A recent Inspector General’s (IG) report from the Department of Defense (DoD) found that the agency lacked complete tracking and reporting details on the number of federal employees working remotely.
Based on the results of an audit conducted from September 2024 through
September 2025, the IG analyzed a sampling of 10,179 of full-time remote work employees at the agency.
For FY 2023, the DoD reported a total of 17,504 remote work employees. However, in FY 2024, it reported a total of 60,315, a 245% increase which the IG said was “potentially overstating the number of remote work employees.” The massive increase was due to a lack of documented control over the reporting and recordkeeping process, employees using incorrect timesheet codes, and unique guidance from DoD components not in accordance with broader guidance from DoD and the Office of Personnel Management.
Worse still, the IG found instances in its data sample where federal employees were significantly overpaid because of the agency’s tracking problems. This was due to the employees receiving the wrong amount of locality pay.
The report states:
We identified that DoD personnel paid 93 (12 percent) of the 794 DoD employees sampled $128,068.80 in improper payments (of which $97,101.60 could be put to better use if recouped) for payments made to remote work employees from the pay period ending June 29, 2024, through the pay period ending September 21, 2024. The DoD also had $537,174.40 in questioned costs paid to an additional 255 (32 percent) employees due to insufficient documentation provided to determine the correct locality pay.
In some instances, employees were being paid according to their previous work location because the worksite had not been updated in the agency’s payroll system.
One employee’s SF 50 was incorrect so he or she was being paid incorrect locality pay for 8 years, from 2017 until 2025 when the error was finally corrected. This resulted in an overpayment of $4,004 for the pay period ending June 29, 2024 through the pay period ending September 21, 2024.
In other instances, some of the agency’s telework agreements showed that the employees were not scheduled to report to their agency’s worksites which means they were actually considered remote work employees. These 22 employees were being paid based on their agency’s worksite location as opposed to where they were actually working.
In one instance, this resulted in an overpayment of $5,605.60 for the pay period ending June 29, 2024 through the pay period ending September 21, 2024. This happened because the employee was working in Carmel, IN and getting locality pay for Annapolis, MD where the locality pay rate is over 15% higher.
The report states, “In this instance the employee had an approved remote work agreement for Annapolis but had not updated their remote work location when they began working in Carmel in June 2024. Based on DoDI 1035.01, the remote work employee should have obtained a new approved remote work agreement, with their SF 50 updated for the new remote work location.”
The good news, however, is that most of the federal employees analyzed in the IG’s report were getting the correct locality pay. 446 (56%) of the 794 remote work employees reviewed were getting correct locality pay.
However, because of documentation problems, this turned out to be dumb luck in some cases. The report notes:
…an employee with a work LPA [locality pay area] of Detroit-Warren-Ann Arbor received the maximum salary amount (legally mandated pay cap) as a GS-15, step 10. Correcting the duty station to their remote location of Washington-Baltimore-Arlington would not change their pay as the salary would still be limited to the maximum amount. In addition, there were instances in which remote work employees had the wrong duty station listed but were in pay plans that did not include locality pay. Others received the locality pay that did not match their work LPA.
To correct the problems, the IG made some recommendations. Among them were implementing a centralized records system to maintain each employee’s remote work agreement and reviewing pay discrepancies, correcting duty stations, and determining any pay that is owed or due and either paying or recouping the money.
More Telework, More Problems?
With the surge in the amount of telework and remote work that began during the pandemic, reports of these types of problems are not uncommon. The findings in this report were relatively minor in comparison to others.
For instance, an IG report for the Department of Commerce found that 23% of employees were overpaid due to incorrect locality pay at a cost of $42,985 and the agency could not verify that its employees were showing up to the office as required.
Telework and Remote Work Policy Shift
These types of problems are a contributing factor to the Trump administration’s change in policies put in place last year regarding telework and remote work. Then acting OPM Director Charles Ezell stated last summer, “Under the previous administration, OPMʼs telework and remote work policies were mismanaged and oversight was virtually nonexistent. That era of telework abuse is over. At President Trumpʼs direction, OPM has restored in-person operations to ensure federal employees are working for the taxpayers.”
Critics, however, disagree with the administration’s position. For instance, AFGE national president Everett Kelley said in a statement issued shortly after President Trump issued his memo restricting telework and remote work:
Providing eligible employees with the opportunity to work hybrid schedules is a key tool for recruiting and retaining workers in both the public and private sectors. Restricting the use of hybrid work arrangements will make it harder for federal agencies to compete for top talent. It’s also been a critical tool for federal agencies to maintain continuity of operations in emergencies, increase disaster preparedness, and improve efficiency. Hybrid work has been so successful that many agencies have been working to consolidate unused office space and sell off properties that are costly to maintain — meaning there may no longer be enough office space to accommodate an influx of on-site workers.
As part of this policy change, OPM recently issued new telework guidelines to ensure agencies are in compliance with the Trump administration’s changes. The general assumption is that federal employees will spend their entire bi-weekly work weeks in the office and that telework and remote work will only be used sparingly, such as for disabilities or medical conditions.
