Management Challenge/
Significant Issue

Actions Taken in FY 2007

Actions Remaining and Expected Completion Date

I. Protecting the Safety and Health of Workers

Challenge first identified in FY 2005. Areas of concern include the effectiveness of recent efforts to protect the safety and health of mine workers, particularly those who work in underground coal mines, the effectiveness of OSHA's compliance assistance efforts and its ability to respond in disasters. Affects Strategic Goal 3 — Safe and Secure Workplaces, Performance Goal 3A- Improve workplace safety and health through compliance assistance and enforcement of occupational safety and health regulations and standards and Performance Goal 3B- Reduce work-related fatalities, injuries and illnesses in mines.

Progress Assessment: Yellow

Strengthen MSHA accountability program.
(OIG 2007, OIG 05-07-002-06-001)

http://www.oig.dol.gov/public/
reports/oa/2007/05-07-002-06-001.pdf

Announced plans to create an Office of Accountability to ensure that management controls are in place and fully implemented.

Revise current MSHA Accountability Program and Accountability Program Handbook — January 2008.

Implement the Mine Improvement and New Emergency Response (MINER) Act of 2006.
(2006 PAR)

Implemented most of the provisions of the MINER Act.

Complete implementation of the MINER Act — December 2007.

Improve MSHA management data.
(OIG 22-07-008-06-001)

http://www.oig.dol.gov/public/
reports/ oa/2007/22-07-008-06-001.pdf

Updated coal noise sampling procedures and drafted revision to Metal and Nonmetal Handbook to require inspectors to verify that their noise sampling results are entered accurately.

Respond to recommendations to develop the capability to compute fatality and injury incidence rates that include non-exempt contractor work hours at the mine site level — FY 2008.

Replace retiring mine inspectors.
Implement localized and targeted recruiting to increase the applicant pool (2006 PAR).

In FY 2007, GAO issued a second report on hiring mine inspectors.
(GAO-07-704R)

Hired all 170 coal mine enforcement personnel funded by emergency supplemental appropriation. Developed a Human Resources Strategic Plan FY 2006-2011; a strategy roadmap and means to measure performance for staffing.

Implement Human Resources Strategic Plan FY 2006 -2011 for hiring new mine inspectors — FY 2008.

Ensure that interim protection is in place before OSHA funded consultation projects grant extensions to correction due dates for serious hazards and refer uncorrected serious hazards to OSHA enforcement.
(OIG 2007)

Reminded consultation officials about requirements to ensure that serious hazards are corrected at the Consultation Project Manager's meeting.

Regions to monitor consultation programs‘ adherence to requirements for ensuring that serious hazards are corrected — FY 2008.

Identify cost effective methods of collecting complete and comparable data on OSHA program outcomes.
(2006 PAR)

Improved the data management system for the Voluntary Protection Programs and implemented an automated data management system for the Strategic Partnership Program.

Complete system to improve data collection for voluntary programs — September 2009.

Improve planning for OSHA efforts to protect workers in disasters.
(GAO-07-193)

Signed a Standard Operating Procedures (SOP) document addressing roles and responsibilities of FEMA and OSHA and forwarded to FEMA for signature.

FEMA to approve SOP — FY 2008.

II. Ensuring the Effectiveness of the Job Corps Program

Challenge first identified in FY 2006. Contractors operate 98 Job Corps Centers nationwide; the Departments of the Interior and Agriculture operate another 28 centers via interagency agreements with DOL. These centers provide services to about 60,000 students annually. DOL Regional Offices monitor contractors to ensure DOL policies are implemented. DOL is challenged to ensure that regional monitoring is effective. Affects Strategic Goal 1 — A Prepared Workforce, Performance Goal 1B, Improve educational achievements of Job Corps students and increase participation of Job Corps graduates in employment and education.

Progress Assessment: Yellow

Promote effective regional monitoring.
(OIG 2007, 2006 PAR)

Required Regional Offices to perform rigorous data quality/data integrity reviews in addition to comprehensive onsite policy compliance monitoring reviews at least once every 24 months. Assessed $315,739 in liquidated damages for recovery.

Continue to conduct rigorous data integrity audits concurrently with onsite compliance/quality assessments — FY 2008.

Improve contracts management.
Job Corps runs contractor-operated centers through performance-based contracts, which tie incentive fees and bonuses directly to contractor performance. There is a risk that contractors will inflate their performance reports. Recent audits determined that specific centers manipulated performance data and others had inadequate financial management systems and weaknesses in the management of personal property.
(OIG 2007)

A new process that included both a fiscal and performance review became operational in July. Trained three (of six) regional offices on monitoring contractor performance of financial management and cost reporting, data integrity, and asset management.

Conduct training for the three remaining regional offices on monitoring contractor performance of financial management and cost reporting, data integrity, and asset management — October 2007.

Drafted revised Interagency Agreement (IA) with Interior and Agriculture to provide for more accountability on financial and property management by the agencies and greater oversight by Job Corps.

The agencies will continue to work collaboratively to revise the drafted IA and expect a final IA to become effective in FY 2008.

Ensure student safety and health.
(OIG 2007)

Addressed the safety and health issues identified by OIG by closing the Oconaluftee Center effective March 22. A Notice to Proceed has been issued to repair failing infrastructure and when work is completed, the Oconaluftee Center will once again commence operations.

Implement occupational safety and health standards; develop and disseminate programs promoting occupational safety and health; ensure timely and accurate injury reporting; provide technical assistance, conduct annual safety and health reviews; monitor quarterly facility inspection reports; and, assist regions in approving center abatement plans — FY 2008.

Assess incoming students for cognitive disabilities.
Federal law requires assessment for cognitive disabilities under specific circumstances.
(OIG 2007)

Revised screening admissions process to ensure that criteria are objective and comply with nondiscrimination laws. Hired part-time Regional Disability Coordinators and revised the Health Questionnaire to aid in minimizing or removing barriers to success. Began developing training packages and information booklets for center staff on topics related to cognitive disabilities.

Offer staff training opportunities on instructional strategies for cognitively disabled and low achieving students. Strengthen site-level training, technical guidance and monitoring to ensure that students with cognitive disabilities are identified and properly assessed. Convert part-time Regional Disability Coordinators to full time — FY 2008.

III. Ensuring the Security of Employee Benefit Plan Assets

Challenge first identified in FY 2000. Safe-guarding the retirement assets of American workers, retirees, and their families is a daunting challenge that affects the quality of life for millions. EBSA strengthened its enforcement program and leveraged its resources. Affects Strategic Goal 4, Strengthened Economic Protections and Performance Goal 4D - Enhance pension and health benefit security.

Progress Assessment: Green

Implement the Pension Protection Act of 2006.
(2006 PAR)

Issued regulations implementing the Pension Protection Act of 2006.

Continue to implement regulations — FY 2008.

Establish written procedures for the PBGC Board's monitoring of operations.
(GAO-07-22)

Enhanced PBGC's governance processes.

Review and revise PBGC's bylaws to delineate authorities — FY 2008.

Increase efforts toward legislative change to strengthen EBSA oversight authority over plan auditors and the scope of plan audits to increase plan protections for American workers.
(OIG 2007)

Plan audits provide a first-line defense for plan participants against financial loss. DOL's authority to require corrective action is currently limited.

Continued CPA firm inspection program, focusing on firms that conduct at least 200 audits annually. Performed augmented reviews of 450 sets of work papers from CPA firms and referred 24 to the American Institution of Certified Public Accountants Professional Ethics Division or a State board of public accountancy.

Continue to focus on CPA firms that perform a significant amount of plan audit work and to selectively target those that have smaller audit practices for ongoing enforcement — FY 2008.

Continue EBSA efforts to decrease the number of fraudulent Multiple Employer Welfare Arrangements (MEWAs).

Continue to work closely with State insurance commissioners and the Department of Justice to identify and prosecute fraudulent MEWAs.
(OIG 2007, 2006 PAR)

Worked with the Department of Justice to prosecute these complex white-collar crimes. Closed 36 civil and criminal MEWA cases that restored, protected, corrected or recovered in excess of $5.1 million. Met with National Association of Insurance Commissioners (NAIC) quarterly to coordinate actions against fraudulent MEWA operators.

Health Fraud/MEWAs is an EBSA national enforcement project with a focus on health fraud recidivists. EBSA will continue to coordinate closely with NAIC and DOJ officials — FY 2008.

IV. Safeguarding Unemployment Insurance

Challenge first identified in FY 2000. Preventing overpayments and reducing fraud against these programs remains a major challenge. The Department, other Federal agencies, and the states are further challenged in having the necessary systems and controls in place to quickly respond and yet prevent improper payments during national emergencies or disasters. Affects Strategic Goal 4 — Strengthened Economic Protections, and Performance Goal 4A - Make timely and accurate benefit payments to unemployed workers, facilitate the reemployment of unemployment insurance beneficiaries and set up unemployment tax accounts promptly for new employers.

Progress Assessment: Green

Prevent overpayments.

Continue to disseminate information about best practices and promote the use of mechanisms, to identify ineligible claimants more timely. Require states to cross-match UI payments selected for Benefit Accuracy Measurement audits with the National Directory of New Hires (NDNH) to improve detection of erroneous payments.
(OIG 2007, 2006 PAR)

Issued a Directive requiring all states to incorporate the NDNH cross match into their Benefit Accuracy Measurement audits. All states are expected to comply by the January 2008 deadline.

All states incorporate the NDNH cross match into their Benefit Accuracy Measurement audits — January 2008.

Monitor the initiation of cross-matching activities. If a State fails to implement cross-matching, it will be required to address remedies in its annual State Quality Service Plan for the next fiscal year — FY 2008.

Collect results of Reemployment and Eligibility Assessment (REA) Grants. (2006 PAR)

Analysis of REA report revealed that in some states, REAs enhanced rapid reemployment of unemployed and reduced overpayments while other states found no significant impact. Even though results were uneven, REA grants are likely effective and ETA solicited all states for REA grant applications.

Requested $40 million in the FY 2008 President's Budget to expand the number of states receiving REA grants to about forty.

Reduce fraud.

Contingent upon the appropriation of funds and passage of the Integrity Act, State UI agencies will increase efforts to prevent fraudulent employment benefit claims.
(OIG 2007, 2006 PAR)

The Integrity Act included in the President's FY 2007 Budget did not receive Congressional action, but has been included again in the President's FY 2008 Budget request.

Continue to promote enactment of the 2008 Integrity Act — FY 2008.

Conduct an Integrity Conference for State UI agencies — FY 2008.

V. Improving the Federal Employees' Compensation Act (FECA) Program

Challenge first identified in FY 2005. FECA is one of three DOL programs classified as high risk for improper payments due to the amount of benefits paid. (The other two are UI and WIA.) Affects Strategic Goal 4, Strengthened Economic Protections and Performance Goal 4B-Reduce the consequences of work-related injuries.

Progress Assessment: Green

Reduce improper payments.

OWCP had not consistently obtained and reviewed medical evidence when determining claimants' continued eligibility for FECA compensation payments.
(OIG 2007)

Ensure that current medical information for claimants is on file, so that payments are not made to those who are no longer disabled. (2006 PAR)

Conducted testing of iFECS system controls to ensure that current medical evidence is on file during FECA program district office accountability reviews.

Monitor and adjust iFECS as necessary — FY 2008.

Reduce fraud.

OWCP does not have legal authority to match FECA compensation recipients against their social security wage records to identify those who are collecting FECA benefits while working.
(OIG 2007)

Seek legislative reforms to enhance incentives for injured employees to return to work; address benefit equity issues; discourage unsubstantiated claims; and make other improvements. (2006 PAR)

Redrafted legislative proposal to include a provision to enable data record matching of FECA payment records with SSA records to identify concurrent receipt of FERS retirement benefits and receipt of employment earnings. Estimated savings of the entire legislative proposal over ten years is $608 million.

Transmit draft bill to Congress —
FY 2008.

VI. Improving Procurement Integrity

Challenge first identified in FY 2005. DOL resolved all prior procurement recommendations except one. The OIG believes the Department should move quickly to fill the CAO position and place the Department's acquisition workforce under the supervision of the CAO. Affects all DOL strategic goals.

Progress Assessment: Yellow

Improve procurement integrity.

Resolve the "unresolved and open" OIG procurement recommendations.
(OIG 2007, 2006 PAR)

Issued Secretary's Order 2-2007 establishing the Chief Acquisition Officer (CAO) position and requiring acquisition management to be the CAO's primary duty. The CAO will report to the Secretary with day-to-day guidance from the Deputy Secretary and will have responsibility for overseeing Department acquisition activities.

Issue decision on recommendation that Departmental procurement responsibilities be removed from the Office of the Assistant Secretary for Administration and Management and that a Senior Procurement Executive position reporting to the Deputy Secretary be established — FY 2008.

VII. Securing Information Technology Systems and Protecting Related Information Assets

Challenge first identified in FY 2002. Developing and maintaining efficient, effective and secure systems is an ongoing challenge. DOL successfully completed its challenges in the FY 2006 PAR to enhance incident response capability and maintain information technology security. In addition, DOL was the first agency to successfully implement Smart Card requirements in Homeland Security Presidential Directive 12. Affects all DOL strategic goals.

Progress Assessment: Green

Secure Personally Identifiable Information (PII).

Implement security controls for protection of remote information provided in OMB's Memorandum "Protection of Sensitive Agency Information".
(OIG 2007)

Developed and began implementing a plan to protect personally identifiable information (PII) in compliance with OMB requirements.

Drafted DOL Directive on for PII, revised the Computer Security Handbook (CSH), and implemented an annual process requiring agencies to review their PII and sensitive data.

DOL-wide implementation of OMB requirements — Ongoing.

Complete DOL Clearance process for DLMS 9-1200 — December 2007.

Revised incident handling procedures to include new requirements for reporting incidents involving PII and developed a breach notification policy.

Develop policy and procedures for logging computers' readable extract — June 2008.

Began deploying encryption of mobile devices and computers and selected a solution for 2-factor authentication.

Implement 2-factor authentication solution for remote access capabilities — June 2008.

Drafted policy regarding user responsibility to safeguard PII.

Finalize and issue the PII Rules and Consequences Policy — FY 2008.

Established a Task Force of representatives from each DOL agency to eliminate unnecessary use of SSN and reduce holdings of PII.

Implement SSN Reduction Implementation plan milestones —
FY 2008-FY 2009.

Prevent unauthorized access to systems.
(OIG 2007)

Be proactive in identifying and mitigating IT security weaknesses. (2006 PAR)

Revised the Computer Security Handbook (CSH) to incorporate National Institute of Standards and Technology (NIST) Security Controls for Federal Information Systems requirements for all minimum controls. Performed Access Controls security controls testing and evaluation for all DOL Major Information Systems. Implemented agency specific continuous monitoring requirements.

Complete revision to the CSH to incorporate additional requirements for access controls — June 2008.

Implement enhanced security controls testing and evaluation process — FY 2008.

Transition VETS' major information systems to DOL's ECN /DCN and properly apportion security responsibilities between the OASAM and VETS Security teams — March 2008.

Ensure certification and accreditation of systems.
(OIG 2007)

Completed a comprehensive review of DOL's security certification and accreditation document repository to ensure the documentation was complete and current for all systems.

Revise DOL's CSH to incorporate additional NIST Recommended Security Controls for certification and accreditation — June 2008.

Continue to review certification and accreditation documentation to ensure adequacy as they are revised and updated — Ongoing.

Create an independent Chief Information Officer (CIO).

Consider having agency security officers report to the Chief Information Security Officer (CISO) in addition to reporting to their agency heads. Consider having the CISO report to the Secretary's Office as well as to the CIO.
(OIG 2007)

Considered the creation of a new CIO position.

Issue a decision regarding the creation of a new CIO position and consider having agency security officers report to the CISO in addition to their agency heads and having the CISO report to the Secretary's office in addition to the CIO — FY 2008.

VIII. Maintaining the Integrity of the Foreign Labor Certification Program

Challenge first identified in FY 2001. Problems with the integrity of the labor certification process and fraud may result in economic hardship for American workers, the abuse of foreign workers, and may have national security implications when applications are not adequately screened. DOL published the PERM fraud regulation reducing the incentives and opportunities for fraud and abuse. Affects Strategic Goal 2 — A Competitive Workforce, Performance Goal 2H-Address worker shortages through the Foreign Labor Certification.

Progress Assessment: Green

Reduce high incidence of fraud.

Increase the detection of fraudulent labor applications during the certification process.
(OIG 2007)

Reduce the incidence of applications certified with wage rates on the application that are lower than the prevailing wage and erroneous employer identification numbers. (2006 PAR)

Programmed the H-1B Application System to verify that the wage rate listed on the employer's application is at least the prevailing wage for the occupation and enhanced the system to check for inaccuracies in the Employer Identification Numbers, based on data checks currently in place for employers filing W-2 Wage Reports.

Monitor the impact of the actions taken in FY 2007 and make adjustments as necessary to enhance detection of fraud — FY 2008.

Reduce certification backlogs.

It remains a challenge to avoid backlogs while maintaining the integrity of the FLC process.
(OIG 2007)

In 2006, DOL received 125,000 applications at the National Processing Centers in Atlanta and Chicago. In addition to reducing backlog, DOL is challenged to prevent new backlogs. (2006 PAR)

Permanent Certification Program
Eliminated backlog. To address limited resources, DOL proposed a fee on employers for the processing of Permanent Labor Certifications.

Temporary, agricultural worker (H-2A visas)
In response to a 19 percent increase in demand and processing delays at the States, trained State Workforce Agencies in requirements for the H-2A program. Requested retaining the H-2A processing fee revenue to offset the costs.

Review regulations implementing the H-2A program and institute changes providing farmers with an orderly and timely flow of foreign legal workers, while protecting the rights of American laborers — FY 2008.

Temporary, non-agricultural workers (H-2B visas)
Responding to a more than 20 percent increase in demand, some PERM resources were temporarily reallocated to eliminate an applications backlog in the H-2B Program. Requested authority to establish a fee structure to cover the Department's direct costs of administering the H-2B program.

Monitor H-2B application caseloads and act to address backlogs as they arise — FY 2008.

Issue regulations streamlining the process by moving from a government-certified system to an employer-attestation system akin to the PERM system that has reduced backlogs — FY 2008.

IX. Improving Performance Accountability of Grants

Challenge first identified in FY 2007. The competitiveness of the American workforce is a top priority. The OIG found high error rates in the performance data reported by DOL direct grantees that raised concerns about the usefulness of that data for decision making. ETA made progress in improving performance data by making data validation by the states a criterion for incentive awards. (This information was taken into account when preparing the relevant ETA Performance Data Quality Assessments. For information about the DOL Performance Data Quality Assessments, please see the Performance Section Introduction.) Due to funding constraints, ETA did not modify data validation software to allow Federal staff to sample records at the State level, and instead Regional staff will continue to request manual samples for review. In addition, ETA did not meet milestones for developing a monitoring guide for the trade program as an addendum to the ETA Core Monitoring Guide and continues to use the draft issued in FY 2005 as a tool. ETA's Workforce Investment Streamlined Performance System, scheduled for implementation in FY 2008, will integrate and expand program reporting. Affects Strategic Goal 1: A Prepared Workforce, Performance Goals 1C-1D, and Goal 2: A Competitive Workforce, Performance Goals 2A-G.

Progress Assessment: Yellow

Improve monitoring of direct grants.

Audits of three direct or non-formula grantees showed underperformance, services to participants whose eligibility was not established, unsupported or unallowable costs, and inadequate financial and performance reporting systems.
(OIG 2007)

Held new grantee training, including sessions on allowable costs and eligibility requirements. Federal grant managers conducted desk reviews of grantee financial and performance quarterly reports as well as on-site reviews. Grant project officers provided ongoing assistance throughout the life of the grant.

Emphasize financial and performance requirements at new grantee training sessions — FY 2008.
Train grant project officers — FY 2008.
In the Solicitation for Grant Applications (the vehicle used by ETA to award non-formula grants), continue to comply with applicable Federal laws, regulations, and OMB circulars. Selected grantees must conduct or will be subject to independent evaluations to determine the outcomes and benefits of the projects — FY 2008.

Audit ETA data validation.

DOL lacks monitoring procedures to ensure that single audits of its grantees are completed and that reports are received in a timely manner for those grantees that meet the single audit threshold.
(OIG 2007)

DOL uses audits conducted by independent accountants or State auditors under the Single Audit Act (SAA) to provide oversight of more than 90 percent of DOL expenditures by State and local governments and non-DOL organizations. (2006 PAR)

Monitored grantees' performance on submitting their audit reports required under the single audit act to the Federal government. Additionally, ETA modified its standard grant agreement to emphasize adherence to the single audit submission requirements.

Develop and test the monitoring procedures for the single audit report submission — FY 2008.
Codify procedures into the appropriate offices' Procedures Manuals — FY 2008.

Improve performance measurement for Youthbuild grants, transferred from HUD to DOL in 2007.
(GAO-07-82)

Built a Web-based MIS/Case Management System for YouthBuild.

Produce quarterly performance reports that include three common performance measures (placement in employment/education, attainment of a degree/certificate, and literacy/numeracy gains) as well as a six month retention rate, a recidivism rate, and additional data — FY 2008.

Work with States to improve data quality.

Implement reporting format (Workforce Investment Streamlined Performance System — WISPR) to enable DOL to analyze performance across programs. (2006 PAR)

WISPR implementation delayed.

Implement WISPR, which will expand data collection and reporting — FY 2008.

Collect employer services information to help gauge employer involvement in the One-Stop system.
(GAO-07-167)

The WISPR System will capture employer services data based on customized geographic areas down to the One-Stop Career Center level.

Improve Apprenticeship data quality.

Develop a cost-effective strategy for collecting data from council-monitoring states. Continue to negotiate with states to participate in the Registered Apprenticeship Information System (RAIS). (2006 PAR)

Retention and wage data from Phase I of the performance reporting system for Apprenticeship became available. California and New Hampshire agreed to participate in the RAIS, bringing the total of participating states to 32. Nearly 70% of the Federally managed registered apprentices are registered in RAIS.

Phase II RAIS Quarterly performance data available — FY 2009.

X. Preserving Departmental Records

Challenge first identified in FY 2007. Current DOL policy requires employees to treat e-mail like any paper record. Recently, the OIG reported that employees may not be aware of their responsibilities to preserve Federal records and recommended that DOL require records management training for employees. Affects all DOL strategic goals.

Progress Assessment: Green

Require records management training for managers and employees.
(OIG 2007)

Employees may not be aware of their responsibilities to preserve Federal records.

Conducted numerous records management training sessions throughout the year.

Published and disseminated the DOL Records Management Staff Development Training Plan to DOL Records Officers and Records Management Contacts.

Announced and disseminated NARA's Basic Electronic Records Management Training course to DOL Records Managers, Administrative Officers, Employees, and Agency Heads.

Install a URL link to NARA's "Records Management for Everyone" training course on LaborNet for all DOL employees to receive the training — November 2007.