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Department of Labor

Recommendations and Actions

DOL19: Transfer the Veterans' Employment and Training Service to the Employment and Training Administration

Background

The Office of the Assistant Secretary for Veterans' Employment and Training (OASVET), which includes the Veterans' Employment and Training Service (VETS) of the Department of Labor (DOL), develops policy and provides funds for use by the states in administering employment and training services to veterans and to military personnel planning to enter the civilian workforce. OASVET was created in 1981 in a move to separate veterans' services from the Employment and Training Administration (ETA). VETS program staffing and responsibilities are specified in detail by statute.(1)

VETS has a national and regional staff and also funds positions at the state and local level. With approximately 40 employees in its national office, VETS also maintains 10 regional offices. The law requires the department to maintain a VETS regional office in each of the 10 DOL regions. At present, the regions are staffed by a regional administrator, an assistant regional administrator, a management assistant, and one clerical support position. In addition, most regional offices maintain one or more specialists in veterans' reemployment rights and grants management.

Managing program activities in each state is a Director of Veterans' Employment and Training (DVET). In some states, there are also Assistant Directors (ADVETs). The number of ADVETs in each state depends upon the veteran population.(2) The DVETs and ADVETs advise state veteran specialist employees and ensure compliance with program performance indicators through such measures as visits to training sites.

Responsible for providing direct employment and employability development services to veteran customers are two classes of State Employment Security Agency (SESA) employees: Local Veterans' Employment Representatives (LVERs), and Disabled Veterans' Outreach Program (DVOP) specialists. LVERs and DVOP specialists provide a range of services to veterans. In addition, they cooperate frequently with employers and other government agencies (particularly the Departments of Defense and Veterans Affairs) to develop and deliver employment and training programs. For example, they deliver the larger part of the presentations made as part of the Transition Assistance Program, a program for service members about to leave active duty. VETS, through its National Veterans Training Institute, trains LVERs and DVOP specialists to provide the services they render. VETS field staff administer the Veterans Reemployment Rights statute by receiving and resolving complaints from veterans, reservists, and guard members called to active duty, but not properly reinstated by their employers. VETS also administers grants to states, local governments, and nonprofit organizations for the Homeless Veterans Reintegration projects under the Stewart B. McKinney Homeless Assistance Act and under Title IV C of the Job Training Partnership Act.

The current grants and state agency oversight program structure is similar to activities carried out by DOL's Employment and Training Administration (ETA). Elsewhere in this report, the need better integrate employment and training services is outlined in detail.

Concerns about the VETS program structure are reflected at all levels of the program. For example, the statute specifies the job duties for DVETs, DVOPs, and LVERs.(3)

At the local level, DVOP specialists and those LVERs who are designated as full-time are required by law to work with veterans and the Employer Community to develop training and employment opportunities for veterans. A situation could exist that, even if all other workers in a local job service office are busy assisting customers, the veterans' specialists would not serve non veterans who come in for help. In practice, exceptions are routinely made to this requirement as authorized by Congress under certain circumstance. The private sector offers many models of priority service, through which designated employees serve priority customers first, but assist others if no priority customers are waiting.

Another concern about VETS relates to its regional structure. The job of the regional staff is to prepare personnel actions, execute and allocate grants to states, and determine whether to recommend litigation of veterans' reemployment rights cases. All of these responsibilities could be handled at the national office level, but the statute does not grant DOL the flexibility to pursue such alternatives. Costs could be reduced (and communications streamlined) by transferring the regional functions to the national office.

The national office structure would also benefit from streamlining. Veterans' needs would be more effectively incorporated into plans for such efforts as dislocated workers' services and one-stop career centers within the ETA structure.

As an immediate step, services to veterans can be improved-and costs lowered at the same time-by contracting for some veteran training services.

Actions

1.Contingent upon DOL's review of all employment and training programs and contingent upon implementation of a successful, comprehensive, integrated program of one-stop shopping centers for career management, the Secretary of Labor should consider reforms to the administration of VETS that would preserve and improve veteran's training.

Congress should amend Title 38 of the United States code regarding OASVET, the duties of DVOP specialists and LVERS, and regional base positions. Removal of the limitations on DVOP specialists and LVERs providing services to nonveterans would allow greater flexibility in providing assistance to the public while ensuring that veterans continue to receive priority service. Removal of the requirement for maintaining a regional presence would permit DOL the flexibility to determine whether duties should be performed at regions or the national office.

ETA does not use state directors for the employment service or unemployment insurance operations, which suggests that state-level directors and assistant directors are unnecessary. Other means can be used to provide sufficient oversight to ensure the integrity of program service delivery.

2.DOL should explore possibilities for improving employment delivery and customer choice of service provider by requiring states to make delivery of veterans' employment and training service competitive.

To ensure delivery of high-quality service at competitive costs on a contract basis, DOL must impose clearly stated penalty clauses on contractors who fail to meet their commitments to quality training. State employment services could compete for these contracts on the same basis as private sector providers.

Implications

The recommended consolidation will mean that employers, veterans, and other job seekers will have only one DOL agency responsible for providing employment services with guidance and oversight, simplifying DOL staff relationships with the state employment security agencies and facilitating one-stop shopping. (See DOL08.)

Allowing private contractors to bid on providing services to veterans will make provision of services more cost-effective because the more efficient service provider would have a competitive edge in winning contracts.

Amending Title 38 to allow greater flexibility in office structure could facilitate faster communication between state-level service delivers and the national office.

There is a risk that this recommendation will be perceived as offering a lower level of service to veterans. However, the services available and the priority placed upon those services will not change. Elimination of unneeded middle layers in this program will support the intent of the legislation that "policies and programs to increase opportunities for . . . veterans to obtain employment, job training, counseling, and job placement services and assistance in securing advancement in employment . . . be effectively and vigorously implemented by the Secretary of Labor."(5) As DOL and other agencies implement new approaches to delivering employment and training services, the proposed consolidation will ensure that veterans' needs continue to be met.

Fiscal Impact

Fiscal savings will be achieved by merging the two agencies and restructuring the regional and state-level VETS offices, and will include a staff reduction of approximately 210 full-time equivalents (FTEs). Given program administration centralization in ETA, DOL may also realize some savings in program management at the national level in the long term. Making the delivery of VETS services competitive should result in savings, but a specific amount cannot be determined at this time. The restructuring of VETS would result in the savings detailed in the following fiscal impact table.

 Budget Authority (BA) and Outlays (Dollars in Millions) 
 *******************************************************
 Fiscal Year
         1994     1995     1996     1997     1998     1999     Total
 ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^
 BA       0.0   -$12.0   -$13.0   -$13.0   -$14.0   -$14.0     -$66.0

Out- lays 0.0 -$12.0 -$13.0 -$13.0 -$14.0 -$14.0 -$66.0

Change in FTEs -105 -210 -210 -210 -210 -210 -210

Endnotes

1. 38 U.S.C. Chapter 41.

2, The DVET positions also exist in the District of Columbia and Puerto Rico. Twenty states do not have ADVETs.

3. 38 U.S.C. sec.sec. 4103, 4103A, and 4104.

4. Local office managers may use the veterans' representatives to serve nonveterans; but in those cases, VETS recaptures the grant funds and reallocates them to other states.

5. 38 U.S.C. 4100.

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