How do you handle a situation where a peer E-5 has failed in his duties?

I think I would personally displace every article in the Private's room to the grass outside, and post the "inspecting" Sergeant to guard his stuff until the pigpen weasel tried to slink back into the barracks from wherever he is out carousing. At which point, there would be some reindeer games whilst I figure out WTF happened to standards, integrity, and downright decency.
Depending on the answers and how salty I got (more than likely in proportion to how long Private McNasty stayed out in town), there'd be more formal action in the morning.

I would have them BOTH standing tall in front of me to explain themselves (if I were the squad leader of these 2).
1) Asking the PVT why he lives in such filth and think that this is okay?
2) Asking the SGT to explain how, when the room is in the state that it is in, how each "weekly" he performed resulted in "PASS" ratings?
3) Counsel them both, respectively, in the areas that they are CLEARLY deficient in.
4) Perform inspections, personally, with the PVT AND the SGT, 3 times a week until I am confident that standards will be maintained.
5) Have the local Preventive Medicine give the BOTH Soldiers a briefing on sanitation standards and cleanliness and the ramifications of not maintaining good sanitation.

If I were not the Squad Leader of these two, then these would be the recommendations I would give to their Squad Leader.

Wow. Sometimes discussions come up on FP and other such forums that smack me in the face with the realization that I might in fact be a COF (Confirmed Old Fart) who belongs in the past.
My first impression is that it is not only the "peer E-5" that has failed in his duties. Bear with me on the terms I will use being primarily USMC. I'll trust you can translate into other service structure.
Where is the unit Commanding Officer to start with? One of the responsibilities of command is proper care of facilities. Another is providing the best possible environment for those in the unit to work and live. Are the standards for care of living quarters not published in unit and base orders. Who is responsible for supervising the failing E-5? The E-5 is the first failed level, but the next person up the chain is responsible for the E-5's performance. Let's assume it's an E-6 who lives in married quarters. The fact he does not live in the barracks doesn't relieve him of his responsibility to the people in his platoon or section. If the E-6 doesn't know about the situation, shame on him. He has failed. If the unit SgtMaj doesn't make frequent visits to the barracks and make himself available to hear of the situation from other persons living in the barracks, he has failed. If the XO and CO don't know, shame on them. Maintaining an "informal" disciplinary system to ensure standards are maintained are the responsibility of NCOs and SNCOs, and if they can't do it, you move on to the section officers and finally to the CO level where you have nonjudicial punishment and ultimately Courts Martial to enforce regulations.
I could carry the idea further, but hopefully it would be redundant. The unit organization is not only to address operational situations; in fact, the majority of a unit commander's responsibility is not assaulting an objective. The unit commander takes care of his people to ensure they are able to concentrate on their billet responsibilities. If there are weak sisters in the organization, the commander is obligated to discover them and correct the situation; and that responsibility extends to every part of his peoples' lives, on base, or off.
How do you correct the original circumstance? You move up the chain until you reach the individual who takes his responsibility as an NCO, SNCO or commissioned officer seriously. As a peer of a non performer, you also have your own assigned responsibilities and, to ensure you can address those, the efforts and time you expend to correct the other E-5 should be minimal. That's what the chain is there to do.

First, I would call that Soldier's NCO and explain the situation. That NCO deserves an opportunity to fix himself and his Soldier. I would be very clear that I still intend to report the situation back to the PLT SGT since he/she tasked me. In a perfect world, that NCO would make contact with the Soldier and begin to rectify the situation (counseling, cleaning, etc).

If that NCO doesn't step up, I ensure CQ understands they are to contact me on the Soldiers' return. I'd be waiting with that Soldiers counseling statement and corrective action. The PSG would be briefed on the plan of action. That NCO and I would be having some words next time we meet face to face too!

First off "Don't overthink the Problem."

It doesn't matter what the problem was in the past. That's irrelevant. You now have a problem in the present. Deal with that. And correct the problem for the future.

Deal with the problem in front of you.

Problem #1 - The Room.

The other Troop called you in. He needs "Help" because a situation has escalated to a point that he cannot deal with it. What is the simplest way to deal with this problem?

Assess the damage. Verify that soldier's side of the room is "inspection ready" first, and point out any obvious discrepancies. Set the CORRECT STANDARD, and ASSIST them.

Have them sit down, and document the events that led them to calling in "help" (you), while you "declusterfy" the other side. Slowly and methodically begin cleaning the NON-COMMON AREAS of the room, bringing it up to the CORRECT STANDARD.

Segregate items into obvious Garbage, Laundry, Contraband, etc piles. Anything that can be thrown away, throw away. Anything that can be washed, wash (assuming onsite Laundry facilities), anything else, retain. Cleaned laundry can be displayed on the rack (Junk on the bunk style).

After the Troop has finished documenting the events, you can have him begin working on the COMMON AREAS, with the understanding that you will be ASSISTING him. This will be a JOINT endeavor. Same plan as the roommates area, and any of the roommates belongings will be shifted to his area for YOU to deal with.

Once the room is brought to CORRECT STANDARD (Inspection Ready), thank him for his assistance and remind him that when situations are getting "appear to be getting out of control," that is exactly what leadership is for. Calling for help allows us to allocate additional resources including manpower and time to correct situations just like this before they get out of control (just like this). You'll touch base with his immediate supervisor, his roommate, and his CoC to make sure this situation does not happen again.

*** This corrects the problem in front of you ***

Problem #2

The Roommate and the other NCO. As NCO's we always have the ability to IMMEDIATELY correct a troop in front of us. However "retroactive" correction gets really tricky when the troop does not belong to us. For this we need to go Peer-to-Peer. Unfortunately, this Peer-to-Peer issue is significantly more complex (See Problem #3).

Normally, I would suggest grabbing Sgt X, and saying Pvt Z is a slob AND is causing his roommate heartache. This allows Sgt X to correct the problem (#2). Unfortunately Sgt X is enabling Pvt Z's behavior, and has now made it my problem.

Problem #3

Sgt X is not only enabling Pvt Z, but this incident calls into question whether he is inspecting any of his troops rooms. This questions a peers Integrity, and Professionalism, and forces your hand into the "PSG needs to know" realm, because he has to be back-briefed on the events. Regardless of anything else, because you were assigned the task of correcting the problem at the barracks by the PSG, he has to know what the situation was there. That means knowing the full details.

This means that You & PSG have a meeting. It may turn into a You & PSG plus other NCO fact finding mission, and escalate up from there.

However, this does not address the Pvt with bad room standards. I would suggest "taking charge" after back-briefing the PSG as to the Sgt's "deficiencies" and "personally volunteering" to retrain the Pvt on what the CORRECT STANDARD for a room is. Especially since you spent several hours fixing the room previously, and have a vested interest in it staying that way. That may expand to the entire section/squad... because the reward for hard work is more hard work.

*** End of Problems ***

Now as for photos. You can take them. And evidence is always "nice" but honestly unnecessary. If a troop popped red smoke to call the PSG, there's a problem. If you tell the PSG the troop was correct to call him, then the problem was real. You don't "need" pictures. Your statement is enough.

Just my 2 cents.

Back when I was in the Army we had an old custom - "GI Party." If the room wasn't ready for inspection at 0800 (when I usually did my walk-through after PT and recovery) we'd try it again at 2000, and then again at 2200, if necessary. And if that didn't work we'd try it Saturday.

I know the situation was complicated by the fact the douchebag wasn't in your direct chain, but if you are in the same platoon and you are the ranking NCO present, he does (at least for the time being) become your responsibility. I already spoke above about dealing with the chain issue so wont go into it again.

When I first became a Field Artillery gun section chief back in the early 80s I was given a brand-new Sergeant, E-5 as a gunner. I would have my gunner go through the troops' rooms for a pre-inspection before I walked through (you don't expect what you don't inspect - even if sometimes you don't let the troops know you are looking over their shoulders; taking a private's word for something is a sure way to become a private again yourself). I thought an E-5 should require less direct supervision, boy was I wrong. My troops' rooms were straight but his (he lived in the barracks) was a wreck.

His roommate (another young E-5) came to me about it and I about hit the ceiling when I walked in and saw empty pizza boxes and beer cans strewn over the place. It was counseling time. How could he have the nerve to correct his men's deficiencies if he wasn't straight? It was up to him as a sergeant to set an example. I realized that by trusting him too much I had failed to mentor him and set about correcting the issue. He had proven deficient in several areas, failing to satisfactorily complete even some of the simplest tasks I assigned him. Butt-chewings weren't doing the job. I started formally (in writing) counseling him - for his own good and with an eye to (last resort) perhaps busting him for inefficiency if his performance didn't improve. Sometimes troops are promoted too soon and are not ready for the new responsibilities of leadership.

He turned around and had a fairly successful career. I really believe if I'd been forced to bust him it would have been a failure on my part. Sometimes we forget we are responsible for mentoring ALL our subordinates - even those in leadership.

Wweeelllll! Sounds like some lack of Integrity is going on to say the least! Or, maybe just from what I am reading! Could this be a soft PSG? Could there be some NCOs and soldiers who plays their PSG as a chump?!!! Just wondering! Just my two cents and thoughts!

Move the solder out who was cleaning up out of the room if you can. I'm sure he'd be more than willing to move in this case. Have the nasty one stay in the room. Secure his liberty and have him field all weekend. Every morning before pt, have someone check his room. If it fails, an NCO that lives in the barracks checks his room every hour after work until it's fixed. It happens again after that, paperwork.

First, there was no reason to get involved. After all, it was another SqdLdr's soldier, right? However, it sounds like there might be one, maybe two, Blue Falcons in the platoon. There are two basic issues here:
1.) Failure of the soldier to maintain an orderly room; and
2.) Failure of the (other) SqdLdr to accurately inspect and/or report status of the inspection.
The first is a leadership problem. The latter may be an integrity problem. Either way, this is now a issue for the Platoon Sgt. You've done your due diligence. Now, bow out. At this point, the Platoon Sgt should set the course.

Force choke.