B-247048 October 6, 1992

B-247048: Oct 6, 1992

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We lack sufficient evidence to agree with IG that the agency improperly used its authority to employ experts and consultants to positions that should have been done by full-time regular government employees. Graham: This is in response to your letter of December 5. The IG concluded that 14 of these appointments were inappropriate because the experts and consultants were hired to perform the duties of regular government employees or they did not have the requisite skills and abilities to meet the definition of expert or consultant. Eight of them were civil service annuitants who the IG concluded should not have been Compensated without a reduction in their annuity because their improper appointment negated their right to this benefit.

B-247048 October 6, 1992

On basis of written record provided by U.S. Arms Control and Disarmament Agency and its Inspector General, we lack sufficient evidence to agree with IG that the agency improperly used its authority to employ experts and consultants to positions that should have been done by full-time regular government employees. See 22 U.S.C. Sec. 2584.

Mr. Thomas Graham, Jr. General Counsel United States Arms Control and Disarmament Agency Washington, D.C. 20451

Dear Mr. Graham:

This is in response to your letter of December 5, 1991, concerning the appointment of civil service annuitants as experts or consultants and their exemption from the laws regarding dual compensation.

This question arose as a result of an investigation by the Inspector General (IG) of the Arms Control and Disarmament Agency (ACDA). For fiscal years 1989 and 1990, the IG reviewed the hiring of 18 out of 60 individuals that ACDA appointed under its statutory authority, 22 U.S.C. Sec. 2581 (1988). The IG concluded that 14 of these appointments were inappropriate because the experts and consultants were hired to perform the duties of regular government employees or they did not have the requisite skills and abilities to meet the definition of expert or consultant. Of these 14 individuals, eight of them were civil service annuitants who the IG concluded should not have been Compensated without a reduction in their annuity because their improper appointment negated their right to this benefit.

In response to the IG's report, ACDA denied each of the allegations and requested the views of the Office of Personnel Management (OPM) on this matter. In its response, OPM noted that the IG's report did not contain sufficient detail to enable OPM to comment on the appointments. Also, OPM suggested that ACDA follow through on its proposed administrative changes and conduct quarterly reviews of the expert and consultant program as required in the Federal Personnel Manual (FPM).

As noted above, the authority for ACDA to hire experts and consultants is contained in 22 U.S.C. Sec. 2581(d) which states that the Director of ACDA may procure the services of experts and consultants as provided for under section 3109 of Title 5, United States Code. Section 3l09 provides that agencies, when authorized by an appropriation or other statute, may procure the services of experts and consultants for temporary (less than a year) or intermittent work. This section also provides that such appointments are not subject to the usual rules relative to obtaining a federal position such as competitive examination, job classification, and General Schedule pay grades.

In chapter 304 of the Federal Personnel Manual, agencies are provided with guidance concerning how to use the authority found in section 3109. As this guidance explains, most appointments of experts and consultants create an employee and employer relationship, although experts and consultants may be independent contractors. [1] FPM, Ch. 304, Para. 1-4. Here, all the individuals were appointed as employees and neither the IG nor ACDA have suggested that this should have been otherwise.

With limited exceptions, any individuals receiving a civil service annuity, who are appointed to an expert or consultant position, must have their compensation reduced by the amount of their annuity. 5 U.S.C. Sec. 8344(a). However, experts and consultants employed by ACDA are exempt from the operation of 5 U.S.C. Sec. 8344 and are allowed to receive their annuities and their full compensation. 22 U.S.C. Sec. 2584. Thus, all properly appointed experts and consultants of ACDA, regardless of whether they are employees or independent contractors, are exempt from the restrictions in 5 U.S.C. Sec. 8344.

Essentially we agree with the position of OPM in regard to this dispute. The matter is one concerning the propriety of these appointments, which is a matter within the sound discretion of the agency. On the basis of the record before us, we do not find an abuse of discretion.

Although we cannot agree with the IG that the appointments were inappropriately made, we concur in the recommendation that the agency improve its internal controls. See, for example, our recent reports on the use of experts and consultants in the government. [2]

1. One critical aspect in determining whether an expert or consultant is an independent contractor is whether he or she is supervised and directed by a federal employee. See 53 Comp.Gen. 542 (1974).

2. Federal Workforce - Inappropriate Use of Experts and Consultants at Selected Civilian Agencies, GAO/GGD-91-99 (July 1991) and Experts and Consultants - Weaknesses in Hiring Process at State's Office of Inspector General, GAO/GGD-91-60 (June 1991).