In 2010, NMB changed its rules for certifying a union. NMB Is Missing Key Elements of Successful Performance Planning and Reporting

		NMB Lacks a Robust Strategic Planning Process for Meeting Federal Requirements

NMB lacks a robust strategic planning process, with formal mechanisms  for gathering congressional and stakeholder input, and as a result, the  agency has not met some federal requirements for performance planning. Strategic  planning should provide the basis for everything an organization does. (See sidebar  for key strategic planning requirements.) Federal agencies are required to develop annual performance  plans. NMB Lacks Some Key Management Controls

		NMB Has Most Key Controls for Financial Accountability but Lacks a Formal Mechanism to Address Deficiencies

NMB is following most key practices for financial accountability and  control, an integral part of an organization’s management that should  reach throughout all departments and programs as well as financial  management and reporting functions. NMB Has Not Fully Implemented Key Information Security and Privacy Controls

NMB relies on information technology to carry out its mission. NMB Has Taken Steps to Improve Its Human Capital Program but Does Not Follow Key Planning Practices

NMB has taken steps to improve its human capital program, such as  increasing oversight of mediators and providing additional training  opportunities to its staff. NMB also did not follow its own procurement procedures in purchasing  the iPads. Sharing voting  materials and voting in groups violates federal law, NMB officials said. Disagreement during Past Rulemaking on Union Elections Created Challenges

NMB in 2010 changed its rules for certifying a union in an election, and  several stakeholders told us and a former NMB board member wrote at  the time that this process harmed the perception of NMB as a nonpartisan  arbiter and caused disagreement. Despite concerns, NMB officials reported that the percentage of elections  resulting in certification of a union has remained relatively constant in the  years before and after NMB’s 2010 rulemaking. Conclusions

The National Mediation Board is a small agency with a vital role in  facilitating labor relations and helping avoid work stoppages in two key  transportation sectors: the railroads and airlines. Develop a strategic workforce plan that (1) involves input from top  management, employees, and other stakeholders; (2) identifies critical  skills and competencies needed by NMB; (3) identifies strategies, such as  training, to address any gaps; and (4) provides for cost-effective  evaluations of these strategic workforce planning efforts. This plan should  also address succession for the significant proportion of NMB staff and  senior managers who are eligible to retire in the next few years. Although our matter for congressional consideration was not directed to  NMB, the agency suggested that having another federal agency’s Office  of Inspector General provide oversight of NMB would be redundant with  GAO’s biennial audits and evaluations, which were mandated by the FAA  Modernization and Reform Act of 2012. NMB noted, with respect to our second recommendation to develop  performance goals and measures, that it will include such goals and  measures in its new February 2014 strategic plan. For example, NMB  should ensure that it completes its draft policies and procedures, provides  information security training to its users and contractors, and updates its  disaster recovery and continuity of operations plans and procedures. Thus we believe  our recommendation is still valid. Finally, in commenting on recommendation seven to analyze data on the  types and disposition of rail grievance arbitration cases to better inform its  management of those processes, NMB officials stated that they plan to  collect additional data on the types of cases they receive from all  arbitration boards and make the information available on the agency’s  website. We also assessed NMB’s management plans,  policies, and practices in financial management, information management  and security, human capital, and procurement using GAO’s Standards for  Internal Control in the Federal Government and other criteria developed  by GAO in prior work for these management areas, as described later in  this appendix. In addition, we  reviewed but did not duplicate the work performed by NMB’s independent  auditors in the six most recently issued internal control reviews of NMB  program areas:
Report on Review of Internal Controls Over Representation Functions  (fiscal year 2005)
Report on Review of Internal Controls Over Alternative Dispute  Resolution (ADR) Services (fiscal year 2006)
Report on Review of Internal Controls Over Mediation Services  (October 2006-September 2007)
Report on Review of Internal Controls Over Personnel/Payroll (April  2008-March 2009)
Report on Review of Internal Controls Over Arbitration Services  Functions (April 2009-March 2010)
Report on Review of Internal Controls Over Procurement (October  2010-September 2011)
To gain additional perspectives on NMB’s program and management  functions, we interviewed officials at the two primary federal labor  relations agencies that cover labor relations in the private sector. We did not independently assess the  findings in these financial statement audits and internal control reviews.
Why GAO Did This Study

A small federal agency, NMB facilitates labor relations in two key transportation sectors--railroads and airlines-- through mediation and arbitration of labor disputes and overseeing union elections. Established under the Railway Labor Act, NMB's primary responsibility is to prevent work stoppages in these critical industries. The FAA Modernization and Reform Act of 2012 required GAO to evaluate NMB programs and activities. GAO examined NMB's (1) strategic planning and performance measurement practices; (2) controls for key management areas; and (3) challenges, if any, in overseeing elections. GAO assessed NMB's management practices using internal control standards and other GAO criteria; interviewed NMB officials, current and former board members, and key stakeholders from rail and air labor and management groups; and reviewed relevant federal laws, regulations, and NMB policies.

What GAO Found

The National Mediation Board (NMB) recently updated its strategic plan but is not meeting some federal strategic planning and performance measurement requirements. NMB missed deadlines for updating its strategic plan and lacks performance measures to assess its progress in meeting its goals, even though an agency's strategic plan should form the basis for everything an agency does.
NMB also lacks some controls in key management areas that could risk its resources and its success:
Financial accountability: NMB contracts for annual financial statement audits and internal control reviews. However, it lacks a formal process for addressing identified deficiencies, a key internal control.
Information technology: NMB recently transitioned to new information technology systems but is missing key management and security controls, including an information security program that fully implements federal requirements.
Human capital: NMB has taken steps to improve its human capital program but improvements are still needed. Although all NMB senior managers are eligible for retirement, NMB has not engaged in formal workforce planning to identify gaps in staff skills, and strategies, such as training, to address them.
Procurement: NMB has established some key procurement policies and controls but weaknesses remain. For example, in a recent purchase of tablet computers for some staff, NMB did not follow its own procedures to assess the need for the devices or solicit competition.
Other management issues: NMB does not have an Inspector General (IG), and oversight by other federal agencies is limited. NMB also has a significant number of pending rail arbitration cases, and it lacks complete data on the types of cases filed to help it address the backlog and the costs.
NMB has adapted to challenges presented by large union elections resulting from airline mergers and has implemented improvements such as online voting. In 2010, NMB changed its rules for determining a majority in union elections. While this process caused disagreement among some stakeholders, NMB data suggest that the percentage of elections in which a union was certified has, thus far, remained relatively constant in the years before and after the rule change.

What GAO Recommends

Congress should consider authorizing an appropriate federal agency's IG to provide oversight of NMB. NMB should implement a formal strategic planning process and develop performance goals and measures to meet federal requirements, develop a process to address audit findings, implement key components of an information security and privacy program, and engage in strategic workforce planning. NMB should also collect and analyze data on the types of rail grievances filed to help improve efficiency in its arbitration process. In commenting on a draft of this report, NMB said it would address our recommendations and described actions it plans to take.