Inspector general investigates Obama Department of Labor for wasteful spending

FEBRUARY 6, 2014 4:00 AM

Wasteful High Jinks at the Labor Department

Staffers slam DOL busy work, propaganda, and favoritism.
By Quin Hillyer

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President Obama’s Department of Labor appointees have shaken things up at the Department, but probably not in ways you would expect. An investigation of DOL practices reveals that Obama appointees are wasting time and resources with public-relations busy work, weird morale-boosting exercises, and many other activities that have nothing to do with helping U.S. workers.

Current and former DOL employees spoke with National Review Online about workplace shenanigans that they say interfere with the department’s mission, which is to promote the welfare of wage earners, job seekers, and retirees; improve working conditions; “advance opportunities” for employment; and “assure work-related benefits and rights.”

Four DOL insiders agreed to be quoted by NRO while others provided additional details and corroboration. All requested anonymity and expressed fear of retaliation. All described a workplace where pressure to join in time- and money-wasting activities unrelated to job tasks was subtle but insistent.
Among the examples of waste current and former Labor Department staffers described to NRO:

1) A series of glossy, expensive, time-consuming, politically charged, and controversial posters displayed in every elevator at the main building of the Department of Labor.

2) Instructions from political appointees for employees to vote in an online religious poll to declare Frances Perkins, the New Deal–era secretary of Labor, a favorite saint.

3) Insistent instructions to staff to participate in a poetry contest.

4) Staff time and money (including on fees) for communications-industry award applications.

5) Staff time and money, along with a $100,000+ contract with an outside communications firm, to promote a national book club revolving around “work, workers, and workplaces and . . . about [the] department’s mission and history.”

6) Use of the department’s (i.e., the taxpayers’) funds to hire a mascot of the Washington Nationals to cheer up employees when sequestration began.

These high jinks began before the arrival of current Labor secretary Thomas Perez. DOL staffers described a near-toxic atmosphere in several divisions of Labor, most particularly the Office of Public Affairs (OPA) and the Occupational Safety and Health Administration (OSHA).

“There’s a sense of entitlement among [Obama’s political] appointees at the Labor Department,” says one source. “They feel that the ethics rules and the rules about effective management and the rules about effectively spending taxpayers’ money do not apply to them.”

Sources told NRO that as many as three communications specialists or artists are asked each week to produce designs for posters to be placed in each elevator in the Frances Perkins Building (FPB), at a cost (including staff time) of tens of thousands of dollars overall.

According to Hilda Solis, Obama’s first secretary of labor, the posters “celebrate our achievements, recognize our colleagues, and articulate our mission.” In practice, most of these “heroes” of the American labor movement are far more valued by the political Left than by the Right. Among them: Mark Ayers, a labor leader who used public speeches to blast “greedy right-wing bastards.” Dolores Huerta, the labor leader and Cesar Chavez associate who serves on the board of the People for the American Way and the Feminist Majority Foundation. Labor-party founder Tony Mazzocchi, who also helped found the peacenik/freezenik Committee for a Sane Nuclear Policy.

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And posters celebrating “LGBT Pride” featured San Francisco administrator Harvey Milk and civil-rights advocate (and onetime Communist-party member) Bayard Rustin.

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The latter caused a real stir. It read: “Bayard Rustin — a labor leader, civil rights advocate and openly gay man — paved the way for lesbian, gay, bisexual and transgender people to make their own unique contributions to the world of work, the U.S. Department of Labor, our country and the world.”

A number of the Rustin posters were ripped down. Two sources claimed that the culprits actually were black employees angry that homosexual advocacy was being equated in kind and importance with black Americans’ struggle for civil rights.

In response, the posters thenceforth were mounted in expensive, locked-glass cases for protection. Secretary Solis sent a three-page letter to all departmental employees waxing eloquent on the contribution of homosexuals, boasting about her efforts to have the department promote LGBT equality and celebrate LGBT pride (including a banner over the building entrance) — and blasting the unnamed vandals who tore down the elevator posters.

“Earlier today,” she wrote on June 23, 2011, “we screened a documentary about Bayard Rustin here in the FPB. We’ve provided copies of the video to our regional offices and have encouraged them to sponsor similar events. I’ve instructed the Wirtz Library to screen the film for any employees who would like to watch it, individually or as a group. My office is happy to partner with any agency or group that would like to screen the film.”

Regarding the second example of waste at Labor, the religious poll: In 2010, two Episcopal priests launched Lent Madness, a take-off on NCAA basketball March Madness in which voters choose their favorite Christian saints. Labor higher-ups pushed employees to take part in the religiously themed event.

Because former Labor secretary Frances Perkins is recognized as a saint by the Episcopal Church, Labor Department public-affairs senior adviser Carl Fillichio sent an e-mail to his employees on March 1, 2013 (the first day of sequestration, no less), urging them to vote in the poll. “Show your love for Frances today and help her reach the ‘Saintly Sixteen’ round!” Fillichio wrote. “Don’t forget to vote. And forward to friends and familiy [sic].” One source questioned whether this was a violation of church-state separation.

Other employees speculate that the strange campaign may have created a security breach. Online registration was required to vote. “All of this is a violation of DOL computer-security protocol, which prohibits using government computers for personal use,” says one source.

Shortly after Lent Madness, the department suffered a computer phishing attack severe enough that department tech support sent a department-wide e-mail warning employees about phishing and advising them on how to avoid it.

Contacted for comment, the public-affairs adviser Fillichio defended the exercise. “The office of the assistant secretary for administration and management and the office of the solicitor, including the department’s ethics attorneys, conducted an investigation that concluded that the activity ‘did not violate any law, regulation, or policy’ and ‘determined that the activity did not result in a computer security breach,’” Fillichio told NRO.

Regarding the third time-and-money waster, on poetry, this past December and January, OSHA chief David Michaels had his staff repeatedly push employees to enter an internal New Year’s poetry contest in conjunction with a holiday party. His last urging came in the form of an e-mailed poem urging entries in which employees would:

Sing of last year’s deeds.
Feats of which you’re proud.
Now’s your chance to boast
Bragging’s clearly allowed. . . .
Since, after all, we’re OSHA,
And this is our celebration,
You must voluntarily comply
With mandatory regulation.

Several employees griped about Michaels’s poetic pestering. “They waste employees’ time asking them to enter the national poetry contest or to log on to an outside website and vote in a religious poll,” said one. “Both of those examples take away from staff time, and it’s against government protocol to use computers for non-government things . . . So the question is, How many workers were injured the week that the head of OSHA directed his staff to concentrate on the national poetry contest and diverted their attention from protecting workers?”

In the fourth example in our list of waste, inordinate time and money were spent on an internal news magazine called “Frances Mag” and on entries (and fees) in outsidePR-award contests, some DOL employees complained. Fillichio announced the contest, critics said, in a self-aggrandizing manner. Frances won a Ragan’s Employee Communications Award (fee for each entry, paid by taxpayers: $225) for a cover story called “Is There Anything OSHA Inspectors Won’t Eat?”

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Ragan’s, in granting the award, noted that “the issue as a whole dealt with such food-related issues as ethical questions for employees at events where food is served and stories of courage on the part of employees investigating wage and safety conditions in stockyards, restaurants, and everything in between.”

The Labor communications office entered many other contests as well, ranging from the “Blue Pencil and Blue Screen Awards” of the National Association of Government Communications to the “Thoth Awards” from the Public Relations Society of America. “Often there are more than 40 categories that the DOL <acronym title="Google Page Ranking">PR</acronym> office can and does enter per contest,” says one source, “each with a fee paid for by the taxpayers.”

The fifth project criticized by Labor insiders is the DOL’s “book club.”

Fillichio, the public-affairs adviser, expressed significant pride about this endeavor and seemed a bit baffled by naysayers. The club was, he said, “part of the commemoration of the department’s centennial,” and, at the direction of Secretary Perez, the communications office devoted real effort to publicizing it so that major publications would cover it from coast to coast.

Recommended reading included works from all former secretaries of labor and a host of other significant public figures, and the list ranged from left-wing (Upton Sinclair’s The Jungle) to objectivist (Ayn Rand’s Atlas Shrugged), from the gritty On the Waterfront to the glitzy The Devil Wears Prada.

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The heavy <acronym title="Google Page Ranking">PR</acronym> effort paid off in favorable media coverage of the book club. A breathless Washington Post reporter called the book list a “colorful and often unexpected collection” from a “relevant and perhaps fun” agency, in telling contrast with the “swanky, black-tie affairs” that marked previous DOL anniversaries.

But critics complained that Fillichio was “unrelenting” in directing staff to spend time promoting the club. Worse, the Labor Department hired an outside <acronym title="Google Page Ranking">PR</acronym> firm, Maryland-based Concepts Communications, at a cost of more than $100,000.

Said Fillichio this week: “[The book club] has proven to be a terrific way for the American public to learn about not only the history of the department but the resources available from the department for the general public. We did hire an outside contractor to assist with a variety of centennial activities.”

Fillichio similarly defended the use of the Washington Nationals’ William Howard Taft mascot, the sixth in our list of dubious projects questioned by staffers. The mascot was brought to a ceremony, at a cost of no more than $1,000, not to cheer up employees facing sequestration cuts, he specified, but to help commemorate the department’s centennial. Taft, Fillichio explained, was the president who helped create the Department of Labor.

The backdrop for all these complaints is what the sources describe as a work atmosphere that favors the Obama political-appointee insiders, to the serious detriment of career employees, and eventually to the public’s detriment as well. Staffers repeatedly described a workplace in which goofball activities got in the way of the Labor Department’s real work and where showing enthusiasm for tomfoolery became a de facto work requirement.

One employee describes “a pretty hostile environment,” adding, “I believe ageism, sexism, and racism are involved” in personnel decisions. In particular, two top OPA officials – Fillichio, who is the senior adviser for communications and public affairs, and Senior Managing Director Stephen Barr — are variously described as “self-indulgent,” “verbally abusive” (one drops frequent “f-bombs”), “screaming at people,” “very demeaning,” and “abominable” in their treatment of those who aren’t Obama-administration picks.

“The public-affairs director brags about how many people he has fired or otherwise gotten rid of,” says one worker. “Anybody who had anything to do with prior administrations, whether career or political, has been forced out,” either from their job altogether, or from significant responsibilities that would give them a chance at further career advancement. “For us, it’s about harassment.” Several of the current or former employees interviewed have more than 20 years of department experience, through administrations of both parties, and all interviewees said their complaints have no political component.

Several said favoritism (in assignments or even promotions) was shown to the new insiders, who were often groomed for success and given brownie points for doing things career employees might not want to do. They allege a pattern of age-related comments, or other comments hinting that retirement might be in order.

One complainant says that Fillichio for years used his office’s balcony as the equivalent of a smoking lounge, inviting others there too and leaving black smudge marks all over — although smoking anywhere on the premises, inside or out, is explicitly forbidden in federal buildings. Some employees with smoke sensitivities were exposed to the fumes wafting back inside from the balcony. One source says that the ashes once started a small fire in the bushes below the balcony.

Smoking on the balcony was the one violation that Fillichio acknowledged to me, though he noted that he had stopped that practice and had quit smoking entirely in October 2012.

Again and again, sources say, they fear making formal complaints, and fear being quoted by name, out of fear of retaliation. They don’t even trust that the complaint process will be complied with.

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Workers’ fears are backed up by the action of a key union, which charged the Labor Department with failing to comply with labor laws in its own internal practices. The American Federation of Government Employees sent a letter on January 16 of this year to Deputy Secretary of Labor Patricia Smith. The letter outlines

grave problems pertaining to the scheduling and presentations of mediations and arbitral hearings. With respect to mediations, from 2009 to the end of 2013, management simply refused to mediate even the most minor grievances. . . . [Also,] management has been so very uncooperative in even empaneling arbitrators . . . [that] the cases awaiting hearing just became further and further backlogged. . . . We need arbitrators brought on board as expeditiously as possible; we need our grievances heard.

Finally, many DOL staffers objected to the hiring of former Washington Post reporter Stephen Barr to a senior position under Fillichio. Barr had no federal experience, they note, and little or no experience managing staff or significant budgets. One source reports that Fillichio openly told people he was going to hire Barr even before the position had been advertised — a gross violation of competitive-hiring rules for federal-government jobs.

Several sources say that Fillichio had to submit Barr’s name several times to the Office of Personnel Management (OPM) and “pull strings” before OPM would approve the hire. Barr did not return calls seeking comment.

Speaking with NRO Monday, Fillichio defended several of the under-fire projects with enthusiasm — and with a pleasant, gracious demeanor — while dismissing others as “old chestnuts.” He specifically declined all comment on personnel matters and work atmosphere, other than to note that there are “no formal personnel actions or complaints” directed at him in his own file at the department.

Fillichio defended the elevator-poster project specifically, saying, “The use of staff and resources is minimal, and we find the elevator-poster campaign to be an extraordinarily effective way to communicate with our employees.”

I’ve worked in public affairs in the federal government, and I know there is value in internal communications that inform the vast departmental workforces, boost morale, and make employees better equipped to serve the public.

But the goal should indeed be public service, which means concentrating employee time and resources on outside communications rather than the sorts of self-indulgent practices described at Obama’s Department of Labor.

“None of these things,” summed up one source, “create jobs in America.”

— Quin Hillyer is a contributing editor for National Review.

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