Chaos Performance Review

By Jonathan Pont

Aug. 2, 2005

Although Labor Secretary Elaine Chao is the public face of the department she has led since 2001, making her tenure the longest in four decades, she has surrounded herself with experienced professionals whom she entrusts with managing the department’s two dozen bureaus.

    Within those bureaus, 17,000 full-time employees perform a range of duties, from compiling statistics to working with business to ensuring better compliance with labor laws.

    Two of Chao’s top aides at the department, Assistant Secretary Ann Combs, who leads the Employee Benefits Security Administration, and Deputy Secretary Steven Law, her chief deputy, talked to Workforce Management staff writer Jonathan Pont about what makes Chao an effective leader, and how the department is getting results.

    Workforce Management: You’ve worked closely with five labor secretaries. How do you characterize Secretary Chao’s strengths?

    Ann Combs: They’ve all got their strengths. She has a real interest and a natural affinity for issues this agency deals with. These are somewhat esoteric issues. We have to be able to communicate to people who may not have a background in these issues. Her background, with an MBA and work in banking–she really likes these issues. She likes talking about pensions and health care and the numbers–the quantitative aspect. She often says that “personnel is policy.” She has spent a lot of time thinking about people on her team and the people in senior positions. She trusts you to run your agency, and wants to hear from her senior managers and issue experts.

    WM: How would you characterize her management style?

    Combs: I remember when I interviewed with her the types of questions she asked. She got right to the heart of things. And she listens. She asked a lot of background questions: what was going on in the field, how we could make the department more responsive to peoples’ needs, how we could deliver benefits with more efficiency.

    WM: You lead the Employee Benefits Security Administration, which oversees pensions for the American worker. What types of results are you seeing there?

    Combs: We recovered $3.1 billion in pension assets last year. That’s an increase of 120 percent over the previous year. We find assets that have been misused or taken out, like improper loans that are reversed and restored to the plans. In bankruptcies, we protect the plan to make sure that the money owed to the plan is kept out of the bankruptcy estate and given to the workers.

    WM: What type of program is helping achieve that kind of result?

    Combs: There have been a number of things. We have expanded our compliance assistance efforts under direction of the secretary. The Voluntary Fiduciary Correction Program, where companies perform self-audits and agree to make a (pension) program whole in instances where there are late or missing payments. To qualify, they have to come to the department before we’ve opened a case. They have to make the steps to make sure the plan is whole. It’s not a substitute for enforcement. The department has also helped by streamlining paperwork and adding online tools like a model application form and a calculator to help calculate the interest. This program was designed in the late ’90s, and the department has expanded it, and there are proposals to expand it more.

    WM: How does compliance work with in conjunction with enforcement with regard to worker health and safety?

    Steven Law: We take the view that compliance assistance is complementary to enforcement. If you do both, workers are safer. The results bear that out. Fatalities, injuries and lost days have gone down since we’ve been here. That’s a long-term trend. And we have said consistently that compliance should never be viewed as a replacement for enforcement. Our philosophy is that most employers want to do the right thing and protect their employees. Compliance is the means by which we give them the tools to do it.

    WM: How does the department’s agenda change from one term to the next?

    Law: When we got here in 2001, we talked to people who followed the department, people who had worked here, and practitioners and asked them what the things are that the Department of Labor should be doing. Changing the overtime rules was a common response. We built our list from people mostly outside government. In the new term, the White House has taken a lead on pension security, the Workforce Investment Act and immigration.

    WM: I read something recently that referred to you as the department’s chief operating officer. That might lead one to believe that the department is functioning more like a business these days. Is that on the mark?

    Law: It wouldn’t be quite correct to say we run it like a business, because government isn’t a business. It’s more that we’re trying to manage it better, trying to make sure that the career professionals who are here that their performance is rated according to results that we expect and that they agreed to, making sure we’re using technology more efficiently to communicate to customers, making sure that budget decisions we make reflect how programs are performing. All those things are good management disciplines. Businesses may do these things more than government, but I don’t think it would be true to say that stylistically (the department is) like a business structure.

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