Federal Employee Misconduct: Actions Needed to Ensure Agencies Have Tools to Effectively Address Misconduct

Misconduct is generally considered an action by an employee that impedes the efficiency of the agency's service or mission. Misconduct incidents can affect other aspects of employee morale and performance and impede an agency's efforts to achieve its mission.

GAO was asked to examine how executive branch agencies address employee misconduct. This report (1) describes the process agencies are required to follow in responding to employee misconduct; (2) identifies alternative approaches to the formal process that agencies can use and assesses what factors affect agencies' responses to misconduct; (3) describes trends in removals and other adverse actions resulting from misconduct; and (4) identifies key practices agencies can use to help them better prevent and address misconduct. To address these objectives, GAO reviewed relevant sections of title 5 of the U.S.C; analyzed MSPB and OPM data, and interviewed, among others, agency officials and subject-matter experts.

Chapter 75 of title 5 of the U.S. Code specifies the formal legal process that most agencies must follow when taking adverse actions, i.e., suspensions, demotions, reductions in pay or grade, and removals, for acts of employee misconduct. Chapter 75 details the built-in procedural rights certain federal employees are entitled to when faced with adverse actions.

Depending on the nature of misconduct, an agency may use utilize alternative discipline approaches traditionally used in government to correct behavior. Alternative discipline is an approach to address misconduct that is available to agencies in lieu of traditional penalties (e.g., letters of reprimand and suspensions of 14 days or less). An example is a last chance agreement, whereby an employee recognizes the agency's right to terminate him or her should another act of misconduct occur.

Based on the data collected by the Office of Personnel Management (OPM), agencies formally discipline an estimated 17,000 employees annually under Chapter 75, or less than 1 percent of the federal workforce, for misconduct. Based on OPM data, in 2016, agencies made 10,249 suspensions, 7,411 removals, and 114 demotions for misconduct. However, because of weaknesses in OPM's data on employee misconduct, which is provided by the agencies, OPM is unable to accurately target supervisory training to address misconduct, and decision-makers do not know the full extent or nature of this misconduct.

Key lessons learned can help agencies better prevent and respond to misconduct. For example, tables of penalties provide a list of the infractions committed most frequently by agency employees, along with a suggested range of penalties for each to ensure consistent treatment for similar offenses. However, not all agencies have a table of penalties, including OPM, nor are agencies required by statute, case law or OPM regulations. Subject-matter experts we contacted identified additional promising practices that agencies can use to respond employee misconduct. Some of these are presented below.

Agencies are accountable for providing required training to their managers. However, agency officials and subject-matter experts we interviewed said federal managers may not address misconduct because they are unfamiliar with the disciplinary process, have inadequate training, or receive insufficient support from their human resources offices.

GAO recommends that OPM, working with the Chief Human Capital Officers Council, (1) take steps to improve the quality of data collected on misconduct; (2) leverage lessons learned to help agencies address misconduct; and (3) improve guidance on training supervisors and human resources staff on addressing misconduct. OPM partially concurred with two recommendations, and disagreed with the first, stating that its guidance has been successfully relied upon by agencies. GAO maintains the action is needed to help strengthen oversight.

An average of less than 1 percent of the federal government’s 2.1 million  employees are formally disciplined for misconduct annually, according to  our analysis of the Office of Personnel Management’s (OPM) data. While  this number is relatively small, even a few cases of employee misconduct  can have significant impacts on workplace morale and impede an  agency’s efforts to achieve its mission. Indeed, according to a 2008 study  by the Merit System Protection Board (MSPB), “Misconduct affects not  only the employee and the supervisor; it also impacts those who interact  with the employee.” To that end, it is important for agencies to timely and  effectively address cases of employee misconduct while simultaneously  respecting employees’ procedural and due process rights.

The term “employee misconduct” does not have a general definition in a  statute or government-wide regulations. Agencies may elaborate on types  of misconduct in handbooks and other internal guidance. However,  according to OPM, there is a large body of decisional law by MSPB  addressing discipline for employee misconduct in the federal government  that contains definitions of various forms of misconduct, such as  “insubordination,” “excessive absence,” and “misuse of government  property,” as well as instances where specific types of misconduct are  referenced concerning appointment into the competitive service.  According to OPM officials, the lack of a general definition of misconduct  gives agencies flexibility in the manner in which they address misconduct.  Ultimately, when an agency needs to take an adverse action against an  employee for inappropriate workplace behavior, it must do so “for such  cause as will promote the efficiency of the service” as provided for in 5  U.S.C. Chapter 75. Such actions could include, but are not limited to,  instances of misconduct. The efficiency of the service standard provides  managers with maximum flexibility to pursue adverse actions whether the  impetus was a conduct issue, a failure to perform, or something else.

Activities that may be considered misconduct can vary from agency to  agency. According to agency officials and subject-matter experts we  interviewed, examples of misconduct include  time and attendance infractions; physical aggression toward an employee;  improper use of a government-issued credit card; misuse of government equipment (such as viewing pornography or use of public position for private gain; and behavior that affects national security.

It should be noted that the law differentiates misconduct from  substandard performance. Poor performance can generally be described  as an employee’s inability to carry out work responsibilities, while  misconduct can be described as an employee, willfully or otherwise,  violating stated policies or norms. In certain cases, however, employee  performance and misconduct can overlap, combining the two issues.  Sleeping on the job, for example, is both a failure to abide by norms of  conduct an agency would expect of an employee on duty and a failure to  perform.

Our prior work on poor performers found that adverse actions, including  suspensions, demotions, and removals, take time to resolve and because  of a lack of internal support, concerns over litigation and other factors,  supervisors may be hesitant to initiate required procedures outlined in the  United States Code (hereinafter U.S.C.). Supervisors can address  misconduct through alternative discipline approaches which can shorten  the timeline and eliminate costly litigation if the employee decides to  appeal an adverse action. When used under the right circumstances,  alternative discipline may be more efficient and effective than traditional  discipline.

You asked us to examine the process for addressing misconduct and to  identify any challenges to removing employees for misconduct. Our  objectives were to (1) describe the process that agencies are required to  follow in responding to employee misconduct in the federal service; (2)  identify alternative approaches to the formal legal process that agencies  can use to respond to misconduct, and assess what factors affect  agencies’ responses; (3) describe trends in removals and other adverse  actions resulting from misconduct; and (4) identify key practices agencies  can use to help them better prevent and address misconduct.

To address the first objective, we reviewed relevant sections of Title 5  chapter 75 of the U.S.C. (hereinafter chapter 75) which contains the  statutory process for taking such adverse actions as are necessary to  promote the efficiency of the service, which would include adverse  actions to address misconduct. We also reviewed OPM regulations  implementing chapter 75 adverse action procedures and describing  employee grievance and appeal rights. Additionally, we reviewed 5  U.S.C. §§ 7701 and 7702 (hereinafter chapter 77), which contain the  statutory process for adverse action appeals to the MSPB and  subsequent appeals to the Equal Employment Opportunity Commission  (EEOC) when the employee has alleged that an adverse action within the  jurisdiction of the MSPB was taken on account of discrimination within the  jurisdiction of the EEOC. To provide context for our review of Chapters  75 and 77, we interviewed current and former practitioners, subject- matter experts, and academics. We selected our subject-matter experts  based on our guidance for selecting experts, including their depth of  experience on this issue and their present and past employment history,  the subject-matter experts’ practical experience in applying and practicing  administrative law related to employee misconduct, and academicians  who have conducted research on employee misconduct.

To address the second objective, we interviewed OPM and MSPB  officials and reviewed MSPB documents to obtain alternative discipline  approaches agencies may use to address employee misconduct. We  reviewed OPM regulations and documents to determine the legal  framework within which most agencies address employee misconduct in  the federal service, including formal procedural and employee appeal  rights. To describe and assess factors that affect an agency’s response to  employee misconduct, we interviewed a panel of chief human capital  officers (CHCO) from selected agencies as well as current and former  human capital practitioners and other individuals and organizations with  expertise in working on employee misconduct issues. These interviews  helped us to gain insight into the agency perspective on addressing  employee misconduct.

To address the third objective, we analyzed data from OPM’s Enterprise  Human Resources Integration (EHRI) database and MSPB data from  fiscal years 2006 to 2016 to describe trends in misconduct-related  personnel actions and determine the number of adverse actions that  agencies take against employees government-wide. Some agencies are  excluded from the EHRI database, such as those in the intelligence  community. For this report, the term ‘adverse action’ refers to non- appealable and appealable personnel actions listed under chapter 75,  which includes reductions in grade or pay, suspensions, and removals.  Adverse actions can be taken for reasons that will promote the efficiency  of the service. Such actions include, but are not limited to, misconduct.

To address the fourth objective, we conducted a literature review to  identify promising practices and lessons learned associated with  employee misconduct in the federal sector. We interviewed officials from  OPM, MSPB, the EEOC, and the Office of Special Counsel (OSC), to  obtain their perspectives on responding to employee misconduct through  alternative approaches. We also interviewed officials from the  Environmental Protection Agency (EPA) to obtain their perspectives on  recent efforts to better coordinate with EPA’s Inspector General to  address cases of employee misconduct. We obtained the perspectives of  a panel of CHCOs from selected agencies through the CHCO Council.  We also interviewed former human capital practitioners and other subject- matter experts with extensive experience working on employee  misconduct issues identified through literature reviews and  recommendations from other experts. For further information on our  scope and methodology, see appendix I.

We conducted this performance audit from July 2016 to July 2018 in  accordance with generally accepted government auditing standards.  Those standards require that we plan and perform the audit to obtain  sufficient, appropriate evidence to provide a reasonable basis for our  findings and conclusions based on our audit objectives. We  independently assessed OPM and MSPB’s data by determining data  checks and quality control steps taken on entering and maintaining the  data. We determined the data from both agencies to be sufficient and  reliable for our purposes. We believe that the evidence obtained provides  a reasonable basis for our findings and conclusions based on our audit  objectives.

Misconduct can occur in any workplace. When employee misconduct  happens, an agency may incur a number of direct and indirect costs  depending on how the agency chooses to address misconduct. For the  agency, direct costs can mean potentially significant time and resource  investments, including investigations, adversarial relationships between  management and the employee, costs to the agency as a result of the  misconduct committed (e.g., time and attendance or credit card fraud),  and reduced employee engagement. The subject-matter experts we  interviewed told us that, based on their experiences, the time it takes to  address a case of misconduct may range from a couple of weeks to  years. The time range depends on whether the employee appeals their  case and other factors.

Agencies may also incur litigation expenses if an employee decides to  appeal an adverse action. While there are costs to addressing  misconduct, agencies also incur indirect costs when misconduct goes  unaddressed in the workplace. These indirect costs include corrosive  effects on other employees’ morale, higher employee turnover, reduced  productivity, and lower employee commitment to their work or agency.  Indirect costs also include redirecting management’s attention away from  achieving the agency’s mission.

Employee misconduct in the federal government is regulated by a well- developed body of statutes and regulations as well as decisions from  MSPB and U.S. Court of Appeals for the Federal Circuit and Supreme  Court. While there is no general definition of the term “employee  misconduct” in a statute or government-wide regulation, Standards of  Ethical Conduct are prescribed by the Office of Government Ethics at 5  CFR Part 2635 and agencies may also elaborate on types of misconduct  in handbooks, tables of penalties (listings of some of the most common  offenses with recommended ranges of penalties), and other internal  guidance. There is a large body of law by MSPB addressing discipline for  employee misconduct in the federal government that contains criteria of  various forms of misconduct, such as, “insubordination,” “excessive  absence,” and “misuse of government property.” According to OPM  officials, there are instances in law and regulation where types of  misconduct are referenced concerning appointment into the competitive  service. Chapter 73 (Suitability, Security, and Conduct) addresses certain  types of misconduct of executive branch employees.

Generally speaking, an employee’s violation of an agency’s regulation or  policy may cause the agency to take disciplinary or corrective action.  Ultimately, if an agency needs to take an adverse action for inappropriate  workplace behavior, it must do so “for such cause as will promote the  efficiency of the service” as provided for in Title 5, Chapter 75. OPM has  also prescribed some regulations on employee responsibilities and  conduct. One of the nine Merit System Principles set forth by the Civil  Service Reform Act of 1978 that govern the management of the federal  workforce states that federal employees “should maintain high standards  of integrity, conduct, and concern for the public interest.”

According to MSPB, when there is misconduct by a federal employee,  management’s goal should be to either persuade the employee to behave  properly or to remove the employee if the conduct is serious enough.  Moreover, OPM maintains that supervisors have a responsibility to set  clear rules and expectations for employees in the workplace. It is  imperative that federal agencies manage their workforces effectively,  which includes the effective use of discipline when addressing employee  misconduct. In addition, employees may be disciplined for conduct that  that they knew or should have known was unacceptable. Similarly,  federal executive branch employees have a responsibility to adhere to  principles of ethical conduct and should avoid any actions that appear to  violate the law or ethical standards.

Overall, the objective of discipline is to deal with employees who are  unwilling or unable to behave properly, and, where management deems it  possible and appropriate, correct deficiencies in employee conduct. When  management decides to take an action short of removal, discipline can  deter misconduct and correct situations interfering with productivity.  Conduct-based actions are important tools designed to aid supervisors in  maintaining an efficient and orderly work environment.

Agencies Must Follow Statutory and Regulatory Procedures When Taking Adverse Actions for Employee Misconduct Under Chapter 75 of Title 5

Most agencies are required to adhere to formal, statutorily established  guidelines under chapter 75 when taking adverse actions against an  employee for misconduct. Chapter 75 of Title 5 includes two subsections  that outline the requirements for (1) non-appealable adverse actions such  as suspensions of 14 days or less or (2) appealable adverse actions  such as reductions in pay or grade, suspensions of more than 14 days,  and removals (see figure 1). Subchapter I actions are covered by  sections 5 U.S.C. 7501-7504 (Subsection I) and are referred to as “non- appealable actions,” while Subchapter II actions covered by sections 5  U.S.C. 7511-7514 are referred to as “appealable actions” based on  whether or not they can be appealed to the MSPB.

According to a MSPB report, through the Civil Service Reform Act of 1978  (CSRA), “Congress sought to ensure that agencies could remove  employees who engage in misconduct while protecting the civil service  from the harmful effects of management acting for improper reasons,  such as discrimination or retaliation for whistleblowing.” OPM  regulations specify the process agencies must pursue to take adverse  actions. These regulations also specify the procedural and appeal rights  to which employees facing adverse actions are entitled. According to  OPM officials, agency policies usually cover lesser disciplinary actions,  such as oral and written reprimands, letters of warning, and letters of  counseling. Employees may grieve these actions depending on the  agency’s administrative or negotiated grievance processes. According to  OPM, agencies may issue these actions without following the procedural  requirements for adverse actions under 5 U.S.C. Chapter 75.

The procedural rights due to employees subject to adverse actions  covered by Chapter 75 are derived both from Chapter 75 and from the  U.S. Constitution. In 1985, the U.S. Supreme Court held that tenured or  post-probationary public employees who may be terminated only for  cause have a constitutional property interest in continued employment  and cannot be deprived of their jobs without due process of law. The  process that was due in that case was notice of the proposed removal  before it occurred and the opportunity to present reasons why the  proposed action should not be taken. Chapter 75 and OPM regulations  promulgated thereunder establish additional procedural requirements  extending to actions other than removal that go beyond what the Due  Process Clause of the U.S. Constitution would itself require under current  precedent. For example, they require that employees be given advance  notice of a suspension or a reduction in pay with the opportunity to  respond in writing with supporting affidavits.

Subchapter I of Chapter 75 and Corresponding Regulations Describe Procedures for a Suspension of 14 Days or Less

An agency may take an adverse action under Subchapter I of Chapter 75  only for such cause as will promote the efficiency of the service. When  proposing to suspend an employee for 14 days or less, an agency must  give the employee advance written notice stating the reasons for the  proposed suspension. The agency must also inform the employee of his  or her right to review the material which is relied on to support the  reasons for the action. The agency must give the employee a reasonable  time (no less than 24 hours) to answer orally and in writing, to furnish  affidavits and other documentary evidence in support of the answer, and  to be represented by an attorney or other representative. Lastly, the  agency is to give the employee a written decision with the specific  reasons for the suspension on or before the effective date of the action.

An employee may challenge a suspension of 14 days or less through an  agency administrative grievance procedure, if applicable. If the employee  is represented by a union with a collective bargaining agreement (CBA)  with the agency that includes an applicable grievance procedure, the  employee may challenge the suspension only under the CBA unless the  employee is alleging that the suspension was discriminatory. If the  employee wishes to challenge the suspension as discriminatory or  retaliatory under the EEO laws, the employee may file an EEO complaint  with agency followed by a request for a hearing with the EEOC. The  employee may also file a complaint with the OSC and then, if necessary,  an Individual Right of Action appeal with the MSPB, to assert that the  suspension was in retaliation for the employee’s whistleblower activity. If  the employee is represented by a union that has a collective bargaining  agreement with the agency that includes an applicable negotiated  grievance procedure, the employee may only file a grievance under the  agency’s collective bargaining agreement.

Subchapter II of Chapter 75 Describes Steps Agencies Must Take to Address More Significant Cases of Employee Misconduct Than Those Addressed Under Subchapter I

Subchapter II of Chapter 75 addresses steps agencies must follow to take  the four adverse actions listed below. These following actions are referred  to as appealable adverse actions:  suspensions longer than 14 days;  reductions in pay; and  removals.

An agency may take an adverse action under Subchapter II only for such  cause as will promote the efficiency of the service. Subchapter II and  OPM regulations contain more extensive procedural requirements for  removals, reductions in pay or grade, and suspensions of over 14 days.  The employee is entitled to at least 30 days advanced written notice of  the proposed action, unless there is reasonable cause to believe the  employee has committed a crime for which a sentence of imprisonment  may be imposed. The notice must state the reasons for the action and  inform the employee of their right to review the material on which the  reasons stated in the notice are based. Agencies typically provide the  material supporting the proposal to the employee with the notice. The  proposal is usually prepared by the employee’s supervisor in consultation  with human resources and, sometimes, the agency’s legal staff.

The agency must give the employee a reasonable amount—no less than  7 days—of official time to review the supporting material, to prepare an  answer orally and in writing, and to furnish affidavits and other  documentary evidence in support of the answer. According to OPM and  MSPB officials, normally the agency designates an official other than the  person who proposes the adverse action to review the employee’s  response and make the decision. The employee is entitled to be  represented by an attorney or other representative, including a union  steward if the employee is a bargaining unit member. The employee is  entitled to a written decision on or before the effective date specifying the  reasons for the decision and advising the employee of any appeal and  grievance rights under 5 CFR § 752.405.

An employee may challenge discipline under Subchapter II through an  agency administrative grievance procedure, if applicable, or by filing a  grievance under an applicable CBA. An employee may also appeal  adverse actions covered by Subchapter II to the MSPB unless the  employee first filed a grievance challenging the action under the CBA.  Accordingly, a large number of MSPB decisions address the elements  and relative seriousness of various kinds of misconduct.

According to OPM, if the employee wishes to challenge an appealable  adverse action under subchapter II as discriminatory or retaliatory under  the EEO laws, the employee may file a “mixed case” EEO complaint with  agency. The agency then issues a final agency decision that may be  appealed to the MSPB. An employee affected by an appealable action  (removal, suspension for more than 14 days, reduction in pay or grade) who believes that the action was motivated by prohibited discrimination,  such as a person’s race, color, religion, sex, national origin, age or  disability, may also file a “mixed case” appeal directly with MSPB and  raise the discrimination claim in that forum. The employee may seek  review of MSPB’s decision on the discrimination claim before the EEOC.  If MSPB and EEOC disagree on the discrimination claim and MSPB does  not defer to EEOC’s view, then a special panel of the EEOC and MSPB  will be convened to resolve the disagreement.

When deciding an appropriate penalty for misconduct, agency officials  are to make decisions on a case-by-case basis, taking into consideration  all relevant circumstances. Deciding officials within the agency should  consult the Douglas Factors –12 criteria developed by MSPB to guide  such decisions (see appendix II). In the Douglas vs. Veterans  Administration decision, MSPB found that a penalty will be sustained as  long as “managerial judgment has been properly exercised within  tolerable limits of reasonableness.” The list of Douglas Factors is not  exhaustive. According to MSPB, weighing all relevant aggravating and  mitigating factors and the totality of the circumstances is critical in any  disciplinary case. The process agencies use to identify and address  employee misconduct is illustrated in figure 2.

Agencies may use progressive discipline to help determine which course  of action to take when responding to misconduct. OPM officials define  progressive discipline as the “imposition of the least serious disciplinary  or adverse action applicable to correct the issue or misconduct with  penalties imposed at an escalating level for subsequent offenses.” The  Douglas factors incorporate the concept of using a lesser penalty in  appropriate circumstances. For instance, if an employee commits a first  offense, the agency may choose to suspend the employee for 14 days or  less. After that, the employee might learn from his or her mistake or  correct the action, and not commit another offense, and therefore the  agency will not discipline the employee again. However, the President  has now prescribed that “supervisors and deciding officials should not be  required to use progressive discipline”, and that “the penalty for an  instance of misconduct should be tailored to the facts and  circumstance.” This will affect how agencies will determine appropriate  penalties going forward.

Alternatively, if the employee commits the same offense a second time,  the agency may choose to suspend the employee for longer, or impose  stronger adverse actions, including removal. According to OPM officials,  progressive discipline is not defined or required by civil service law, rules  or regulations.

Chapter 75 provides that an employee with appeal rights who wants to  contest an agency decision to remove, suspend for over 14 days, or  reduce in pay or grade may appeal the agency’s decision with MSPB. If  that employee is a member of a collective bargaining unit, the employee  also has the option of pursuing a grievance under negotiated grievance  procedures if the appeal has not been excluded from coverage by the  collective bargaining agreement. The employee may pursue either option,  but not both. The employee may seek review of an arbitrator’s decision  before the U.S. Court of Appeals for the Federal Circuit. If the employee  is challenging an adverse action within the jurisdiction of the MSPB and  also alleged unlawful discrimination before the arbitrator or was prevented  from doing so by the negotiated grievance procedure, the employee may  appeal the arbitrator’s decision to the MSPB. In addition, the union may  appeal an arbitration award concerning a suspension of 14 days or less to  the Federal Labor Relations Authority (FLRA) on behalf of the  employee. See figure 3 for the collective bargaining unit appeals  process for major disciplinary actions.

Employees may use several avenues if they elect to appeal adverse  actions through the statutory appeals process for such actions (removal,  suspension of more than 14 days, and reduction in grade or pay). If the  employee believes the disciplinary action was motivated by unlawful  discrimination, he or she may file a discrimination complaint with the  agency or file an appeal directly with MSPB. If the employee believes the  disciplinary action was taken in retaliation for whistleblowing, he or she  may choose to file a whistleblower retaliation complaint before deciding to  appeal to the MSPB. If the employee or agency does not agree with the  decision rendered by a MSPB administrative judge (AJ), he or she may  seek review before the full MSPB. See figure 4 for statutory appeals  process.

Initial Appeals to MSPB Take Around 100 Days to Resolve

We analyzed MSPB’s data and found initial appeals at MSPB generally  take from 63 to152 days to render a decision. MSPB has a policy goal  of resolving cases by an administrative judge on or before 120 days after  the filing of the appeal. An employee or agency can appeal an initial  MSPB decision in a process called petition for review (PFR). PFR cases  are reviewed by the full MSPB, and range from an additional 99 to 251  days, based on our analysis of the MSPB’s data. The time that it takes to  resolve cases at MSPB is consistent for demotions, suspensions of  greater than 14 days, and removals. According to MSPB officials, the  system is designed to require an individual to choose a path of review to  the exclusion of other paths. Depending on the claims raised, there may  be multiple levels of review of a single action before multiple fora.  However, there is only one hearing at the administrative level; therefore,  the timeline to resolve an adverse action appeal can be longer than the  initial appeal and PFR.

According to MSPB officials, the selected CHCOs, and the subject-matter  experts we interviewed, agencies most often make the following errors  which may cause MSPB to reverse the adverse action decision:

Failure to follow procedures by agency: MSPB may overturn an  adverse action decision if the agency did not adhere to the processes  set out in statute and regulation. This most often means that the  agency did not give the employee a chance to respond to the adverse  action charge or did not notify them of their rights to an attorney.

Failure to follow procedures by deciding official: An action may be  vulnerable to a modification or reversal upon appeal if the deciding  official did not fulfill their role appropriately in weighing the evidence  through a Douglas Factors analysis.

Ex parte communications: A challenge may be overturned if a  deciding official gave consideration to any issue not in the proposal  letter.

Incorrect labeling (or charge): Nothing in law or regulation requires  an agency to attach a label to a charge of misconduct. However, if  labels are used, they must be proven. An example used by MSPB  provides that if an agency uses the label of “theft” as its charge, then  the agency must prove that the employee “intended to permanently  deprive the owner of possession” of the item in question. Experts  told us that MSPB requires agencies to prove all legal aspects of a  misconduct label.

Federal courts have held that it is impermissible to allow the official who  makes the final decision in a removal proceeding to rely on aggravating  factors regarding either the alleged offense or the proposed penalty that  were not contained in the notice, and to which the employee did not have  an opportunity to respond. MSPB is bound by this precedent.

Alternative Disciplines Can Help Agencies in Determining the Appropriate Response to Misconduct but Several Factors Affect How Agencies Respond

Alternative discipline is an approach to address misconduct that is  available to agencies in lieu of traditional penalties (e.g., letters of  reprimand and suspensions of 14 days or less). According to MSPB,  agencies may choose to offer alternative discipline at any stage of the  disciplinary process. OPM officials said alternative disciplines tend to be  more focused on taking a corrective or remedial response rather than  punitive actions against an employee. In a report on alternative discipline,  MSPB states that alternative discipline can take many forms and is an  effort undertaken by an employer to address employee misconduct using  a method other than traditional discipline.

As an alternative discipline approach, it is recommended by MSPB that  agencies may consider entering into an agreement with an employee. In  general, such an approach involves a legally binding written agreement  between the employee and the agency addressing an act of misconduct.  If the employee violates the agreement, the agency will proceed with  additional or more serious forms of discipline, up to and including  removal. MSPB also recommends that managers and human resources  personnel consult with legal counsel when drafting and implementing an  alternative discipline agreement that requires the employee’s consent,  adding that it is extremely important for agreements to meet certain legal  requirements to form a valid agreement.

We compiled a non-exhaustive list of alternative discipline based on a  literature review and interviews. Subject-matter experts, including the  panel of CHCOs, reviewed this list and they cited benefits and drawbacks  to some of the approaches (see table 1).

MSPB noted in its 2008 report that the specific alternative discipline  approach an agency decides to use should be based on the nature and  severity of the misconduct. According to OPM officials, alternative  discipline approaches are not appropriate for egregious acts of  misconduct or when the employee is remorseless but rather lower level  offenses where an employee may show remorse for the misconduct and  demonstrate that she or he can be rehabilitated. Egregious acts of  misconduct may involve discrimination, reprisal or retaliation, or sexual  harassment. Alternative discipline approaches are also not appropriate  when the employee’s continued presence in the workplace would pose a  threat to the employee or others.

On a case by case basis, an agency may decide to provide counseling or  additional training as appropriate, depending on the facts and  circumstances that address specific acts of minor misconduct.  Additionally, agencies have flexibility in using alternative discipline as a  final effort before taking formal action such as suspension or removal.  However, in its 2008 report, MSPB found that managers had applied  alternative discipline approaches ineffectively, resulting in further  inefficiencies in the civil service. Specifically, MSPB recommended that  managers and human resources personnel consult with legal counsel  when drafting and implementing an alternative discipline agreement that  requires the employee’s consent, adding that it is extremely important for  agreements to meet certain legal requirements to form a valid agreement.  CHCOs and subject-matter experts said managers and supervisors  should coordinate internally with human resources staff, employee  relations, and legal counsel when assessing whether an alternative  discipline approach would result in correcting improper behavior and  ultimately improve their workforce.

Some subject-matter experts we interviewed expressed concern that  workforces would view alternative discipline measures as providing  opportunities for employees to avoid accountability or encouraging similar  negative behaviors from coworkers rather than penalizing the employee  more stringently through a formal adverse action process. These subject- matter experts identified community service, buy-outs, involvement in  process improvements, and clean-slate agreements as approaches that  had this kind of effect. Additionally, some subject-matter experts told us  that alternative discipline approaches such as community service and  paper suspension agreements could have the unintended effect of  benefiting the employee being disciplined. For example, community  service may allow the employee to serve the alternative discipline during  their scheduled duty time instead of performing their regularly assigned  duties. This may require the employee’s co-workers to take on additional  work while the employee serves the alternative discipline. Additionally,  while a paper suspension limits interruption to work production, it also  allows the employee to work in a pay status while carrying out the  suspension. According to feedback we received from the CHCOs, some  of these alternative discipline approaches were used more often than  others and some approaches were more effective at addressing  employee misconduct. We did not evaluate how often or the extent to  which any of these approaches are used at agencies, nor did we consider  the propriety or legality of these approaches.

According to the CHCOs and subject-matter experts, agency managers  and supervisors may be able to effectively resolve employee misconduct  cases through the use of alternative approaches, which can shorten the  timeline and simplify the adverse action process in a manner that has the  most potential to prevent additional harm to the workplace and avoid the  potentially high costs of litigating a misconduct case.

Several Factors Can Affect Whether and How an Agency Addresses Employee Misconduct

Current and former agency officials and subject-matter experts we  interviewed told us in interviews that several factors can affect whether  and how an agency responds to misconduct. Both agency officials and  subject-matter experts told us that supervisors may not report misconduct  due to fear that an employee could counter with their own complaint.  Several CHCOs and subject-matter experts told us that an agency’s  approach to dealing with misconduct can influence how first-line  supervisors act. In a recently released MSPB publication that highlighted  selected results of its 2016 Merit Principle survey of managers and  supervisors about challenges to addressing employee misconduct, 80  percent of managers and supervisors agree to some extent or a great  extent that their agency’s culture poses a challenge when attempting to  remove an employee for serious misconduct. Additionally, MSPB’s  report provided the perspectives of managers and supervisors regarding  the factors that affect how agencies address misconduct, including

77 percent of managers/supervisors agree to some extent or a great  extent that they do not feel supported by their agencies’ senior  leadership in their actions to remove an employee for serious  misconduct.

88 percent of managers/supervisors somewhat or strongly agree that  some supervisors do not manage their employees’ conduct because  the supervisors want to avoid conflict.

64 percent of managers/supervisors agree to some extent or a great  extent that they do not fully understand the process to remove an  employee for misconduct.

MSPB’s 2016 survey findings were consistent with what agency officials  and subject-matter experts told us during interviews.

Removal Actions for Misconduct Taken Under Chapter 75 Are Relatively Rare

Our analysis of OPM data from fiscal year 2006 to 2016 shows that, on  average, agencies disciplined approximately 17,000 or less than 1  percent of the federal workforce per year under Subchapter II of Chapter  75. The number of employees who separate from the federal workforce  for misconduct under alternative means, such as settlements, is not  known and would not be recorded as misconduct in OPM’s EHRI  database, according to agency officials and experts. Many of the CHCOs  and subject-matter experts we interviewed told us that while data around  such cases are not collected government-wide, they believe internal  resolutions using alternative approaches to address misconduct occur  frequently.

Trends in Misconduct Removals Are Associated with Fluctuations in Probationary Employee Numbers

According to EHRI data, as the number of probationary employees  fluctuated over time, the number of terminations generally followed the  same trend. One of the likely reasons for this fluctuation is that  probationary employees are more likely to be terminated than career  employees who are no longer in a probationary status because  probationary employees are not yet subject to the Chapter 75 process  protection afforded career employees.

Similar to addressing performance issues, it is generally easier to  terminate employees for misconduct during the probationary period. As  we previously reported, the probationary period is an important  management tool to evaluate the conduct and performance of an  employee and should be treated as the last step in the hiring process.  According to OPM, appropriate actions taken within the probationary  period are the best way to avoid long-term problems.

The Most Widely Used Form of Formal Discipline for Misconduct Is Suspension; Approximately One-Fourth of Suspended Employees Have Multiple Suspensions

Our data analysis of personnel actions against employees for misconduct  shows that the most common form of discipline is suspension. In 2016,  agencies made 10,249 suspensions, 7,411 removals, and 114 demotions  for misconduct (the numbers refer to the number of adverse actions that  agencies made in 2016, not the number of employees that received  adverse actions; one employee can be suspended multiple times, and  each suspension is recorded as a separate personnel action in the  employee’s SF-50). The data we analyzed indicated that approximately  one-fourth of suspended employees have multiple suspensions.  According to OPM officials, third parties such as the MSPB will review  whether disciplinary actions are taken “only for such cause as will  promote the efficiency of the service” which includes the assessment of  the relevant Douglas factors.

Figure 5 shows how many suspensions, demotions, and removals took  place from fiscal years 2006 to 2016 according to EHRI data.

Better Data on Employee Misconduct Could Strengthen OPM’s Oversight and Provide Clarity to Agencies Regarding How to Address Misconduct

OPM collects data on personnel actions reported by most agencies and  stores this information in the EHRI database, but these data could be  improved to provide OPM with better information to help agencies  address misconduct. Because not all misconduct data are entered into  the database, the data presented in this report do not represent the  entirety of employee misconduct instances that occur in the federal  government. Personnel actions in the EHRI database originate from  data that agencies send to OPM through the Standard Form 50 (SF-50),  a form that documents personnel actions. OPM officials told us that lesser  disciplinary actions such as a letter of reprimand are not documented by  an SF-50. Without maintaining comprehensive data regarding the extent  and nature of misconduct in the federal government, OPM risks missing  opportunities to provide agencies with guidance and other tools, such as  targeted training to help agencies better address cases of misconduct.  Indeed, better data could help OPM and agencies identify systemic  misconduct issues, such as misuse of government property or physical  aggression toward a co-worker, as well as emerging problems that benefit  from early detection and/or more comprehensive approaches.

It should be noted that for the codes that indicate performance or  misconduct as the underlying cause for the adverse action, it is not  possible to make a clear distinction between whether the action was  specifically related to misconduct, performance, or a mix of the two.  Therefore, some cases include a mix of employee poor performance and  misconduct. OPM officials said they do not have a sense of how  frequently agencies use these (and other non-specific) nature of action  (NOA) codes for misconduct-related actions. According to OPM officials,  by establishing rules in terms of improving the efficiency of the service  and the types of actions that will require specific procedures, Congress  provided managers with maximum flexibility to pursue adverse actions  whenever it would promote the efficiency of the service, whether the  underlying impetus was a conduct issue or a failure to perform.

OPM officials told us the Guide to Processing Personnel Actions directs  agencies to indicate the nature of personnel actions in the EHRI database  through the NOA codes. These codes indicate the employee type, the  nature of the personnel action to be recorded in EHRI, as well as the  underlying cause (e.g., conduct or performance) for the personnel action.  OPM performs validity checks on the NOA codes and legal authorities to  assure the agencies are compliant with OPM reporting  requirements. OPM also periodically reviews agencies’ use of NOA codes  and legal authorities in general.

The EHRI database does not collect or store the specific type of  misconduct—only that the personnel action belongs in the misconduct  category. Several CHCOs and subject-matter experts who we interviewed  agreed this flexibility is helpful to agencies. For example, officials said that  while common types of misconduct exist, such as time-and-attendance  infractions, many unique types of misconduct cannot be placed into easily  identifiable categories. The officials added that it would be easy for  agencies to mislabel misconduct. For instance, OPM officials said that  disobeying an agency’s policy or rules could manifest itself in many  different ways.

Moreover, we found inconsistencies in the data OPM provided. For  example, during this review, we initially used stored EHRI data from  previous audits for fiscal years 2006 to 2014. We used NOA codes  provided by OPM officials to analyze employee misconduct data in the  executive branch. When we compared the results of our data analysis for  this period to the data OPM provided for the same period, we found their  data identified approximately 500 more adverse actions per year. Though  we consulted with OPM, we were unable to resolve these differences.  OPM officials noted that agencies submit data on a rolling basis and may  later correct it, and, some SF-50 forms are filed after the fiscal year ends,  so our stored data may not include these actions.

According to OPM officials, agencies generally have day-to-day oversight  for determining use of NOA codes and legal authorities. Agencies are  required to report a valid NOA code and legal authorities that is found in  OPM’s Guide to Data Standards. Guidance to agencies for classifying  misconduct into the correct nature of action codes is provided in The  Guide to Processing Personnel Actions. Although OPM verifies that  agencies provide valid NOA codes in their data, they assert that agencies  have responsibility for determining which NOA codes to use for each  personnel action based on OPM documentation.

As we noted in a 2017 report on federal human resources data, OPM  developed EHRI to (1) provide for comprehensive knowledge  management and workforce analysis, forecasting, and reporting to further  strategic management of human capital across the executive branch; (2)  facilitate the electronic exchange of standardized human resources data  within and across agencies and systems and the associated benefits and  cost savings; and (3) provide unification and consistency in human capital  data across the executive branch.

An important part of OPM’s role is to support federal agencies’ human  capital management activities, which includes ensuring that agencies  have the data needed to make staffing and resource decisions to support  their missions. EHRI data are essential to government-wide human  resource management and evaluation of federal employment policies,  practices, training, and costs. The ability to capitalize on this information  is dependent, in part, on the reliability and usefulness of the collected  data. According to Federal Internal Control Standards, management is to  obtain relevant data from reliable internal and external sources in a timely  manner based on the identified information requirements.

More specific guidance from OPM to agencies on which NOA codes to  use for misconduct cases will increase confidence in the data, without  requiring practitioners to capture and tabulate the type of misconduct.  More importantly, enhanced data on the extent and nature of misconduct  will improve OPM’s oversight ability and agencies’ ability to target  management training and identify specific trends in misconduct.

Most MSPB Appeals Are Resolved by the Parties, Which Benefits Both the Agency and Appellant, According to Officials

Our analysis of MSPB data found that the most frequent appeal outcome  is a settlement. MSPB said settlements often benefit both the agency and  the appellant because they manage risk. The officials said that when  entering an adverse action appeal with MSPB, both the agency and the  appellant face a risk: the agency is at risk of spending time and money for  litigation only to, in some cases, have its decision overturned; the  appellant is at risk of being removed from his or her position with a  permanent mark on his or her record, which may make finding another  job difficult. To avoid these outcomes for both parties, an agency may  offer the employee a variety of settlement options to incentivize them to  willingly leave. Settlement options may include, but are not limited to back-pay for the time that the employee was out of work, but still  litigating the appeal; and paying the employee’s attorney fees.

OPM notes, on the other hand, that the MSPB’s data might not always  reflect voluntary settlements. According to OPM officials, the MSPB has a  large caseload and typically strives to induce the agency to settle. OPM  officials noted that the pressure to settle cases regardless of merit after  the agency has made the determination that discipline is necessary and  has gone through the procedure to carry it out may be one of the most  significant deterrents to dealing with misconduct or performance under  Chapter 75.

Figure 6 shows the number of MSPB appeals that were filed from fiscal  years 2006 to 2016 that were affirmed, reversed, settled, or dismissed.

We also analyzed data from MSPB’s database of appeals cases. MSPB  hears appeals from those adverse actions that Congress made  appealable under Subchapter II of chapter 75, including suspensions of  greater than 14-days, demotions, and removals. These actions can be  taken for performance problems as well as misconduct under Chapter  75—MSPB does not differentiate between performance and misconduct  in its database. Rather, the agency categorizes its cases by legal  authority. Therefore, similar to OPM’s EHRI data, any analysis with  MSPB’s data may include performance appeals as well as misconduct  appeals under Chapter 75.

Key Steps Agencies Can Take to Better Prevent and Address Employee Misconduct

On the basis of our literature review, as well as interviews with CHCOs  and subject-matter experts, we identified key promising practices and  lessons learned that can help agencies better prevent and address  employee misconduct. These key practices include tables of penalties,  engaging employees, making full use of the probationary periods, and  maintaining effective lines of communication and collaboration between  the human resources office staff, line-level management, and agencies’  legal counsel. Going forward, it will be important for OPM and agencies,  in concert with the CHCO Council to examine each of these practices and  lessons learned, refine, as appropriate, and share how best to implement  these practices.

Tables of Penalties Can Help Guide Responses to Misconduct

We found that tables of penalties—a list of recommended disciplinary  actions for various types of misconduct—though not required by statute,  case law, or OPM regulations, nor used by all agencies, can help ensure  the appropriateness and consistency of a penalty in relation to an  infraction. Further, tables of penalties can help ensure the disciplinary  process is aligned with merit principles because they make the process  more transparent, reduce arbitrary or capricious penalties, and provide  guidance to supervisors.

According to the panel of CHCOs and the subject-matter experts we  interviewed, a table of penalties may also provide information on the  period over which offenses are cumulative, for purposes of assessing  progressively stronger penalties. The officials described tables of  penalties as a listing of common infractions committed most frequently by  agency employees, along with a suggested range of penalties for first,  second and third offenses; however, the range of penalties should not be  too broad, and the penalties should be progressive, meaning that they  increase in harshness with each subsequent offense committed by the  employee. The CHCOs and subject-matter experts said a table of  penalties should also provide sufficient flexibility in the penalty range  (e.g., 1-day to 5-day suspensions for a first offense) to consider mitigating  and aggravating factors when considering discipline for misconduct. OPM  officials stated that where an agency elects to have a table of penalties, it  should serve as a guide in addressing misconduct, noting that it does not  serve as a substitute for management’s judgment. According to OPM  officials, management must take into account the applicable Douglas  Factors, and must consider other appropriate circumstances not covered  by the Douglas Factors. Neither OPM nor MSPB provide any written  guidance to agencies in developing their tables of penalties. However,  OPM officials told us their agency is available to provide assistance upon  request to agencies that elect to use a table of penalties.

Views on the usefulness of the tables of penalties were mixed among  agency officials and subject-matter experts. On the one hand, some  agency officials and other subject-matter experts told us the table of  penalties can assist agencies in determining an appropriate penalty and  ensure consistency of penalty selection from case to case. For that  reason, they said the tables can also help ensure the action taken is  legally defensible based on past similar cases. MSPB officials told us that  they believe table of penalties, which rely on the Douglas Factors, can  help human capital practitioners when making decisions about employee  misconduct cases. On the other hand, several subject-matter experts and  agency officials, including OPM, indicated that table of penalties tend to  be too broad in the range of penalties for individual offenses, which they  said ultimately limited their usefulness in the decision-making process.

OPM officials said their agency does not use a table of penalties nor does  it support encouraging agencies to establish tables of penalties.  According to OPM officials, where table of penalties exist, they are  established at an agency’s discretion and not under OPM’s auspices.  OPM officials believe agencies have the ability to address misconduct  appropriately without a table of penalties and with sufficient flexibility to  determine the appropriate penalty for each instance of misconduct.  Further, OPM officials said that agencies that adopt a table of penalties  will be required to consider its table of penalties, if applicable, as part of  the MSPB’s Douglas Factors analysis which, in their view, imposes an  additional condition on the agency’s ability to defend its actions. Finally,  OPM said there is no substitute for management judgment and that tables  of penalties should not be applied so inflexibly as to impair consideration  of other factors relevant to the individual case.

In short, tables of penalties, if drafted at an appropriate level of detail and  used in conjunction with the Douglas Factors and other case-specific  forms of discretion, could provide agencies with reasonable assurance  that similar cases of misconduct are addressed with similar penalties as  appropriate, and can reduce the risk of inconsistently and potentially  unfairly applying remedial measures.

Set Clear Expectations and Engage Employees

Agency officials and subject-matter experts told us that having effective  agency policies and programs that set clear expectations around behavior  and that engage employees may help reduce the number of misconduct  incidents that occur. These policies and programs may also mitigate the  damage when an incident does occur. Several subject-matter experts  said that agencies should set formal expectations early and reinforce  these expectations throughout an employee’s career. To this point, as we  discussed in our 2015 report on addressing substandard employee  performance, when addressing misconduct agencies should help  managers and supervisors take appropriate action if misconduct occurs  during an employee’s probationary period.

Some subject-matter experts indicated that agencies may also consider  conducting more thorough job screening and hiring processes which  could help determine if the individual is a good fit for their agency.  Specifically, the subject-matter experts mentioned that agencies should  take a closer look at a prospective employee’s work history and carefully  check references. We also learned from our interviews that, as a  deterrent, agencies must clearly communicate that an employee will be  held accountable for any acts of misconduct.

According to OPM, agencies can mitigate the risks of these difficulties by  establishing a well-trained, experienced, and empowered employee and  labor relations staff. OPM said these individuals play a crucial role in  educating supervisors and managers in taking appropriate and  sustainable disciplinary actions. CHCOs and subject-matter experts  provided a number of key promising practices that an agency can use to  mitigate and address employee misconduct, including:

Demonstrating positive conduct at the agency’s senior leadership  (tone at the top): Through policies and their own individual actions,  senior leaders must exhibit positive workplace behavior as an  example to agency employees.

Maintaining a good workplace atmosphere: Agencies should take  steps to monitor workforce morale and initiate programs that  encourage respect and community.

Engaging employees by connecting them directly to the agency’s  mission: Employees should have a sense of purpose and commitment  toward their employer and its mission which can lead to better  organizational performance.

Making full use of the probationary period for employees: Supervisors  should use probationary periods as an opportunity to evaluate an  employee’s performance and conduct to determine if an appointment  to the civil service should become final.

Setting and communicating clear rules and expectations regarding  employee conduct: Agencies should set expectations about  appropriate conduct in the workplace and communicate  consequences of inappropriate conduct at the earliest possible time  after on-boarding an employee.

Assuring that employees conform to any applicable standards of  conduct: Supervisors and managers, with the support of their  agencies’ leadership and human resources staff, should train and  monitor employee compliance with its stated conduct policies.

Maintaining effective lines of communication and collaboration with  the human resources office staff, line-level management, and  agencies’ legal counsel: Agencies should establish clear lines of  communication across relevant offices to ensure misconduct cases  are addressed effectively and consistently.

Conducting on-going training for supervisors and holding them  accountable for addressing misconduct in a timely manner when it  occurs: Supervisors should be trained in identifying employee  misconduct cases and knowledgeable about the process for  addressing such cases.

More Effective Training Could Help Supervisors Identify and Deal with Misconduct

MSPB and OPM officials as well as subject-matter experts said human  resources staff and line-level supervisors and managers would benefit  from additional training in how to address employee misconduct. The  subject-matter experts told us that managers do not receive sufficient  training in how to identify and subsequently deal with misconduct in the  workplace. Specifically, subject-matter experts told us that many  supervisors and managers do not understand the requirements needed to  remove an employee for misconduct, including misconceptions about the  standard of proof required. Many subject-matter experts repeated  observations MSPB made in its 2008 report that without sufficient training  managers and supervisors may find it difficult to engage in challenging  one-on-one conversations with an employee about misconduct.

Agency officials and subject-matter experts also told us that supervisory  training varies by agency. Our subject-matter experts said some agencies  are more structured and provide staff with training curricula with required  timetables to complete, while others rely on staff to self-guide the training  they need. We found many agencies contract out specific training or  provide learning opportunities to staff on their intranet sites via e-learning  tools. Most subject-matter experts said that misconduct training is likely  more effective when delivered in-person, due to the broad range of issues  related to misconduct.

OPM officials told us that supervisors and managers are responsible for  observing and enforcing applicable laws in the federal workplace. OPM  officials also indicated that training, resource allocation, skills, and  knowledge all have a bearing on the administration of the disciplinary  process. According to OPM, good communication and partnerships are  also critical to processing a solid, sustainable response related to  misconduct. OPM guidelines require that agencies provide training when  employees make critical career transitions, for instance from  nonsupervisory to manager or from manager to executive. Further,  OPM’s Supervisory and Managerial Curriculum Framework highlights  human resources technical areas and leadership competencies  necessary for success. The curriculum framework includes employee and  labor relations with supporting learning objectives.

OPM has specific regulatory requirements for training and development of  supervisors, managers, and executives under 5 CFR § 412.202, including  to provide training within 1 year of an employee’s initial appointment to a  supervisory position and follow up periodically, but at least once every  3 years, by providing each supervisor and manager additional training  on the use of appropriate actions, options, and strategies:  improve employee performance and productivity;  conduct employee performance appraisals in accordance with agency  appraisal systems; and  identify and assist employees with unacceptable performance.

According to 5 U.S.C. § 4103, it is the responsibility of each agency to  train its employees. According to OPM officials, it is not responsible under  the CSRA for providing training for the federal workforce. However, while  agencies are accountable for providing required training for their  supervisors, OPM has a key role in ensuring the training meets the  government-wide needs of supervisors. By taking steps to help agencies  improve the training they provide supervisors and managers on  addressing misconduct, OPM could help those managers ensure they  have the knowledge and skills to effectively deal with misconduct in the  workplace. For example, OPM could consider the feasibility of developing  more in-person training modules designed to provide interactive or role  play scenarios around addressing employee misconduct. Furthermore,  subject-matter experts said if an agency is not training new supervisors to  equip them with the appropriate skills to address misconduct, there may  be inconsistencies in how an agency handles misconduct across the  agency. Without sufficient training, supervisors and managers may not be  addressing misconduct appropriately, if at all.

Internal Collaboration Can Help Agency Components Better Communicate about Misconduct Cases

Many of the subject-matter experts we interviewed said that it is important  that the primary stakeholders—first-level supervisors and managers and  human resources and general counsel offices—collaborate on the  agency’s approach to dealing with misconduct.

We found agencies vary in how collaboration takes place. For example,  some subject-matter experts and CHCOs told us that an agency may  choose to handle a case by having their human resources staff and  management work closely together. The subject-matter experts we  interviewed said this collaboration can sometimes include general  counsel staff, if necessary. For example, at EPA, the human resources  office collaborates with the office of general counsel and the agency’s  Office of Inspector General Office of Investigations (OI). EPA officials told  us that their agency’s human resources office, OI, general counsel, and  labor relations meet bi-weekly to discuss ongoing misconduct  investigations to provide a report of investigations to EPA’s senior  management on the facts surrounding allegations of employee  misconduct.

According to EPA, OI also provides real-time notification whenever OI  receives information concerning serious misconduct, before the  investigation is completed, so EPA management can take appropriate  immediate mitigating steps, should it be necessary. However, OI does not  have a role in determining the type of discipline, if any, to be imposed  upon the employee, nor does OI have any role in helping to prevent  misconduct in EPA’s workplace. We did not obtain data to verify that this  process has been successful, but agree that enhanced communication  among key stakeholders is important to addressing misconduct.

An Agency’s Culture and Mission Can Impact How Agencies Approach and Respond to Misconduct

Most of our subject-matter experts told us an agency’s culture and the  nature of its work play a significant role in how the agency addresses  employee misconduct. For example, several subject-matter experts told  us law enforcement and defense-related agencies or other particular jobs  where injuries may occur or lives may be at risk often have significantly  less tolerance for employee misconduct than other agencies. In addition,  OPM officials said that according to MSPB past studies, if an agency  views federal employee due process procedural rights as burdensome  and restrictive, this may discourage supervisors from addressing  misconduct as it occurs. An MSPB report addressed concerns that the  culture in many federal agencies prevents them from effectively dealing  with problem employees. Many of the subject-matter experts we  interviewed indicated that if an agency’s culture is risk averse, it may be  less aggressive in pursuing adverse actions, and instead either ignore  misconduct or reassign an employee without holding him or her  accountable for the misconduct.

The process for dismissing an employee for misconduct can be complex  and lengthy. However, many of these process challenges can be avoided  or mitigated with effective performance management. Supervisors who  take performance management seriously and have the necessary training  and support to address misconduct can help employees either change  their conduct or be subject to removal from the federal workforce.

OPM has a role in ensuring that agencies have the tools and guidance  they need to effectively address misconduct and maximize the  productivity of their workforces. Though OPM already provides a variety  of tools, guidance, and training to help agencies address issues related to  misconduct, we found opportunities to do more to identify the nature of  employee misconduct, improve training tools for managers, and make  tools and guidance available for agencies when and where they need it.

We are making the following three recommendations to the Director of  OPM:

The Director of OPM, after consultation with the CHCO Council,  should explore the feasibility of improving the quality of data on  employee misconduct by providing additional guidance to agencies on  how to record instances of misconduct in OPM’s databases.  (Recommendation 1)

The Director of OPM, after consultation with the CHCO Council,  should broadly disseminate to agencies the promising practices and  lessons learned, such as those described in this report, as well as  work with agencies through such vehicles as the CHCO Council, to  identify any additional practices. (Recommendation 2)

The Director of OPM, after consultation with the CHCO Council,  should provide guidance to agencies to enhance the training received  by managers/supervisors and human capital staff to ensure that they  have the guidance and technical assistance they need to effectively  address misconduct and maximize the productivity of their workforces.  (Recommendation 3)

We provided a draft of this product to the Acting Chairman of MSPB and  Acting Director of OPM for comment. The Acting Chairman of MSPB  provided technical comments on the draft. We incorporated these  comments, as appropriate. MSPB did not comment on the  recommendations.

OPM’s Associate Director for Employee Services provided written  comments on the draft, and these comments are reproduced in appendix  III. In its comments, OPM noted that while we had made many of the  changes OPM suggested, the changes still did not reflect all of OPM’s  feedback, and also contained what it believed to be inaccurate  information and incomplete representations of OPM’s views. To the  contrary, we maintain that our report contains accurate factual information  and represents the views of OPM that we collected through reviewing  documents, interviewing OPM officials, and incorporating OPM’s written  feedback. Of our three recommendations, OPM partially concurred with  two recommendations, and did not concur with one recommendation. For  those recommendations OPM partially concurred with, OPM described  the steps it planned to take to implement them. We stand by our  recommendations which we maintain would give OPM and Congress  better visibility over the extent and nature of employee misconduct in the  federal government, as well as help strengthen agencies’ capacity to  address misconduct.

With respect to OPM’s overall comments, OPM noted that Chapter 75 is a  set of procedural requirements that must be met when certain actions are  contemplated that would impact an employee’s pay, specifying that it was  never intended to encompass or catalogue all forms of action an agency  could take to address misconduct. On this issue, we agree with OPM on  the purpose of Chapter 75 and noted as much in our description of the  statutorily established guidelines and procedures throughout this report.  OPM also noted that there is no general statutory definition of  misconduct, and that managers need maximum flexibility to pursue  adverse actions, whether the underlying impetus is a conduct issue, a  failure to perform, or any other reasons related to federal employment.  We also agree with OPM on this point, as our report makes clear that, in  certain cases, employee performance and misconduct can overlap,  conflating the two issues.

As indicated in this report, OPM believes a table of penalties creates  additional conditions and restrictions on an agency’s ability to address  misconduct and does not improve the agency’s ability to address  misconduct effectively. Accordingly, OPM does not require or encourage  agencies to adopt tables of penalties. Our report recognizes both the pros  and cons of an agency having a table of penalties and the circumstances  under which they could be effective. However, we believe the use of a  table of penalties ensures the appropriateness and consistency of a  penalty in relation to the charge. It also ensures merit system principles  guide the process by providing penalty transparency, reducing arbitrary or  capricious penalties, and serve as a guide for managers and supervisors  who deal with these issues.

With respect to our recommendations, OPM did not concur with our first  recommendation to explore the feasibility of improving the quality of data  on employee misconduct by providing additional guidance to agencies on  how to record instances of misconduct in OPM’s databases. Specifically,  OPM noted that the OPM Guide to Processing Personnel Actions is a  thorough resource that has been and continues to be successfully relied  upon by agencies to document adverse actions as expressly defined in  Chapter 75. We acknowledge OPM’s view that NOA codes were never  intended or designed to allow reporting of adverse actions down to the  degree of a particular kind of misconduct involved, but we maintain that  our recommendation would increase confidence in the data on  misconduct and make it more useful to OPM and agencies. Further,  OPM’s non-concurrence with this recommendation seems inconsistent  with the Administration’s own initiatives, including the May 2018  Executive Order Promoting Accountability and Streamlining Removal  Procedures Consistent with Merit System Principles, which was released  after OPM commented on our draft report. Specifically, the Executive  Order requires all federal agencies, beginning in FY18, and for each fiscal  year thereafter, to provide a report to the OPM Director containing  detailed data about how it addressed issues of misconduct. For example,  agencies will need to report out on  (i)  the number of civilian employees in a probationary period or otherwise  employed for a specific term who were removed by the agency;  (ii)  the number of adverse personnel actions taken against civilian  employees by the agency, broken down by type of adverse personnel  action, including reduction in grade or pay (or equivalent), suspension,  and removal; and  (iii) the number of decisions on proposed removals by the agency taken  under chapter 75 of title 5, United States Code, not issued within 15  business days of the end of the employee reply period.

We maintain that enhanced data on the extent and nature of misconduct  will help strengthen OPM and congressional oversight and better position  agencies to address misconduct through management training and other  approaches.

OPM partially concurred with our second recommendation to broadly  disseminate to agencies the promising practices and lessons learned,  such as those described in this report, as well as work with agencies  through such vehicles as the CHCO Council, to identify any additional  practices to help agencies better address employee misconduct. Indeed,  the President’s Management Agenda (PMA) for 2018 states, “Aligning  and managing the Federal workforce of the 21st Century means  spreading effective practices among human resources specialists.” In  response to this recommendation, OPM noted that some of the key practices and lessons discussed in this report are already part of OPM’s  comprehensive accountability toolkit in addressing employee misconduct  across the federal government and are frequently communicated through  on-going educational outreach to federal agencies and available on  OPM’s website. Specifically, OPM said it will decide which appropriate  measures it should take to obtain examples of practices agencies believe  are promising and will broadly disseminate any of these practices and  lessons learned as identified by OPM. We acknowledge OPM’s existing  efforts to develop and disseminate promising practices and lessons  learned, and also maintain that OPM should also be open to considering  additional practices from other sources.

OPM also partially concurred with our third recommendation to provide  guidance to agencies to enhance the training received by  managers/supervisors and human capital staff to ensure that they have  the guidance and technical assistance they need to effectively address  misconduct and maximize the productivity of their workforces. In its  response, OPM said it will continue to play its statutory role under 5  U.S.C. Chapter 41 and will support agencies on a cross-agency priority  goal, which it believes could be read to encompass training, pursuant to  the PMA, for example by providing guidance to agencies on training  requirements for managers, supervisors and human resources staff.  However, OPM notes that it is not responsible under current statute for  providing training to the federal workforce. As stated in the report, while  agencies are accountable for providing required training for their  supervisors, OPM has a key role in ensuring the training meets the needs  of supervisors. Further, OPM’s position on this recommendation seems  inconsistent with the Administration’s own initiatives, including the May  2018 Executive Order which states that “the OPM Director and the Chief  Human Capital Officers Council shall undertake a Government-wide  initiative to educate Federal supervisors about holding employees  accountable for unacceptable performance or misconduct under those  rules,” following any final rules issued pursuant to parameters set in the  Order. Indeed, the PMA states, “In order to best leverage the workforce to  achieve our mission efficiently and effectively, Government needs to  remove employees with the worst performance and conduct violations.”  By taking steps to help agencies improve the training they provide  supervisors and managers on addressing misconduct, OPM could help  those managers ensure they have the knowledge and skills to effectively  deal with misconduct in the workplace.

OPM also provided technical comments, which we have incorporated as  appropriate.

As agreed with your office, unless you publicly announce the contents of  this report earlier, we plan no further distribution until 30 days from the  report date. At that time, we will send copies to the Director of the Office  of Personnel Management, the Chairman of the Merit Systems Protection  Board, as well as to the appropriate congressional committees and other  interested parties. In addition, the report will be available at no charge on  the GAO website at http://www.gao.gov.

If you or your staff have any questions about this report please contact  me at (202) 512-2757 or goldenkoffr@gao.gov. Contact points for our  Offices of Congressional Relations and Public Affairs may be found on  the last page of this report. GAO staff who made key contributions to this  report are listed in appendix IV.

Appendix I: Objectives, Scope, and Methodology

You asked us to examine the process for addressing misconduct and to  identify any challenges in removing employees for misconduct. Our  objectives were to (1) describe the process that agencies are generally  required to follow in responding to employee misconduct in the federal  service; (2) identify alternative approaches to the formal legal process  that agencies can use to respond to misconduct, and assess what factors  affect agencies’ responses; (3) describe trends in removals and other  adverse actions resulting from misconduct; and (4) identify key steps  agencies can take to help them better prevent and address misconduct.

To describe the process that most agencies are generally required to  follow in responding to employee misconduct in the federal service, we  reviewed relevant sections of Title 5 Chapter 75 of the U.S.C. (herein  Chapter 75) which contains the statutory process for formally disciplining  employees for misconduct and performance. We also reviewed the Civil  Service Reform Act and OPM regulations to describe and determine the  authority agencies have to address employee misconduct in the federal  service, including formal procedural and employee appeal rights.  Additionally, we reviewed 5.U.S.C. §§ 7701 and 7702 (herein Chapter  77), which contains the statutory process for employee appeals with the  Merit Systems Protection Board (MSPB) subsequent appeals to the Equal  Employment Opportunity Commission (EEOC).

5 U.S.C. § 7701(a)-(b); 5 U.S.C. § 7702(b). counted the outcomes of the cases from 2006-2016, by year and in  aggregate (e.g. out of the total number of cases, how many were  reversed, upheld, mitigated, or settled). For the purpose of our analysis,  we used the following nature of action (NOA) code categories in OPM’s  EHRI database: (1) codes directly attributed to misconduct; and (2) codes  that indicate a mix of misconduct or poor performance. Based on data  limitations in both databases, we did not make any evaluative  assessments from our data analysis.

To identify alternative approaches to the formal legal process, we  reviewed documentation provided by the Merit System Protection Board  (MSPB) on alternative discipline approaches used by agencies to address  employee misconduct. We also reviewed OPM regulations and  documents to determine the authority agencies have to address  employee misconduct in the federal service, including formal procedural  and employee appeal rights. We interviewed current and former  practitioners, subject-matter experts, and academics to identify alternative  approaches that they were aware of or were commonly used at agencies  to address employee misconduct.

To develop our list of alternative discipline approaches to addressing  employee misconduct, we conducted a literature review and reviewed  reports and documents to identify alternative discipline approaches  commonly used to address employee misconduct in the federal sector.  After compiling our non-exhaustive list of alternative approaches, we  contacted our previously interviewed subject-matter experts and asked  them to provide their final thoughts or suggestions to our alternative  discipline approaches. We included those additional approaches to the  list. We interviewed human capital experts from academia, unions, and  former and current human resources practitioners. We also interviewed a  panel of CHCOs to gain insight into the agency perspective on  addressing employee misconduct. To identify CHCO members, we asked  the Director of the CHCO council to select CHCOs that have knowledge  and experience in addressing employee misconduct. Agency size and  mission were also considered as part of the selection process to gain a  range of perspectives. Our panel of CHCOs was from the Departments of  Commerce, Defense, and Housing and Urban Development, the National  Science Foundation, and the Nuclear Regulatory Commission. We also  reviewed prior work by MSPB in developing our list of commonly used  alternative discipline approaches to employee misconduct in the federal  sector.

To describe and assess the factors that can affect an agency’s response  to employee misconduct, we interviewed:

OPM officials and representatives from Employee Services, Human  Resources Solutions, Planning and Policy Analysis, and the Office of  the Chief Information Officer

MSPB officials from the Office of the acting Chairman & Vice  Chairman, Office of Information Resources Management, and the  Office of Policy & Evaluation;

Panel of Chief Human Capital Officers (CHCO)

National Treasury Employees Union officials;

American Federation of Government Employees officials;

Federal Managers Association officials;  Individual members of the Federal Employees Lawyers Group;

Partnership for Public Service officials;

Senior Executives Association officials; and

Selected individuals with expertise in human capital management,  specifically focused on employee misconduct, from academia and the  private sector.

We selected our list of interviewees based on GAO’s guidance for  selecting experts, the interviewees’ practical experience in applying and  practicing administrative law, and for academics in their specific areas of  research. To assess the factors that agencies use to deal with employee  misconduct, we analyzed the interviewee responses and identified key  themes that were common throughout our interviews and, we counted the  frequency of those key themes.

To describe the trends in removals and adverse actions resulting from  misconduct at Chief Financial Officer (CFO) Act agencies, we analyzed  OPM’s Enterprise Human Resource Integration (EHRI) data from fiscal  years 2006 to 2016.

The 24 CFO Act agencies are listed at 31 U.S.C. § 901(b) and include: U.S. Departments  of Agriculture, Commerce, Defense, Education, Energy, Health and Human Services,  Homeland Security, Housing and Urban Development, the Interior, Justice, Labor,  Transportation, the Treasury, Veterans Affairs, and State, as well as the U.S. Agency for  International Development, Environmental Protection Agency, General Services  Administration, National Aeronautics and Space Administration, National Science  Foundation, Nuclear Regulatory Commission, Office of Personnel Management, Small  Business Administration, and the Social Security Administration. These agencies account  for a very high proportion of the total federal labor force.

For reporting purposes, we only provide data on the number of adverse actions rather  than use the number of employees subject to an adverse action, because one employee  may be subject to more than one adverse action. This can be a result of progressive  discipline or could indicate issues related to data reliability. As part of our analysis, we  identified all employees subject to each type of adverse action (removal, suspension, and  demotion) and quantified the number of similar adverse actions taken against the same  person.   5 U.S.C. §§ 7502 and 7512. probationary employees to provide some relative statistics. To show  trends in misconduct removals associated with probationary employees,  we identified the number of adverse actions taken against probationary  employees (overall and by type of action).

To determine the trends in employee appeals to MSPB, we analyzed  MSPB’s appeals data, on adverse actions taken under Chapter 75 from  fiscal years 2006 to 2016. To understand what types of adverse actions  are driving appeals to MSPB, we calculated the underlying adverse action  for each case by fiscal year of appeal filing. To determine how appeals  were resolved by MSPB, we identified the number of appeals that were  settled, mitigated, dismissed, reversed, affirmed, or otherwise resolved.  We calculated overall trends by fiscal year as well as trends by fiscal year  for each type of underlying adverse action. To determine how long the  appeals process takes, we calculated the mean time for resolution along  with other statistics (minimum, maximum, 25th percentile, 75th percentile)  for different types of adverse action. Additionally, because appellants can  file a Petition for Review (PFR) to the larger MSPB body, we looked at the  time for the initial appeal, the PFR, and the total time from filing through  final decision.

To assess the reliability of both EHRI and MSPB data, we reviewed past  GAO data reliability assessments, interviewed relevant agency officials,  and conducted electronic testing to evaluate the accuracy and  completeness of the data used in our analyses. We determined the data  used in this report to be sufficiently reliable for our purposes, subject to  the constraints identified in our report.

To identify and provide key promising practices and lessons learned at  agencies from encountering and responding to employee misconduct, we  conducted a literature review to identify practices and lessons learned  associated with employee misconduct in the federal sector. We  interviewed officials from OPM, MSPB, the Equal Employment  Opportunity Commission (EEOC), and the Office of Special Counsel  (OSC), to obtain their perspectives on responding to employee  misconduct through alternative approaches. We interviewed officials from  the Environmental Protection Agency (EPA) to obtain their perspectives  on recent efforts to better coordinate with their Inspector General to  address cases of employee misconduct.  We also obtained the  perspectives of a panel of CHCOs from selected agencies as well as  former human capital practitioners and other subject-matter experts with  extensive experience working on employee misconduct issues.

Appendix II: Douglas Factors –12 Criteria Developed by the MSPB to Guide Agency Decisions on Employee Misconduct

The Merit Systems Protection Board in its landmark decision, Douglas vs.  Veterans Administration, 5 M.S.P.R. 280 (1981), established non- exclusive criteria that supervisors must consider, as appropriate, in  determining an appropriate penalty to impose for an act of employee  misconduct (“The Douglas Factors”). The following relevant factors must  be considered in determining the severity of the discipline:  1.  The nature and seriousness of the offense, and its relation to the  employee’s duties, position, and responsibilities, including whether the  offense was intentional or technical or inadvertent, or was committed  maliciously or for gain, or was frequently repeated;  2.  the employee’s job level and type of employment, including  supervisory or fiduciary role, contacts with the public, and prominence  of the position;  3.  the employee’s past disciplinary record;  4.  the employee’s past work record, including length of service,  performance on the job, ability to get along with fellow workers, and  dependability;  5.  the effect of the offense upon the employee’s ability to perform at a  satisfactory level and its effect upon supervisors’ confidence in the  employee’s work ability to perform assigned duties;  6.  consistency of the penalty with those imposed upon other employees  for the same or similar offenses;  7.  consistency of the penalty with any applicable agency table of  8.  the notoriety of the offense or its impact upon the reputation of the  9.  the clarity with which the employee was on notice of any rules that  were violated in committing the offense, or had been warned about  the conduct in question;  10. the potential for the employee’s rehabilitation;  11. mitigating circumstances surrounding the offense such as unusual job  tensions, personality problems, mental impairment, harassment, or  bad faith, malice or provocation on the part of others involved in the  matter; and  12. the adequacy and effectiveness of alternative sanctions to deter such  conduct in the future by the employee or others. The list was not  intended to be exhaustive.

Appendix III: Comments from the Office of Personnel Management

Appendix IV: GAO Contact and Staff Acknowledgments

Robert Goldenkoff, (202) 512-2757 or goldenkoffr@gao.gov.

In addition to the contact named above, Tom Gilbert, Assistant Director,  and Anthony Patterson, Analyst-in-Charge, supervised the development  of this report. Isabel Band, Crystal Bernard, Jehan Chase, Sara Daleski,  Shirley Jones, Serena Lo, Krista Loose, Amanda Miller, and Kayla  Robinson made major contributions to all aspects of this report. Robert  Gebhart and Robert Robinson provided additional assistance.

Employee misconduct encompasses a range of behavior, including physical aggression towards a co-worker. The number of federal employees formally disciplined for misconduct is relatively small—less than 1 percent of the workforce, annually. But even a few cases can have a big impact on an agency’s morale and effectiveness. So, are supervisors addressing employee misconduct?

We found that federal agencies made 10,249 suspensions, 7,411 removals, and 114 demotions for misconduct in 2016.

We recommended that the Office of Personnel Management improve their tools for helping agencies prevent, identify, and address misconduct.