Who to serve? The ethical dilemma of employment consultants in nonprofit disability employment network organisations

Australian Journal of Social Issues, Autumn, 2009 by Stephen Thornton, Greg Marston

The DEN differs from many other markets in that it is a managed quasi-market, mimicking many features of a typical market by providing 'scope for competition, variable prices, some degree of choice for job seekers, flexibility in the way services are delivered, and rewards for good providers' (Productivity Commission 2002: xxii). The term quasi-market is used to understand a market for services where there is only one purchaser. In the DEN and Job Network this is the Federal Government. Burgess (2003) explains that the provision of employment services under this particular model has two elements; vertical disintegration where the natural monopoly purchaser is separated from service provision, and contestability via a competitive tendering system. The DEN model is analogous to the Job Network, which consists of a 'web of services' provided to jobseekers. The spider at the centre of the web is the Federal Government agency, Centrelink, which is responsible for initial client assessment, payment and co-ordination of services, while financial accountability and performance is monitored through the Department of Employment and Workplace Relations, which tenders out employment services (Burgess 2003: 228).

While funding models for employment services both in Australia and overseas have largely been based on fee-for-service, the model adopted for DEN providers is outcomes driven. This case-based funding model is popular in the human services, especially within the United States, United Kingdom and Australia (Corden and Thornton 2003). Using contracts and this type of funding model to deliver traditional government services can theoretically result in positive gains by innovative services being delivered at minimal cost, so long as quality of service provision is not compromised (Webster and Harding 2001). However, they can also create a level of dissatisfaction amongst nonprofit organisations, particularly in cases where government simply invites organisations to 'accept the terms of a deal it has already drafted' instead of negotiating 'as equals the terms of an agreement' (Hancock 2006: 55). This may create asymmetrical power relationships between the state and nonprofit organisations where the government is the dominant partner (Acheson 2001). This, in Hancock's (2006) opinion, means these organisations must adopt the practices of government as their involvement increases. Further, micro-management of providers by the purchasers can stifle innovation and flexibility.

In the case of the Job Network, there is sufficient evidence to suggest that over the life of the Job Network administrative and compliance requirements imposed by the government have increased to the point where there is now little room for innovation and flexibility (Marston and McDonald 2006; Thomas 2007). Eardley (2002: 301) believes the creation of the Job Network (and now the DEN) represents a 'significant challenge for non-profit, community based agencies ... accustomed to working in partnership with government on a grant-for-services basis' and who are now 'faced with full-scale competition'. The experiences of nonprofit organisations in the Job Network over the past decade provide an insight into the behaviour of employment consultants (ECs) as they appropriate, resist and adapt to the new model of service delivery. In a study conducted in the late 1990s, Considine (2003) compared the difference in practice of nonprofit employment organisations and their staff in two different years; 1996 and, three years later, in 1999. Two changes in this period are particularly relevant to nonprofit DEN organisations. First, there was an increase in front-line staff reporting their actions better reflected the financial benefits for the organisation; and second, with respect to sanctioning or breaching, although nonprofit staff still had an aversion to this task as part of their case management of clients, there was nonetheless a trend over the three year period towards becoming more like the (then) government provider and for-profit providers, with there being no significant difference between the three groups in 1999.