IRS Employee Evaluations

The Internal Revenue Service (IRS) is seeking to transform its organizational culture to one that more fully embraces customer service as a core value. IRS has replaced its old mission statement, which stressed collecting the proper tax at the least cost, with a new one that emphasizes providing world-class customer service by helping taxpayers understand and meet their tax responsibilities and by applying the tax law with integrity and fairness. IRS has undertaken several long-range initiatives to turn the new mission statement into reality. GAO reviewed the extent to which IRS' current employee evaluation system can support the new mission statement during the period IRS will need to revamp its performance management system. To fulfill its new mission statement, IRS will need to depart from the past supervisory practice of emphasizing revenue and efficiency in employee evaluations to one that balances these goals with good customer service. IRS recognizes that making changes to its employee evaluation process will be important in brining about cultural change and establishing customer service as an agency priority. However, because of the magnitude of the changes that IRS is undertaking, it is unclear when such a system will become fully operational and a new employee evaluation process will be put in place. In the meantime, IRS could take better advantage of opportunities within the current evaluation process to reinforce the important of customer service among its frontline enforcement employees.

GAO noted that: (1) IRS could take advantage of opportunities within the evaluation process to reinforce the importance of customer service among its frontline enforcement employees; (2) there are a number of reasons for doing so; (3) most importantly, the evaluation process is not aligned with IRS' new mission statement because it emphasizes revenue production more than customer service; (4) also, it is uncertain when a new performance management system that IRS is planning will become fully operational; (5) enforcement employees' two most recent written evaluations for the period ending June 1998 emphasized their revenue production and efficiency skills more than their customer service skills; (6) available evidence indicates that four features of the evaluation process could be used to greater advantage to reinforce the importance of customer service among enforcement employees; (7) if the features were to be used more, however, IRS would need to consider the potential implications for the way in which supervisors allocate their time between these and other administrative tasks; (8) the narrative portion an employee's written evaluation provides flexibility for supervisors to focus on employees' customer service skills; (9) midyear progress reviews, which are required, provide supervisors with opportunities to give interim feedback on aspects of case handling in relation to customer service (and other) goals; (10) mandatory reviews of sampling of completed cases present another opportunity for supervisors to comment on customer service skills because these are ex post facto examinations of documents prepared by employees to support their case decisions; (11) field visits present an excellent opportunity to reinforce customer service; (12) IRS has implemented a number of initiatives to promote customer service; (13) it has: (a) revised its strategic goals; (b) aligned them with its mission statement; and (c) introduced organizational performance measures that are to balance customer satisfaction, employee satisfaction, and business results; (14) in the meantime, IRS has taken several interim actions to encourage enforcement employees to be taxpayer oriented; and (15) it has incorporated into the employee evaluation process a new retention standard relating to the fair and equitable treatment of taxpayers that employees must meet at a passing level to retain their jobs.

Recommendations

Our recommendations from this work are listed below with a Contact for more information. Status will change from "In process" to "Open," "Closed - implemented," or "Closed - not implemented" based on our follow up work.

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