Agencies Reported Using Special Payment Authorities to Varying Degrees but for Few Employees in Fiscal Years 2014-2016

		Agencies Reported Using a Range of Special Payment Authorities

CHCO agencies used a range of special payment authorities to recruit  and retain employees. For example, in fiscal year  2016, less than 6 percent of the over 2 million federal employees at  CHCO agencies received compensation under at least one of the seven  special payment authorities, as shown in figure 2. Specifically, agencies  reported using special rates for over 74,000 employees, of the over 2  million CHCO agency employees, in each of these fiscal years. More specifically, of the 10 CHCO agencies that reported having  documented assessments, agencies most frequently reported evaluating  the impact of these authorities on meeting staffing needs and on their  effectiveness relative to other human capital flexibilities. Critical position pay: OPM collects data on agency use of critical  position pay from the agencies with existing OPM approval, but the  information does not help OPM understand how the payment authority  supports recruitment or retention. OPM has stopped regularly collecting and analyzing data for the 3R  incentives, except on the use of retention incentives for employees likely  to leave for other federal agencies, and does not collect and analyze data  for special rates, leaving a void for conducting government-wide analysis  that would help determine whether special payment authorities help  address agency recruitment and retention needs:
3R incentives: In a February 2010 memorandum to agency CHCOs  on 3R incentives, OPM called for it and agencies to more actively  manage the program and track data. With guidance to assess effectiveness and consistent tools and guidance  across the range of authorities, OPM and CHCO agencies could more  fully support strategic use of special payment authorities to improve  recruitment and retention across the federal government. Few agencies  are documenting assessments. By providing  guidance on assessing effectiveness of these authorities, OPM and  CHCO agencies could be better positioned to know whether use of the  authorities is improving recruitment and retention or what changes might  be needed to improve their effectiveness. Agency officials may also perceive documentation and approval  processes as time consuming or burdensome barriers to using  compensation tools. Of our three  recommendations, OPM concurred with one and partially concurred with  the other two. OPM also outlined its planned steps to implement the  recommendations. This includes use for government-wide mission-critical  occupations. Agencies also have data that can inform  discussions between OPM and the CHCO Council on potential strategies  for a government-wide approach to enhance strategic use of these  authorities to address mission-critical skill gaps. Appendix I: Objectives, Scope, and Methodology

This report (1) describes what is known about how much Chief Human  Capital Officer (CHCO) Council agencies used selected special payment  authorities in fiscal years 2014-2016; (2) assesses the extent to which  CHCO agencies evaluate the effectiveness of these authorities and  identifies challenges, if any, the agencies reported facing in using the  authorities to address mission-critical skills gap areas; and (3) evaluates  how the Office of Personnel Management (OPM) has helped agencies  address federal recruitment and retention needs. 3.
Why GAO Did This Study

Federal agencies can provide additional compensation by using seven broadly available special payment authorities to recruit and retain employees to address needed skills. Though special payments can help fill mission-critical skills gaps, agencies also face constrained budgets, which underscores the importance of cost-effective use of authorities. OPM and the CHCO Council play important roles in assuring effective federal human capital management.
GAO was asked to examine agency use, challenges, and improvements needed, if any. This report 1) describes CHCO agencies' use of special payment authorities in fiscal years 2014-2016; 2) assesses to what extent CHCO agencies examined effectiveness; and 3) evaluates how OPM has helped agencies address recruitment and retention needs. GAO obtained information from CHCO agencies on use of authorities through a questionnaire. GAO also analyzed OPM personnel data and agency documents, and interviewed agency officials.

What GAO Found

Generally, federal agencies have seven broadly available government-wide special payment authorities to help address recruitment and retention challenges. Chief Human Capital Officer (CHCO) Council agencies reported using these authorities to varying degrees but overall for few employees in fiscal years 2014-2016. For example, in fiscal year 2016, less than 6 percent of the over 2 million CHCO agencies' employees received compensation from at least one of the authorities (see figure). The two most frequently used—special rates and retention incentives—were used for over 74,000 employees and over 13,000 employees, respectively, each year. The least-used—critical position pay—was used for as few as seven employees a year. CHCO agencies also reported using the range of authorities to help address skills gaps, particularly for science, technology, engineering, and mathematics occupations.
CHCO Agency Employees Receiving Special Payments, Fiscal Year 2016
CHCO agencies reported that these authorities had positive impacts—such as on-staff retention and applicant quality—but had few documented effectiveness assessments. Nine of 10 agencies that reported having documented assessments provided them, but GAO found that only 3 had information on effectiveness, such as its impact on meeting staffing needs.
The Office of Personnel Management (OPM) collects agency data on use but has not tracked data to analyze how much authorities help agencies improve recruitment and retention government-wide. OPM may be missing opportunities to promote strategic use by providing guidance and tools on assessing effectiveness. For example, OPM has not explored reasons for trends in use of critical position pay or consistently shared best practices and innovative ways to use authorities. Without tracking data and providing guidance to help agencies assess effectiveness, OPM will be unable to determine whether use of special payment authorities helps agencies to improve recruitment and retention.

What GAO Recommends

GAO is making three recommendations, including that OPM should work with the CHCO Council on tracking data and providing guidance and tools to assess effectiveness of authorities, among others. OPM concurred or partially concurred with all recommendations, and described planned steps to implement them.