A Study to Review How Teleworking Can Reduce Operational Cost for State Government (October 18, 2021)

Summary

An October 18, 2021 letter from Emily S. Elliott, Director of the Department of Human Resource Management, to the Honorable Luke E. Torian, the Honorable Janet D. Howell and the Honorable Grindly Johnson, submitting a study to review how teleworking can reduce operational cost for state government and impact recruitment and retention of state government jobs. The letter states that the report is submitted pursuant to Chapter 552, Item 83, N of the 2021 Virginia Acts of Assembly, Reconvened Special Session I. The study states that no funding was authorized for it. It reports that in March 2020, 37 state agencies reported that 80 to 100% of their employees were teleworking, and that VITA expanded virtual private network (VPN) capacity from 5,000 to 35,000 concurrent connections.

Summary drafted by a model from the document's text below and checked by script against that text before publication. It is a navigation aid, not a reading of what the document proves. Where AI is used

Full text

                                                                                                     James Monroe Building
EMILY S. ELLIOTT
DIRECTOR
                            COMMONWEALTH OF VIRGINIA                                                 101 N. 14th Street, 12th Floor
                                                                                                     Richmond, Virginia 23219
                              Department Of Human Resource Management                                Tel: (804) 225-2131
                                                                                                     (TTY) 711


                                                    October 18, 2021
                                                                                                     (TYY) 711



         The Honorable Luke E. Torian, Chair, House Appropriations Committee
         The Honorable Janet D. Howell, Chair, Senate Finance and Appropriations Committee
         The Honorable Grindly Johnson, Secretary of Administration


         Subject:        A Study to Review How Teleworking Can Reduce Operational Cost
                         for State Government and Impact Recruitment and Retention of State
                         Government Jobs


         The attached report is submitted pursuant to Chapter 552, Item 83, N of the 2021 Virginia Acts of
         Assembly, Reconvened Special Session I.

         Please contact me if there are any questions or concerns.

                                                    Sincerely,



                                                    Emily S. Elliott
                                                    Director
                                                    Department of Human Resource Management




                                    Navigating Pathways to Workforce Excellence
10/1/2021
            A Study to Review How
            Teleworking Can Reduce
            Operational Cost for State
            Government and Impact the
            Recruitment and Retention of
            State Government Jobs




            Virginia Department of Human Resource Management
 A Study to Review How Teleworking Can Reduce Operational Cost for State Government and
              Impact the Recruitment and Retention of State Government Jobs


Purpose

The submission of this report complies with Chapter 552 (2021 Special Session), Item 83. N.,
which requires the Department (DHRM), in collaboration with the Department of General
Services (DGS), the Virginia Information Technologies Agency (VITA), and any other state agency
upon request, to examine the Commonwealth's existing telework policies, and how agency
program and service delivery tools and methodologies employed during the COVID-19
pandemic may inform future policy objectives regarding the use of telework and alternate work
schedules as a means of achieving administrative efficiencies, reducing cost, and sustaining the
hiring and retention of a highly qualified workforce. No funding was authorized for this study.
A primary focus of the study is to review how teleworking can be used as a means to reduce
operational costs for state government, and recruit and retain workers for state government
jobs.


Background
In July 2008, DHRM released the Commonwealth’s first Teleworking Policy that supported the
use of teleworking and alternate work schedules within the state’s workforce. Through
legislative action, the Commonwealth mandated each state agency to have a goal of not less
than 25% of its eligible workforce participating in alternate work schedules by July 1, 2009 and
by January 1, 2010, each state agency, except the Department of State Police, to have a goal of
not less than 20% of its eligible workforce telecommuting.
Operating in a decentralized Human Resource environment, the DHRM statewide Telework
Policy provided guidance for Executive Branch agencies and, in turn, Agency Heads for each
Executive Branch agency to determine how best teleworking and alternate work schedules
could be utilized within their respective agencies to support workforce recruitment, retention
and service delivery. Pre-pandemic, agency adoption of teleworking and alternate work
schedules varied greatly within the Executive branch agencies. Prior to the COVID-19 pandemic,
Commonwealth agencies reported roughly 26% of classified positions as eligible for teleworking
with approximately 19% of the employees in eligible positions as actually teleworking in some
capacity. Agencies also reported that 55% of classified positions as eligible for alternate work
schedules with 18% of those employees currently having an alternate work schedule.
In early 2020, as a result of the COVID-19 pandemic, the Commonwealth of Virginia and its
Executive Branch agencies had no choice but to adopt a mindset to support the use of
teleworking and alternate work schedules as agencies were forced to close to the public, and a
significant number of employees in the state workforce were instructed to remain at home.
State agencies found that the ability to maintain continuity of operations for an extended
period of time could only be accomplished by rapidly adopting teleworking and alternate work
                                                                                       Page 1 of 8
 A Study to Review How Teleworking Can Reduce Operational Cost for State Government and
              Impact the Recruitment and Retention of State Government Jobs
schedule practices far beyond what had been previously experienced within the
Commonwealth.
During 2020 and into 2021, state agencies reported teleworking levels at their highest. In
March 2020, 37 state agencies reported that 80 to 100% of their employees were teleworking
and another 15 agencies reported 40 to 80% of employees were teleworking. The level of
telework within the Commonwealth was achieved not only because of necessity and agency
leadership support, but also through the use and support of technology. VITA provided much-
needed technology and operational support.
To enable increased remote work, VITA deployed additional methods for Commonwealth
employees to connect securely with Commonwealth systems. VITA expanded virtual private
network (VPN) capacity by 700% (from 5,000 to 35,000 concurrent connections) in just over a
month and implemented a cloud-based VPN alternative rapidly for large agencies with
particular need.

Next, VITA provided additional devices and flexibility for remote workers. VITA obtained
thousands of additional laptops sufficient to meet all identified remote work needs and created
a secure option to take a desktop computer to a remote location for work.
Finally, VITA scaled up its support resources to meet the increased demand from agencies. VITA
increased its help desk support staff to address a surge in call volumes and VPN access
requests. VITA enhanced the frequency and detail of communications about its operations to
provide additional insight to agency IT staff, worked with the Department of Human Resources
Management (DHRM) to develop guidance for telework, and addressed nearly all agency one-
time requests in an expedited manner.
Additionally, throughout 2021, VITA has launched many new services to support agencies'
efforts to automate and to facilitate work from anywhere. These services include robotic
process automation, improved electronic signature capabilities and remote access tools, virtual
desktop capabilities, and additional content management and collaboration tools.


Return to Office and Hybrid Work Environments

As Executive Branch agencies began their return to office planning, agencies conducted surveys
that showed employee expectations had shifted as a result of the extended teleworking. A
large number of employees expressed an ongoing interest to telework in some capacity, either
full time or on a hybrid schedule. In a hybrid teleworking model, an employee works in a
designated physical location (office) and an alternate (remote) location such as their home.
In January 2021, agencies reported a spectrum of teleworking that varied based on agency
mission and types of positions within the agency.


                                                                                     Page 2 of 8
 A Study to Review How Teleworking Can Reduce Operational Cost for State Government and
              Impact the Recruitment and Retention of State Government Jobs




                                      Figure 1- Survey January 2021




In June 2021, DHRM surveyed Executive Branch state agencies to determine what percentages
of employees were physically at work as opposed to working remotely. Of the 23 agencies that
responded, the data showed that onsite workers ranged from 5%-10% to 75% depending on
the agency.
Employee presence on site has changed little due to the ongoing concerns over the ability to
control, prevent and mitigate the spread of SARS-CoV-2, the virus that causes coronavirus
disease 2019 (COVID-19), along with the continued shift towards a long-term hybrid
teleworking model. This was further validated by the findings of a recently study conducted by
a study group participating in the Virginia Executive Leadership Institute (VEI). VEI is a program
run by the Performance Management Group within the L. Douglas Wilder School at Virginia
Commonwealth University.

In that study titled, Changing Spaces, Changing Workplaces, the group reviewed entrance data
for nine state owned facilities over the course of multiple weeks. Using the week of July 26,
2021 through July 30, 2021 as an example, the occupancy rate for the nine buildings ranged
from 14% to 20% with a daily average occupancy rate of 17%. Recommendations from the
study group have been folded into the recommendations at this end of this report.


Potential for Office Space Reduction
Leadership across agencies continue to support teleworking as a recognized means to attract
and retain talent while continuing to accelerate service delivery. There is also a realization that
having full time and hybrid teleworkers brings forth an opportunity to look at physical

                                                                                         Page 3 of 8
 A Study to Review How Teleworking Can Reduce Operational Cost for State Government and
              Impact the Recruitment and Retention of State Government Jobs
workplace environments and the potential for a reduction in office space needed to house on-
site workers.
While reducing office space seems simple, it comes with a great deal of complexity and detail
that must be considered for both short-term and long-term workforce needs. In addition, an
understanding of the Commonwealth’s real estate program is critical to assessing the potential
for office space reduction.


Commonwealth’s Real Estate Program

The Department of General Services (DGS) Division of Real Estate and Facility Management,
manages the Commonwealth’s broad portfolio of leases, sells or assists with redeploying
underutilized real estate assets and oversees other real estate transactions as needed by state
agencies. The Division assists agencies and institutions to develop and maintain facility strategic
plans, assessing current and future facility needs.

The chart on the right provides a high level overview of this
program. DGS annually reports on this data and includes
recommendations for any actions that may be required by the
Governor and the General Assembly to identify and dispose of
property not being efficiently and effectively utilized.
DGS has a lead role in tracking space occupancy, use, building
efficiency and works closely with agency leadership to identify
space need.
As noted in the submitted DGS Combined Real Estate Report
dated November 15, 2020, pre-pandemic, opportunities
existed then and remain today to support “increased
teleworking for employees and a more creative use of space
through hoteling or other shared uses by staff. Implementing
new efficient approaches to agency space utilization is
dependent upon the agency missions, services provided to the
public, agency leadership and available funding. DGS is in a
position to make recommendations; however, DGS does not
have the authority over an agency’s operation and funding to
implement the recommendations.”

DGS is well positioned to assist agencies in assessing space
needs and utilization. However, agency leadership must first
define their future workforce and service delivery model. It is
further recognized that these models can change over time
due to unforeseen circumstances. The ability to quickly

                                                                                        Page 4 of 8
 A Study to Review How Teleworking Can Reduce Operational Cost for State Government and
              Impact the Recruitment and Retention of State Government Jobs
expand and contract the Commonwealth’s workplace footprint will create the greatest
efficiencies. As reflected in Chapter 522, Item 79, A.2. of the 2021 Virginia Acts of Assembly,
Reconvened Special Session I, “The rent rate for occupants of office space in seat of government
facilities operated and maintained by the Department of General Services, excluding the building
occupants that currently have maintenance service agreements with the department, shall be $15.96
per square foot for the first year and $15.96 the second year.” Based on the cost of facilities per square
foot, a reduction in building occupancy and the footprint needed to support the Commonwealth
workforce has the potential to generate cost savings for the Commonwealth. This amount would be
offset by any cost, to be identified, that may be needed to further support remote workers, albeit much
of those cost are being covered already.



Federal Government – Return to Office and Workspace Reductions
On June 10, 2021, the White House announced its support for the federal government to “Open
with maximum telework flexibilities.” The Office of Personnel Management (OPM) went further
to state that “During the pandemic, telework expanded dramatically out of necessity. As
agencies consider what their post-reentry policies should be, OPM encourages them to
consider telework as part of overall strategic workforce planning that provides new flexibility to
agencies competing for top talent with other sectors across the country.”
At the federal level, the Telework Enhancement Act of 2010 forced agencies to quantify remote
work results. The Social Security Administration reported $900 million in real estate savings in
2018 and 2019, prior to the pandemic. The General Services Administration reported a 40%
reduction in space and millions in real estate and administrative savings.

In March 2021, the U.S. Office of Personnel Management (OPM) published the Status of
Telework in the Federal Government Report to Congress for Fiscal Year 2019. This report is a
comprehensive reflection of telework within federal government. Cost savings are measured
and reported in the following categories: Rent/Office Space; Utilities; Human Capital
(Recruitment/Retention); Training; Reduced Employee Absences; Transit/Commuting Cost. Of
note and interest is the use of both agency and employee realized savings supported by
teleworking federal operations and employment.
The OPM has not yet released the Fiscal Year 2020 report; however, the updated report should
be reviewed for further analysis. Of specific interest will be the impact of the COVID-19
pandemic and what is envisioned for the future federal government workforce model and the
related facilities that house federal employees.


State Comparators - Return to Office and Workspace Reductions
That National Association of State Chief Administrators (NASCA) and real estate firm JLL
conducted and released a study of 23 states on their plans for new workforce and real estate

                                                                                               Page 5 of 8
    A Study to Review How Teleworking Can Reduce Operational Cost for State Government and
                 Impact the Recruitment and Retention of State Government Jobs
strategies. The study titled, How States are Future-Fitting Real Estate Portfolios, provides several
case studies that demonstrate how teleworking can reduce square footage and occupancy costs
by 15% to 30% “depending on the ratio of desk sharing and amount of collaborative space
needed.”

Within the report and related news articles released thereafter by NASCA, States reporting
savings included the following:

        Utah – expected to save nearly $13.6 million annually based on the adoption of
         employees working a hybrid teleworking model. They reported exiting 67 leases and
         reducing its state-wide footprint by nearly 850,000 square feet.
        Colorado - will continue to have 20% of the state workforce working from home which
         will save the state about 1 million square feet of office space.
        Wisconsin – in their Vision 2030 report established a goal to decrease overall general
         office space by 10% or 400,000 square feet over the next decade through lease
         consolidation, a reduction in the number of state owned facilities and operational
         savings.


Findings

    Teleworking and alternate work schedules have proven beneficial in maintaining continuity
     of government operations, enhancing service delivery through automation of processes and
     online service delivery, lessening the impact on the environment by reducing travel and
     vehicle emissions and supporting employee attraction and reduction.
    Leadership across all entities must have the awareness and be sensitive to the realization
     that not all jobs (corrections officers, nursing or direct care, mechanics, retail, etc.) are
     designed for teleworking and not all employees are a good fit for teleworking. Leadership
     must manage teleworking and alternate work schedules with a sense of fairness and equity
     with the realization that a “one size fits all” approach to teleworking and alternate work
     schedules will not work across all agencies.
    The Commonwealth of Virginia has lagged behind the private sector in shifting to a
     workplace culture that fully and openly adopts teleworking and alternate work schedules.
     To be a competitive employer of choice, agencies must design workforce models that
     support full-time and hybrid teleworking models. This includes the design and delivery of
     service through automation and by redesigning positions to support working remotely.
    The technology enhancements and improvements stated herein have positioned the
     Commonwealth to embrace a more modern approach to workforce management and offer
     flexibilities in work locations that enhance the Commonwealth’s ability to attract and retain
     both current and future employees.
    The Department of General Services, through its Division of Real Estate and Facility
     Management, has access to information and the expertise needed to support Executive

                                                                                         Page 6 of 8
    A Study to Review How Teleworking Can Reduce Operational Cost for State Government and
                 Impact the Recruitment and Retention of State Government Jobs
     Branch agencies in the review of space utilization and in strategic planning for future
     workplace environments.
    Support for teleworking, use of alternate work schedules and the justification of workspace
     needed for employee’ remains at the discretion of each agency head. There is no incentive
     or disincentive in place to maximize space efficiency (i.e. reduction of space and cost).
    DHRM policies support teleworking, the use of alternate work schedules and are
     intentionally broad to provide flexibility to meet agency specific needs. DHRM must
     continue to provide training to supervisors on onboarding new employees, managing
     remote employees and teams, and how best to manage by outcomes, not line of sight.
    The Federal government and other State governments have reported significant cost
     savings by continuing to embrace teleworking and putting in place goals or targets for state
     footprint reductions.


Recommendations
The following recommendations are provided for consideration.

1. Require each Executive Branch agency to conduct and regularly report on space utilization
   and cost. In turn, consider establishing a space reduction goal or establish a square footage
   allowance based on a formula created by DGS that accounts for criteria to be identified and
   includes the number of agency employees eligible to telework.
2. Require each Executive Branch agency to report on their ability to move to fully remote
   operations (to the extent practicable) and develop action plans to mitigate any identify gaps
   using the lessons learned from the COVID-19 pandemic including retention of remote
   workers. Require agencies to report this information annually to their respective Cabinet
   Secretary until all gaps have been closed.
3. Research and consider incentives that can be offered to encourage state agencies and/or
   employees to telework or participate in an alternate work schedule. This could include
   evaluation of changes to the state employee compensation and benefit plan that may allow
   for an employee to recoup cost to support teleworking offset by savings to an agency.
4. Require on an annual basis a determined number of agencies to undergo a space utilization
   review by DGS or a third party contracted resource. A key focus of the review would be to
   identify efficiencies and cost savings, as well as, look at future workforce needs to ensure
   long term needs are identified and incorporated in the Commonwealth’s strategic planning
   for real estate and facility management needs.
5. Require DGS or a third party contracted resource to conduct a more in-depth review and
   evaluation of current real estate optimization with support of DHRM, VITA and any other
   agency as needed and present a short term 2 year and long term 5 year plan that reduces
   the Commonwealth’s footprint and achieves cost savings while enhancing the
   Commonwealth’s ability to attract and retain both current and future employees.


                                                                                       Page 7 of 8
 A Study to Review How Teleworking Can Reduce Operational Cost for State Government and
              Impact the Recruitment and Retention of State Government Jobs


Conclusion

The Commonwealth of Virginia is well positioned to transform the public sector workforce and
rebrand the public sector work experience. Doing so, requires a continued commitment to
teleworking and alternate work schedules which will enhance the ability to attract and retain
the current and future talent needed within state government. Teleworking and alternate work
schedules can and do provide cost savings and facility efficiencies.




This report is submitted by the Virginia Department of Human Resource Management with
input from the Virginia Department of General Services and the Virginia Information
Technologies Agency.


                                                                                   Page 8 of 8


File and source

File

2021-RD532.pdf

Size

1,724,140 bytes

SHA-256

e218552214df262b7a4e30d88b518501b848376899c00f5186f13a7b99df88ec

Our copy

2021-RD532.pdf

Original

No public link identified.