MSPB Evaluates Use of Direct Hire Authority in Federal Agencies

The Merit Systems Protection Board (MSPB) released a report evaluating federal agencies’ use of Direct-Hire Authorities (DHAs) when filling critical roles in government, including medical, information technology, and acquisition occupations.

According to the Office of Personnel Management (OPM), a Direct-Hire Authority (DHA) is an appointing (hiring) authority that OPM can give to federal agencies for filling vacancies when a critical hiring need or severe shortage of candidates exists.

The report explained that while agency human resource representatives identified a number of advantages to this process – including the ability to target recruitment efforts, make timelier job offers, hire faster, and improve satisfaction rates of managers – some also expressed concerns about the fairness of DHAs. For example, data suggests that veterans are hired at lower rates for certain jobs. Veterans made up just 22% of direct hires between fiscal years 2014 and 2018, compared to 50% of all other competitive hires.  However, the report notes, “the impact of occupation makes the story more complex.”

OPM guidance suggests that agencies should make hiring decisions under DHAs based on which candidate meets the minimum qualifications of the job in the order the application is received, not rating and ranking candidates.

“If agencies are using assessments to compare applicant qualifications, this adds time to the process and seems inconsistent with the need to hire qualified applicants as quickly as possible. This trend may demonstrate that agencies place a high value on applicant quality and do not just want to hire the first applicants who meet the qualification requirements,” the report continued.

The MSPB report suggests that OPM and agencies may have different outlooks on the role DHAs should play in hiring decisions. Agency HR representatives reported a  preference for candidate quality to play a greater role in hiring decisions, which often results in a longer process. Meanwhile, OPM expressed that agencies should use DHAs to expedite the process when there is a critical hiring need or severe shortage of candidates.

According to the MSPB report, agencies on-boarded nearly 30,000 employees using direct hiring in fiscal 2018, a 460% increase from a decade prior.

The MSPB report concludes by stating, “The time is right for thoughtful, well-planned hiring reform that balances the principles of fairness, openness, quality, and efficiency. MSPB [recommends] that OPM work with Congress and other stakeholders to develop a policy framework for hiring reform.”