DHRM - Department of Human Resource Management

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Agency Background and History

The Office of the Governor’s Division of Personnel, now the Department of Human Resource Management, was created in 1942 as a function within the State Budget Office, but the history of the Virginia Personnel System dates back to the early 1900s. At that time, many agencies had independent sources of revenue. Employee pay and benefits were not uniform.

Focus on Central Government

In 1916, Governor Henry Carter Stuart expressed concerns that this lack of uniformity could result in “injustice, waste, over/under-manned services, inefficiency, poor service, and nonperformance.” In 1918, the State Commission on Economy and Efficiency recommended the establishment of the first centralized personnel management function in the Commonwealth. That recommendation was not approved. In 1922, the State Commission on Simplification and Economy did develop the first uniform State Classification Plan to begin to address concerns about the fair and uniform treatment of employees. The Commission again recommended the centralization of state government personnel systems, and again, the recommendation was not approved by the legislature. Amid growing concerns about the lack of central mechanisms for monitoring employee compensation, the 1926 General Assembly ruled that the Governor personally approve all pay actions on state employees who earned over $100.00 per month. Ten years later in 1936, Governor George Perry, in what was known as The Griffenhargen Study, requested the establishment of a “state personnel management system that would provide equal pay for equal job responsibilities,” but the concept was not supported by the legislature. In early 1940 the General Assembly drafted, and then rejected another proposal to centralize personnel management in the Commonwealth. Its rejection was based on concerns that centralization might limit the authority of agencies.

Impact of Social Security Grants

The turning point came later that year when the federal government ruled that all states receiving Social Security Grants have “central civil servant type merit systems” in order to qualify for grant money. That single federal decision led to the adoption of the Virginia Personnel Act in 1942 and to the establishment of the Governor’s Division of Personnel as an Executive Branch Agency. Over the next three decades, central functions would come to include the Administration of Rules for the Act, Merit System of Employment, Classification and Compensation, Health Insurance, Transactions and Records Management, State and Local Government Development Services, and Equal Employment Services.

Impact of Employment and Civil Rights Laws

By the early 1970s the role of personnel was changing across all sectors in response to expanding federal and state employment and civil rights laws designed to protect the rights of employees. Personnel became an established profession, and personnel systems were becoming an important partner in risk management. Specialized services expanded, including recruitment, employee relations, compensation and benefits, and personnel development in order to better meet management’s workforce needs and support employee morale. In light of this, Governor Linwood Holton formed the Commission on State Governmental Management, which initiated an evaluation of the state personnel system. One of its goals was to reinforce the “service oriented approach to personnel administration as originally envisioned.” He recommended expanding the role of personnel to include evaluating the performance of individual state agencies.

Focus on Management Role

During the administration of Governor Mills Godwin, the 1975 Hopkins Commission Report, initiated in 1973 as the Commission on State Governmental Management, recommended that the “role of the state personnel function be one of management and leadership, and that the State Personnel Office provide guidance and technical advice on all phases of personnel management, including agencies’ compliance with statutory and delegated authority. The report recommended: that the pay system be evaluated and revised to include performance awards; the elimination of administrative rules and the establishment of an organized system of policies; major revisions to the performance management system; an improved grievance procedure; and improved systems for data collection and analysis. It also recommended that legislation be enacted to develop a definitive plan for the decentralization of personnel functions to agencies. One year later in 1976, the agency’s name was changed to the Virginia Department of Personnel and Training. (DPT)

Focus on Agency Accountability

In 1979, Governor John Dalton and the General Assembly supported the passage of House Document 11, The Plan for Personnel Management Decentralization. The purpose of the plan was to improve state management generally, and personnel management specifically, by placing greater responsibility and accountability on agency management for managing personnel programs and operating within the parameters of state personnel policy. To insure material changes and improvements in agency programs, agencies were expected to shift from “paper administration systems to employee relations management systems.” New programs, including the Virginia Executive Institute and the State Program Evaluation team emerged from DPT in the early 1980s. Position classification, and to some extent routine compensation actions were decentralized to agencies that could formally demonstrate executive support of the concept, appropriate staffing in personnel, staff competencies necessary for a decentralized environment, and a record of successful workforce leadership. Concurrently, DPT was promulgating the Commonwealth’s first formal personnel policies which eventually replaced the former Rules for the Administration of the Personnel Act. Decentralization was viewed as a success that sped business processes and reinforced management accountability. By the early 1990s approximately 20 agencies functioned under formal decentralized agreements. The 1993 General Assembly created the Workforce Commission and mandated a study of the management of the Commonwealth’s workforce. JLARC was directed to study the organization, staffing, management, and resource needs of the Commonwealth’s personnel function and the role of DPT. Five Task Force groups comprised of experts from the private and public sectors made recommendations in 1994 for the continuous improvement of the management of the workforce with emphasis on Strategic Planning, Quality Improvement, Compensation, Family Friendly Policies, and Career Development.

Impact of Streamlining Government

In 1995 Governor George Allen’s Blue Ribbon Strike Force, which sought to streamline and reduce the size and reach of state government, resulted in significant staff reductions and program eliminations at DPT, particularly in the areas of compliance, equal employment, training, policy, compensation, and program evaluation. Decentralization was expanded to all agencies who were encouraged to adopt “Reinventing Government” strategies. Following an employee engagement survey in 1998, Governor James Gilmore’s Commission on Reform of the Classified Compensation Plan was established to recommend modifications to the Commonwealth's classified compensation plan. The Commission’s work was based in large part on the findings from the Workforce Commission Report published in 1994. The reforms recommended by the Commission included occupational banding, performance driven awards, team-driven performance increases, flexible compensation tools, alternative rewards, a new performance management system, career development resources and tools, and other modem employee compensation features common to other large, multi-site employers. Reform was supported by the General Assembly. On March 9, 2000 the General Assembly approved legislation that changed the name of the agency from the Department of Personnel and Training to the Department of Human Resource Management. (DHRM) On September 25, 2000, DHRM implemented Compensation Reform. Ultimately the reforms were much broader than compensation because they changed the Commonwealth's overall approach to attracting, retaining, and motivating employees.

Focus on Leadership and Strategic Planning

Over the next decade DHRM’s mission focused on leadership and strategic planning. The agency developed a robust data warehouse and online workforce planning and assessment tools, transitioned to an online Recruitment Management System, implemented an online Learning Management System, in-sourced Wellness programs to save the Commonwealth millions of dollars, improved health plan options, developed employee recognition programs, published tools and policies designed to attract and retain talent, and established a central Shared Services (fee-for-service) function to provide human resource services to small agencies for a significantly lower cost than in-house programs.

Today, the Department of Human Resource Management (DHRM) serves as the central human resource agency for state government. DHRM provides a broad range of leadership, guidance, and operational support to the state government and its stakeholders. Functions include Human Resource Systems Technology, Policy, Equal Employment Services, Employment, Compensation and Benefits, Employment Dispute Resolution, Talent Management and Workforce Planning, Workers’ Compensation, Wellness Programs, Charitable Giving.