Energy Management:

Department of Energy's Efforts to Manage Overtime Costs Have Been Limited

RCED-94-282: Published: Sep 27, 1994. Publicly Released: Oct 3, 1994.

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Pursuant to a congressional request, GAO reviewed the Department of Energy's (DOE): (1) overtime costs for calendar years 1989 through 1993; and (2) efforts to manage overtime and minimize costs.

GAO found that: (1) DOE direct overtime costs almost doubled from $15.5 million in 1989 to $30.4 million in 1992; (2) direct overtime costs declined to $26.5 million in 1993, mainly due to the Bonneville Power Administration's (BPA) reduction of its overtime costs to improve its financial condition; (3) DOE pays, on average, an additional $1.5 million annually in indirect overtime costs that result from its share of social security contributions and unused compensatory time; (4) the DOE organizations and activities that contribute to overtime costs vary significantly; (5) BPA and the Albuquerque Field Office account for over 60 percent of total DOE overtime costs; (6) DOE written justifications for overtime are often vague and are reviewed by only the employees' immediate supervisors; (7) DOE has no guidance on what constitutes essential work; (8) many DOE offices believe that overtime is needed because they do not have sufficient staff to meet their increasing workloads; (9) DOE does not require higher-paid employees to take compensatory time in lieu of overtime pay for irregular or unscheduled overtime; (10) DOE pays for unused compensatory time at the overtime rate; and (11) contrary to policy, DOE does not always plan employees' annual leave to minimize the use of overtime because many supervisors are unaware of the requirement.

Recommendations for Executive Action

  1. Status: Closed - Implemented

    Comments: DOE has required more stringent documentation for overtime to include the specific tasks to be performed and the reasons why the work could not be accomplished during the regular workday.

    Recommendation: To put DOE in a better position to manage overtime and minimize costs, the Secretary of Energy should revise the agency's overtime policy guidance to more specifically define what constitutes adequate written justification to demonstrate that overtime is needed and cost-effective. Also, such justification should be reviewed periodically by DOE management to assess overall trends and ensure that the types of activities driving overtime are essential from an agencywide perspective.

    Agency Affected: Department of Energy

  2. Status: Closed - Implemented

    Comments: DOE has changed its policy of paying for earned compensatory time if it has not been used by the requisite time and delegated to managers the authority to require compensatory time off instead of overtime payment to higher-paid employees.

    Recommendation: To put DOE in a better position to manage overtime and minimize costs, the Secretary of Energy should develop a more restrictive policy on overtime payments to higher-paid employees. Specifically, for higher-paid employees, the Secretary should amend DOE policy to allow DOE managers the option of requiring that compensatory time be granted for irregular or occasional overtime and that payments for unused compensatory time after a specified time be eliminated, unless the employee had no chance to use the compensatory time because of work demands. DOE should also ensure that supervisors are not routinely scheduling excessive amounts of overtime.

    Agency Affected: Department of Energy

  3. Status: Closed - Implemented

    Comments: DOE has placed all overtime requirements in a single overtime policy directive which states that annual leave should not be approved for an employee when such approval will require that employee to work overtime shortly before or after the requested absence.

    Recommendation: To put DOE in a better position to manage overtime and minimize costs, the Secretary of Energy should ensure more effective implementation of DOE policy on overtime and annual leave by clarifying and increasing awareness of the requirement that annual leave and overtime should not be planned and approved close together (e.g., on the same day or the following day). This could be accomplished by ensuring that all overtime requirements are included in a single overtime policy directive and by periodically monitoring the implementation of this policy.

    Agency Affected: Department of Energy

 

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