Private Sector More Likely Than Gov't to Cut Poorly Performing or Unneeded Workers

By Susan Jones | March 10, 2015 | 1:02 PM EDT

"Federal agencies’ ability to address poor performance has been a longstanding issue," the GAO says in a report dated February 2015. (AP File Photo)

( - Workers in the private sector are more likely to be laid off or involuntarily discharged than government workers are, according to data from the Bureau of Labor statistics.

Coincidentally, the Government Accountability Office recently released a report saying the federal government needs to do a better job of weeding out poorly performing employees.

In January 2015, 1.3 percent of workers in private, nonfarm industry were laid off or involuntarily discharged, compared with only 0.5 percent of civilian government workers (federal, state and local), the BLS reported on Tuesday.

And for all of 2014, that turnover discrepancy persists: 16.5 percent of private sector workers were laid off or involuntarily discharged, compared with 4.9 percent of all civilian government workers (federal, state and local).

(The BLS defines an employee "layoff" and an employee "discharge" as a "separation of an employee from an establishment that is initiated by the employer; an involuntary separation.")

'Longstanding issue'

"Federal agencies’ ability to address poor performance has been a longstanding issue," the GAO says in a report dated February 2015.

"Employees and agency leaders share a perception that more needs to be done to address poor performance, as even a small number of poor performers can affect agencies’ capacity to meet their missions."

According to GAO, federal agencies in 2013 dismissed 3,489 employees for performance or a combination of performance and conduct, representing 0.18 percent of
the 1.93-million-strong career, permanent, civilian workforce.

Over the last ten years (2004-2013), the number of federal agency employees dismissed for performance or a combination of performance and conduct ranged from a low of 3,405 in 2006 to a high of 4,840 in 2009; on average, around 4,000 individuals were dismissed for performance-related reasons annually.

The rate of dismissals for individuals in the career permanent workforce (2004-2013) ranged from a low of 0.18 percent in 2013 to a high of 0.27 percent in 2009, GAO said.

The report notes that federal agencies have three ways to deal with poorly performing employees: Managers with the right skills can provide regular feedback to improve a workers' performance; supervisors can take advantage of the one-year probationary period to eliminate poor performers; or supervisors can launch formal dismissal procedures of permanent employees, but this is "more time and resource intensive than probationary dismissals."

The audit concluded that supervisors often do not make effective use of the one-year probationary period to evaluate employees' performance. "Because dismissing a poorly performing employee becomes more difficult and time consuming after the probationary period, it is important that agencies use this time to assess employee performance and dismiss those that cannot do the work."

GAO also found that the time and effort needed to remove a sub-par worker after the probation period ends "can be substantial," taking six months to a year -- and sometimes longer -- to dismiss a permanent career employee.

As an alternative to dismissal, federal agencies may also demote or reassign poorly performing employees: For example GAO noted that federal agencies reassigned 652 employees for performance-related reasons in 2013, which means they were moved to a job of the same pay-grade. Another 168 employees were demoted for performance reasons in 2013.

GAO said dismissing employees "is and should be a last resort in performance management."  But -- "when the employee cannot perform the work, the employee voluntarily leaving the agency can be the most favorable outcome for both the agency and the employee."

The report said there's no way to determine how many federal agency career employees voluntarily resign or retire each year because of poor performance reviews. "However, according to experts we interviewed, such separations happen 'all the time,'" GAO said.

Of the 2,001 employees receiving an “unacceptable” performance rating in 2009, 1,104 (55 percent) remained employed with the same agency in 2013, while 897 (45 percent) are no longer with the agency. Those remaining with the agency may have improved their performance or may have been reassigned within the agency, the report concluded.

The GAO made four recommendations to the federal Office of Personnel Management, including extending the one-year probationary period for new hires (when they may be fired more easily); and leadership training for supervisors.

The GAO audit was conducted from February 2014 through January 2015.

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