Agencies use more early-outs, buyouts

Federal agencies are turning more frequently to buyouts and early-outs to reshape their workforces, according to a new Government Accountability Office report released today.

The total number of agencies using this method to adjust their workforces has increased from 28 to 51 between fiscal years 2003 and 2005, GAO found. The total number of buyout and early-out programs jumped from 136 in 2003 to 179 last year, and at least 22,600 employees have left federal services under such authorities, GAO found.

Between fiscal 2003 and 2005, the Energy Department offered its employees 40 buyout and early-out programs, the most of any agency during the time period, according to the report. The Department of Health and Human Services offered 39 programs.

The Office of Personnel Management must grant an agency the authority to offer employees voluntary separation incentive payments, or a buyout, and a voluntary early retirement, called an early-out.

GAO recommends that OPM share information on the successful uses of such offers and help agencies assess their programs’ effectiveness. It also suggested a program assessment for potential improvements.

“As agencies transform to better meet the 21st-century challenges and changing missions, they are increasingly recognizing the need to reshape their workforces to meet these challenges,” the report states.

Officials at six agencies interviewed by GAO agreed that increasing the amount agencies can pay under buyouts and early-outs would make the program more attractive to employees. They also suggested that OPM allow agencies to make minor changes to an approved plan.

The Chief Human Capital Officer Act of 2002 expanded buyout and early-out authority to give agencies the flexibility to reorganize should they need to reduce organizational layers, transfer functions or reduce operating costs.