By Paige Winfield Cunningham
Paper still reigns when it comes to tracking hours worked and time off for most Virginia state employees.
Recording things like earned vacation and performance reviews is still not done electronically for most of the state’s human resources offices. While Virginia likes to tout itself as the best-run state in the U.S., some officials say HR practices still need updating and standardizing.
“If you look at Virginia as a corporation, there’s no way a corporation would run its HR and payroll the way we run ours,” says Bill Leighty, an advisor to Gov. Bob McDonnell’s government reform commission and former executive director of the Virginia Retirement System.
While a few offices have taken matters into their own hands by purchasing systems on their own, there’s still a lot of variance in how records are kept.
The problem is a symptom of Virginia’s human resources overhaul back in the 1990’s. From 1978 to 1995, executive branch state agencies could opt out of services provided by the Virginia Department of Human Resource Management and apply to run their own HR departments. After 1995, the DHRM stopped running HR for all but 17 of the smaller agencies.
At the time of the decentralization, Leighty was working at the Department of Motor Vehicles. He remembers fellow employees welcoming the change because it meant they no longer had to rely on DHRM to send their paychecks and approve new hires.
Now, dozens of separate HR departments handle the hiring of state employees and making sure they get paid. Each of the 68 agencies who maintain their own HR departments do things a little differently. HR officials say the new system has provided state employees with better services, but Leighty says records still need to be kept in a more consistent fashion.
“I think you can decentralize policy while centralizing practice,” Leighty said. “There are a number of things we can do in the HR arena that can be done more consistently.”
Giving state agencies more autonomy in managing their personnel had been lawmakers’ goal when they decentralized HR services back in the 1970’s. They felt agencies would operate in a more accountable and speedy manner if they were making decisions themselves, said Rueyenne White, director of Agency Human Resource Services at the DHRM.
Up until that time, the DHRM controlled all hiring decisions. An agency could hire an employee and put them to work, only to be halted after HR finally processed the paperwork and found the new employee to be unsuitable for the job.
“You hire the person, you congratulate them, you put them on payroll, but because we were backed up in paperwork, now I’m calling you and telling you to let them go,” White said.
Central HR decided who got hired, how they’d be paid and when they’d be paid, White said.
“Virtually every decision about your job classification was ultimately determined by us, period,” White said.
To decentralize or not to decentralize became a hot-button issue around the time Virginia decided to move towards that model in 1978, White says. At the time, the state’s decision to hand over more control to individual agencies was viewed as radical. But as more and more states have followed suit, centralized HR systems like those in Tennessee or New York are the odd men out, she said.
“Tennessee and some of the other states teased us for years,” White said. “They said, ‘it’s crazy, letting people make their own decisions.’”
The downside was that agencies could lose out on the economies of scale available through one large, comprehensive HR department working for the whole state. While the DHRM still administers health plans, decentralization gave it a new focus on promulgating policy, Rue said.
But fewer Virginia employees work in HR now than 20 years ago, according to DHRM records.
In 1991, 676 state employees worked in HR jobs. That number stood at 650 in June of this year, making the ratio of employees to HR staff roughly 150 to 1.
Technology advances are partly responsible for fewer HR workers, Rue said. During the last decade, the state made strides toward paperless systems. Now, HR agencies need another surge of updates to get rid of old-fashioned systems that remain—like recording hours worked and paid leave on paper.
“Everything just started going 100 miles an hour,” White said. “I feel like we’re at a point where we need that to happen again, but we have no money.”
The antiquated system also bothers Mary Ann Belcher, HR director for the Department of Rehab Services, who oversees the HR needs of 1,460 employees. But as someone who has worked in HR before and after decentralization, she applauds independence at the agency level. Sending every document to Richmond for review took an enormous amount of time and an enormous amount of delay, she says.
“We don’t have a need to have every piece of paper go downtown to be reviewed by two or three people who have thousands of papers to look at to make sure people get paid,” Belcher said.
Decentralizing Virginia’s HR services rescued agencies from the state’s “stranglehold,” White said. But she thinks there are things the state could change to tap into more economies of scale—like updating systems and standardizing more procedures—without returning to the centralized model.
“I like decentralization with good, strong internal controls and policies and training, and we haven’t done that,” White said.
