[House Hearing, 114 Congress]
[From the U.S. Government Publishing Office]








   TIME AND ATTENDANCE ABUSE AT THE U.S. PATENT AND TRADEMARK OFFICE

=======================================================================

                                HEARING

                               BEFORE THE

                            SUBCOMMITTEE ON
                         GOVERNMENT OPERATIONS

                                 OF THE

                         COMMITTEE ON OVERSIGHT
                         AND GOVERNMENT REFORM
                        HOUSE OF REPRESENTATIVES

                    ONE HUNDRED FOURTEENTH CONGRESS

                             SECOND SESSION

                               __________

                            DECEMBER 7, 2016

                               __________

                           Serial No. 114-128

                               __________

Printed for the use of the Committee on Oversight and Government Reform


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              COMMITTEE ON OVERSIGHT AND GOVERNMENT REFORM

                     JASON CHAFFETZ, Utah, Chairman
JOHN L. MICA, Florida                ELIJAH E. CUMMINGS, Maryland, 
MICHAEL R. TURNER, Ohio                  Ranking Minority Member
JOHN J. DUNCAN, Jr., Tennessee       CAROLYN B. MALONEY, New York
JIM JORDAN, Ohio                     ELEANOR HOLMES NORTON, District of 
TIM WALBERG, Michigan                    Columbia
JUSTIN AMASH, Michigan               WM. LACY CLAY, Missouri
PAUL A. GOSAR, Arizona               STEPHEN F. LYNCH, Massachusetts
SCOTT DesJARLAIS, Tennessee          JIM COOPER, Tennessee
TREY GOWDY, South Carolina           GERALD E. CONNOLLY, Virginia
BLAKE FARENTHOLD, Texas              TAMMY DUCKWORTH, Illinois
CYNTHIA M. LUMMIS, Wyoming           ROBIN L. KELLY, Illinois
THOMAS MASSIE, Kentucky              BRENDA L. LAWRENCE, Michigan
MARK MEADOWS, North Carolina         TED LIEU, California
RON DeSANTIS, Florida                BONNIE WATSON COLEMAN, New Jersey
MICK MULVANEY, South Carolina        STACEY E. PLASKETT, Virgin Islands
KEN BUCK, Colorado                   MARK DeSAULNIER, California
MARK WALKER, North Carolina          BRENDAN F. BOYLE, Pennsylvania
ROD BLUM, Iowa                       PETER WELCH, Vermont
JODY B. HICE, Georgia                MICHELLE LUJAN GRISHAM, New Mexico
STEVE RUSSELL, Oklahoma
EARL L. ``BUDDY'' CARTER, Georgia
GLENN GROTHMAN, Wisconsin
WILL HURD, Texas
GARY J. PALMER, Alabama

                   Jennifer Hemingway, Staff Director
                 David Rapallo, Minority Staff Director
                 Kevin Ortiz, Professional Staff Member
                           Willie Marx, Clerk
                                 ------                                

                 Subcommittee on Government Operations

                 MARK MEADOWS, North Carolina, Chairman
JIM JORDAN, Ohio                     GERALD E. CONNOLLY, Virginia, 
TIM WALBERG, Michigan, Vice Chair        Ranking Minority Member
TREY GOWDY, South Carolina           CAROLYN B. MALONEY, New York
THOMAS MASSIE, Kentucky              ELEANOR HOLMES NORTON, District of 
MICK MULVANEY, South Carolina            Columbia
KEN BUCK, Colorado                   WM. LACY CLAY, Missouri
EARL L. ``BUDDY'' CARTER, Georgia    STACEY E. PLASKETT, Virgin Islands
GLENN GROTHMAN, Wisconsin            STEPHEN F. LYNCH, Massachusetts




















                            C O N T E N T S

                              ----------                              
                                                                   Page
Hearing held on December 7, 2016.................................     1

                               WITNESSES

The Hon. Russell Slifer, Deputy Under Secretary of Commerce for 
  Intellectual Property and Deputy Director, U.S. Patent and 
  Trademark Office
    Oral Statement...............................................     3
    Written Statement............................................     5
Mr. David Smith, Acting Deputy Inspector General, U.S. Department 
  of Commerce
    Oral Statement...............................................     8
    Written Statement............................................    10
Ms. Pamela Schwartz, President, Patent Office Professional 
  Association
    Oral Statement...............................................    15
    Written Statement............................................    17
Mr. David Chu, Ph.D., Panel Chair, National Academy of Public 
  Administration
    Oral Statement...............................................    25
    Written Statement............................................    27

                                APPENDIX

Questions for the record, submitted by Mr. Meadows...............    58
Questions for the record, submitted by Mr. Connolly..............   102

 
   TIME AND ATTENDANCE ABUSE AT THE U.S. PATENT AND TRADEMARK OFFICE

                              ----------                              


                      Wednesday, December 7, 2016

                  House of Representatives,
             Subcommittee on Government Operations,
              Committee on Oversight and Government Reform,
                                                   Washington, D.C.
    The subcommittee met, pursuant to call, at 2:22 p.m., in 
Room 2154, Rayburn House Office Building, Hon. Mark Meadows 
[chairman of the subcommittee] presiding.
    Present: Representatives Meadows, Jordan, Carter, Grothman, 
Connolly, Maloney, Norton, and Clay.
    Also Present: Representative Hice.
    Mr. Meadows. The Subcommittee on Government Operations will 
come to order. And, without objection, the chair is authorized 
to declare a recess at any time.
    I want to thank all of you for being here. It was in August 
of this year that the Commerce Department's Office of Inspector 
General released what I would say is an alarming report 
detailing the potential time and attendance abuses at the U.S. 
Patent and Trademark Office. The OIG compared hours certified 
as worked by nearly 8,400 patent examiners with data such as 
records from either virtual private networks or computer 
workstation records or the like. This comparison actually 
allowed the OIG to assess whether or not the hours claimed by 
examiners were backed up by quantifiable data.
    The results are shocking. The OIG identified some 288,479 
unsupported hours by patent examiners over a 15-month period. 
Now, these hours equate to $18.3 million in potential waste. 
415 of the examiners covered in the analysis had 10 percent or 
more of unsupported hours. And, indeed, 310 of these examiners 
received above-average annual performance ratings and accounted 
for nearly 98,000 of the unsupported hours. The unsupported 
hours could have been helped to reduce patent application 
backlog, which currently stands at 540,000 or by some 15,990 
cases.
    What is most troubling is the numbers provided by the OIG 
are a conservative estimate. The OIG wanted to make sure that 
everything was done in an appropriate manner, and actually 
received the benefit of the doubt when making their analysis. 
By some less conservative assumptions, we could push the amount 
of unsupported hours to be nearly twice as high as the OIG 
reported. And this, indeed, is unacceptable.
    The report comes on the heels of a previous OIG 
investigation into examiner A. This examiner would often leave 
work early to play golf, and overall, examiner A committed to 
at least 730 hours of time and attendance abuses. This resulted 
in nearly $25,500 for time not worked. And I want to add is, 
when we have this, it has a chilling effect on other people in 
the workforce. So, conveniently for examiner A, he or she 
resigned on the advice from the union before action could be 
taken against him or her. Now, when the OIG retroactively 
tested it's methodology for the new report on examiner A's 
unsupported hours, it received a similar unsupported hour 
total. This shows that the OIG's methodology accurately 
measures the unsupported hours.
    Now, while not necessarily widespread, the OIG's findings 
do show that, at the U.S. Patent and Trademark Office, internal 
controls for fighting time and attendance abuse are lacking. 
The OIG has six recommendations that would help safeguard 
taxpayers from fraud at that agency. They include a requirement 
that examiners provide their supervisors with work schedules; 
examiners use their ID badges to exit the agency in turnstile 
facilities; and all examiners log into the USPTO network during 
their working hours while teleworking. Now, these commonsense 
recommendations should be adopted now.
    Now, while some may argue that the total amount of 
unsupported hours is less than 2 percent of the total work 
hours logged in by patent examiners, even 1 unsupported hour is 
too many. The American people deserve better. And I look 
forward to hearing your testimony on how we can not only 
address this issue but make sure that we have an accountable 
workforce going forward.
    Mr. Meadows. I'm going to wait and recognize the gentleman 
from Virginia for his opening statements here in a few minutes. 
And I will hold the record open for 5 legislative days for any 
member who would like to submit a written statement.
    The chair notes that the gentleman from Georgia, Mr. Hice, 
will be attending today. He was here earlier. We appreciate his 
interest in this particular issue. He is here now. I ask 
unanimous consent that Representative Hice be allowed to fully 
participate in today's hearing.
    And, without objection, so ordered.
    In addition to that, I make a unanimous request that we 
enter into the record the investigative report of the U.S. 
Patent and Trademark Office which would actually be the IG's 
report, the investigative report.
    And, without objection, so ordered.
    [The information follows]:
    [This report can be found on The Department of Commerce 
website at: https://www.oig.doc.gov/oigpublications/14-
0990.pdf]
    Mr. Meadows. I'm pleased to actually welcome here the 
Honorable Russell Slifer, Deputy Under Secretary of Commerce 
for Intellectual Property and Deputy Director at the U.S. 
Patent and Trademark Office. Welcome.
    Mr. David Smith, acting deputy inspector general at the 
U.S. Department of Commerce. Welcome, Mr. Smith.
    Ms. Pamela Schwartz, president of the Patent Office 
Professional Association. Welcome, Ms. Schwartz.
    And Dr. David Chu, panel chair of the National Academy of 
Public Administration.
    Welcome to you all.
    And pursuant to committee rules, all witnesses will be 
sworn in before they testify. So if you would please rise and 
raise your right hand.
    Do you solemnly swear or affirm that the testimony that 
you're about to give will be the truth, the whole truth, and 
nothing but the truth?
    Thank you. You may be seated. Please let the record reflect 
that all witnesses answered in the affirmative.
    In order to allow time for discussion, please limit your 
oral testimony to 5 minutes. However, your entire written 
statement will be made part of the record.
    And so, Mr. Slifer, we'll come to you for 5 minutes.

                       WITNESS STATEMENTS

           STATEMENT OF THE HONORABLE RUSSELL SLIFER

    Mr. Slifer. Chairman Meadows, Ranking Member Connolly, and 
members of the subcommittee, thank you for this opportunity to 
discuss the United States Patent and Trademark Office's 
management of employees' time and attendance.
    I am proud of the work that our nearly 13,000 employees, 
including more than 8,300 patent examiners, to help our 
Nation's innovators secure intellectual property rights. The 
overwhelming majority of these employees are hard-working, 
highly educated, and highly skilled professionals who perform 
their jobs with the utmost integrity and dedication. We take 
seriously any allegation of abuse in our workplace. Any abuse 
of time and attendance by an employee is unfair to our 
stakeholders who rely on our agency and to the employees who 
abide by the rules. It is unacceptable and will not be 
tolerated within the USPTO.
    In recent years, we have made workforce management a 
critical focus and have invested a significant time and effort 
in improving our overall management for all employees, 
including teleworking employees and those stationed at our 
physical facilities. We have taken a number of concrete steps, 
including requiring new training for employees and supervisors, 
updating policies, adding controls, and building tools for 
supervisors to enable our supervisors to engage and manage 
their employees more effectively.
    Today, at the USPTO, supervisors receive extensive 
training, and they have a variety of tools in place to help 
monitor employees' attendance and work levels, regardless of 
where the employees are working. We have addressed our 
workforce management issues by providing new tools, policies, 
and guidance. My written testimony provides more detail on our 
extensive efforts to date. In the interest of time, I'll 
highlight just a few of those now.
    We created an IT dashboard tool to review employee-specific 
data to monitor examiners' production and timeliness, which can 
show early signs of changes in performance and potential time 
and abuse--time and attendance issues. We implemented a policy 
requiring all USPTO employees, supervisors, and full-time 
teleworkers to remain logged into the USPTO's IT system during 
working hours. We updated the overtime policy for patent 
examiners, emphasizing that exceeding production goals does not 
excuse employees from actually working claimed hours.
    We appreciate the work of the office of inspector general 
in preparing the August 2016 analysis of patent examiners' time 
and attendance. The findings and recommendations in the report 
serve as a valuable resource as we further enhance the 
extensive measures we have already taken to focus on time and 
attendance compliance among USPTO employees.
    We also appreciate the work of the National Academy of 
Public Administration for their study of our telework programs 
and controls.
    The USPTO is committed to implementing additional 
improvements as necessary in response to the IG's report. 
Because the report identified overall trends and didn't examine 
individual employee's cases, our team has worked to rigorously 
analyze the data in detail to better identify the nature of the 
unsupported hours. This refined analysis is helping us make 
tailored improvements to our overall workforce management. 
While the USPTO is certainly unique among Federal agencies in 
our ability to quantify the productivity of a majority of our 
employees, striking the right balance between management tools 
and employee productivity is a challenge faced by all 
employers, both public and private sector, and something that 
we strive to achieve in an effort to ensure the effectiveness 
and efficiency of our agency in order to better promote 
American innovation. We have and will continue to work toward 
ensuring proper and accurate accounting of all time and 
attendance. Any hour of time claimed and not worked is 
unacceptable.
    In closing, I want to underscore our continuing commitment 
to detect and address all cases of abuse and hold any employee 
who commits that abuse accountable while also strengthening our 
overall management and operations. As we continue to support 
our Nation's innovators, we know that we owe nothing less to 
our hard working and dedicated employees, to the stakeholders, 
and to the public we serve. Thank you.
    [Prepared statement of Mr. Slifer follows:]
    
    
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    Mr. Meadows. Thank you.
    Mr. Smith, you're recognized for 5 minutes.

                    STATEMENT OF DAVID SMITH

    Mr. Smith. Chairman Meadows, Ranking Member Connolly, and 
members of the subcommittee, I appreciate the opportunity to 
testify today. First, it is important to mention that our 
investigation found the vast majority of patent examiners' 
claimed hours were supported by evidence contained in the 
various records of computer activity that we examined. Our 
findings do not indicate this is a widespread problem, which 
echoes the NAPA report.
    Second, I would like to thank the employees at USPTO who 
reviewed our analysis and findings and helped us achieve the 
more accurate results contained in our report. It's rare that 
such a collaborative effort on such an investigation occurs, 
which is testimony to the professionalism of those employees.
    Even though it may not be widespread, the data establishes 
that claiming hours not actually worked is a problem at USPTO. 
An earlier OIG investigation uncovered paralegals at the Patent 
Trial and Appeal Board being directed by management to falsify 
hours over several years, and totaled more than $5 million in 
waste.
    Next, OIG reported on patent examiner A, who falsely 
claimed to work at least 730 hours in 2014 alone, which 
amounted to more than $25,000 of waste.
    Lastly, in August 2016, my office issued a report that 
identified over a 15-month period approximately 288,000 hours 
not supported by the data, which equates to over $18 million in 
potential waste. The analysis compared the time examiners 
asserted as computer-related work on their time sheets against 
four sets of data that evidenced computer work. For the hours 
examiners claimed but lacked any supporting data, we considered 
those hours to be unsupported. Our analysis included a separate 
9-month period when a policy change required full-time 
teleworkers to be logged into the USPTO network for all the 
hours claimed as teleworking. Evidence of substantial abuse by 
some patent examiners is particularly troubling, especially 
considering my office analyzed the data in a light most 
favorable to the patent examiners. OIG assumed for examiners 
working on campus that all computer-related worktime claimed 
supported from the time of arrival until the time they left or 
10 p.m., whichever occurred first, regardless of when they 
actually left the office.
    I want to emphasize again that the vast majority of patent 
examiners had few, if any, unsupported hours, and appeared to 
be working the hours certified on their time sheets. However, 
our approach identified 415 examiners who accounted for 
approximately 124,000 unsupported hours over a 15-month period. 
That amounted to almost 45 percent of the total unsupported 
hours we found.
    Of additional concern, approximately three-quarters of 
those 415 examiners received above-average performance ratings, 
and 30 percent of the unsupported hours for these high 
performers was claimed as overtime. Fifty-six of the 415 
examiners averaged 24 or more unsupported hours per 80 hours of 
analyzed time, which equates to 3 or more days of work for 
every 2 weeks of analyzed time. Seventy other examiners 
averaged between 16 and 24 unsupported hours per 80 hours of 
analyzed time.
    Our methodology may have been actually overly generous. 
When we analyzed the data for examiners, we switched to a 
router that provided more precise indication of online 
activity, the OIG found that the total number of unsupported 
hours actually doubled. In addition, the use of a less 
conservative methodology for on-campus examiners, using 
computer logoffs and other activity to determine work stoppage, 
increased the total unsupported hours by an additional 327,000.
    The OIG recognizes that examiners could conceivably perform 
examiner-related work offline. However, that would mean that 
those examiners are working offline for the entire day without 
logging into the USPTO network, without logging any activity in 
the patent examining application, and without checking their 
email. However, during the initial 6-month period where there 
was no requirement for them to be logged on, we found almost 
1,300 days in which full-time teleworking examiners had zero 
computer activity, not even checking their email once for 2 or 
more days in a row. Therefore, we recognize that it's possible 
on an individual basis; we believe it's just not a plausible 
explanation for the volume of unsupported hours.
    While we acknowledge the changes USPTO management has 
implemented in response to the previous OIG reports, there's 
still a lot of work yet to be done to improve internal controls 
over time and attendance reporting. Some of those improvements 
include empowering supervisors with the tools needed to enable 
them to properly monitor work performed by employees, a 
recommendation also contained in the NAPA report.
    In closing, we note that the OIG interpreted the exceptions 
to the Computer Matching and Privacy Protection Act of 1988 to 
prohibit pursuing criminal prosecution or civil remedies in 
recommending that the agency take administrative action against 
those examiners engaged in misconduct. In a September 13, 2016, 
hearing, the question was asked if the OIG report would be more 
accurate if the OIG had interviewed individuals. And the 
correct answer was yes. Therefore, if POPA and the other unions 
would encourage their members to voluntarily be interviewed by 
the OIG, we would be happy to interview the examiners to 
determine if any evidence exists to support their claims of 
hours worked. This would be done with the understanding that 
those results of the interviews would be made available to the 
USPTO to take appropriate action against any examiners found to 
have claimed hours where there was no actual work performed.
    I want to thank the subcommittee for the opportunity to 
testify today. And I look forward to your questions.
    [Prepared statement of Mr. Smith follows:]
    
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    Mr. Meadows. Thank you, Mr. Smith.
    Ms. Schwartz, you're recognized for 5 minutes.

                  STATEMENT OF PAMELA SCHWARTZ

    Ms. Schwartz. Chairman Meadows Ranking Member Connolly, and 
members of the subcommittee, thank you for inviting me to 
present the views of the Patent Office Professional 
Association, POPA, on the inspector general's report on patent 
examiners' time and attendance.
    The OIG's conclusions contradict those of the National 
Academy of Public Administration, which reported in 2015 that 
it is, quote, ``unlikely that time and attendance abuse is 
widespread or unique to teleworkers, and it does not appear to 
reflect the activity of the workforce as a whole. The USPTO has 
requisite procedures in place to monitor time and attendance,'' 
closed quote.
    The OIG's analysis is based on flawed methodology and 
faulty assumptions. Reliance on turnstile, VPN, and workstation 
records does not reliably capture all the work performed by the 
examiners. The OIG did not account for unrecorded, 
uncompensated overtime regularly worked by examiners to meet 
their production goals, which far exceeds the 2 percent 
unsupported time. The GAO recently issued a report on patent 
quality in which it concluded that 70 percent of examiners must 
work extra uncompensated hours to meet their required 
production quota. A companion GAO report found that examiners 
worked between 5 to 10 hours of uncompensated overtime each pay 
period on average. Even the OIG's report acknowledges that 
there were, quote, ``many days where the evidence of computer-
related work activity appeared to exceed the time claimed for 
the day,'' closed quote.
    Even if a teleworker was not connected to the agency's 
computer system, this doesn't mean that she wasn't working. 
Many aspects of an examiner's job can and are routinely done 
offline, like working from printed application documents and 
studying printed copies of prior art patent and nonpatent 
literature. Furthermore, there was no policy requiring 
teleworkers to be logged into the agency's servers during all 
their working hours for a substantial portion of the 15 months 
studied.
    The OIG acknowledges that there was a statistically 
significant reduction in the number of unsupported hours 
following the issuance of the agency's full-time teleworker 
policy in February 2015. To the extent that some teleworkers 
did not consistently log into the agency's servers in the 9 
months immediately following the issuance of the policy, it 
only means that they were not yet conscientious about complying 
with the new policy.
    Buried in the OIG's report on page 17, footnote 39, is this 
important concession that undermines the report's conclusions, 
quote: ``Since the OIG methodology uses VPN and workstation 
records to support worktime for teleworkers, this approach 
could incorrectly determine that certain hours were unsupported 
if the examiners were working but did not connect to the USPTO 
network,'' closed quote.
    Even assuming that the OIG's methodology was accurate, the 
ostensibly unsupported hours equal only 1.6 percent of overall 
time, less than 8 minutes a day on average. A 98.4-percent time 
accounting efficiency rate demonstrates an extraordinarily high 
level of productivity for any employer. As a result of this 
extraordinary productivity, the examining corps has reduced 
both the backlog of unexamined patent applications as well as 
the average time for completing examination by 25 percent in 
the last 5 years.
    While potential amount of loss estimated by the OIG was $18 
million over 15 months, the USPTO saves over $100 million a 
year due to its extensive telework program, including over $38 
million in real estate savings. According to the USPTO, in 
fiscal year 2015, the 2,000 full-time teleworkers who 
participate in the Telework Enhancement Act pilot program were 
actually 6 percent more productive than other examiners in 
terms of annual production units, resulting in a revenue gain 
of over $35 million, far more than the alleged potential loss 
estimated by the OIG.
    Nonetheless, POPA is in full accord with the agency's 
efforts to ensure that all employees work their full 80 hours 
each pay period. POPA has worked with our management regularly 
to achieve full compliance with time and attendance 
requirements, and we will continue to do so. Thank you.
    [Prepared statement of Ms. Schwartz follows:]
    
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    Mr. Meadows. Thank you, Ms. Schwartz.
    Dr. Chu, you're recognized for 5 minutes.

                 STATEMENT OF DAVID CHU, PH.D.

    Mr. Chu. Thank you, Mr. Chairman. Members of the 
subcommittee, it is indeed a privilege to appear before you to 
summarize the report by the National Academy of Public 
Administration on the telework program of the United States 
Patent and Trademark Office.
    I should emphasize the report was undertaken in response to 
the issues you identified earlier in this time period, really 
work in the fall of 2014, the spring of 2015. I should also 
emphasize that I'm appearing today as a fellow of the academy 
and not in my position with the Institute for Defense Analyses.
    The National Academy effort comprised two parts, an 
internal controls review undertaken in partnership with Grant 
Thornton, an accounting firm, and a program review on the 
efficacy of the telework program. The conclusions of the 
internal controls review were generally positive in character. 
Several essentially small deficiencies were identified that 
could easily be corrected. Much of the report is focused on the 
program review: How well does this program actually perform? 
And it's our conclusion that it is a valuable program from the 
perspective of managing the United States Patent and Trademark 
Office. Indeed, it's a foundational element of its business 
model as we're all aware. We conclude there's no difference in 
productivity between those who telework and those who do not. 
And our further conclusion was the telework program at USPTO 
ought to continue.
    We did have a series of recommendations to strengthen the 
ability of the program to perform effectively. And I'd like to 
touch very briefly on four of those recommendations. First, we 
felt there should be stronger tools in the hands of supervisors 
with regard to their ability to manage the examiners for whom 
they are responsible. We did a survey of supervisors. An 
important minority reported that they thought they needed more 
instruments in order to be effective as managers. It's a very 
simple step and which I'm pleased to understand that the office 
has taken--at least up to a certain point--is requiring a 
presence indicator be used. And the office now requires that of 
full-time teleworkers. We recommend it be done for all PTO 
employees. It's valuable, not only for the purpose of time and 
attendance, but also from the perspective of encouraging a more 
collaborative approach to the patent process.
    Second, the one difference we found between the Patent and 
Trademark Office telework program and telework programs 
elsewhere, both in governmental units and the private sector, 
is, in most other programs, telework is emphasized as a 
privilege, not a right. And we thought it would be useful for 
the office to signal that important distinction by requiring 
employees to re-sign their agreements every 2 years. It's my 
understanding that the agency has undertaken that step.
    Third, we believed it was timely to begin reviewing what 
standards for productivity we expect by art unit. These art 
units differ significantly in terms of their complexity and 
nature of the applications. Many of these standards date back 
to the 1970s and have not been substantially reviewed since 
that time. And, again, I'm pleased to understand that that 
series of reviews has just started. That is not a short-term 
fix. It will take time to understand what kind of productivity 
standards should Patent and Trademark Office employees sustain.
    And, finally, we felt there should be more attention not 
just to the volume of output but the quality of the patents 
that are granted. Ultimately, as we all understand, the ability 
to protect intellectual property correctly is a foundational 
element for the success of the American economy. That turns on 
the quality of the patents that are granted.
    Much of our discussion is today about inputs and outputs in 
the terminology of the government performance community. What 
really counts here are, what are the outcomes? And that 
importantly does turn on the quality of the patents that are 
granted.
    Thank you, Mr. Chairman. I look forward to your questions.
    [Prepared statement of Mr. Chu follows:]
    
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    Mr. Meadows. Thank you so much.
    The chair recognizes the gentleman from Virginia, Mr. 
Connolly, for his opening statement.
    Mr. Connolly. Thank you, Mr. Chairman. I thank you for 
holding this hearing on the penultimate day of the 114th 
Congress. There is no human problem that cannot be improved 
with another hearing.
    Looking at the findings in the recent Department of 
Commerce IG report on time and attendance issues of patent 
examiners at the U.S. Patent and Trademark Office--and I want 
to thank the IG for his report--who found that 1.6 percent of 
the total hours that PTO examiners claimed they worked during a 
9-month period in 2015 lacked supporting computer evidence of 
actual work activity. The IG concluded that this could have 
resulted in potential waste of $8.8 million. The IG also looked 
at an overlapping 15-month period and concluded that the 
unsupported hours could have resulted in potential waste of $18 
million. However, the IG has found no proof of actual 
misconduct in this latest report. Let me be clear about my 
views on time and attendance abuse. It's unacceptable. Any 
amount of fraud, whether it's 1.6 percent of total claimed 
hours cited in the IG report or twice that amount, is 
unacceptable if proved true. The IG found that, for about 10 
percent of the hours worked by a small fraction of patent 
examiners, apparently no evidence of work activity from an 
evaluation of their computer use could be found. The IG notes 
that this problem was not widespread. The National Academy of 
Public Administration conducted a review of PTO's internal 
controls and came to that same conclusion. The IG's audit is 
valuable but incomplete. The IG's approach does not reflect any 
offline work done by patent examiners. The Patent Office 
Professional Association has already testified that many 
examiners routinely spend a portion of their work hours working 
offline, and even work overtime without claiming it.
    I understand that the IG has provided its data and 
algorithms to PTO to allow the agency to determine whether 
there in fact were cases of actual abuse of the agency's time 
and attendance policy.
    Another question raised by the IG's findings was whether 
there is a reasonable explanation for why the most unsupported 
time is associated with PTO's highest performing examiners. Do 
the findings suggest an indication of a complex managerial 
problem? A conflict between an examiner's production goals and 
time and attendance requirements? How can we resolve these 
conflicts to incentivize the agency's most efficient examiners 
to take work beyond their production goals?
    Lastly, I'd like to know, Mr. Chairman, as an original 
cosponsor of the Telework Enhancement Act of 2010, I take a 
special interest in PTO's telework program, which many agencies 
have viewed as a model. I understand some of my colleagues may 
suggest that the IG's report indicates a problem with PTO's 
telework program. But the IG's analysis does not make a 
comparison between teleworkers and on-campus workers. However, 
NAPA's 2015 study of PTO's telework program found no difference 
in the performance or conduct between these two groups of 
employees.
    The benefits of telework are significant. PTO's telework 
program has saved the agency more than $7 million during 
government closures, and the agency avoided more than $38 
million in rent in this last fiscal year alone.
    In addition, there's potential for traffic congestion 
relief--and as somebody who represents this area, we need it--
and widespread adoption of telework policies governmentwide.
    I want to thank the witnesses for being here today, and 
thank you for your indulgence in my being here a little bit 
late. Thank you, Mr. Chairman.
    Mr. Meadows. Thank you.
    The chair recognizes the gentleman from Ohio, Mr. Jordan, 
for a series of questions.
    Mr. Jordan. Thank you, Mr. Chairman.
    Dr. Chu, what does NAPA stand for again?
    Mr. Chu. The NAPA report was----
    Mr. Meadows. Hit your red button there. Or make it red.
    Mr. Chu. My apologies. That report was based on work----
    Mr. Jordan. What's the organization? What's the acronym 
stand for?
    Mr. Chu. I'm sorry?
    Mr. Jordan. What's the acronym stand for, NAPA? What's it--
--
    Mr. Chu. Oh, National Academy of Public Administration.
    Mr. Jordan. National Academy of--okay. And you guys did a 
study that reaches a different conclusion than the IG's report. 
Is that right?
    Mr. Chu. Well, our study is for a period prior to the most 
recent IG report.
    Mr. Jordan. You reached a different conclusion, different--
different--your report----
    Mr. Chu. I believe the IG testified that he did not think 
it was widespread, time and attendance abuse. That is also--was 
also our conclusion. We did not see it as a widespread issue.
    Mr. Jordan. Well, the USPTO cites it as showing that 
different conclusion than the IG's report. Is that fair?
    Mr. Chu. I think we're all agreed that the fraction of time 
that is believed to be abusive is small. A goal, as I think the 
chairman emphasized----
    Mr. Jordan. Is your report different--is your report 
different than the IG's report?
    Mr. Chu. Excuse me?
    Mr. Jordan. Is your report different than the IG's report?
    Mr. Chu. Our report is different from the IG report in the 
following sense: we did not do the kind of analysis the IG 
undertook. What we sought to do was two things: First, look at 
the internal controls structure. That seemed basically sound. 
There were some small tune ups that came out of that process. 
Second, look at, how well does the program as a whole work? 
Yes, there have been abuses. Those were the product of earlier 
controversy that led to the NAPA report. There are anecdotes 
that we recommended. I'm delighted that the IG found that one 
of those anecdotes, the use of the presence indicator, has had 
some helpful effect.
    Mr. Jordan. All right. Thank you.
    Mr. Chu. You could go further in that direction, and we did 
so recommend.
    Mr. Jordan. Okay. Let me change the direction. What's the 
Elliot Richardson Prize?
    Mr. Chu. I'm sorry?
    Mr. Jordan. What's the Elliot Richardson Prize?
    Mr. Chu. It's a prize given by the academy for 
extraordinary public service to the United States.
    Mr. Jordan. Your academy. Right? NAPA? The one you just 
told me about. Right?
    Mr. Chu. Right.
    Mr. Jordan.Okay. And who was the recipient of last year's 
Elliot Richardson Prize.
    Mr. Chu. I don't remember who last year's recipient was. 
But I do remember it was Bob Gates a couple years before that.
    Mr. Jordan. What about the 2016? Who won the 2016 prize?
    Mr. Chu. I apologize. I don't recall.
    Mr. Jordan. Do you know what the criteria is that is used 
in selecting who's going to win this Elliot Richardson Prize?
    Mr. Chu. It is sustained excellence to the service of the 
United States, essentially.
    Mr. Jordan. Okay. And you don't know who won last this 
current year, 2016.
    Mr. Chu. I should remember, but I don't remember.
    Mr. Jordan. Are you on the board who selects that person?
    Mr. Chu. No. I do not select.
    Mr. Jordan. Okay. But you're here representing today NAPA. 
Right?
    Mr. Chu. I'm here as chair of the panel that did the United 
States Patent and Trademark Office review of the telework 
program.
    Mr. Jordan. Are you of--and you're part of NAPA, correct?
    Mr. Chu. I'm a fellow of NAPA. Right.
    Mr. Jordan. You're a fellow at NAPA, and they have this 
award, the Elliot Richardson Prize, and last year's winner--and 
you don't know who this year's winner of that prize was.
    Mr. Chu. I don't, sir. I'm terribly sorry.
    Mr. Jordan. Would it surprise you if it's the IRS 
Commissioner, John Koskinen? Would you be surprised that that's 
the guy who was selected for outstanding public achievement?
    Mr. Chu. I think that was--I think you're right, sir. I 
think they did select Mr. Koskinen.
    Mr. Jordan. Oh, you can remember now, right? So it was Mr. 
Koskinen.
    Mr. Chu. You refreshed my memory.
    Mr. Jordan. I refreshed your memory. Good. And I look at 
the criteria for that award and it says ``significantly 
advancing the public good.'' You all felt that John Koskinen 
significantly advanced the public good last year?
    Mr. Chu. That was the conclusion of the selection panel. 
I'm not part of that process.
    Mr. Jordan. Do you know who else might have been considered 
for last year--for this year's 2016 award? Who else may have 
been in the running for that?
    Mr. Chu. I don't, sir.
    Mr. Jordan. I'd be curious to see who was turned down, who 
was not given that award and Mr. Koskinen was selected over 
them.
    Do you understand, Dr. Chu, that Mr. Koskinen gave false 
statements to this very committee? Do you understand that 
happened?
    Mr. Chu. I know there's been considerable exchange between 
this committee and Mr. Koskinen, yes, sir.
    Mr. Jordan. Do you understand, when Mr. Koskinen was 
brought in as Commissioner of the IRS, that 422 backup tapes 
containing 24,000 emails were destroyed under his watch? Do you 
understand that fact? Or did the folks at NAPA understand that 
fact? I'd be curious to know.
    Mr. Chu. I know the public discussion between this 
committee----
    Mr. Jordan. Do you know that he withheld information from 
Congress? After he learned in February, he waited 4 months 
before he told Congress about missing Lois Lerner emails. And 
you come in here and tell us your organization, which reaches 
different conclusions or slightly different conclusions than 
the inspector general, and last year, you gave the outstanding 
public achievement by--the achievement says significantly 
advancing the public good. You gave that award to John 
Koskinen?
    Mr. Chu. I didn't, sir. The----
    Mr. Jordan. No, the organization. But you're representing 
NAPA, right?
    Mr. Chu. I'm a fellow of the organization. That's correct. 
I'm not part of the award process. I would point out----
    Mr. Jordan. Do you know if John Koskinen was a contributor 
to NAPA? Do you know if he's given money to that organization?
    Mr. Chu. I don't know, sir.
    Mr. Jordan. Okay. Okay. All right. And you don't know who 
was passed over so that Mr. Koskinen could receive this 
outstanding public servant award last year.
    Mr. Chu. I'm sorry. What's this?
    Mr. Jordan. And you don't know who was passed over, who was 
not given the award, who was under consideration and not given 
the award so that Mr. Koskinen could----
    Mr. Chu. Sir, no, I have no insight into the process.
    Mr. Jordan. All right.
    Mr. Chairman, I yield back.
    Mr. Meadows. The chair recognizes the gentleman from 
Virginia, Mr. Connolly.
    Mr. Connolly. Well, Mr. Chu, for a different point of view, 
congratulations on naming an honorable public servant, Mr. 
Koskinen, as your outstanding awardee last year. And no amount 
of innuendo or smear is going to tarnish his reputation. I've 
known him for a long time. And I consider him one of the most 
honorable public servants I've known in a long time. So I guess 
we're all entitled to our point of view. But I wanted you to 
know right away there is a different point of view. And 
congratulations. He deserves it. And I thank you for doing it.
    Mr. Smith, I'm looking at your report. And I want to be 
real clear. You found potential waste in roughly 1.6 percent of 
the time and attendance records you looked at. Is that correct?
    Mr. Smith. Yes, sir. That is correct.
    Mr. Connolly. You did not in fact document actual waste. 
And I'm not--I mean, it's out there potentially, but there's no 
dollars or cents to actual documented waste. Is that correct?
    Mr. Smith. Well, Mr. Connolly, as I was mentioning in my 
opening statement--you might have missed it--that we would be 
more than happy to interview these employees with POPA 
encouraging their employees to come be interviewed. The problem 
is we ran against the Computer Matching Act, which does not 
allow the combination of information from various computer 
databases to then proceed and contain any kind of disciplinary 
reaction. However, I would like to read for you a quote that 
was in one of the IP Watchdog newspapers or articles. It says: 
Some patent examiners have contended on IP Watchdog and 
attempted to explain their actions are innocent but have 
actually admitted to committing fraud. These patent examiners 
have explained that, because of their superior talents, they're 
capable of doing their work in a fraction of the time the 
office thinks it should take them to do the work. Multiple 
examiners have said here on IP Watchdog that if they are, for 
example, allocated 3 hours to do a task and can do it in 2 
hours, then there's absolutely nothing wrong with them claiming 
all 3 hours on their timesheet. One examiner actually said that 
he or she is capable of doing work twice as fast, using an 
example where the office allocates 20 hours to complete a task, 
presumably an entire application, but the examiner's able to 
get it done in 10 hours. Of course, that examiner explained 
he's completely justified in claiming all 20 hours worked on 
his timesheet.
    So I have a confession here by at least one that they did 
fraudulently fill out their timesheet.
    Mr. Connolly. Well, are you contending, Mr. Smith, that 
that one so-called confession somehow characterizes widespread 
fraud within PTO?
    Mr. Smith. Sir, there is nowhere in our report that we use 
word ``widespread.'' And as I said in my opening----
    Mr. Connolly. I'm asking you, sir, a question on what you 
just said. What conclusion are you drawing from one person, one 
interview?
    Mr. Smith. That was not one person. The author cited 
multiple people----
    Mr. Connolly. Who admitted to fraud? Excuse me. Who 
admitted to fraud?
    Mr. Smith. Yes.
    Mr. Connolly. Multiple people?
    Mr. Smith. Multiple people.
    Mr. Connolly. What did you do with that? Did you refer it 
to legal authorities?
    Mr. Smith. As I mentioned, the Computer Matching Act does 
not allow us to go after these individuals. Now that the IP--
Empowerment Act has been passed that exempts us from the 
Computer Matching Act, we can now go forward under this. But 
for right now, our hands are tied unless the individuals want 
to come in voluntarily for an interview.
    Mr. Connolly. Well, I think one needs to be a little bit 
careful about drawing broad conclusions from particular 
incidents. None of us want to see timecard fraud. And in fact, 
if you uncover it, we want to see it pursued. But I am 
concerned that it comes to characterize an agency where it may 
or may not in fact be at all characteristic of normal practice.
    Mr. Smith. And, sir, I stated that twice in my opening 
statement.
    Mr. Connolly. Good. But you know how this works, Mr. Smith. 
That's not what the story will be.
    Mr. Smith. Sir, I can't control what people do with the 
facts we've reported.
    Mr. Connolly. No. No, I know. You have no responsibility 
for that. I've seen a lot of IGs take the same position as they 
do damage to the reputations of individuals and agencies.
    Mr. Slifer, do you want to comment on that, that people 
apparently in your organization admitted to fraud, according to 
Mr. Smith?
    Mr. Slifer. Well, thank you. I certainly can't comment on 
the anecdotal article in a blog that was just quoted as being 
evidence or admission of a particular examiner.
    Our examiners have a very difficult job. Our examiners have 
got scientific, engineering, advanced degrees and have a very 
difficult job to examine patent applications and understand 
prior art, legal arguments, and synthesize all of that data 
into an examination for----
    Mr. Connolly. All right. All right. I got it. But you're 
sitting next to the acting deputy inspector general, who, 
through his words, is clearly making a statement about a 
practice, not widespread, but it's occurring, and it's fraud. 
That's the word he uses. I want you to respond to that. Is it 
in fact a big problem or a contained problem, but nonetheless a 
problem, from your point of view?
    Mr. Slifer. No. It's not a widespread problem.
    Mr. Connolly. I didn't say ``widespread.'' Mr. Smith 
corrected me properly. Their report doesn't say ``widespread,'' 
nor do I. I'm asking you, is it a contained problem? Is it 
something you're worried about? Is it something you recognize 
as in fact a practice that has to be addressed by these 
examiners who are specialized and doing difficult work?
    Mr. Slifer. The Patent Office takes----
    Mr. Connolly. I can't hear you.
    Mr. Slifer. I'm sorry. The Patent Office takes any----
    Mr. Connolly. I know. Yes, yes. I know; we all take it 
seriously. But I'm asking you to comment on what Mr. Smith said 
in his findings. Is that consistent with what you know about 
your agency?
    Mr. Slifer. It is not consistent----
    Mr. Connolly. It is not consistent.
    Mr. Slifer. Yes.
    Mr. Connolly. Why is that?
    Mr. Slifer. Because I know that our examiners are working. 
I know, looking at their production requirements. I know, 
talking to our----
    Mr. Connolly. Would you take issue with Mr. Smith that 
people, according to him, self-admitted fraud, timecard fraud?
    Mr. Slifer. If we had an examiner who self-admitted--that 
admitted to fraud, we're certainly going to----
    Mr. Connolly. Well, he gave one example, but he claims 
there were more than one.
    Mr. Slifer. I'm not aware of any.
    Mr. Connolly. Thank you.
    Mr. Meadows. I thank the gentleman.
    The chair recognizes himself for a series of questions.
    Mr. Slifer, let me come to you, because I find this 
fascinating. You're saying that you do not have a problem, in 
spite of what the inspector general's report suggests, that you 
do not have a problem. That's your sworn testimony here today?
    Mr. Slifer. It is.
    Mr. Meadows. With 400--in at least 400 different cases, you 
don't have a problem?
    Mr. Slifer. The data that the inspector general looked at--
--
    Mr. Meadows. That's not my question. You just testified 
that you do not have a problem. Is that your sworn testimony 
here today? Because I'm going to drill down on it if that's 
your sworn testimony.
    Mr. Slifer. It is.
    Mr. Meadows. So what you're suggesting, there is no time 
and abuse problems with regards to reporting?
    Mr. Slifer. I did not say there's no time and abuse 
problems. We have disciplined 30 people.
    Mr. Meadows. So how many people have you let go?
    Mr. Slifer. We have either----
    Mr. Meadows. Because of this.
    Mr. Slifer. We're not----
    Mr. Meadows. I know the answer. You go ahead. I mean, how 
many people have you let go because of this?
    Mr. Slifer. Because of the inspector general report?
    Mr. Meadows. Yes.
    Mr. Slifer. Zero.
    Mr. Meadows. Yes. That's the answer.
    Mr. Slifer. We're not allowed----
    Mr. Meadows. So how are you taking it seriously? So what 
other kind of punishment have--here's my problem, is I go to 
Federal agencies, and I find that we have some of the greatest 
Federal workers, truly, in not only just in the public sector 
but in the private sector. And so you've got over 8,000 great 
employees, and you've got 400 or so who are taking advantage of 
the system and perhaps giving a bad report because--and 
actually giving a bad taste to teleworking, which I don't know 
that that is a hypothesis that I would support, because of the 
400 that don't log in. Are you suggesting that it's okay to not 
log into their computer for 2 days and actually they're doing 
work? Because according to Mr. Smith, he said, even if they 
checked their email in a 2-day period, he'd give them the 
benefit of the doubt. So do you think that you can actually do 
your work without checking an email or actually going--do you 
think you can actually do that for 48 hours and actually be 
working, Mr. Slifer?
    Mr. Slifer. The nature of the examination process, yes, 
there can be.
    Mr. Meadows. For 2 days?
    Mr. Slifer. Yes. Is that the best practice? No. And we 
instituted a change----
    Mr. Meadows. So have you implemented all the 
recommendations there that the IG----
    Mr. Slifer. In the current report?
    Mr. Meadows. --recommended? Have you implemented all of 
those?
    Mr. Slifer. I'd be happy to walk through them with you, 
each one.
    Mr. Meadows. Just yes or no. Have you implemented all of 
them?
    Mr. Slifer. We have addressed each one, and we are close to 
implementing all of them.
    Mr. Meadows. When will you be done with implementing all of 
the recommendations?
    Mr. Slifer. There is a significant capital investment in 
some of the requirements. Our budget is not at this----
    Mr. Meadows. So you're saying this is a cashflow problem.
    Mr. Slifer. I'm not saying it's a cashflow, but some are 
multimillion dollar investments.
    Mr. Meadows. Okay. Because I'm going to allow you a little 
bit of flexibility here. But let me tell you the trouble that I 
have with some of your testimony. I read the report. And what I 
find in the report is, is there is no logical conclusion that 
you could come to, other than someone is gaming the system. 
There is no explanation for it. And what I'm going to do is, in 
support of the 8,000 good employees that you have, I'm not 
going to let the 300 or 400 get by with it. Do you follow me? 
And neither should you. Are you going to hold everybody 
accountable to the same standard? Because what I saw was that 
you gave bonuses, significant bonuses, to some of the people 
that actually were perhaps the most troublesome in this report. 
Would you agree with that, that you gave them above-average 
performance review and bonuses?
    Mr. Slifer. Some of the individuals identified in the top 
by the inspector general did both receive bonuses and have----
    Mr. Meadows. So what kind of message of giving a bonus and 
good reviews to someone who does not act the way that the other 
8,000 would act, what kind of message does that send to the 
good employees?
    Mr. Slifer. Well, I would prefer to dig into the data and 
find out exactly why there's a difference between the digital--
--
    Mr. Meadows. I would prefer that you dig into the data too, 
Mr. Slifer, but it doesn't look like you're digging into it.
    Mr. Slifer. Well, we have been for several months working 
on this.
    Mr. Meadows. But you've fired no one. And what other 
disciplinary actions have you had?
    Mr. Slifer. I'm not allowed to fire anybody as a result of 
this.
    Mr. Meadows. What other--we have already established that 
you fired no one. What other disciplinary actions have you had?
    Mr. Slifer. We have actually disciplined and terminated 30 
of the individuals listed in the top 300. But that was done 
independent of the inspector general's report.
    Mr. Meadows. So you fired them for another reason.
    Mr. Slifer. No. We had fired them independent of the 
report. Our internal controls had already identified those 
individuals before the report was published.
    Mr. Meadows. So now you can't have it both ways, Mr. 
Slifer. Your testimony was that you didn't have a problem. And 
now you're saying that you do have a problem, that you got rid 
of 30 people. So which is it? Do you have a problem, or you 
don't have a problem?
    Mr. Slifer. Sir, 30 out of----
    Mr. Meadows. Because 30 people may have a grievance that 
you fired them for no problem. Do you follow me?
    Mr. Slifer. I understand that any agency of our size will 
have individuals that need to be disciplined. And we have 
policies and procedures to address that. I don't believe that 
it is systemic, as identified by NAPA and agreed to----
    Mr. Meadows. I'm saying it's systemic within 400-plus 
employees that the inspector general's report pointed out. I'm 
not saying the other 8,000. In fact, I give them great rewards 
for what they're doing. And if they're watching right now, let 
me just tell you, I'm telling them that I've got their back. 
I'm looking forward to whistleblowers telling me about other 
issues. And if they'll call, I promise you I will personally 
follow up on it because it's apparent that you're not willing 
to do that.
    Mr. Slifer. I disagree. The agency has taken substantial 
steps and continues. We don't take this lightly ourselves. But 
I will----
    Mr. Meadows. Okay. You don't take it lightly. So help me 
reconcile the two parts of testimony. You don't take it 
lightly, but you don't have a problem. So which is it? Because 
you just in the last 6 minutes you said you don't have a 
problem and now you're saying you don't take it lightly. So 
which is it?
    Mr. Slifer. I believe my testimony is that we don't take it 
lightly, while we recognize that there's always going to be 
individuals in an agency of 13,000 who don't follow our rules, 
don't follow our procedures, that are going to require 
discipline. We take it seriously, and we discipline those 
individuals.
    Mr. Meadows. So you do have a problem. All right.
    I'll recognize the gentlewoman from the District of 
Columbia, Ms. Norton.
    Ms. Norton. Thank you, Mr. Chairman.
    This is an important hearing because, of course, abuse of 
time and attendance is always unacceptable, whatever the 
amount. The amount here seems low, but it's worthy of some 
oversight.
    I do have to say something about what the chairman 
indicated. He wondered whether or not anyone had been let go 
because of the IG report. Of course, you cannot be let go 
because of a report, even of an IG. Under civil service law, 
it's an accusation, and you'd have to go through the process 
for independent substantiation. That is the law so that, of 
course, we do have to understand when you can take action and 
when you cannot, and of course, you couldn't take it, whatever 
the outcome of this report.
    And I also have to say, Mr. Chairman, that I was amazed in 
the wake of the recent report not to impeach Mr. Koskinen, that 
that issue would be raised in an effort to relitigate it at 
this hearing. There has just been an overwhelming vote. There 
was a privilege resolution on the floor to impeach Mr. Koskinen 
based on the findings, I might add, of this committee and 
overwhelmingly voted to send it back to committee, to the 
Judiciary Committee, which, of course, kills it. You can't kill 
some things. They just refuse to die.
    And if I may say, for the record, if Mr. Koskinen was given 
a reward, it probably had to do with the fact that he has been 
called in time and again by Democratic and Republican 
Presidents to straighten out troubled agencies, just as he was 
summoned to straighten out the IRS. And I'm sorry I had to take 
some of my time for that. It seemed to me that those two issues 
deserved a response.
    What intrigued me about Mr. Smith's report was the number 
of those with the best annual ratings who had these time and 
attendance issues. I think 81 percent of the unsupported hours, 
if I have the record correct----
    Mr. Smith. Forty-three percent of the hours, ma'am.
    Ms. Norton. Forty-three percent?
    Mr. Smith. Yes, ma'am.
    Ms. Norton. Thank you. Now, Mr. Smith, your testimony, your 
report says: The existence of highly rated examiners with large 
unsupported regular and overtime hours indicates that these 
examiners are likely exceeding their performance goals in less 
than the time allotted.
    I had staff get me your testimony, and they brought me your 
printed testimony. I appreciate it. And on page 3, because my 
first question was, when was the last time these performance 
goals were looked at? How timely is the data on which we are 
relying? And here I am quoting from your report on perhaps the 
most important recommendation: We recommended that the USPTO 
reevaluate its examiner production goals for each group of 
examiners and revise them to the extent necessary.
    And here's the operative sentence: Production goals were 
last set by art unit, as it is called, in 1976, and much has 
changed since then.
    I'm astonished. We're working off of goals that--when I 
wasn't even thinking of coming to Congress. Could this account 
for why so many of the highest performers--in fact, I must ask, 
what makes you a high performer? How are you even judged--who 
are high performers if 43 percent of the hours were from these 
high performers, how are they evaluated?
    Mr. Smith. I'd have to defer that to PTO, ma'am. It's a 
management issue.
    Mr. Slifer. I'd be happy to address that. While the time 
that is allocated for an examiner to spend examining an 
application based on either the technology or their seniority 
and experience hasn't been fully reviewed since the 1970s, we 
are undertaking that massive project right now.
    But the performance goals for each individual have been 
adjusted, and we have looked at it over the course of even the 
last couple of years to set those standards. And the GAO 
recently came out with a study that indicated that 70 percent 
of our employees don't have enough time to reach the production 
goals that they have.
    We understand that, on a bell curve of individuals, we'll 
have some that have the ability to understand the data, 
synthesize it, produce their work product faster than others. 
We still expect them to finish their full 80 hours. We expect 
them to put in all of their time, whether they've completed 
that or not. We even have an incentive program to incentivize 
them to produce additional work product for the agency to help 
us reduce our backlog in pendency, which I'm happy to say, over 
the course of the last 6 years, has dropped from over 700,000 
cases to the 500,000 we have now.
    Ms. Norton. So are these performers moving on to take on 
additional work?
    Mr. Slifer. That is what----
    Ms. Norton. These best annual performers----
    Mr. Slifer. Yes.
    Ms. Norton. Who apparently have some of the poor ratings 
time and attendance ratings.
    Mr. Slifer. I want to be careful and I believe----
    Mr. Meadows. The gentlewoman's time is expired, but please 
do answer the question.
    Mr. Slifer. The inspector general is looking at digital 
data, security data, security entering our building, security 
entering our IT, and looking at that to see if it provides a 
verification of an examiner's timecards that they filled out. 
Where there's a mismatch, there's a question because there's no 
way at that point to verify whether an examiner was or wasn't 
working. We have looked at that data and looked at other data 
in the agency, and I can say that, of some of those individuals 
that are highlighted, I can show that they worked Monday 
through Thursday, 10 hours a day but entered 8 hours a day on 
their timesheet, showing that they did not work on Friday, 
when, in fact, they worked the full 40 hours that week.
    So I know that the data is not 100 percent accurate as a 
verification of the veracity of the timesheet, and that's 
something that the agency is digging into so that we can make 
changes, not only reminding our employees of their requirements 
to abide by filling out the timesheet properly, putting in 
their full 80 hours, but narrowing up the gap between that data 
and their timesheet so that we can more accurately identify any 
areas in the agency where we do have time fraud, instead of 
losing it in a large analysis like this. Thank you.
    Mr. Meadows. I thank the gentlewoman.
    The chair recognizes the gentleman from Wisconsin, Mr. 
Grothman.
    Mr. Grothman. Sure. A couple questions for Mr. Smith. First 
of all, the information here says we have 415 patent examiners 
responsible for 93--or 43 percent of the unsupported hours. But 
I want you to talk a little bit about the methodology as to 
whether you think that's a hard number or what it takes to be 
considered, I guess, not showing up.
    If I come in and I stand there for 5 minutes and document 
that I'm there for 5 minutes a day and then I go out golfing 
for the day, how do you record that?
    Mr. Smith. We did not take an overly harsh look at the time 
records that were or the time periods that the employees 
actually claimed. If an employee swiped in and said they were 
there for 8 hours, then we gave them credit for 8 hours. If we 
were to take a more harsher view and go back and look at actual 
computer time spent, some type of activity on their computer, 
it would increase the number of unsupported hours for the on-
campus employees by 327,000 unsupported hours.
    The PTO requires their employees to only swipe out between 
10 p.m. And 5:30 a.m., so the employee could go in, swipe his 
badge, claim 8 hours, not even turn on his computer at all, not 
even do any work. He could be another examiner A.
    Mr. Grothman. So this just means that you were basically in 
the building, not working?
    Mr. Smith. Yes, that is correct.
    Mr. Grothman. And only in the building for 5 or 10 minutes.
    Mr. Smith. But yet I affirmatively charged 8 hours, saying 
I was working on my computer.
    Mr. Grothman. And even then, if you checked that, could 
they be hardworking at their computer playing video games or 
something?
    Mr. Smith. Potentially.
    Mr. Grothman. Okay. Wow, it's shocking, shocking, shocking, 
shocking. Well, I don't know. I guess it confirms what a lot of 
people think about the Washington, D.C., work ethic for some 
people.
    We'll give you a question here. Now, how many of these 
people have been prosecuted, even under your relatively low 
standards? I realize you have time constraints yourself. Under 
the relatively low standards that you're laying out here, how 
many have been prosecuted?
    Mr. Smith. We have presented these time and attendance 
cases to U.S. Attorney's Office in the past, and they have 
declined because they say they have to actually go hour by hour 
and prove that the employee was not physically working, and 
that's a bit of a burden for them, so they deadline all the T&A 
cases we present to them. So the answer to your question: none.
    Mr. Grothman. If I had to just put a dollar amount, say on 
when some of the guys or gals don't show up, you know, you'd 
have to know how many hours they're not showing up, assuming 
they're working when they're in, but how many hours they're not 
showing up and what their salary is. Can you guess on some of 
the most egregious cases over the last few years how much 
they're taking the government for?
    Mr. Smith. We found that examiner A was taking the 
government, on a conservative estimate, for $25,000 just in 
2014 alone. And the total of these 415 individuals we figured 
was about $18 million just in pay and benefits.
    Mr. Grothman. Wow, I remember back home sometimes people 
would be caught stealing, some public officials, and they wound 
up going to prison for years. So how many of these that you 
mention of the golden 415 we have here, how many have been 
subject to administrative action?
    Mr. Smith. I would have to defer that to PTO, sir.
    Mr. Grothman. Okay. But nobody prosecuted. Why not? Can you 
tell us, are there any proposals out there that you're aware of 
floating through Congress that may do something to improve the 
environment a little bit?
    Mr. Smith. Yes, sir. As I mentioned earlier, we got word 
that both the House and the Senate have approved the IG 
Empowerment Act, which exempts the IGs from the Computer 
Matching Act so that if we were to do this exercise again, we 
would be able to turn that information over to the agency to 
take administrative discipline.
    Mr. Grothman. Do you have any reason why we wouldn't pass 
that bill?
    Mr. Smith. I don't currently see any reason. CIGI is in 
full support of that bill. However, I do understand there is a 
hold on that right now.
    Mr. Grothman. Okay--do we know who's putting the hold on 
it?
    Mr. Smith. I don't recall the person's name, sir.
    Mr. Grothman. Okay. We should talk about that a little bit 
and see who that is. Well, I have a little bit of time left, 
only a few seconds, and I know how much Chairman Meadows covets 
these seconds.
    So I yield them back to him.
    Mr. Meadows. I thank the gentleman from Wisconsin.
    The chair recognizes the gentleman from Georgia for 5 
minutes.
    Mr. Hice. Thank you, Mr. Chairman.
    Ms. Schwartz, how long have you worked at the USPTO?
    Ms. Schwartz. Thirty-four years.
    Mr. Hice. Thirty-four years. That's a long time. Your 
current pay grade, you're GS-14, ballpark $150,000?
    Ms. Schwartz. Yes.
    Mr. Hice. Okay. It's my understanding that your particular 
area of expertise is as a patent examiner for chemical 
engineering patents. Is that correct?
    Ms. Schwartz. Yes. But for full disclosure, as president of 
the union, I have worked for the union for several years 
without patent examining.
    Mr. Hice. Okay. So how long have you been doing that?
    Ms. Schwartz. This is not going to be accurate. I'm going 
to say approximately 8 years.
    Mr. Hice. Approximately 8 years. So, as an individual to be 
looking after chemical engineering patents, you've not been 
doing that for 8 years?
    Ms. Schwartz. For approximately 8 years, yes.
    Mr. Hice. Okay. So you're on official time. Is that 
correct?
    Ms. Schwartz. Yes.
    Mr. Hice. So official time means you were hired to work 
with patents and chemical engineering patents, but instead of 
doing the job for which you were hired, you're doing union 
work. Is that correct?
    Ms. Schwartz. I'm doing union work. That's correct.
    Mr. Hice. Okay. But that's not what you were hired to do. 
You were hired as a chemical engineer patent examiner?
    Ms. Schwartz. Yes.
    Mr. Hice. Okay. So the American people are paying you to do 
something that you were not hired to do. Was anyone hired in 
your place to do the work that you're not doing?
    Ms. Schwartz. I can't tell----
    Mr. Hice. Mr. Slifer, was anyone hired? Do you know?
    Mr. Slifer. I left private industry 2 years ago, so I can't 
speak to what happened 8 years ago.
    Mr. Hice. What's happening now? Has anyone been hired to do 
the job that Ms. Schwartz was hired to do that she's not doing?
    Mr. Slifer. I don't believe I can speak directly to that, 
but----
    Mr. Hice. Do you know how many people are doing official 
time who were hired to work at the Patent Office but they're 
doing union work?
    Mr. Slifer. I do not, but I would be happy to----
    Mr. Hice. Would it surprise you that there's 154 such 
individuals?
    Mr. Slifer. Again, I wasn't aware of how many.
    Mr. Hice. It would seem to me that being entrusted with the 
good faith of the American taxpayer, that you would have an 
understanding of how many people have been hired to do work 
that they're not doing. This just absolutely is astounding to 
me, Ms. Schwartz, that you are hired to work with folks seeking 
a patent, but you're not doing that. So the American people are 
subsidizing union work and paying you $150,000 to do union 
activity rather than to do the work you are hired to do.
    Ms. Schwartz. Congressman, a lot of the work I do is 
assisting the agency in implementing its----
    Mr. Hice. But that is not what you were hired to do. You 
were not hired to do union work.
    Ms. Schwartz. I am assisting the agency in meeting its 
mission by assisting them in developing and implementing 
programs. For example, last year----
    Mr. Hice. How many clients have you worked with in the last 
8 years?
    Ms. Schwartz. I'm sorry?
    Mr. Hice. How many people who are seeking a chemical 
engineering patent have you worked with?
    Ms. Schwartz. None in the last 8 years.
    Mr. Hice. But that's what you were hired to do. So I'm 
really curious about your daily schedule. What do you do on a 
daily basis?
    Ms. Schwartz. On a daily basis, I deal with a number of 
different issues. Many of them are assisting the agency in 
developing and implementing programs to meet the mission of 
reducing pendency and increasing quality. Over the last year, 
my organization has reached many agreements to help the agency 
with its----
    Mr. Hice. That's fine, Ms. Schwartz, and I'm glad your 
agency is doing it. I'm not attacking your union, nor am I 
attacking your union work. The problem I have is that you are 
using the time that the American taxpayer paid you to do as a 
patent examiner, and you're doing zero of that. You've done 
none of that in 8 years, and instead, you've been doing union 
work on the time that the taxpayers have asked you to be a 
patent examiner. You can do your union work, just not during 
this. I would like, I'm really curious about your daily 
schedule. I would like for you to provide this committee with a 
copy of your daily schedule, just your work hours--not 
interested in your personal time--but what you do from your 
clock-in official time for the last 6 months. Will you provide 
that for us?
    Ms. Schwartz. I will try to provide that.
    Mr. Hice. When can we expect to have that calendar?
    Ms. Schwartz. I can probably provide this--I'm going to 
have to--I can probably provide this in a reasonable time, but 
I can't assure that everything on this--I have a calendar that 
I keep. I can't assure that everything on it is accurate, and 
it won't have hour by hour because there are hours that are 
open that I have not written down every activity during those--
--
    Mr. Hice. But everything that you have written down, I 
would like to have submitted to this committee for the last 6 
months.
    Ms. Schwartz. I will do that.
    Mr. Hice. Thank you very much.
    And, Mr. Chairman, I yield back.
    Mr. Meadows. I thank the gentleman.
    And we are going to go into our second round of questioning 
at this point, and so we will recognize the gentleman from Ohio 
for 5 minutes.
    Mr. Jordan. Thank you, Mr. Chairman.
    It seems to me if you could summarize, Mr. Smith does his 
investigation and finds there are folks cheating the timecard, 
415 of them to be exact, accounting for 43 percent of total 
unsupported hours. Mr. Slifer says that is not a problem 
because it wasn't everyone. And Ms. Schwartz agrees with him 
and cites the report done by Dr. Chu, a report that he co-
authored and a report produced by an organization that this 
year gave its top public servant prize to a guy who was 
censured by this committee. Now if that's not a story line, I 
don't know what is. I mean, think about that. Think about that. 
Top public servant, they're citing as evidence that it's not a 
problem; cheating the timecard is not a problem. They're citing 
the NAPA report as evidence to support their claim it's not a 
problem, even though it was 43 percent of all unsupported 
hours, even though it was 415 individuals. They said an 
organization that gave an award to a guy who was censured by 
this very committee as support for their position. I just find 
this--if you wonder why people have had it with Washington, 
D.C., just look at that. Look at the fact pattern in front of 
us, Mr. Chairman. So I appreciate you having this hearing.
    One other question if I could for you, Dr. Chu. Are you a 
fellow at the organization at NAPA?
    Mr. Chu. Yes, I'm a fellow.
    Mr. Jordan. And who nominates people for consideration for 
the Eliot L. Richardson Prize?
    Mr. Chu. I don't know, sir.
    Mr. Jordan. It's my understanding that fellows nominate 
them, nominate those individuals who are considered by the 
organization to receive this prestigious award. You didn't 
nominate him?
    Mr. Chu. No, sir, I did not.
    Mr. Jordan. Do you know who did?
    Mr. Chu. I don't, sir.
    Mr. Jordan. Again, Mr. Chairman, I just find this 
remarkable. People cheating the timecard, 415 of them, almost 
half of all unsupported hours that accounts for. Mr. Slifer 
tells you in your round of questioning ``not a big deal because 
it wasn't everybody.'' And Ms. Schwartz says we're going to 
rely on this NAPA report co-authored by Dr. Chu, this report by 
an organization that gives its most prestigious award to a guy 
who's been censured by the very committee now looking at this 
issue. I think it's important that we had this hearing. I 
appreciate the chairman's indulgence. I yield back.
    Mr. Meadows. The chair recognizes the gentlewoman from the 
District of Columbia for 5 minutes.
    Ms. Norton. Thank you, Mr. Chairman.
    And one more clarification. When it comes to the use of 
official time by union representatives, like Ms. Schwartz, it's 
not a gift to the union. It's not a gift to the worker. If, in 
fact, these matters, which, of course, are recognized in our 
country, once there has been an election and a union has been 
certified and grievances are filed, if, in fact, these matters 
were not processed during official time, then they would have 
to be done, sir, during overtime, which would mean overtime to 
the government for all of those involved. So this is a 
carefully worked-out matter.
    Once you recognize that, in our country, there still is a 
right and certainly in Federal agencies to elect a union and to 
process grievances.
    I want to get further into the bottom of this matter 
involving--what is it?--43 percent of the hours from the best 
performers because that doesn't seem to belong together, that 
you found that the most unsupported work that the inspector 
general found was being claimed by what had otherwise been 
declared the most efficient workers. That just doesn't jibe. 
They don't fit together. And, of course, raises questions, I 
raised some of them about the way in which the Patent Office 
measures and rewards its workforce.
    Dr. Chu, do these highly efficient examiners have enough 
incentive, do you believe, to take on additional work beyond 
their productive goals? I'd ask that of Mr. Slifer as well? Are 
there enough incentives to take on additional work beyond their 
production goals?
    Mr. Chu. As Mr. Slifer has testified, the office does have 
a set of incentives to encourage staff members to produce more 
than is normal and uses those as a judgment for its award 
program.
    Ms. Norton. Mr. Slifer, what needs to be done about 
production incentives to encourage more output by patent 
examiners?
    Mr. Slifer. If I may, there's an interesting question to be 
asked when you look at the high performers that are on the 
list, and the first assumption is that they're not actually 
working. The other assumption can be that one reason those 
individuals are able to be such high producers is that they're 
putting in the extra effort. They're taking documents home. 
They're working on their--just like I take home a briefing book 
every weekend, individuals have different work habits, and 
they're putting in extra effort.
    Our incentive program that you're asking about has actually 
saved the agency over 1.1 million examiner hours a year. It's 
the equivalent of over 800 additional examiners that we would 
have to hire to meet the same production. So we do have 
incentives, and it is paying dividends for the agency without 
having to hire close to additional 1,500 additional examiners a 
year, and it provides us the flexibility when filing may drop, 
the revenue for the agency may, so that we can adjust our 
workforce without either having to hire more or fire more. So I 
am comfortable that our incentive program does incentivize 
those individuals who are capable of producing more work during 
their work hours to go ahead and produce more.
    Ms. Norton. So do you believe that your production goals, 
your production targets rather, and time and attendance 
requirements get the most work effort out of the patent 
examiners?
    Mr. Slifer. We work hard to optimize the balance between 
those, including the investment we are making over the last 2 
years and improving quality at the agency. The quality of the 
time the examiners are spending, the incentives that we put in 
place to get them to work harder, not only in quantity but the 
quality and the timeliness of their work, are working in 
harmony, and we are always tweaking it and trying to find ways 
to improve it. The inspector general's report and 
recommendations are very informative for us in helping us focus 
on additional improvements in areas that he's highlighted.
    Ms. Norton. There seems to be some suggestion that the 
system in use discourages highly efficient and effective 
workers rather than incentivizes them. I'm trying to resolve 
this tension between time and attendance and production records 
so it doesn't look like we're punishing some of the most 
efficient members of our Federal workforce.
    Mr. Slifer. It is a concern of mine to jump to the 
conclusion that unsupported hours looking at digital data 
equates to work that wasn't done. That's why we're digging in 
as an agency and trying to answer the question of, why is there 
a mismatch between digital data and the certified time records? 
When we look at production records for these individuals, the 
quality and the quantity of what they're producing doesn't 
point to the same result, and we want to get to the bottom of 
this so that third parties that are looking at our certified 
time and questioning whether our employees are actually working 
when they say they are and producing what they say they are is 
accurate so that we can resolve the question of whether we have 
any systemic problems or whether we have individual issues that 
any agency would have with individuals. So we are digging 
deeper and continue to work on this and have taken the 
recommendations to heart and will work with that and the 
inspector general to make improvements going forward.
    Ms. Norton. Mr. Chairman, I do want to thank you, but I do 
want to indicate that the indication of a systemic problem 
comes from these figures showing the best performers have the 
worst data. That has to be explained. Contraindicated, not what 
you'd expect as you look at the Federal workforce, and I hope 
we can get to the bottom of that dilemma.
    Thank you very much, Mr. Chairman.
    Mr. Meadows. I thank the gentlewoman. And so the best 
performers, according to what matrix? Their supervisor?
    Mr. Slifer. It's not just their supervisors. We have 
multiple levels of review for the work products that examiners 
provide. We do do audits. We do do quality checks, so it's not 
simply----
    Mr. Meadows. Okay. So here's I guess my--I was in the 
business world for a long time. If you did not change your 
goals and perspective since the 1970s, as my good friend from 
the District of Columbia mentioned, you've got a problem. Do 
you realize, in the 1970s, cutting-edge technology was a Texas 
Instrument little tiny computer that did nothing? Do you 
realize DOS was just being developed as an operating system? Do 
you realize that computers the way that we have it, we have got 
more computing power in my iPhone today than we had in a 
mainframe computer at that particular point, and yet you're 
saying your goals and objectives haven't changed since the 
1970s? Do you not see a problem with that?
    Mr. Slifer. As an electrical engineer who grew up through 
that time period, understand, I want to try to clarify if given 
a moment.
    Mr. Meadows. You're an engineer?
    Mr. Slifer. I am.
    Mr. Meadows. I love engineers because they've always got a 
matrix. What performance matrix would an engineer put forth in 
terms of helping the gentlewoman and I figure out this whole 
problem of productivity? Is there a rule matrix there, or is it 
just some guess on who the best performers are? Do you have a 
real matrix?
    Mr. Slifer. There are matrix, and with regard to the 
production requirement that hasn't been adjusted, shall we say, 
since the 1970s, the question is, how much time does it take an 
examiner in a particular art, let's say pacemakers, to read an 
application provided by the applicant, understand the 
invention, study the claims, do a prior art search for that 
particular invention, understand the art from their search, and 
apply it, and apply the laws to determine whether an 
application should be changed? A lot has changed over this 
time, including the accessibility using computers, the 
efficiencies of that.
    Mr. Meadows. So we would assume that, because on those 
efficiencies, that we would have a greater output from the 
1970s, wouldn't we?
    Mr. Slifer. The only flaw to that assumption would be that 
we also have billions of additional pieces of prior art that 
are now readily available, so the examiner now, while maybe 
more efficient in extracting that data, has much more data to--
--
    Mr. Meadows. Okay. That is valid. I'll give you that one. 
So let me come back to you, Ms. Schwartz, to quote the 
Washington Post. And by the way, I want to give them a shout 
out because they've done some good work on this. I don't know 
that they're watching today, but to quote them: ``The Patent 
and Trademark Office has an unusually close relationship with 
its unions. Under its labor contracts, the agency does not 
require employees who work from home to log into their 
computers if they do telework full-time. It allows them to take 
up to 24 hours to respond to a call or email from their boss.'' 
It really only requires poor performers to give a work 
schedule.
    So you were mentioning how you spend 100 percent of your 
time helping the agency implement things to make it more 
efficient. Is that correct? Did I understand you correct?
    Ms. Schwartz. Not 100 percent of my time, but----
    Mr. Meadows. But a lot of your time?
    Ms. Schwartz. A big portion of my time, yes.
    Mr. Meadows. So would you be willing to work with the 
agency on this strengthening of time and attendance 
requirements for its examiners?
    Ms. Schwartz. Yes.
    Mr. Meadows. So would you be willing to require all people 
to give their schedule to their supervisors?
    Ms. Schwartz. We would have to look at it terms of what the 
agency is asking for.
    Mr. Meadows. What do you mean? You're willing to give your 
schedule to us. Why would you not give a schedule--I can tell 
you that my scheduler knows almost every minute of where I am, 
and so do you not think that that would be a reasonable 
request, is to have the schedule given to their supervisors?
    Ms. Schwartz. It depends on what the requirements are for 
doing it. It's something we're willing to discuss and----
    Mr. Meadows. It's not the question. What is it--you say it 
depends. Depends on what, on how you feel on that given day, or 
what does it depend on?
    Ms. Schwartz. We would like to look at what it is they're 
actually asking for with respect to their work.
    Mr. Meadows. Their work schedule. Is it a ridiculous 
request to ask a supervisor to have access to a work schedule 
for someone who works for them?
    Ms. Schwartz. Are we talking about a minute-by-minute 
schedule? Because then we have a concern that employees are 
going to have to spend a lot of time----
    Mr. Meadows. I'm not asking them for a ``5-minute, I'm 
going to go get a cup of coffee.'' What I am saying is a real 
work schedule that they're accountable to that provides a good 
basis for where they are while they're working. Is that a 
reasonable request?
    Ms. Schwartz. It sounds like a reasonable request, yes.
    Mr. Meadows. Okay. So, since it's a reasonable request to 
you and me and since you're committed to making sure that the 
agency works well, is that something as the head of POPA, that 
you're willing to advocate on behalf, could that be an action 
item that we have coming out of this hearing that we're going 
to get the work schedules given to supervisors of all those 
people who do work?
    Ms. Schwartz. We're willing to work with the agency on what 
they ask.
    Mr. Meadows. Yes or no. Are you willing to do that or not? 
I mean, it's a pretty simple question.
    Ms. Schwartz. I would need to see the details of what we're 
being asked to----
    Mr. Meadows. Okay. Well, let me give you some details. How 
about a work schedule, between 8 and 5, if that's when they 
work, or between 10 and 7, if that's when they work, and saying 
that they're working on this case for this many hours and this 
case for this many hours or a full case for the full-time and 
that they took an hour off for lunch and whatever the 
appropriate breaks. I mean, is there any kind of a schedule 
that they keep?
    Ms. Schwartz. Not the kind of schedule you're talking about 
where they need to provide which applications they're working 
on.
    Mr. Meadows. So they could give us a schedule that says I 
was not golfing? Is that what you're telling me?
    Ms. Schwartz. They could give a schedule of----
    Mr. Meadows. The American people don't understand this, Ms. 
Schwartz. What they've seen is they've seen 400-plus people 
that an IG says has not actually accounted for their time 
according to computer and other logouts. We have got Mr. Slifer 
who says he's working on it, but he's not really sure what it 
is, and we have got you who says there's really not a problem, 
according to your written testimony and your oral testimony, 
and you're basing that on what?
    Ms. Schwartz. The IG report----
    Mr. Meadows. I didn't ask about the IG. You're basing, your 
assumption based on what, that you don't have a problem?
    Ms. Schwartz. I didn't represent that we don't have a 
problem----
    Mr. Meadows. So you do agree that we have some waste, 
fraud, and abuse with regards to time and attendance?
    Ms. Schwartz. There can always be improvements in time and 
attendance.
    Mr. Meadows. Do we have a problem with time and attendance 
reporting with some of your union employees? Yes or no?
    Ms. Schwartz. Are you asking if there are any employees for 
which there is an issue?
    Mr. Meadows. Sure. Let me give you a softball. Are there 
any employees that have a problem?
    Ms. Schwartz. I don't have personal knowledge of any right 
now, but we received proposals with evidence that----
    Mr. Meadows. Ms. Schwartz, so let me be a little bit more 
direct. Is it true when we found examiner A with a problem, is 
it true that your organization encouraged them to retire so 
that they couldn't have any kind of backlash or, quote, 
``mark'' on their record? Did you recommend that to examiner A, 
you or anybody within your organization?
    Ms. Schwartz. Examiner A came to us and after discussing 
the issue with examiner A, it seemed that there was going to be 
significant evidence, which there was in the OIG report, about 
examiner A. And according to the way government protocol works, 
we suggested if examiner A wanted to keep their OPF cleaner, 
that examiner A could resign.
    Mr. Meadows. So answer the question. Did you recommend to 
examiner A that they resign in order to make it look better on 
their record?
    Ms. Schwartz. On their OPF, yes.
    Mr. Meadows. Do you think the American people would have a 
problem with that?
    Ms. Schwartz. I'm not sure. This employee should not have 
been working for the agency so having the employee resign was 
appropriate. There's no doubt that there was wrongdoing and 
losing----
    Mr. Meadows. Having them resign and face the consequences--
and not face the consequences is not appropriate, Ms. Schwartz. 
Because here's the whole thing is, you had them resign so that 
the IG or anybody else investigating it couldn't follow that 
because they had resigned. You know this. You know it well. Was 
that not the motivation?
    Ms. Schwartz. The motivation was--the decision was the 
employee's decision. We were----
    Mr. Meadows. But you advised the employee.
    Ms. Schwartz. We advised the employee that their OPF would 
have less information in it if they resigned.
    Mr. Meadows. Mr. Slifer, is that something that you would 
recommend to the 30 people that you've taken action against?
    Mr. Slifer. From the agency's perspective, Chairman, we 
seek out to find the individuals that are taking advantage of 
their fellow employees and the agency and seek to discipline 
those individuals.
    Mr. Meadows. And you've disciplined, you said either 
terminated or disciplined 30 people. Is that correct?
    Mr. Slifer. That's correct.
    Mr. Meadows. And you will send to this committee a 
breakdown of who those 30 people are and what kind of 
disciplinary actions?
    Mr. Slifer. I'm not sure by law if I'm allowed to. If I am, 
I certainly will.
    Mr. Meadows. Well, we'll keep it confidential. And I can 
tell you from an oversight standpoint, here's what we need to 
see. So what you're saying is not based on an IG report, but 
based on your own internal investigation, you let 30 people go?
    Mr. Slifer. I'm not sure of the discipline for each of the 
30. I know it ranges anywhere from the whole suite of 
discipline up to termination.
    Mr. Meadows. All right. So how many other people are under 
investigation out of the 400?
    Mr. Slifer. I'm not sure at this moment sitting here what 
the nature of----
    Mr. Meadows. More than 10?
    Mr. Slifer. I can't speculate. I believe the inspector 
general and our internal investigation teams would have a 
better----
    Mr. Meadows. All right. Will you get to this committee the 
number of people that are currently under investigation, 
internal investigation?
    Mr. Slifer. We will.
    Mr. Meadows. All right. So, Ms. Schwartz, do I have your 
sworn testimony here today that you will be supportive of 
efforts to discipline anyone who has taken advantage of the 
situation, because in my mind, it's the other 8,000 good 
employees that we're not being fair to. Are you willing to work 
in a way that actually promotes some kind of disciplinary 
action?
    Ms. Schwartz. I'm not sure what POPA can do to support 
disciplinary action.
    Mr. Meadows. So it's your sworn testimony here today that 
you think that anybody that is not performing properly or are 
falsifying records, that they shouldn't be punished?
    Ms. Schwartz. We believe if people are falsifying records 
and the agency has the evidence of that and takes action 
against them, that that's appropriate.
    Mr. Meadows. So you would support their termination if they 
were falsifying records?
    Ms. Schwartz. If that's what the agency proposed to do and 
it was the appropriate level of discipline.
    Mr. Meadows. You added the little caveat on the end of 
that, and that wasn't the question. If they falsified records, 
are you willing to support their termination?
    Ms. Schwartz. Are we talking about falsifying their time 
and attendance? I would need clarification on that.
    Mr. Meadows. So it's okay to falsify some records, just not 
time and attendance?
    Ms. Schwartz. It's not necessarily okay, but it's possible 
that you could falsify some records and the correct discipline 
level would not be termination.
    Mr. Meadows. Okay. Valid. So if they falsified time and 
attendance records, would you support their termination?
    Ms. Schwartz. Once again, if it was the appropriate level 
of discipline----
    Mr. Meadows. If they falsified more than 8 hours, would you 
support their termination?
    Ms. Schwartz. I don't----
    Mr. Meadows. Give me a number then, Ms. Schwartz. I'm not 
going to keep guessing. What is appropriate?
    Ms. Schwartz. I don't have information on the correct 
number here.
    Mr. Meadows. Well, you're the expert witness.
    Ms. Schwartz. Well, we would want to be following the 
factors that are normally considered in making a determination 
of the correct----
    Mr. Meadows. I'm asking, from a union perspective, what 
would you support? Because I don't want to get sideways with 
you.
    Ms. Schwartz. I don't have the information here. I would 
have to go back and look.
    Mr. Meadows. So, within 30 days, can you get the 
information back to this committee?
    Ms. Schwartz. Yes.
    Mr. Meadows. Seeing that there is no further business 
before the committee, I want to thank each of our witnesses for 
being here today, and this subcommittee stands adjourned.
    [Whereupon, at 3:55 p.m., the subcommittee was adjourned.]






                                APPENDIX

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               Material Submitted for the Hearing Record
               
               
               
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