Almost Half of All Agencies Have Used Buyout and Early-out Programs to Reshape Their Workforces and the Number of Programs Has Increased

Since fiscal year 2003, the number of agencies using buyouts and early outs  to reshape their workforces has increased, and to date, about half of the  executive branch agencies have requested and used these authorities. According to OPM data, at least 22,600  employees have separated from federal service under a buyout, early out,  or both. OPM is taking steps to reduce the  amount of time it takes to review agency submissions and is further  planning to streamline its review process. The number of and maximum amounts of Voluntary Incentive Payments  to be offered. Reasons why the agency needs voluntary early retirement authority. OPM and Agency Officials Responsible for Use of These Authorities Believe Plans Can at Times Be Approved More Quickly and the Process Can Be Streamlined

OPM program officials and nearly all of the agency officials responsible for  use of these authorities in our review believe the approval process can at  times be accomplished more quickly and have fewer steps. On average, we found that OPM took 36 days  to review the programs in our sample. 3. However, agencies have not expanded on these monitoring efforts to  provide an evaluation of the longer-term effectiveness of these tools. OPM officials  said that they believe that the CHCO Act does not provide OPM the  authority to allow agencies to make changes to approved plans. Officials in four agencies said some consideration should be  given to ways to make buyouts more attractive to employees. In addition, some agency officials suggested that more coordination across  the agencies using the programs would be helpful as would the sharing of  examples of how some agencies used effective practices in ways that were  particularly successful or instructive in reshaping their workforces, and  that OPM may be in the best position to do this coordination. 1. 2. Objectives, Scope, and Methodology

The objectives of our review were to identify  how many agencies have sought and been granted authority to offer  buyouts and early outs and the extent to which agencies have used these  authorities;  how selected agency officials view the Office of Personnel  Management’s (OPM) role in facilitating the use of the buyout and early- out authorities;  what practices are associated with agencies’ effective use of buyouts  and early outs, how selected agencies used these practices, and whether  they have helped agencies to achieve their workforce reshaping goals;  and  what challenges the selected agencies identified, if any, to continued  effective use of these authorities. We selected the Departments of  Agriculture, Commerce, Energy, Health and Human Services, Interior, and  the Treasury for further review since they accounted for over half of all  requests for authorities at the time we started our review. We interviewed agency officials, such as human capital officers and buyout  and early-out program managers from the six selected agencies to ascertain  (1) their views of OPM’s role in their use of the buyout and early-out  authorities, (2) the particular buyout and early-out practices they were  using, (3) their views on how the practices helped them to achieve their  goals, (4) the lessons learned from their experiences, and (5) the challenges  to continued successful use of these authorities.
Why GAO Did This Study

Under the Chief Human Capital Officers (CHCO) Act of 2002, an agency may request authority from the Office of Personnel Management (OPM) to offer employees voluntary separation incentive payments (buyouts) and voluntary early retirement (early outs) to help reshape its workforce. GAO was asked to identify (1) how many agencies have been granted authority to offer buyouts and early outs and how often agencies used them, (2) how agencies view OPM's role in facilitating the use of these tools, (3) how agencies have used practices associated with effective use of the tools, and (4) what challenges agencies identified, if any, to continued effective use. To respond, GAO reviewed the practices of the Departments of Agriculture, Commerce, Energy, Health and Human Services, Interior, and the Treasury because they were among the most frequent users of these authorities.

What GAO Found

The total number of agencies using buyouts and early outs to reshape their workforces has significantly increased from 28 to 51 during fiscal years 2003 through 2005, and the number of programs agencies have offered over the past 3 years has also significantly increased. During this timeframe, at least 22,600 employees have separated from federal service under these authorities. Officials at all six agencies GAO reviewed believe that OPM's mandatory review of and feedback on their plans for using buyouts and early outs has improved implementation. However, nearly all of the agencies said they believe the review at times can be achieved more quickly and should be streamlined. OPM on average took 36 days to review the 28 randomly selected programs GAO assessed at the six agencies. OPM is taking steps to reduce its overall average review time including establishing more stringent timeframes for review and reducing the number of reviewers. The six agencies also reported using almost all of the practices GAO identified as associated with the effective use of buyouts and early outs, and that these practices resulted in better-planned programs. Agencies were not, however, using one practice that involves evaluating the longer-term effectiveness of the buyout and early-out authorities for reshaping their future workforces. Officials at the six agencies suggested that information on how some agencies used effective practices in ways that were particularly successful or instructive in reshaping their workforces could help them improve program results. Agency officials responsible for use of these authorities from the six agencies agreed that certain reforms would help them address some of the challenges they face in implementing their programs. These include (1) increasing the current dollar amount agencies can pay under buyouts to make the programs more attractive to employees and increase the acceptance rate and (2) allowing agencies to make minor changes to buyout and early-out plans after OPM approval. OPM is in the best position to assess these and other possible reforms and ways to achieve them.