Human Capital
Continued Opportunities Exist for FDA and OPM to Improve Oversight of Recruitment, Relocation, and Retention Incentives
GAO-10-226, Jan 22, 2010
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The Food and Drug Administration (FDA) within the Department of Health and Human Services (HHS) has faced challenges in obtaining the workforce needed to support its responsibilities and similar to other agencies, has paid selected employees recruitment, relocation, and retention (3R) incentives. This report examines (1) the extent to which FDA is linking its use of 3R incentives to its strategic human capital approaches to address its current and emerging challenges; (2) the extent to which FDA's 3R incentives were awarded consistent with regulations and the internal controls FDA has in place to ensure proper disbursement of 3R incentives; and (3) the steps the Office of Personnel Management (OPM) has taken to help ensure that agencies have effective oversight of their 3R incentive programs and how HHS is providing oversight. GAO analyzed a stratified sample of FDA's 3R incentives files, 3R data provided by HHS, HHS's 3R policy and FDA's guidance, and interviewed HHS, FDA, and OPM senior officials.
Retention incentives encompass the majority of 3R incentives awarded to FDA employees in recent years. FDA's employees in mission-critical occupations received the greatest number of 3R incentives from 2007 to 2009. However, without an updated strategic workforce plan or established agencywide indicators for tracking its use of 3R incentives, FDA cannot assess the impact that these incentives have on its overall human capital strategy. While FDA collects data on workforce indicators at the agency and center levels, it has not analyzed how 3R incentives are helping the agency achieve its recruitment and retention goals. On the basis of GAO's review of a stratified sample of FDA's 3R incentive files awarded from January 2007 through October 2008, GAO found that FDA maintained documentation which provided sufficient explanation to justify each award. However, several of the incentive files we reviewed lacked adherence to certain other requirements, such as prescribed contents of a service agreement, which in most instances may have resulted from a lack of documentation. To help ensure the proper awarding of 3R incentives, FDA has various internal controls in place, such as a centralized review and approval process for incentive requests. Over the past 3 years, FDA has made some changes to its internal controls, such as updating its guidance including the standard forms for 3R incentive requests. If effectively implemented, FDA's revisions to its internal controls may help ensure that in the future 3R incentives are properly awarded and documentation exists to support the incentives. While both OPM and HHS provide oversight of 3R incentives through various mechanisms, including guidance and periodic evaluations and accountability reviews, there are opportunities for improvement. As a next step, OPM could provide guidance to all agencies on the importance of considering succession planning in the decision process for awarding retention incentives. While HHS's 3R incentive policy generally addressed the requirements for 3R incentive plans as outlined in OPM's regulations, there were several instances where the policy omitted or did not clearly address certain important requirements, such as the conditions for terminating or reducing an incentive.
Status Legend:
Status will change from "In process" to "Open," "Closed - implemented," or "Closed - not implemented" based on our follow up work.
- In Process
- Open
- Closed - implemented
- Closed - not implemented
Recommendations for Executive Action
Recommendation: As OPM implements the results of its governmentwide 3R incentive review, the Director of OPM should require agencies to incorporate succession planning efforts into the decision process for awarding retention incentives and document this requirement for succession planning in their 3R incentive plans.
Agency Affected: Office of Personnel Management
Status: Open
Comments: In January 2011, OPM issued proposed regulations to add succession planning to the list of factors an agency may consider before approving a retention incentive for an employee who would be likely to leave the federal service in the absence of the incentive. OPM states that specifically listing this factor in the regulations will strengthen the relationship between succession planning and retention incentives. We are awaiting issuance of the final regulations, which are expected in 2012.
Recommendation: As FDA implements the results of its 2009 review of 3R incentives, the Commissioner of FDA should continue to strengthen FDA's internal controls for requesting, approving, and processing 3R incentives by ensuring 3R incentive files are properly completed and reviewed to address policy and regulatory requirements before the employees receive the incentive payments.
Agency Affected: Department of Health and Human Services: Food and Drug Administration
Status: Open
Comments: FDA officials said staff from the Office of Management has coordinated with FDA program staff to ensure that actions are properly documented and that actions submitted to the Office of Human Resources are properly processed. The Office of Human Resources has implemented a "hard stop" mechanism to ensure that payments of incentives automatically terminate upon the not to exceed date of the retention incentive in order to help reduce overpayments and processing errors. We asked the FDA liaison for a copy of the most recent guiding principles FDA uses to govern the use of 3R incentives and provide managers with parameters for the use to see if additional language has been added regarding internal controls.
Recommendation: As FDA implements the results of its 2009 review of 3R incentives, the Commissioner of FDA should continue to strengthen FDA's internal controls for requesting, approving, and processing 3R incentives by updating the guidance for awarding 3R incentives to include the payment method used for retention incentives and all the conditions for terminating a retention incentive when no service agreement is required.
Agency Affected: Department of Health and Human Services: Food and Drug Administration
Status: Open
Comments: FDA officials said they added additional instructions to the 3R incentive request forms to address both payment method and conditions for termination. We asked the FDA liaison for a copy of the most recent 3R incentive forms and the guiding principles FDA uses to govern the use of 3R incentives and provide managers with parameters for the use.
Recommendation: To better align the use of 3R incentives with the agency's human capital goals, the Commissioner of FDA should update FDA's strategic workforce plan to document the agency's recruitment and retention goals and strategies and as part of that update, identify indicators to better track the progress of 3R incentives over time in addressing the agency's recruitment and retention goals.
Agency Affected: Department of Health and Human Services: Food and Drug Administration
Status: Open
Comments: In the update of its Strategic Human Capital Plan for 2010-2012, FDA officials said it added goals, objectives, and performance measures related to 3R incentives with target dates: Develop and issue new 3R policy and guidance (if necessary) by June 2011; and Establish agency-wide indicators for tracking the progress of 3R incentives in addressing recruitment and retention needs by October 2011 and 2012. We asked the FDA liaison for a copy of the plan and an update on the status of addressing these indicators.
Recommendation: To ensure the department and operating division (OPDIVs) are aware of HHS's policy in all areas of 3R incentives and use these incentives consistent with law and OPM regulations, the Secretary of HHS should revise HHS's 3R incentive policy to ensure that the guidance provided clearly addresses certain important requirements outlined in the regulations.
Agency Affected: Department of Health and Human Services
Status: Open
Comments: We contacted the HHS liaison office regarding the status of the agency's efforts in addressing the recommendation, but did not hear back. We will continue our efforts to follow up with the liaison.