A new report released on Thursday outlines abuses of the government’s telework program for federal employees that are likely to make it a target of the newly formed Department of Government Efficiency (DOGE).
Senator Joni Ernst (R-IA) published the findings of investigations she has been conducting for the past two years in the report which was released at the first meeting of the Senate DOGE Caucus held in Washington, DC.
Ernst is the chair of the Senate DOGE Caucus. Elon Musk and Vivek Ramaswamy, the co-leaders of DOGE, were in Washington Thursday to attend the meeting.
In a statement about the Senate Caucus, Ernst said:
As President Trump, Elon Musk, and Vivek Ramaswamy prepare to take action, the Senate DOGE Caucus is ready to carry out critical oversight in Congress and use our legislative force to fight against the entrenched bureaucracy, trim the fat, and get Washington back to work for Americans.
Telework and Improper Locality Pay
Ernst dedicated an entire section in the report to locality pay abuses and lapses in oversight that she says were enabled by expanded telework policies in place since 2020. Her report states:
An employee is obligated to show up at their official worksite at least once a week to get that locality pay. However, that requirement can be waived on an employee-by-employee basis, in perpetuity. Some agencies used this flexibility in a blanket manner for years beginning in March 2020. If not periodically reviewed, these exceptions are ripe for abuse.
However, Ernst’s investigations have uncovered various instances of federal employees using telework to get higher locality pay rates than they were entitled to receive, and in some cases, federal managers were enabling it. Several examples were outlined in the report.
The report states that Office of Inspector General (OIG) investigations have so far found that 23 to 68 percent of federal employees are receiving incorrect locality pay that is higher than it should be.
The Department of Commerce OIG found that nearly 23% of teleworking federal employees sampled across 10 bureaus were being overpaid and that the agency is unable to verify employees are showing up to the office as required.
At the U.S. Agency for International Development (USAID), one GS-13 employee lived in Florida for the duration of her employment but used an office supply store in Virginia for work-related correspondences in order to collect Washington, D.C. locality pay.
Under the terms of her telework agreement, she was required to report to the USAID office in DC twice every pay period, but her supervisor permitted her to violate the agreement. When questioned by OIG special agents, the supervisor denied knowing where the employee lived, but the OIG found evidence showing that “the supervisor knew the employee lived in Florida and was using an address in Virginia to receive the higher locality pay.” Criminal charges against both the employee and the supervisor were declined and the employee retired.
The report notes that this abuse of locality pay is an example that could involve tax evasion. “Collecting a salary set at the pay scale for Washington, D.C., which is one of the highest taxed areas in the country, while living in Florida, where there is no state income tax, effectively dodges liability for thousands of dollars in state and local tax bills,” states the report.
In another instance, a GS-14 USAID employee was living in North Carolina while receiving DC area locality pay and was overpaid over $9,800 in a seven-month period as a result. The Justice Department declined to pursue criminal charges against the employee. A report was provided to USAID for action.
Ernst said in her report that USAID admitted it does not collect data regarding why certain USAID employees have their telework privileges revoked, and the agency has been unable to produce even basic information about how many of its employees have had their telework agreements adjusted or why.
Another instance cited by Ernst’s report involved a Human Performance Railroad Specialist at the Federal Railroad Administration (FRA) who set up a mailbox at a UPS box facility in East Stroudsburg, PA, an area with higher locality pay than Dunmore, PA, the location where he lived and worked remotely full-time.
From January 2018 to January 2023, he was paid at the higher rate and ultimately stole $123,641.32 from FRA. He was convicted and sentenced to 36 months of probation, a $5,000 fine, $123,641.32 in restitution, and a $25 special assessment.
At the Architect of the Capitol (AOC), the OIG found that 80% of its teleworking employees were receiving incorrect locality pay, and 68% were being overpaid. More than $100,000 was misspent before the error was caught. The OIG continues to receive complaints from AOC employees that the agency’s remote work policy is confusing and lacks transparency.
The report notes that because a federal employee’s pension is determined in part by the highest three years of his or her salary, collecting higher locality pay for even just a few years can result in a permanently higher pension after retirement.
Unions in federal agencies have been working to incorporate telework provisions into the collective bargaining agreements with their agencies in advance of the Trump administration’s arrival in Washington next year. AFGE, for instance, reached an agreement with the Social Security Administration to protect telework until 2029. AFGE represents 42,000 federal employees at the agency.
Ernst’s report stated:
The current unaccountable telework arrangements are providing a significant financial incentive for employees to stay away from the office. An employee can collect a bigger paycheck by claiming a workstation in an area with higher locality pay while living somewhere else with the added benefit of not having to commute to the office.
With more collective bargaining agreements being put in place to protect telework, it will make efforts from DOGE and supporting lawmakers more difficult to reduce or eliminate telework. It could still be done, but each case will have to be considered individually based on what the labor contract says. How the situation will unfold after the Trump administration takes office remains to be seen.
Ernst has introduced legislation (S. 5429) targeting telework as part of the initial efforts of DOGE. According to Daily Mail, the REMOTE Act will use software to monitor federal employees’ computer use and require agency reports on the adverse impacts of telework.
