House Oversight Committee Launches Probe into Federal Settlement Payouts

Chairman James Comer of the House Oversight and Government Reform Committee announced a formal request for records on federal employee settlements, arguing that the volume and cost of such payouts have surged since President Biden took office. The inquiry targets the Equal Employment Opportunity Commission (EEOC), the Merit Systems Protection Board (MSPB), the Federal Labor Relations Authority (FLRA), the Office of Special Counsel (OSC) and the Office of Personnel Management (OPM). Comer contends that the “sue-and-settle” approach may incentivize weak claims and discourage managers from disciplining staff.

Washington ExaminerHouse Oversight Republicans to Probe Federal-Worker Settlements

• EEOC-mediated and settlement payouts to federal workers totaled $202 million in fiscal 2023.

House Oversight Republicans to Probe Federal-Worker Settlements

• Litigation judgments against the government in the same period amounted to roughly $22.6 million.

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• Attorney-fee payments in MSPB “sue-and-settle” cases rose to nearly $11 million under the Biden administration, compared with $3.6 million during the first year of the Trump administration.

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• MSPB data indicate that agencies win over 80 % of adverse-action cases that proceed to a formal decision.

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In a letter to OPM Director Scott Kupor, Comer warned that “a supermajority of disputes are resolved through opaque, non-public agreements,” limiting congressional oversight. He argued that performance metrics emphasizing rapid case closures may push agencies toward settlements that increase taxpayer costs while shielding misconduct from public scrutiny. Comer also highlighted that settlement agreements can impose “substantial operational costs,” such as restoring prior working conditions or expanding collective-bargaining obligations beyond statutory limits.

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Comer’s request cites an MSPB survey showing roughly 40 % of supervisors believe they can remove employees for serious misconduct, yet only 25 % feel confident terminating workers for poor performance. He suggests that the settlement-heavy system fosters a culture where federal managers are reluctant to discipline underperforming employees. The chairman also raised concerns that settlement templates, nondisclosure agreements and internal communications may be factored into performance evaluations for adjudicators, potentially compromising impartiality.

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The sources provide consistent monetary figures but do not disclose the total number of settlement cases, the proportion of claims deemed “weak or frivolous,” or the outcomes of the requested records review. No response from OPM or the targeted agencies is included in the available material.

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• “Congress cannot exercise meaningful oversight of the federal workforce when a supermajority of disputes are resolved through opaque, non-public agreements,” — James Comer, Chairman, House Oversight Committee

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• “These prospective obligations can effectively expand the scope of collective bargaining beyond what the Federal Service Labor-Management Relations Statute authorizes, and may constrain agency management rights … without going through the formal adjudicatory process that would subject such expansions to appellate review,” — James Comer

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• “Comer warned that performance metrics emphasizing quick case closures could encourage settlements that increase taxpayer costs while shielding misconduct and personnel disputes from public scrutiny.” — James Comer

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• “Comer further argued that the settlement-heavy system has contributed to a culture in which federal managers are reluctant to discipline underperforming employees.” — James Comer

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Comer gave the agencies until May 25 to provide the requested documents, including settlement templates, nondisclosure agreements and internal communications. The committee plans to review the materials to assess whether settlement practices compromise fiscal responsibility or managerial authority within the federal workforce.

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