had sufficient merit to prosecute before
MSPB. EEOC's role, therefore, would change from adjudicator to
investigator and prosecutor.
MSPB's role would also change. For the first time, it would
adjudicate discrimination complaints that were not necessarily
associated with adverse actions.
The redress rights of federal employees would also change
dramatically. The most significant changes would involve
complainants' access to formal adjudication, both by an adjudicatory
agency and in court. Today, no gatekeeper exists to determine which
discrimination cases go to an adjudicatory agency. Under the
proposed legislation, EEOC would become that gatekeeper,
investigating and determining the merits of individual EEOC
complaints and deciding whether to argue these cases before the new
adjudicator of EEO matters, MSPB. Today, discrimination complainants
who remain unsatisfied after exhausting their administrative redress
opportunities at EEOC can initiate an entirely new case in U.S.
district court. Under the proposed legislation, any administrative
redress opportunities would have been exhausted at MSPB, with
recourse only to the U.S. Court of Appeals for the Federal Circuit.
That would mean a review in court of the administrative process, not
a de novo trial on the merits of the case itself.
The proposed legislation would give federal employee discrimination
complainants the same opportunity as private-sector employees to take
their case to U.S. district court. But it would deny them the right
to first pursue formal adjudication within the federal redress
apparatus, and then, if still dissatisfied, to start a new case from
scratch. The intention of the proposed legislation would be to
eliminate what is commonly called the "two bites of the apple."
One significant effect of these proposed changes might be to dampen
the number of discrimination complaints reaching the formal
adjudicative stage. In earlier testimony, we pointed out that one
reason it takes so long to adjudicate discrimination cases is that
there are so many of them. From fiscal years 1991 to 1994, for
example, the number of discrimination complaints filed increased by
39 percent; the number of requests for a hearing before an EEOC
administrative judge increased by about 86 percent; and the number of
appeals to EEOC of agency final decisions increased by 42 percent.
Meanwhile, the backlog of requests for EEOC hearings increased by 65
percent, and the inventory of appeals to EEOC of agency final
decisions tripled.
Dampening the number of complaints--particularly frivolous complaints
and those filed by employees who choose to abuse the system--is
certainly a worthwhile goal. However, any major change in the roles
of EEOC or MSPB--or in other aspects of the discrimination complaint
process--will have broad implications and require careful
examination. For example, changes in the adjudicatory
responsibilities of EEOC and MSPB would require major organizational
change in both agencies. Further, the staffing requirements and
skill mix at both agencies would change with their new
responsibilities; EEOC, for instance, might need more investigators
and fewer administrative judges than it does today. In addition, a
basic change in adjudicatory redress procedures would have
repercussions in the individual federal agencies, which would likely
need to develop new processes to handle discrimination complaints.
Moreover, cases already in process would need to be accommodated; a
transition period to ensure an orderly changeover from the old system
to the new would need to be provided and carefully planned. All
these issues would need Congress's close attention if fundamental
redress system reform were to be successful.
--------------------
\5 This would be analogous to the current role of the Office of
Personnel Management, which may petition the Court of Appeals for the
Federal Circuit to review MSPB decisions when it concludes that MSPB
has misinterpreted personnel law.
PROMOTING THE USE OF ADR
-------------------------------------------------- Chapter STATEMENT:4
One way of avoiding formal adjudicative procedures is through the use
of alternative dispute resolution (ADR). Many private sector firms
have adopted ADR as a means of avoiding the time and expense of
employee litigation.\6 A number of federal agencies have explored ADR
as well, and for the similar purpose of avoiding the costly and
time-consuming formalities of the employee redress system.
At your request, Mr. Chairman, we have been examining the extent to
which federal agencies have been using ADR to settle workplace
disputes, as well as the variety of ADR methods they have tried. The
particular approaches vary, but include the use of mediation, dispute
resolution boards, and ombudsmen.
The use of ADR methods was called for under CSRA and underscored by
the Administrative Dispute Resolution Act of 1990, the Civil Rights
Act of 1991, and regulatory changes made at EEOC. Based not only on
the fact that Congress has endorsed ADR in the past, but also that
individual agencies have taken ADR initiatives and that MSPB and EEOC
have explored their own initiatives, it is clear that the need for
finding effective ADR methods is widely recognized in government.
Our preliminary study of government ADR efforts, however, indicates
that ADR is not yet widely practiced and that the ADR programs in
place are, by and large, in their early stages. Most of these
involve mediation, particularly to resolve allegations of
discrimination before formal complaints are filed. Because ADR
programs generally have not been around very long, the results of
these efforts are sketchy; however, some agencies claim that these
programs have saved time and reduced costs. One example is the
Walter Reed Army Medical Center's Early Dispute Resolution Program,
which provides mediation services. From fiscal year 1993 to fiscal
year 1995, the number of discrimination complaints at the medical
center dropped from 50 to 22--a decrease that Walter Reed officials
attribute to the Early Dispute Resolution Program. Moreover, data
from the medical center show that, since the program began in October
1994, 63 percent of the cases submitted for mediation have been
resolved. Walter Reed officials said that the costs of investigating
and adjudicating complaints have been lessened, as well as the amount
of productive time lost on the part of complainants and others
involved in the cases.
This example is an encouraging one, and at your request, Mr.
Chairman, we are continuing to study ADR usage in both private and
public sector workplaces, to identify lessons that can be applied
more widely in the federal government. Based on work we have done so
far in the ADR area, we feel that support for ADR is justified. The
strength of ADR, some agencies have told us, is in getting beyond
charges and countercharges among the parties involved and getting at
the underlying personal interests--many of which may have nothing to
do with discrimination--that are often the real cause of conflicts in
the workplace. But we would caution that, at this point, ADR is in
its preliminary stages of development, that good data on its
effectiveness are hard to come by, and that the factors necessary for
its success have yet to be fully identified.
--------------------
\6 For a discussion of ADR methods private sector employers use, see
our report Employment Discrimination: Most Private-Sector Employers
Use Alternative Dispute Resolution (GAO/HEHS-95-150, July 1995).
SUMMATION
-------------------------------------------------- Chapter STATEMENT:5
The redress system for federal employees is an area with great
promise for change--and not just for improving efficiency, saving
money, and improving the timeliness of redress. We feel that
effective improvements in the redress system would also improve the
fairness and accessibility of the system to employees, and make it
easier for managers to manage effectively. Of course, any sweeping
change in the redress system would need to be closely examined to
ensure that the legitimate rights of federal employees were still
protected. Where the balance should be struck is a critical matter
for Congress to decide.
This concludes my prepared statement, Mr. Chairman. I would be
pleased to take any questions that you or other Members of the
Subcommittee may have.
*** End of document. ***