Washington, July 22 — The Inspector General of the US Department of Labour on Wednesday told lawmakers that the Biden-Harris administration failed to establish basic safeguards governing the sharing of confidential investigative information with outside lawyers, saying weak oversight created the potential for sensitive government information to be used in private litigation.
Appearing before the House Education and Workforce Subcommittee on Workforce Protections, Inspector General Anthony D'Esposito said his office found that the department lacked department-wide controls over so-called common interest agreements, which allow parties with shared legal interests to exchange confidential information under limited circumstances.
"I repeat with a shared interest," D'Esposito said. "They were never intended to become a tool for the federal government to align itself with private plaintiff attorneys."
He told lawmakers that the audit, initiated after concerns raised by Congress and Acting Labour Secretary Keith Sonderling, found widespread deficiencies in how such agreements were managed.
"The Biden-Harris Department of Labour had no department-wide controls governing any of these common interest agreements," he said. "There were no written policies, no consistent approval processes, no centralised tracking."
According to D'Esposito, some agreements were documented while others "amounted to a little more than a verbal handshake."
"In one case, an individual executed a common interest agreement without the authority to even do so," he testified.
The inspector general said investigators were unable to obtain a complete inventory of the agreements because none existed.
"When our auditors requested a complete inventory of these agreements, none existed. Agreements were scattered across emails, shared drives, and case files. Officials initially identified 45 agreements; manual searches uncovered even more. That is not oversight. That is a system without accountability."
D'Esposito said government lawyers "represent the United States of America, not private plaintiffs' law firms."
"It should never create the appearance that government resources, privileged information or taxpayer-funded personnel are being used to benefit private attorneys or increase their legal fees," he added.
House Republicans argued the findings showed a breakdown in public trust.
Subcommittee Chairman Ryan Mackenzie said the report confirmed "serious failures of accountability" and praised the inspector general's eight recommendations to tighten oversight.
"The department agreed with every single recommendation," D'Esposito said, adding that implementation was already underway.
Republicans repeatedly argued that the issue was not the number of agreements but the lack of safeguards.
"Whether it's one common interest agreement or one million common interest agreements," D'Esposito said, "there was a potential for critical information to be leaked to plaintiff's attorneys."
The hearing also examined inconsistencies across regional Labor Department offices. D'Esposito said some regional solicitor offices relied on oral agreements rather than written ones, while signatory practices differed across the country.
Democrats, however, argued Republicans were overstating the issue.
Ranking member Mark Takano noted that common interest agreements represented only a tiny fraction of the department's investigations and said the inspector general's report primarily made "process-related recommendations."
"The Labour Department is currently implementing them. This is rather straightforward stuff," Takano said during his closing remarks.
He criticised Republicans for focusing on "a legal, yet rarely used Labour Department practice" instead of issues such as wages, worker protections and child labour enforcement.
The hearing also briefly touched on broader oversight issues. During his testimony, D'Esposito said his office was working with the administration's anti-fraud efforts and referred to fraud involving H-1B visas, saying some schemes had "led to wage theft, been exploited, encouraged human trafficking, funded criminal enterprises and taken American jobs away from American workers."
The Office of Inspector General's report issued in June made eight recommendations aimed at strengthening oversight of common interest agreements, including formal procedures, centralised tracking, conflict-of-interest monitoring and staff training. According to testimony, the Department of Labour has accepted all eight recommendations and implementation is under way.