The IRS is continuing to rehire former employees who had performance or conduct problems in their prior stints there, the IG there has said, despite its promises to take such work histories into consideration during hiring in light of a prior report and despite a law requiring it.

At a House hearing, IG J. Russell George cited hiring practices as among the major management issues facing the agency. He recounted that in 2014 his office found that more than 800 of some 7,000 former employees that the IRS had rehired in 2010-2013 had prior conduct or performance issues. In response, the agency agreed to fully consider such issues in the hiring process and Congress later enacted a law imposing that as a requirement.

However, he said a recent follow-up study found that about 200 of the some 2,000 former employees rehired in January 2015-March 2016 had such issues. That included four who had been terminated or resigned for willful failure to properly file their federal tax returns; four while under investigation for unauthorized accesses to taxpayer information; and 86 while under investigation for absences and leave, workplace disruption, or failure to follow instructions. Some of these employees held positions with access to sensitive taxpayer information, he said.

“Given the substantial threat of identity theft and the magnitude of sensitive information that the IRS holds, hiring employees of high integrity is essential to maintaining public trust in tax administration and safeguarding taxpayer information. This is especially important in light of recent cyber events against the IRS intended to access tax information for the purposes of identity theft and filing fraudulent tax refunds. The IRS must ensure its systems and data are protected against both external and internal threats,” he said.

IRS officials said at the hearing that the hiring process has been improved since the period covered by the most recent report.

Other major management issues cited by the IG were primarily IT related, including information security of taxpayer data, replacing legacy software and hardware, and filling cybersecurity positions.