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Contracting Out

Contracting Out

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Contracting Out

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  1. Contracting Out

  2. THE OLD GENERAL RULE • The general rule in the State of Washington is that, in the absence of legislative authority to do so, a state agency may not contract with an outside entity for work traditionally or historically performed by state employees.

  3. Evolution of the Law • 1889 Statehood

  4. Andrew Jackson • A strong proponent of the Spoils System.

  5. The Department of Government and Management Affairs (DOGMA)

  6. Civil Service Laws (1960) • The general purpose of the Civil Service Law is to establish for the state a system of personnel administration based on merit, principle and scientific methods governing the recruitment, appointment, promotion, retention, and welfare of its civil employees.

  7. Spokane CC Case • Contracted for custodial services. • Saved $$$$. • No layoff of employees.

  8. Spokane CC Case Con’t. • Supreme Court Held: [A]s a matter of law, the college has no authority to enter into a contract for new services of a type which have regularly and historically been provided, and could continue to be provided, by civil service staff employees...

  9. Government Contracts • The prohibition against illegal contracting out equally applies to contracts between government entities. • Western Washington University decision (Campus Security).

  10. Exceptions to the Prohibition against Contracting Out • RCW 41.06.380. • The service can’t be performed by state employees. • Not practicable to have state employees perform the service. • The “Homer” Defense. • Statutory Authority.

  11. RCW 41.06.380 • An urgent reaction to the Spokane CC decision (Grandfather Clause). • Creates a statutory exception to the contracting out prohibition. • Must have regularly purchased the services. • No termination of employees/positions.

  12. Rhinehart v. Ecology & GA • Contract for custodial services. • RCW 41.06.380 used as a defense against charge of illegal contracting out. • History of contracting for service and no elimination of employees or positions.

  13. The O’berg Distinction • Court rejected the RCW 41.06.380 defense finding it did not apply because the services provided by O’berg were different than the services historically purchased by the agency. • Close scrutiny of the service. • Historical purchase of specialized services.

  14. Can’t be done Exception • Civil service work should be provided by civil servants rather than private entities, unless there is a showing that civil servants could not provide those services. • Yakima Valley School contract for Speech Pathologist/Occupational Therapist. • Fircrest School use of Contractor.

  15. Not Practicable Exception • Cost savings is not sufficient justification. • However, a showing that it is not practicable for civil servants to provide the necessary services is sufficient to permit the use of private entities. • Teamsters Local 117 v. King County factors to consider.

  16. The “HOMER” Defense. • I’M BUYING DONUTS - NOT SERVICES!

  17. Goods v. Services • Keeton v. DSHS (Homer likes Keeton). • Agency wanted to save money. • Reduction in residents/need for goods. • Contract with private entity. • 2 civil service bakers laid off. • The prohibition against contracting out is limited to services - not products.

  18. Statutory Authority Exception • Must have a clear expression of legislative intent. • If the legislature intends to create exceptions to the Civil Service Law, it must do so specifically. • Exceptions narrowly construed.

  19. The Joint Center Case • Contract for janitorial services. • The Board may “contract for services [which] shall include but not limited to facilities and project management…”. • Didn’t specifically identify janitorial services • Court didn’t see the statute as a blanket authorization to purchase services.

  20. Impairment of Collective Bargaining Agreement • Art. 1, Section 23 of the Washington State Constitution. • No bill of attainder, ex post facto law, or law impairing the obligations of contracts shall ever be passed

  21. DON’T GIVE UP!!!!! on creating statutory authority. • Make sure the statute clearly authorizes the agency to purchase services to include services which have been historically performed by classified employees. • The statute should reference or be included in RCW 41.06. • Include language that the statute will not be permitted to impair an existing CBA, but that no CBA may be executed or renewed to the extent it is inconsistent with the statute.

  22. THE CHANGING LANDSCAPE • RCW 41.06.142 IS THE NEW LAW ON PURCHASING SERVICES BY CONTRACT • NEW LAW CREATED CONSISTENT WITH PAST CASE LAW REQUIREMENTS • SPECIFICALLY REPEALS THE LIMITATIONS IN RCW 41.06.380 • EMPLOYER MAY NOW PURCHASE SERVICES, INCLUDING THOSE SERVICES THAT HAVE BEEN HISTORICALLY PERFORMED BY CLASSIFIED EMPLOYEES IF IT COMPLIES WITH THE STATUTE • DISPLACED EMPLOYEES MAY COMPETE (COMPETITIVE CONTRACTING) • NO COMPLIANCE REQUIREMENTS IF CONTRACTING FOR SERVICES IS EXPRESSLY MANDATED BY THE LEGISLATURE (NO EMPLOYER DISCRETION) OR WAS AUTHORIZED BY LAW PRIOR TO JULY 1 05 (EVEN IF EMPLOYER HAS DISCRETION), INCLUDING CONTRACTS/AGREEMENTS BETWEEN GOVERNMENT ENTITIES

  23. QUESTIONS & ANSWERS