Senator Joni Ernst (R-IA) is calling for a thorough investigation of telework and whether it is negatively impacting federal agencies’ operations, the services provided to taxpayers, or the federal government’s operating costs.
Specifically, she is requesting that the inspectors general at numerous federal agencies investigate whether federal employees are getting paid at higher locality pay rates even though they are working in lower cost of living areas, whether or not taxpayer money could be saved by consolidating unused federal office space, and what impact telework is having on delivery and response times to agency services.
Ernst sent letters to the Inspector Generals of numerous federal agencies. Her letter cited a couple of examples in which it was questionable as to how much work the federal employees in the cases cited were actually doing. Her golfing comment is in reference to a 2015 IG report from the Department of Commerce which found that an agency employee who was supposed to be teleworking was out doing other things such as playing golf.
The report concluded that the employee in question “committed at least 730 hours of time and attendance abuse, resulting in the payment of approximately $25,500 for hours not worked in FY 2014 alone. The number of Examiner A’s unsupported hours in FY 2014 amounted to approximately 43 percent of the total hours he certified for the fiscal year.”
“Growing up on a farm, I know what working from home actually means,” Ernst said in a statement. “It’s not fair to let the responsibilities of running an agency—and the country—fall on the shoulders of the hardworking public servants who are showing up while others are out golfing on the taxpayer’s dime. Frustrated Americans are being put on hold while too many federal employees are phoning it in. I’m calling out federal employees who refuse to answer the call of duty to return to work on behalf of taxpayers, veterans, seniors, and our great nation. It’s time to get back to work.”
She reiterated her commitment to investigating federal employees on telework who live in lower cost-of-living areas but get paid at Washington, DC locality pay levels on September 6, 2023, when she told federal employees during a press conference, “We are coming after you!”
She added, “This really gets under my skin… How many of these federal employees who get location-based pay [at] Washington, DC wages, who are teleworking from a lower cost area, how many of them moved away during COVID and are still getting paid for living in Washington, DC? It is fraud folks.”
Higher Pay for a Cheaper Locality?
Ernst is asking agencies to investigate how many federal employees are spending “the majority of their working hours in a region with a lower locality pay rate than where their designated primary workstation is located, but continue to receive the higher locality pay associated with the primary workstation.”
If so, she wants to know how much money could be saved by switching the pay for those federal employees to the cheaper localities where they are actually performing the majority of their work.
FedSmith author Ralph Smith raised this question two years ago when telework had become widespread amidst the COVID-19 pandemic. He wrote:
Can a federal employee live and work in a rural area while technically assigned to an office in Washington? In effect, can an employee create a situation where he will receive higher pay than would normally be paid for an employee working in the rural area where his home is located and where he is working?
With the dramatic rise in telework during the pandemic, it was a logical question. It turns out it is not one that is easy to answer. Guidance from the Office of Personnel Management (OPM) states:
In certain temporary situations, an agency may designate the location of the agency worksite for a General Schedule employee’s position (i.e., the place where the employee would normally work absent a telework agreement) as the official worksite for location-based pay purposes even though the employee is not able to report at least twice each biweekly pay period on a regular and recurring basis to the agency worksite….
The current pandemic is an example of an appropriate temporary situation for which an agency may apply this exception to the twice-a-pay-period reporting standard if the telework employee is expected to return to the agency worksite at some point in the future on a regular and recurring basis.
An agency may also apply this exception during the current pandemic to any new or current employee if the employee’s position is based out of an office in a different geographic location and the employee would be working at that office in the absence of the pandemic and the employee signs a telework agreement.
In a follow-up article on the subject, Smith wrote:
And, by the way, there is no time limit on what is considered a temporary situation. There is a requirement to consider OPM or guidance from the Office of Management and Budget. OPM also suggests an agency “review periodically an employee’s temporary full-time telework arrangement” to ensure the temporary exemption of reporting into the office at least twice during each bi-weekly pay period.
But, if that does not leave enough leeway for the agency to grant paying locality pay to an employee working outside the designated pay area, “It is up to an agency to determine how often an employee reports into the agency worksite.”
Senator Ernst is obviously wondering the same thing. It will be interesting to see what may come of any investigations that are initiated as a result of her letters.
Comments from FedSmith readers in the past indicated varying policies at their agencies as to how locality pay on telework was treated. These were a couple of comments posted two years ago on Smith’s original article:
This is a non-issue at my agency. We are told via policy that we have to reside in the area where locality pay is earned. We also have a policy that all issued work phones must be answered or responded to in a set period of time, and all phones have location services turned on. Its pretty easy to see who is out of the approved area. We’ve had a handful of folks prosecuted for fraud and then fired. Its pretty much a non-issue now…..
Have a coworker that took a high paying promotion in D.C., Covid happened and never moved. Has been working in the Midwest where house prices are insanely cheap. Not only collecting DC pay, but got promoted a second time. Their income went up $30K, all the while sitting at the same house, doing not much harder work. Last I heard, they were already on the list to be transitioning back later this year as a lateral. Pretty much leaped past what would have taken a decade here. So very smart, and lucky.
The text of one of Ernst’s letters that was sent to the State Department is included below.
Ernst Letter Requesting Telework Investigations
Ms. Diana R. Shaw
Acting Inspector General
United States Department of State
2121 Virginia Avenue NW, Room 8100
Washington, D.C. 20037
Dear Acting Inspector General Shaw,
August 28, 2023
Remote work provides federal agencies with an opportunity to reduce costs for taxpayers and increase the ability to recruit and retain talent for public service. However, such arrangements only work for taxpayers when telework does not (1) harm the agencies’ ability to achieve their mission, (2) adversely impact the timely delivery of quality services, or (3) impede or impair the management of the federal workforce and taxpayer money.
The U.S. Patent and Trademark Office (USPTO), where telework was already dramatically increasing prior to the COVID-19 pandemic, highlights both the benefits and challenges of remote work.
The agency claims the practice is saving tens of millions of dollars in reduced operating costs. Downsizing the amount of space leased for USPTO headquarters alone may save at least $30 million every year.
However, a series of investigations by the Department of Commerce Office of Inspector General (OIG) found USPTO’s lax oversight and inadequate internal controls of telework has costs millions of dollars for unpaid work and contributed to a patent application backlog. After a tipster called out a patent examiner who “never shows up to work” and whose work is “garbage,” it was determined the employee was paid $25,000 for 730 hours not worked. He was instead playing golf, shooting pool, and going to happy hour. A subsequent larger review of telework over a nine-month period found USPTO “failed to receive nearly $8.8 million in work product that would advance its mission and lessen the patent application backlog by an estimated 7,530 cases.” The OIG noted these are conservative estimates and the true costs “could be twice as high.” Additionally, more than 4,000 examiners paid for unsupported hours received above-average ratings on their annual performance reviews.
USPTO’s experience demonstrates telework practices can and should be reviewed for cost savings, impact on services, and quality control of management.
Yet, despite telework being more commonplace throughout the government, other agencies have not adopted obvious operational cost saving measures and the administration has not set clear standards or expectations to improve management and prevent abuse.
First, we should not be paying for office space that is not being used.
Just five percent of the pre-pandemic federal workforce swiped-in to a government- leased office in the Washington, D.C. area on an average workday during a two-month period in the fall of 2022, according to data from the General Services Administration (GSA) and analyzed by the real estate firm Cushman & Wakefield.
Seventy-five percent or more of the available office space at the headquarter buildings of 17 different federal agencies is not being used, according to a review conducted by the Government Accountability Office (GAO). “Underutilized office space has financial and environmental costs,” GAO notes. “Federal agencies spend about $2 billion a year to operate and maintain federal office buildings regardless of the buildings’ utilization. In addition, agencies spend about $5 billion annually to lease office buildings. Any reduction in office space could reduce these costs. Office buildings also have environmental costs that could be lowered with better utilization. For example, GSA renovated and reduced its current agency real estate footprint, which helped reduce energy consumption and costs.”
The empty offices beg the question: Where are federal employees?
The work locations of 281,656 employees were redacted from data provided in response to a Freedom of Information request filed by the nonprofit group Open the Books.
Only one in three federal employees is fully back in the office, according to a recent Office of Personnel Management (OPM) survey, while less than one in five “never” report to a physical office.
This is important information to know, especially when calculating salaries.
Remote work may be inflating salaries for those federal employees who relocated from an official worksite in a locality with higher pay rates to telework from a less expensive area. Compensation is determined, in part, by where an employee’s official worksite is located. There are 53 different locality areas and base pay is adjusted to take into account the cost-of-living in each. The U.S. Office of Personnel Management (OPM) maintains the official worksite for teleworkers “remains the location of the agency worksite (i.e., the agency worksite where they would normally work, not the telework location).” These pay determinations should be re-evaluated, and possibly redefined, to save taxpayers money. Digital records can identify the locations from which an employee is logging onto a computer or swiping an access card to enter a building, which should make it relatively easy to determine the primary location of any employee.
In March, I asked OPM how, or if, federal agencies are reviewing compensation packages to certify federal employees who predominantly work remotely from areas outside the national capital region are not receiving Washington, D.C. locality pay, which is on the higher end of the pay scale. Only this month did I receive a response. OPM told me it can provide guidance to agencies but ultimately the agencies themselves are chiefly responsible for making sure their pay packages are accurate.
The impact of telework on meeting an agency’s mission must also be evaluated. Many civil servants, like meat inspectors or airport security screeners, do not have the luxury of working from home, much less a bubble bath. But that is exactly what a manager responsible for overseeing a team who helps veterans schedule appointments at the Atlanta VA Medical Center—which has one of the longest wait times to see a doctor in the country—was doing. He bragged on Instagram about relaxing in a bathtub for an hour while on the job. In the post, his government-issue laptop is opened to a staff meeting while his legs are soaking in a tub with a caption stating, “MY OFFICE FOR THE NEXT HR.” Other VA employees reported the manager for making a mockery of the veterans they serve. One such veteran temporarily lost his eyesight while waiting six months for an appointment with an eye doctor at the Atlanta VA.
Agencies have been unmotivated to send their workforces back to the office despite repeated calls from the Biden administration do so. In his 2022 State of the Union address, President Biden stated most federal employees would be returning to work in person. In April, the White House Office of Management and Budget directed agencies to develop plans to “increase meaningful in-person work at Federal offices” while continuing to use “flexible operational policies” and establishing routines to monitor organizational performance. Earlier this month, White House Chief of Staff Jeff Zients re-upped those appeals, saying how important it is to achieving “better results for the American people.”
It appears hybrid and remote working is now standard practice for the federal workforce. So, it is imperative for taxpayers and those being served by federal programs that costs and outcomes are not negatively impacted by the arrangement. The examples of telework abuses cited in this letter, after all, were caught thanks to dedicated civil servants who spoke up rather than effective management by the agency or OPM.
To better inform policymakers, I would request your office initiate an agencywide review to determine:
- Based upon IT login information, office swipe-ins, and other measurable and observable factors, how many employees spend the majority of their working hours in a region with a lower locality pay rate than where their designated primary workstation is located, but continue to receive the higher locality pay associated with the primary workstation?
- How much money could be saved by adjusting locality pay for teleworking employees who reside outside of the region in where their primary workstation is located to the true location from where they perform the majority of their work?
- Has the agency taken any action to readjust current locality pay or calculate the locality pay of new or existing hires accounting for the true geographical location from where each employee who teleworks spends the majority of their working hours, rather than the physical location of their position of record?
- What actions are the agency taking to ensure better oversight and quality control of remote work and what other actions could be taken?
- What is the typical daily onsite attendance in the agency’s office buildings as a proportion of its total workforce?
- Has the agency issued any guidance, established incentives, or otherwise enticed its workforce to return to working from the office buildings? If so, have these efforts proven successful?
- In how many instances has the agency exercised its authority under 5 C.F.R. § 531.605(d)(2) to waive the twice-in-a-pay-period in-person standard? How many of those exceptions have been revoked each month, since July 2021? As of today, how many employees remain excepted from the twice-in-a-pay-period standard?
- Comparing the capacity of usable area to the actual in-office attendance, what is the utilization of building space?
- What is the monetary and environmental cost of maintaining underutilized space in terms of energy usage and emissions?
- What, if any, actions are being taken or planned to reduce underutilization of building and office space?
- How is telework impacting the delivery of services and response times by the agency? Have waiting lists or backlogs increased or decreased?
- Does the OIG have any additional recommendations to improve services, reduce costs, and enhance internal controls and reduce the potential for waste and abuse with hybrid work? Thank you for your attention to this request and please do not hesitate to contact me or my staff if you have any questions or would like to discuss further.
Joni K. Ernst
United States Senator