Kay Coles James, the president's chief adviser on the civil service, resigned yesterday and will leave as director of the Office of Personnel Management at the end of the month.
James said she did not have a job lined up but had decided to leave to pursue "several private-sector opportunities," in part to meet financial goals for her retirement.
"I just want to make sure that I explore all the possibilities before making any final decisions," she said in an interview. "So I will take a little bit of time to do that."
James submitted her resignation letter to President Bush in mid-morning and then informed the OPM senior staff at a morning meeting. Bush appointed James in March 2001 to lead the OPM, which helps set federal workforce policies and administers federal employee and retiree benefit programs.
She has played key roles in the Bush administration's decisions to change the pay and personnel rules for about 850,000 civil service employees at the departments of Defense and Homeland Security. The new rules, which the departments plan to publish in the next few weeks, will revamp how employees are paid, hired, promoted and disciplined. They also are likely to curb the role of federal unions and limit issues that may be negotiated.
James has argued that federal agencies need more flexibility in how they deal with employees, such as more closely linking pay raises to job performance ratings. But she also has reminded administration officials that they need to retain fundamental civil service safeguards that shield employees from political pressure, cronyism and discrimination.
Paul C. Light, a New York University professor and Brookings Institution fellow, said the timing of the James resignation "could not be worse, as far as I am concerned." He added: "I value continuity over uncertainty every time."
Light said that the Bush administration is "presiding over a massive change that will remake the federal workforce" and that James holds "a critically important job, particularly at this moment."
"A lot of federal employees are sitting there asking, 'What is going to happen to us?' " he said.
James acknowledged that her successor will face a demanding workload, but she said most of the policy initiatives are far enough along that they will not be put at risk by her departure. "It is never a bad idea to have people come in with new ideas who are hopefully as committed and love this service as much as I do," she said.
Homeland Security Secretary Tom Ridge said yesterday that James's "support and guidance has been instrumental in our efforts to collaboratively develop the department's new human resource management system."
In a statement last night, Deputy Defense Secretary Paul D. Wolfowitz said that James "was critical" in developing plans for the new Defense civil service system and that she "will be truly missed."
Two unions that represent Homeland Security employees gave James credit for pushing for an open process that allowed unions to offer feedback on proposed workplace changes.
"While we did not always agree, it was a pleasure to work with her," said Colleen M. Kelley, president of the National Treasury Employees Union.
John Gage, president of the American Federation of Government Employees, praised James as "a real gentlewoman" but said she failed to get the Pentagon to cooperate with unions on the rewriting of their civil service rules. Unions have complained they are being shut out of the process.
Max Stier, the president of the nonprofit Partnership for Public Service, said James "has acquitted herself admirably" during the difficult transition to an era of new personnel systems at Homeland Security and Defense. At the same time, he said, she has taken steps to bolster recruiting and simplify the federal hiring process, which is notorious for leaving job applicants in the dark about their status for months.
"You are dealing with a set of problems that are enormous," Stier said. "Has she fixed everything? No, but that's not the right standard. The kinds of things that need to take place in the federal work environment are really going to take a long time to fix, and she's taken some important first steps to getting us to the right place. Things like the hiring process, which have not been on the front burner before her tenure, are now on the front burner.
"Unfortunately, none of these issues get resolved by the stroke of a pen. They really require the fundamental change in a variety of agencies. There can be help from a centralized location like OPM, but ultimately the responsibility lies at many doors at all the different agencies."
Sen. Susan Collins (R-Maine), chairman of the Senate Homeland Security and Governmental Affairs Committee, said James "has left a positive mark" on the OPM. "She has an outstanding work ethic and knows how to think 'outside of the box' to come up with innovative solutions to address public policy challenges," Collins said.
White House spokesman Trent Duffy said the administration anticipates a "seamless transition" at the OPM.
Possible replacements for James, administration officials said, include Ed Moy, White House associate director for presidential personnel; Albert C. Zapanta, chairman of the Reserve Forces Policy Board at the Defense Department; Stephen A. Perry, head of the General Services Administration; Cari M. Dominguez, chairman of the Equal Employment Opportunity Commission; Dan Blair, deputy director of the OPM; and Ronald Martinson, staff director of the House Government Reform subcommittee on the civil service and a top aide to Rep. Thomas M. Davis III (R-Va.).
