Schedule C: Appointments are generally noncompetitive and are for  excepted service positions graded GS-15 and below that involve  determining policy or that require a close confidential relationship with  the agency head or other key officials of the agency. Limited Emergency SES: Appointments may be made for up to 18  months to meet a bona-fide, unanticipated, urgent need. For career  excepted service (non-Schedule C) positions, agencies are not required to  follow OPM’s hiring regulations for the competitive service; however, they  must apply veteran’s preference and follow merit system principles when  making most of these appointments. Agencies Made 144 Noncareer to Career Conversions from May 2001 through April 2005

Twenty-three of the 41 agencies we reviewed reported 144 conversions of  individuals from noncareer to career positions from May 1, 2001, through  April 30, 2005. The other 18 agencies reported no conversions during this  period. Four agencies, the Department of Health and Human Services  (HHS), the Department of Justice (DOJ), the Department of Defense  (DOD), and the Department of the Treasury (Treasury) accounted for 95, or  66 percent, of the total 144 conversions reported, as seen in figure 1. Of the 144 reported conversions, individuals were converted from the  following categories of noncareer positions:  47 Limited Term SES positions  25 other statutory at-will positions  6 Limited Emergency SES positions The 144 reported conversions were made to the following categories of  career positions:  64 career SES positions  33 career excepted service (non-Schedule C) positions Appendix III provides more detail on the characteristics of the noncareer  and career positions to which the individuals were converted, e.g., title of  positions, grades, salaries, and appointment dates. For 19  conversions, agencies did not provide us with enough information to make  a determination—many of these conversions were to excepted service  positions where agencies develop their own hiring procedures and have  limited documentation requirements. In 93 Conversions, Agencies Appeared to Have Used Appropriate Authorities and Followed Proper Procedures

For 93 of the 130 conversions at the GS-12 level and above, our review of  the merit staffing files and official personnel files at the respective agencies  indicated that the agencies generally followed the procedural requirements  associated with each appointing authority called for by federal law and  regulations, including merit system principles such as fair and open  competition and fair and equitable treatment of applicants. More details on these conversions can be found in appendix  V. Sixteen of these conversions were to career excepted service (non- Schedule C) positions at DOJ. Although OPM requires agencies to maintain records of the  rating, ranking, and selection process for competitive service  appointments, these documentation requirements do not apply to the  excepted service. For the 3 remaining conversions, HHS  could not locate certain files. Recommendations for Executive Action

To help ensure that federal agencies are following appropriate authorities  and proper procedures in making conversions of noncareer to career  positions, we recommend that the Director, OPM:   review the 18 conversions we identified where it appears that certain  agencies did not use appropriate authorities and/or follow proper  procedures in making these conversions and determine whether  additional actions are needed, and  determine whether conversions to career excepted service positions  should be subject to OPM review—such as through the pre-appointment  review OPM conducts of other conversions during presidential election  periods, and/or during OPM’s periodic audits of agencies’ examining and  hiring activities, and if so, determine what information agencies should  provide on such conversions. For example, Limited Term Senior Executive Service  (SES) and Limited Emergency SES positions are often filled by federal  employees who have previously held career positions (prior to being  appointed to the noncareer positions from which they were being  converted). Conversions Where Appropriate Authorities and Proper Procedures May Not Have Been Followed

For 18 of these conversions, it appears that agencies did not follow proper  procedures or may have violated other statutory or regulatory  requirements. Seven of the 18 conversions were subject to OPM review and approval; 2  because they fell within the presidential election pre-appointment review  period as prescribed by OPM and 5 because they were to SES level  positions.
Why GAO Did This Study

A federal employee conversion occurs whenever an individual changes from one personnel status or service to another without a break in federal government service of more than 3 days. This report focuses on conversions of individuals from noncareer to career positions. Federal agencies must use appropriate authorities and follow proper procedures in making these conversions. GAO was asked to determine for departments and selected agencies (1) the number and characteristics of all noncareer to career conversions occurring during the period from May 1, 2001, through April 30, 2005, and (2) whether appropriate authorities were used and proper procedures were followed in making these conversions at the GS-12 level and above.

What GAO Found

Twenty-three of the 41 departments and agencies selected for review reported converting 144 individuals from noncareer to career positions from May 1, 2001, through April 30, 2005. The other 18 departments and agencies reported making no conversions during this period. Four agencies accounted for 95, or 66 percent, of the 144 reported conversions: the Departments of Health and Human Services (36), Justice (23), Defense (21), and Treasury (15). Of the 144 reported conversions, almost two-thirds were from Limited Term Senior Executive Service (SES) positions (47) and Schedule C positions (46). Limited Term SES appointments may be made for up to 36 months and can include federal employees who previously held career positions. Schedule C appointments are generally noncompetitive and are for positions graded GS-15 and below that involve determining policy or that require a close confidential relationship with key agency officials. Of these 144 individuals, 64 were converted to career SES positions, 47 to career competitive service positions, and 33 to career excepted service (non-Schedule C) positions. Agencies used appropriate authorities and followed proper procedures in making the majority (93) of the 130 conversions reported at the GS-12 level or higher. However, for 37 of these conversions it appears that agencies did not follow proper procedures or agencies did not provide enough information for us to make an assessment. For 18 of the 37 of these conversions, it appears that agencies did not follow proper procedures. Some of the apparent improper procedures included: selecting former noncareer appointees who appeared to have limited qualifications and experience for career positions, creating career positions specifically for particular individuals, and failing to apply veteran's preference in the selection process. Seven of the 18 conversions were subject to OPM review and approval; 2 because they fell within the presidential election pre-appointment review period as prescribed by OPM and 5 because they were to SES level positions. For the remaining 19 conversions, agencies did not provide enough information for GAO to fully assess the process used by the agency in making the conversion. This was largely attributable to the types of appointments involved. Sixteen of these 19 conversions were to career excepted service (non-Schedule C) positions at the Department of Justice. For appointments to excepted service positions, OPM does not require agencies to follow OPM's competitive hiring provisions or to maintain records of the rating, ranking, and selection process, as it requires for competitive service appointments (although most of these conversions are subject to the merit system principles). These unique hiring procedures and limited documentation requirements for excepted service positions resulted in GAO having insufficient information to reconstruct the Department of Justice's decision-making process to convert these individuals. For the remaining three cases, the Department of Health and Human Services could not locate certain files.