Follow-Up Review of Federal Overtime Practices

GAO made a follow-up review of Federal agency and Office of Management and Budget (OMB) actions to detect and prevent overtime abuses.

Federal managers are now placing more emphasis on preventing overtime abuses and focusing more attention on the need for adequate controls in authorizing, approving, and monitoring overtime use. Inspector General offices and fraud hotlines were established which serve as instruments for detecting overtime fraud. GAO approval of an agency's accounting system is one of the best indicators that a system has been designed to minimize the opportunity for fraud and abuse. OMB issued a memorandum instructing the agency heads to: (1) analyze the use of funds for premium pay, including overtime, to be certain the use is justified; (2) be certain that all reasonable alternatives are explored before resorting to the use of overtime; (3) make sure that the agency has adequate procedures for the approval, monitoring, and auditing of overtime use to avoid abuses; (4) devise stronger controls if current systems are inadequate; and (5) test controls periodically to ensure that they are working properly. OMB has also instructed its staff to monitor the steps taken by agencies to control the use of overtime. Overtime usage has continued to increase, and a marked increase in overtime costs is expected because of hiring freezes and personnel ceilings. Management is responsible for correcting situations which consistently require overtime by maximizing effectiveness of the work flow and systematically and objectively determining workforce requirements. They must consider alternatives to overtime which are within the constraints of personnel ceilings.