U.S. Department of State Fiscal Year 2019 Agency Financial Report

Managing the Effects of the Department-wide Hiring Freeze As previously noted, the hiring freeze had a particular effect on workforce management this year. On January 23, 2017, the President ordered a Government-wide freeze on the hiring of Federal civilian employees. 69 The Office of Management and Budget (OMB) lifted the hiring freeze on April 12, 2017, when its director released a plan to reduce the size of the Federal Government workforce through attrition, fulfilling a Presidential requirement to develop such a plan before lifting the freeze. 70 However, the Department continued the hiring freeze for another 13 months, until the Secretary lifted it on May 15, 2018. 71 A review by OIG showed that the freeze had a broad and significant effect on overall Department operations. 72 The hiring freeze particularly affected on-board staffing levels for the Department’s eligible family members and Civil Service employees, which declined by 20.7 percent for the former and by 7.1 percent for the latter from January 2017 to May 2018 when the freeze was lifted. 73 Bureaus and offices consistently described the process of requesting exemptions to the hiring freeze as time-consuming, inefficient, and frustrating. 74 Bureaus also reported that they were unable to approve training and other professional development during the hiring freeze because of heavy workloads and Department-wide restrictions on detail assignments, which affected their ability to develop their workforces. 75 We also noted that its implementation was not guided by any strategic goals linked to a discrete, but related, exercise to prepare a plan to improve the economy and efficiency 69 The White House, Memorandum for Heads of Executive Departments and Agencies, Subject: Hiring Freeze (January 23, 2017). 70 OMB, Comprehensive Plan for Reforming the Federal Government and Reducing the Federal Civilian Workforce (M-17-22, April 12, 2017). 71 18 STATE 64296, “Lifting the Hiring Freeze,” June 25, 2018. 72 OIG, Review of the Effects of the Department of State Hiring Freeze (ISP-I-19-23, August 2019). 73 Ibid . 74 Ibid . 75 Ibid . 76 3 FAM 1214 (September 21, 2018). of Department operations, known as the organizational reform effort. This disconnect led to an inability to apply staffing reductions in a way that reflected the Department’s strategic goals. Lastly, our review found that all the bureaus and offices (38) and 97 percent of the embassies and consulates (145) that responded to our survey reported that the hiring freeze had either a somewhat negative or very negative effect on employee morale and welfare. Employees told OIG that the hiring freeze contributed to excessive workloads, and the lack of transparency about the objectives intended to be achieved by the hiring freeze caused some to be concerned about losing their jobs. Holding Leadership Accountable to Department Principles Strong leadership that adheres to appropriate standards is vital to ensuring a successful workforce. The Department’s Leadership and Management Principles guide the management of its workforce. 76 These principles state that the Department relies on all employees to represent the U.S. Government in the course of carrying out its mission. However, managers and supervisors within the Department have a special responsibility to ensure the mission is carried out by leading by example to foster the highest attainable degree of employee morale and productivity. A report on leadership within the Bureau of International Organization Affairs revealed numerous complaints, including allegations of disrespectful and hostile treatment of employees, unmerited accusations of disloyalty, and retaliation based on 2019 A gency F inancial R eport U nited S tates D epartment of S tate | 123 INSPECTOR GENERAL’S STATEMENT ON THE DEPARTMENT’S MAJOR MANAGEMENT AND PERFORMANCE CHALLENGES | OTHER INFORMATION