SECTION 401

EMPLOYMENT OF FAMILY MEMBERS OVERSEAS

Section 401 of the Act of October 7, 1978, and section 413 of the Act of August 17, 1977, look toward the expansion of employment opportunities for family members of U.S. Government personnel assigned abroad. Section 401(c) directs that a report be submitted describing actions taken by the Department pursuant to these two sections.

CONVERSION OF ALIEN POSITIONS

The Department is keenly aware of the important impact that spouse employment is having on its personnel system. There is a growing trend toward preference for Washington assignment, fewer families are accompanying employees overseas and morale is down in many posts where employment is limited. Not only are Foreign Service spouses generally well educated professionals who seek challenging employment, they also increasingly find that they must work to meet the financial requirements of their children's education.

The Department has given considerable study to how it might help broaden employment opportunities for family members overseas. Progress depends not on a single solution but on seeking innovations in many areas, and we therefore appreciate the authority in section 401 of the 1978 Act to establish a program for the employment of family members in certain vacant alien positions. We want our response to be creative but equitable, and we have identified several potentially serious problems that we believe must be evaluated in a trial program so that they may be dealt with effectively when the program is placed into worldwide effect.

We have concern about the effect the program will have on the legitimate interests of our foreign national employees on whom we must continue to rely for many vital services. We believe some host governments may have concern about the reduction in employment opportunities for their nationals that will result from this program. Also, from the management standpoint, we need to insure that post managers abroad are able to keep all positions filled at all times by qualified employees.

In order to evaluate the above kinds of problems, we are establishing a pilot program with AID and ICA at a cross section of Foreign Service posts, currently 15 in number. To date, these posts have identified 36 foreign national positions which are, or are expected to become vacant within the next 6 months, and for which qualified family members are believed to be available.

During the pilot program, we will discuss procedures with other agencies for the inclusion of their positions and personnel in the program. We have already discussed this with Department of Defense staff who liave advised us that they are in the process of revising their program for the employment of family members of Defense personnel assigned abroad to provide opportunities for family members of personnel of other agencies. We believe this program can be operated most effectively on a cooperative basis by all agencies with all qualified family members being given equal consideration for the available jobs. Weexpect that all agencies will work toward this end.

The Department will send you a followup report on this program at the end of the pilot phase which we expect to complete in less than 1 rear.

RECIPROCAL ARRANGEMENTS WITH FOREIGN GOVERNMENTS

Section 401 of the 1978 Act also directed that the President seek to conclude agreements with other nations to facilitate employment of family members in foreign economies. The Department has developed and cleared proposed regulations providing for reciprocity on this matter with the House Judiciary Committee and with the Departments of Justice and Labor. The regulations are expected to be published in the Federal Register as a notice of proposed rulemaking within the next few days. The public will have 60 days to comment. ['pon completion of the 60-day posting period, any public comments received must be studied and answered before a final ruling can be made putting the new regulations into effect.

Although we realize it is probable that only a limited number of countries will want to enter into reciprocal arrangements with us at this time, we hope these regulations will result in the granting of work permits to family members of U.S. Government employees in some countries that have withheld them in the past.

EMPLOYMENT IN Non-CAREER Positions Sertion 413 of the 1977 Act directs the Secretary to give equal consideration to qualified family members when filling non-career positions abroad. Although there are not many such positions, the Department continues to employ qualified family members in temporary positions abroad. We have recently updated our regulations poverning such appointments to both define the kinds of positions appropriate for such staffing and to provide guidelines and cautions to our post managers to guard against the actual or apparent violation of the nepotism or conflict of interest statutes.

ACTIVITIES OF FAMILY LIAISOX OFFICE

On March 1, 1978, the Family Liaison Office was established with three full-time positions. Ms. Janet Lloyd is the Director and reports to the Under Secretary for Management. In addition, 35 branch offices have been established throughout the world. The Office functions as an information referral and counseling service for family members of State, ICA and AID. It also serves as a communication channel between individuals and management.

The Office is involved in the coordination of all management decicions that relate to family members, both overseas and domestically.

The Family Liaison Office has worked with other areas of the Department to implement section 405 (Orientation and Language Training for Family Members) and section 401 (Employment of Family Members Overseas) of the Foreign Relations Authorization Act, Fiscal Year 1979. The Office is working on several inter-agency projects pertaining to such matters as mental health, employment, allowances, schooling and other areas of family concerns in an effort to make the foreign affairs community more cohesive.

In addition the Office established a centralized computer skills bank to facilitate the matching of family members seeking employment with available jobs. Questionnaires from about 300 family members have been returned and are being put into the system. A contract has just been let to establish liaison with international organizations and multinational corporations to make them aware of the skills of family members of Foreign Service employees and to give notice to the Family Liaison Office of their vacancies.

Two career counseling workshops for family members in Washington have been sponsored by this Office. These proved of such interest that regular monthly luncheons are being held for family members to exchange information and to acquaint family members returning from abroad with the program.

SECTION 413

REVIEW OF FOREIGN SERVICE PERSONNEL

REQUIREMENTS AND COMPENSATION

Section 413 of the Act of October 7, 1978, suggests that the Secretary conduct a thorough review of the personnel needs of the Foreign Service and of the suitability of the current compensation system. Section 413(c) directs that a report be submitted describing the results of this review.

PERSONNEL REQUIREMENTS The Department finds that it has been asked to perform more and more functions without comparable increases in its personnel resources. The reports accompanying section 413 of the Foreign Relations Authorization Act for Fiscal Year 1979 point out that the United States has expanded its diplomatic representation abroad dramatically and that our consular workload has increased significantly while the total number of personnel of the Department has remained approximately the same. In addition, the Department has found it necessary to assume or strengthen a number of other responsibilities in recent years. These include activities in the science and technology, counterterrorism, human rights, narcotics, ethics oversight, declassification, and Freedom of Information and Privacy Act areas.

These pressures have caused a number of shifts in departmental personnel resources. Since 1970, the following trends have taken place: The number of positions (both overseas and domestic) for Americans doing political reporting and analysis has declined 18 percent; although the economic/commercial functions has increased sharply in importance during this period, the number of positions for Americans in this function has been increased by only 2 percent. In contrast, American positions in the consular function have increased by 26 percent. There has also been a substantial shift of positions as the Department converted reimbursable administrative positions to direct positions in fiscal year 1977 to cope more effectively with the increasingly large burdens of supporting other agencies overseas. Moreover, there has been an overall reduction of American positions in the regional bureaus as the Department sought to comply with mandated requirements for strengthening its functional bureaus.

The Department has reviewed its personnel requirements within the severe constraints imposed by the congressional mandate to reduce its personnel ceilings to 1977 levels (Leach amendment) and by the President's directive that all Government agencies seek ways to reduce expenditures. It is in this context that the Department, through the zero-based budget process, made the hard choices required in developing its 1980 budget request.

During the review, we searched for ways to achieve reductions and determined that the following would be necessary: Closing more than a dozen of the least essential Foreign Service posts; reducing the schedule for prison visits abroad; reducing the central management, personnel, and administrative positions of the Department; reducing the Foreign Service national positions abroad through tightening and curtailing of post operations; reorganizing domestic operations in consular affairs, reducing operations in the international organization affairs and intelligence and research areas; and reducing administrative support provided other agencies to the extent possible.

Personnel needs are reviewed not only in the determination of budget year programs but also on a daily basis both within the organizational components of the Department and at the central management level. However, we now believe that the Department is reaching the limit in terms of its ability to reprogram positions to meet new workload requirements with current personnel resources.

Accordingly, some very hard choices are going to have to be made concerning the Department's ability to continue performing certain of its basic functions. Specifically, in taking personnel reductions over the past several years the Department has had no choice but to focus on the most immediate demands placed upon it. This has tended to force resources from long-term and less measurable needs (such as indepth reporting and analysis) to more immediate and pressing requirements. Future central management review of the allocation of Department personnel resources must make provision to insure that valid long-term capabilities are not further eroded.

COMPENSATION

The Department could not spare the personnel resources to conduct the in-depth study of the Foreign Service compensation system contemplated by section 413. Accordingly we have arranged to contract for such a study with the internationally respected consulting firm of Hlav Associates.

The contract calls for the firm to review and evaluate the adequacy of all aspects of the existing Foreign Service compensation system in relation to other governmental and private organizations with overseas operations. The firm's report will include an overall analysis related to the overseas salary and benefit structure, viz, what is required to attract, retain, and motivate emplovees selected for overseas employment. The contract also calls for Hay Associates to present the Department optional approaches to the linkage problem—the appropriate relationship of the Foreign Service pay structure to other Government and private pay structures.

Since the contract has just been let, the results will not be known for several months. As soon as they are, we will send you the results along with recommendations which we now have under consideration to simplify and improve the Foreign Service salary structure.