Military Pay: Army Reserve Soldiers Mobilized to Active Duty Experienced Significant Pay Problems

Army and DFAS developed procedures for mobilization stations to query the DJMS-RC pay system to identify all soldiers on a mobilization tour in the pay system and assigned to a unit reporting to the mobilization station. Changes to the Mobilization Standard Operating Procedures were incorporated to require mobilization station personnel to validate the soldiers listed on the mobilization pay lists against actual personnel reporting to the mobilization station. In addition, DFAS and Army developed a tracking mechanism called, "Soldier Financial Readiness Visibility System" to provide further visibility of mobilizing soldiers' pay status.

The Army has developed automated listings of all soldiers arriving and departing overseas combat theaters. A May 2004 change to the Army Tactical Personnel System (TPS) added a status code for pay purposes to the system at the point of embarkation/debarkation to or from theater. Further, the Army implemented procedure to verify TPS files with hardcopy unit troop manifests to minimize errors. In May 2006, the Army Audit Agency reported that the changes were fully implemented. The implementation of these revised procedures should enable the Army to improve the timeliness and accuracy of pay and allowance payments to Army reserve soldiers.

Army Finance Mobilization Procedures were amended to require the demobilization finance office to obtain a by-name listing of unit soldiers arriving for demobilization and to perform a 100 percent accountability for all soldiers in the unit. In addition, demobilization procedures require finance personnel to reconcile soldier data on the DD Form 214 (Certificate of Release of Discharge from Active Duty)with DJMS-RC pay data to ensure soldiers being discharged do not continue to receive active duty pay. DFAS and Army also completed compliance reviews at Army mobilization/demobilization stations to assess compliance with established pay procedures.

Army Finance Office and DFAS personnel began reconciling soldier data on the DD Form 214 (Certificate of Release of Discharge from Active Duty) obtained through the Transition Processing System (TRANSPOC) with DJMS-RC pay data to ensure soldiers receiving DD Forms 214 are not continuing to receive active duty pay. Demobilization stations are required to follow-up on discrepancies.

Army policy published in January 2004, and since incorporated in the Army Mobilization/Demobilization Standing Operating Procedures in June 2004, established requirements for a thorough one-on-one review of on-line pay records for each mobilized soldier arriving at the mobilization station. Compliance with mobilization policies and procedures have been validated through compliance reviews at mobilization/demobilization stations. Army and DFAS established procedures for a continuing program of periodic compliance reviews at active mobilization/demobilization stations to ensure continued compliance.

DFAS established procedures and system automation to allow deployed finance elements and mobilization stations to obtain and distribute the Unit Commander's Pay Management Report for Army Reserve units in their area of responsibility.

The DJMS-RC Procedures Manual (USAR Pamphlet 37-1) was re-published in June 2005 in its entirety, to include the chapter on mobilization with the requirement that unit commanders, unit administrators, or other designated officials review and reconcile soldier pay and personnel data every month with the monthly Unit Commander's Pay Management Report for mobilized Army Reserve soldiers.

The Army revised its Military Pay Allowance Policy (AR 37-104-4) in June 2005 and updated DD form 1561, "Statement to Substantiate Payment of Family Separation Allowance", in November 2006. The revised policy and form included explicit guidance concerning the 30-day waiting period and the commuting distance criteria. With the implementation of this policy and form, the Army should improve the timeliness and accuracy of pay and allowance payment to Army reserve soldiers.

The Army agreed with GAO's finding concerning inadequate resourcing for key unit administrator pay management responsibilities. At the time our report was issued, the Chief, Army Reserve approved a strategic plan for improving to human capital resources for Reserve unit administrative support. The strategic plan provided for consolidating administrative support, to include pay by supporting military administrative positions with corresponding drilling reserve positions, so that during periods of military duty, the unit administrator will remain at the reserve center performing the same functions. By pooling unit administration resources and responsibilities within a reserve center, there will be continuity of administrative support for units even during absences or vacancies for individual administrators. Army Reserve successfully piloted the new concept at one of the Regional Readiness Commands in 2004. As of March 2009, 11 of 34 reorganized centers were implemented. Full implementation was reported for December 2010.

The Army Reserve conducted the recommended study of resourcing related to pay administrator positions. The study concluded that of the 1,993 unit administrator positions in the Army Reserve, 395 (20 percent) are temporarily vacant due to the incumbent serving on active duty. Only 101 (5 percent) were vacant as a result of awaiting a new personnel selection.

On May 2, 2005, the Army formally established the Army Ombudsman Office at the Army Financial Services Center-Indianapolis, and published a toll-free telephone number to their help desk. The Ombudsman Program mission was expanded to help Army National Guard and Reserve soldiers resolve pay, travel, and health care problems. According to Army National Guard officials, at inception the Ombudsman Office began handling 400 to 1,000 inquiries each week.

DFAS, in coordination with the Army, has developed an automated tracking mechanism called, "Soldier Financial Readiness Visibility System (SFRVS)." Included in this system is a reconciliation with data contained in the Electronic Military Personnel Office (E-MILPO) system. Initial testing was completed in February 2005 and the web-based application on a secure server was completed in April 2005.

DFAS completed the recommended feasibility assessment. The assessment concluded that DJMS-RC would require a systems change to stop the withholding of taxes in tax-exempt combat zones and determined the change would take 12-18 months to implement. Since the implementation would be after the Army Reserve accounts conversion to the Forward Compatible Pay (FCP) system, a change to the DJMS-RC was not considered feasible. However, the Army modified its combat zone tax exclusion process to suspend tax withholding in the same month as earned. In addition, the Army changed its pay system to move the Army Reserve soldiers' tax reimbursement up from the first pay cycle of the following month to the end of month cycle of the same month as applicable. With the implementation of this system change, the Army should improve the timeliness and accuracy of pay and allowance payment to Army Reserve soldiers.

DFAS concluded in a feasibility assessment that a systems change to modify the process to prevent payments after demobilization was not feasible because the change could not be implemented before the new FCP pay system was implemented. However, DFAS and Army Reserves Command processed a systems change to the DJMS-RC pay system to automate payments for Hardship Duty Pay-Location (HDP-L) in March 2004. This automation feature will eliminate the continued creation of manual HDP-L payments after the demobilization date posted in the pay system. In addition, as a result of our review, improvements were made to increase the accuracy of data flowing from the Total Personnel System (TPS) in theater to finance officers for creation of the starts and stops of theater entitlements resulted in increased accuracy of HDP-L payments. These changes should significantly reduce the occurrences of active duty payments made after demobilization.

Army has taken action to establish detailed military pay requirements as part of the DIMHRS Program design. These requirements address the pay deficiencies identified in the audit report. Specifically, the requirements establish an integrated single record for all military members (Active, Reserve, and Guard). The single record will support seamless status transition as military members are mobilized/demobilized. Further, the Reserve system requirement to reenter entitlements monthly was eliminated. Duty status changes from Reserve to Active, will now automatically initiate basic pay and allowances and enable one time entry to start/stop location-based entitlements.