Congress should review a law that allegedly hinders the federal hiring process as part of its new focus on human capital issues, according to a Merit Systems Protection Board official. The so-called "rule of three" stipulates that employees hired into competitive service jobs must be selected from among the three most eligible candidates. But the rule, which has been on the books since 1871, is an outdated relic that needlessly ties the hands of federal personnel officials, argues John Palguta, director of policy and evaluation at MSPB. "We don't have a selection process that is so precise that it can identify the best three people out of [an applicant pool] of 200," said Palguta. "For the rule of three to work, it would require that we have a scientific [hiring] process that simply doesn't exist." Palguta, who has often proposed eliminating the rule in the pages of the office's Issues of Merit newsletter, is "cautiously optimistic" that increased attention to human capital issues might prompt a congressional revisit of the law. The rule of three has survived past civil service reform efforts because of bureaucratic inertia and widespread confusion over the rule's relationship to the legal preference of veterans in federal employment, according to Palguta. "You can have veterans' preference and a hiring system that doesn't use the rule of three and the world will be a better place," said Palguta. As evidence of this point, Palguta cited the Department of Agriculture's record of hiring veterans. Agriculture gained an exemption to the rule of three after a successful demonstration project in the mid-1990s. Devised as a check on the power of the original civil service commission in the 1880s, the rule was intended to prevent the commission from forcing the President or agency heads to hire certain applicants. Instead, appointing officials were allowed to choose from among a pool of three different eligible candidates. Today, agencies' delegated examining units refer job candidates to selection officers. For applicants to the competitive service, personnel officials may only choose from the top three candidates, even if there is virtually no difference between several candidates at the top of the list. As a result, officials sometimes have to make fine distinctions between a large group of well-qualified applicants to narrow the pool down to three, short-circuiting effective recruiting efforts. "I'd be interested if you found any federal personnel officer who would argue to retain the rule," Palguta said. While a spokeswoman for the Senate Governmental Affairs Committee was not aware of any pending legislation that would eliminate the rule of three, she said the committee would explore the gamut of human capital issues. "If it is pertinent to human capital, it will be on our agenda," said committee spokeswoman Whitney Bowles. One possible source of support for the law could be veterans groups, despite the lack of connection between veterans' preference and the rule of three. While the Vietnam Veterans Association of America does not have a position on revoking the law, the group does not consider the rule to be fundamental to veterans preference, according to Bill Frasure, deputy director of goverment relations at the association. MSPB first took aim at the rule of three in a December 1995 report that found the rule impeded agencies' ability to hire competent candidates from outside government. The report also concluded that veterans preference could be provided without the rule of three.
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