Continuity Americans are fond of saying that they have a government of laws, not of men. Yet no law ever accomplished anything by itself. Without men and women to perform the work of government, undergirded by law and regulation, government would not function. So in truth we have a government of laws operated by people. Some of these people are elected, some are directly appointed by the President, and many others make up the great body of civil service employees, serving under a merit system. These people, and the personnel system that shapes their working environment, are the subject of this report. A Time of Testing Like everyone else in the Federal Government, civil service employees and the Civil Service Commission found fiscal year 1974 to be a time of testing. Opinion polls reflected the fact that most Americans held their government in low esteem. There were many indications that the public believed government officials were too concerned with day-to-day political developments to care about the continuing functioning of governmental institutions. Yet there were no reports of surprise on the part of these same members of the public that Social Security checks continued to go out on schedule, needed operations were performed in veterans hospitals, agricultural bulletins came out as usual, and the air traffic controllers were on the job. Other civilian employees continued their search for a cancer cure, took steps to save our lakes and rivers, and checked on the safety of children's toys. Still others proceeded with their work of charting the weather with a satellite's eye in the sky, and mapping the minerals of the earth. Obviously, someone was "minding the store." In a television commentary November 23, 1973, Elizabeth Drew said this: "The Bureaucracy, that much maligned group, serves us very well, and despite the pressures and temptations that are put upon it, we have a remarkably, impressively honest government. It is time to speak up for the Federal government civil servants, to honor them, for we owe them a VICE PRESIDENT GERALD R. FORD greets Civil Service Commission executives at the Commission's annual awards ceremony in January 1974. From left are Deputy Executive Director Edward Dunton, Executive Director Bernard Rosen, Vice President Ford, and Chairman Robert Hampton. great deal. Right now, despite great strains, they are holding our government together." If not exactly "as usual," the business of government continued. Throughout the year, the performance of the career service was competent and matter-of-fact. Supportive and Supported The supportive role of the career civil service was by no means overlooked by high officials of the Government. The Comptroller General of the United States, Elmer Staats, told the National Capital Chapter of the American Society for Public Administration on September 14, 1973: "A true analysis will show that over the past several months the impetus for keeping the Government machine operating has come from the career civil servant." Vice President Gerald R. Ford, speaking at the annual awards ceremony of the Civil Service Commission, said on January 16, 1974: "I believe a strong career service is one of the greatest strengths of our democratic process, and one of the best guarantees of sound, effective, and efficient government. . . . It is a work environment for which top-notch people are selected on the basis of ability." In Defense of Merit With the importance of the continuing career civil service thus publicly recognized, the Commission and its staff were much concerned with the integrity of the merit system-the only system, we believe, on which it is possible to build truly effective government. This concern was based on the perception of numerous storm warnings about the integrity of governmental processes. In addition to the statements of Comptroller General Staats quoted earlier, his September 14 speech contained the following passage: "Rightly or not, there has been a growing concern in recent months that a political test has been followed in some instances in filling career jobs, resulting in a deterioration of the merit system. I understand that allegations of this type are under intensive investigation by the Civil Service Commission, and I will make no further comment on this point except to applaud the Commission's action." The investigations to which Mr. Staats referred set in motion a chain of event that had not reached a final conclusion at the end of the fiscal year. Hence a complete account of the results must await the publication of the later annual report. However, developments within the time-frame of this report are detailed factually in the following paragraphs. Through investigation in the General Services Administration, the Commission staff found evidence of the existence of an organized system of according preferential consideration to favored applicants in the filling of some competitive service jobs in that agency. Although political discrimination was not clearly established, the Commission investigation found that GSA officials gave preferential treatment to applicants referred from nominally political or clearly partisan sources. In so doing, they manipulated or disregarded personnel laws and violated merit principles, according to evidence adduced in the investigation. In reporting its findings on October 23, 1973, the Commission required GSA to take a number of corrective actions, including the immediate abolishment of the improper referral system and its operations. Under the Commission's authority to direct discipline, dismissal, or other corrective action with respect to those who violate any of the laws, rules, or regulations it administers, the Executive Director of the Commission on January 7, 1974 issued letters of charges and proposed disciplinary action to eight employees of the General Services Administration. The letters proposed the dismissal of four of these employees, and the suspension of four (two for 90 days, one for 60 days, and one for 30 days). The employees against whom these proposed actions were initiated subsequently filed motions with the Commission's Administrative Law Judge to dismiss the actions. These motions were based primarily on the contention that the Commission lacked authority to initiate disciplinary actions against employees of other agencies. On June 24 the Administrative Law Judge issued a ruling recommending that the Civil Service Commissioners deny the motions to dismiss. The Commissioners' decision adopting the recommendations of the Administrative Law Judge and subsequent action in this matter will be discussed in the Annual Report for FY 1975. Widening Circles A similar investigation undertaken in September 1973 disclosed evidence that the political affiliations or support of both applicants and career employees were considered in filling some positions in the competitive civil service in the Department of Housing and Urban Development. The investigation developed evidence that, through the operation of a special referral system in HUD, recommendations for employment were received from political sources, inquiries were made into the political affiliations of hundreds of applicants and employees, and favored candidates were accorded preferential consideration in certain appointments, reassignments, and promotions to competitive positions. As a result of the Commission's investigation and a parallel inquiry undertaken by HUD, the special referral unit was dismantled and the improper personnel actions associated with it discontinued. Two key employees of the referral unit resigned. The Commission also directed that other steps be taken by HUD to restore the integrity of the merit system within the agency. Letters of proposed disciplinary action were sent by the Commission's Exective Director to nine HUD employees, three proposing dismissals and six suspensions without pay for from 30 to 60 days. The individuals involved have the right to answer the charges and to receive full consideration of their answers, including a hearing before an Administrative Law Judge if desired. Because of jurisdictional questions raised in the GSA cases, the Commission delayed a final decision in the HUD cases pending resolution of the GSA questions. Investigations of alleged merit staffing violations were also begun during the year in the Small Business Administration and the Social and Rehabilitation Service of the Department of Health, Education, and Welfare. In both agencies violations were disclosed, and corrective action was initiated by the Commission after the close of the fiscal year. The Commission made an extensive onsite review of alleged irregularities in the filling of Schedule C positions in the Office of Economic Opportunity-positions excepted from the career service because the duties are policy-determining or involve a confidential relationship between the incumbent and key agency officials. These investigations showed employees misassigned to Schedule C positions, or not performing the Schedule C duties described in their official position descriptions, but instead performing duties appropriate for career positions. As a result, after a number of |