Reinventing government privatization-style - Avoiding the legal pitfalls of replacing civil servants with contract providers

Public Personnel Management

Volumn 26, Issue 1, 1997, Pages 15-33

  Elam, L B ^a  

^a NONE

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EID: 0039768940     PISSN: 00910260     EISSN: None     Source Type: Journal    
DOI: 10.1177/009102609702600103     Document Type: Article

References (45)

1. Dirk Johnson, "In Privatizing City Services, It's Now 'Indy-a-First-Place'", The New York TImes, Vol. CXLIV (March 2, 1995) p. A 8
2. ". . . Virtually every function of local government has been delegated to the private sector at some time, in some city. . . . Florida and Kentucky, among other states, have private mental hospitals. The privately owned Detroit-Windsor Tunnel links Canada and the United States, while a for-profit company has been authorized to build a toll road to Dulles airport. Nearly forty jurisdictions use profit-seeking fire protection companies, and a private company runs the air-traffic control tower in Farmington, New Mexico. . . La Mirada, California, a city of some forty thousand, contracts out for more than sixty services and has a municipal work force of only fifty-five. Lakewood, California (population sixty thousand), a pioneer in contracting for services, has eight city workers, and one Dallas suburd with twenty-five hundred citizens has no city work force at all side from a single secretary to handle the paper-work knitting together the nexus of contracts that constitute the town's public sector." John D. Donahue, The Privatization Decision: Public Ends, Private Means, (New York: Basic Books, Inc., 1989), p. 135.
3. Subject to the above limitations, the United States, New York, New Jersey, Pennsylvania, Connecticut, Maryland, Michigan, Ohio, Nevada and Alaska have sustained the layoff of civil service perasonnel pursuant to contracting for services. Lodge 1858, Amirican Federation of Govrnment Employees vs. Webb, 580 Fed. 2d 496 (D.C. Cir., 1978) (employees of National Aeronautics and Space Administration); Corwin vs. Farrell, 100 N.E. 2d 135 (N.Y., 1951) (employees performing land title searches); In Re IFPTE Local 195 vs. State, 443 A. 2d 187, 193 (N.J., 1982) (in concept only); Wright vs. Dept. of Corrections, 553 A. 2d 1056 (Pa. Com. Ct., 1989) (licensed practical nurses); Connecticut State Employees Assoc. vs. Board of Trustee, 345 A. 2d 36 (Conn., 1974) (food service workers); Ball vs. Board of Trustees, 248 A. 2d 650 (Md. Ct. App., 1968) (food service workers); Michigan State Employees' Assoc. vs. Civil Service Commission, 367 N.W. 2d 850 (Mich. Ct. App., 1985) (sustained state civil service commission rule liberally authorixing contracting); Carter vs. Ohio Dept. of Health, 504 N. E. 2d 1108 (Ohio, 1986) (data entry personnel); Univ. of Nevada vs. State of Nevada Employees Assoc., Inc., 502 P. 2d 602 (Nev., 1974) (food service workers); Michigan State Employees' Assoc. vs. Civil Service Commission, 367 N. W. 2d 850 (Mich. Ct. App., 1985) (sustained state civil service commission rule liberally authorizing contracting); Carter vs. Ohio Dept. of Health, 504 N. E. 2d 1108 (Ohio, 1986) (data entry personnel); Univ. of Nevada vs. State of Nevada Employees Assoc., Inc., 520 P. 2d 602 (Nev., 1974) (food service workers); Moore vs. State Dept. of Transportation, 875 P. 2d 765 (Alaska, 1994) (airport maintenance worker).
4. In California, Washington, Colorado, Texas and Louisiana the layoff of civil service personnel for the purpose of contracting is either restricted by statute, regulation or judicial decision, or the law is uncertain. Wests Annot. California Government Code, Sections 19130-19133; Department of Transportation vs. Chavez, 9 Cal. Rptr. 2d 176 (Cal. Ct. App., 1992); Calif. State Employees' Assoc. vs. Calif. State Personnel Board, 223 Cal. Rptr. 826 (Cal. Ct. App., 1986); Wash. Fed. of State Employees, AFL0-CIO vs. Spokane Community College, 585 P. 2d 474 (Wash., 1978); Colorado Assoc. of Public Employees vs. Colorado Dept. of Highways, 809 P. 2d 988 (Colo., 1990); Lee vs. City of Houston, 807 S.W. 2d 290 (Tex., 1991); Intern. Assoc. of Firefighters Local 624 vs. City of Antonio, 822 S.W. 2d 122 (Tex. Ct. App., 1991) Moncrief vs. Tate, 593 S.W. 2d 312 (Tex., 1980); Parker and Assoc. vs. State of Louisiana, 454 So. 2d 162 (Lo. Ct. App., 1984). Compare Lodge 1858, American Federation of Government Employees vs. Webb, 580 Fed. 2d 496 (D.C. Cir, 1978) with Lodge 1858, American Federation of Government Employees vs. Administrator, NASA, 424 F. Supp. 186 (D.C. Cir., 1976) with Corwin vs. Farrell, 100 N.E. 2d 135 (N.Y., 1951).
5. Univ. of Nevada vs. State of Nevada Employees' Assoc., 520 P. 2d 602, 606-607 (Nev., 1974).
6. Corwin vs. Farrell, 100 N.E. 2d 135, 137 (N.Y., 1951); Calif. State Employees Assoc. vs. State of Calif., 245 Cal. Rptr. 232, 238 (Cal. Ct. App. 1988); Calif. State Employees Assoc. vs. Williams, 86 Cal. Rptr. 305, 312 [Ftnt. 8] (Cal. Ct. App., 1970).
7. Nassau Educational Etc. Assoc., Inc. vs. Great Neck Union Free Sch. Dist., 439 N.E. 2d 876, 877 (N.Y., 1982); Westchester County Etc. Assoc., Inc. vs. Cimino, 396 N.Y.S. 2d 692, 695 (N.Y. App. Div., 1977).
8. Fibreboard Paper Products Corp. vs. NLRB, 379 U.S. 203, 215 (1964); Saratoga Spring City Sch. Dist. vs. New York State PERB, 416 N.Y.S. 2d 415 (N.Y. App. Div., 1979) (leave to app. den. 394 N.E. 2d 294); Pennsylvania LRB vs. Mars Area Sch. Dist., 389 A. 2d 1073, 1075-1076 (Pa., 1978); Service Employees' Intern. Local 316 vs. Illinois State ELRB, 505 N.E. 2d 418, 423-424 (Ill. Ct. App., 1987); Local 4501, Communications Workers vs. Ohio State Univ., 494 N.E. 2d 1082 1086-1087 (Ohio, 1986); Detroit Police Officers vs. City of Detroit, 404 N.W. 2d 595 (Mich., 1987); Unified Sch. Dist vs. Wisconsin ERC, 259 N.W. 2d 724 (Wisc., 1977); General Drivers Union Local 346 vs. Independent Sch. Dist. No 704, 283 N.W. 2d 524 (Minn., 1979); San Diego Adult Educators vs. California State PERB, 273 Cal. Rptr. 53, 57-59 (Cal. Ct. App., 1990). Contra: In Re IFPTE Local 195 vs. State, 443 A. 2d 187, 193-195 (N.J. 1982).
9. Detroit Police Officers vs. City of Detroit, 404 N.W. 2d 595, 596 (Mich., 1987); West Ottawa Educ. Assoc. vs. West Ottawa Etc. Bd. of Educ., 337 N.W. 2d 533, 544-546 [ftnt 1] (Mich., 1983); Plymouth Fire Fighters Assoc. Local 1811 vs. City of Plymouth, 401 N.W. 2d 281, 282 (Mich. Ct. App., 1986); Building Material and Constr. Teamsters vs. Farrell, 224 Cal. Rptr. 688, 692-696 (Cal., 1986).
10. South Orangetown Kitchen Workers' Assoc. vs. South Orangetown Central Sch. Dist., 422 N.Y.S. 2d 597, 600 (N.Y. Spec. T., 1979); N.Y.S. Assoc. for Retarded Children vs. Carey, 456 F. Supp. 85, 95-96 (E.D. New York, 1978); Western Washington Univ. vs. Washington Fed. of State Employees, 793 P. 2d 989, 990, 993 (Wash. Ct. App., 1990). The rule is otherwise in any jurisdiction in which contracting of layoff is neither a mandatory nor permissive subject of bargaining. In Re IFPTE Local 195 vs. State, 443 A. 2d 187, 193-195 (N.J., 1982); Stone vs. Camden County Free-holders Bd., 435 A. 2d 143, 147 (N.J. Sup. Ct., 1981).
11. First National Maintenance Corp. vs. NLRB, 452 U.S. 666 (1981).
12. Keeton vs. State Dept. of Soc. and Health Services, 661 P. 2d 982, 986-987 (Wash. Ct. App., 1983). If the collective bargaining agreement in Keeton had provided for grievance arbitration for alleged breach, an arbitrator would have been vested with exclusive discretion to interpret the clause, even if a court might render an interpretation more favorable to the agency. Yonfcers City Sch. Dist. vs. Yonfcers Fed. of Teachers, 353 N.E. 2d 569, 573-574 (N.Y., 1976); N.Y.S. Assoc. for Retarded Children vs. Carey, 456 F. Supp. 85,95-96 (E.D. New York, 1978).
13. Bay City Educ. Assoc. vs. Bay City Public Schools, 422 N.W. 2d 504, 508, 510 (Mich., 1988).
14. Furniture Renters of America, Inc. vs. NLRB, 36 Fed. 3d 1240, 1243 (3rd Cir., 1994). While not controlling, National Labor Relations Act precedent relating to the scope of representation is persuasive in the interpretation of counterpart provisions of state labor relations laws governing public employees. Detroit Police Officers vs. City of Detroit, 404 N.W. 2d 595, 601 (Mich., 1987); Fire Fighters Union vs. City of Vallejo, 116 Cal. Rptr. 507, 512-513 (Cal., 1974).
15. School Committee of Newton vs. Labor Relations Com., 447 N.E. 2d 1201, 1206-1207 (Mass., 1983); Metropolitan Council, Etc. vs. City of Center Line, 327 N.W. 2d 822, 830-831 (Mich., 1982); Fire Fighters Union vs. City of Vallejo, 116 Cal. Rptr. 507, 516 (Cal, 1974); Annotation, "Negotiable Issues in Public Employment," 84 ALR 3d 242, 291 et seq. (1978)
16. Wright vs. Dept. of Corrections, 553 A. 2d 1056, 1058 (Pa. Com. Ct., 1989); Univ. of Nevada vs. State of Nevada Empl. Assoc., Inc., 520 P. 2d 602, 606-607 (Nev., 1974); Cunningham vs. Community College Dist. No. 3, 484 P. 2d 891, 895-896 (Wash., 1971); City of San Antonio vs. Wallace, 338 S.W. 2d 153, 157-159 (Tex., 1960).
17. David Osbome and Ted Gaebler, Reinventing Government - How the Entrepreneurial Spirit is Transforming the Public Sector, (Reading Mass: Addison-Wesley Publishing Company, Inc., 1992); Ch. 1, pp. 45-47; App. A, pp. 343-348. Osborne and Gaebler also advocate injection of competition, including contracting, into the delivery of public services in order to reduce costs. Id., Ch. 3, pp. 76-107. However, it is also their view that privatization should be timed in a manner which avoids or minimizes the layoff of public employees. Id.; Ch. 1, pp. 37-39; Ch. 3, p. 84.
18. N.Y.S. Assoc. for Retarded Children vs. Carey, 456 F. Supp. 85 (E.D. New York, 1978).
19. Van Buren Public Sch. Dist. vs. Wayne County Circuit Judge, 232 N.W. 2d 278, 288-290 [ftnt. 17] (Mich. Ct. App., 1975).
20. Teamsters Union Local 117 vs. King County, 881 P. 2d 1059, 1061 (Wash. Ct App., 1994).
21. Harvey vs. Butte County, 250 Cal. Rptr. 65, 66 (Cal. Ct. App. 1988).
22. Horrell vs. Dept. of Administration, 861 P. 2d 1194 (Colo., 1993); Dept. of Transportation vs. Chavez, 9 Cal. Rptr. 2d 176 (Cal. Ct. App., 1992).
23. Cunningham vs. Community College Dist. No. 3, 489 P. 2d 891, 895-896 (Wash., 1971).
24. The Nevada Supreme Court has sustained the layoff of 31 food service employees at the University of Nevada pursuant to the contracting of cafeteria operations. In that case, however, a student-administration committee had recommended contracting in the face of mounting annual operating deficits and increases in student fees to erase them. Univ. of Nevada vs. State of Nevada Empl. Assoc., Inc., 520 P. 2d 602, 603 (Nev., 1974).
25. Infra, pages 10-11.
26. Amherst Columbia Ambulance Service, Ltd. vs. Gross, 437 N.Y.S. 2d 137, 138 (N.Y. App. Div., 1981) (ambulance services); Kennedy vs. Ross, 170 P. 2d 904, 912 (Cal., 1946) (engineering services); Hiller vs. City of L.A., 17 Cal. Rptr. 579, 580, 584 (Cal. Ct. App., 1961) (management and operation of zoo). Whether contracts for the delivery of public services are independently required by law to be let to the lowest responsible bidder constitutes an issue which is beyond the scope of this article. See Annotation, "Contract for Personal Services as Within Requirement of Submission of Bids as Condition of Public Contract," 15 ALR 3d 733 (1967).
27. N.Y.S. Assoc. for Related Children vs. Carey, 456 F. Supp. 85, 89, 92-93 [ftnt. 12] (E.D. New York, 1978).
28. See for example, Stanley C. Wisniewski, "A Framework for Considering the Contracting Out of Government Services," Public Personnel Management, Vol. 21, No. 1 (Spring 1992), p. 101 et seq.
29. Waste Management, Inc. vs. Wisconsin Solid Waste Recycling Authority, 267 N.W. 2d 659, 665 (Wis., 1978); Smith vs. Inter-government Solid Waste Disposal Assoc., 605 N.E. 2d 654, 665 (Ill. Ct. App., 1992).
30. Supra, Footnote 26.
31. Waste Management vs. Wisconsin Solid Waste Recycling Authority, 267 N.W. 2d 659, 668-671 Rptr. 440, 445-446 (Cal. Ct. App., 1988).
32. Educational and Recreational Services, Inc. vs. Pasadena Unif. Sch. Dist., 135 Cal. Rptr. 594, 599 (Cal. Ct. App., 1975); Cnningham vs. Community College Dist. No. 3, 489 P. 2d 891 (Wash., 1971).
33. Saratoga Springs City Sch. Dist. vs. New York State PERB, 416 N.Y.S. 2d 415 (N.Y. App. Div., 1979) (leave to app. den. 394 N.E. 2d 294); City of Poughkeepsie vs. Newman, 466 N.Y.S. 2d 752, 754-755 (N.Y. App. Div., 1983); General Drivers Union Local 346 vs. Independent Sch. Dist. No. 704, 283 N.W. 2d 524, 527 (Minn., 1979); Unified Sch. Dist. vs. Wisconsin ERC, 259 N.W. 2d 724 (Wisc., 1977); L. A. County Civil Service Com. vs. Superior Court, 151 Cal. Rptr. 547, 550 (Cal., 1978); San Diego Adult Educators vs. California State PERB, 273 Cal. Rptr. 53, 59-60 (Cal. Ct. App., 1990).
34. Id.
35. Id.
36. Supra, Footnote 8.
37. Olinkraft, Inc. vs. NLRB, 666 Fed. 2d 302, 308 (5th Cir., 1982), quoting from Shell Oil Co., 149 NLRB 305, 307 (1964).
38. Elizabeth Forward Sch. Dist. vs. Pennsylvania LRB, 624 A. 2d 215, 216 (Pa. Com. Ct., 19922); Minersville Area Sch. Dist. vs. Pennsylvania LRB, 475 A. 2d 962, 963-964 (Pa. Com. Ct., 1984).
39. Borough of Wilkinsburg vs. Sanitation Dept., 345 A. 2d 641, 330 A. 2d 306, 308-311 (Pa., 1975); Service Employees Intern. Local 316 vs. Illinois State ELRB, 505 N.E. 2d 418, 421-423 (Ill. Ct. App., 1987).
40. Supra, pages 10-11.
41. Supra, Footnote 39.
42. Service Employees Intern. Local 316 vs. Illinois State ELRB, 505 N.E. 2d 418, 421-423 (Ill. Ct. App., 1987); State Assn. of Real Property Agents vs. State Personnel Board, 147 Cal. Rptr. 786, 788 (Cal. Ct. App., 1978).
43. Supra, Footnote 39.
44. Elizabeth Forward Sch. Dist. vs. Pennsylvania LRB, 624 A. 2d 215, 216-217; 613 A. 2d 68, 71-73 (Pa. Com. Ct., 1992) (app. den. 613 A. 2d 562).
45. See, for example, John D. Donahue, The Privatization Decision - Public Ends, Private Means, (New York: Basic Books, Inc., 1989), pp. 131-150.