Federal Manager's Daily Report

The State Department spent about $732 million for hardship pay and $266 million for danger pay at overseas posts in fiscal years 2011 through 2016, but the process used is vulnerable to errors, GAO has said.

Hardship pay compensates employees for service at overseas posts where conditions differ substantially from those in the United States. Danger pay compensates employees for service at posts where civil insurrection, civil war, terrorism, or wartime conditions threaten the health or well-being of an employee.

To determine hardship rates, GAO said, State calculates scores for a post based on information from surveys and factors such as air pollution and crime–but it does not always clearly document why management uses a discretion to increase the scores.

Further, policies on stopping the special pays when employees leave an area temporarily and then restarting it when they return cause some 10,000 pay actions each year “and contribute to improper payments, which are costly to recover”–an estimated $2.9 million related mostly to hardship pay in 2015-2016.

The report said that State agreed with the recommendations directed toward those concerns.