Union officials say contract workers costing Wisconsin money

0 Comments | La Crosse Tribune, Sep 28, 2004 | by Sheehan, Tom

MADISON - Gov. Jim Doyle's math doesn't add up for Tony Ricciardi, who was laid off from his computer help desk job at the state Department of Corrections in May 2003.

Ricciardi's job was eliminated along with two other help desk positions as part of Doyle's 2003-05 state budget plan to overcome what was a potential $3.2 billion deficit.

Doyle ordered Corrections to cut 200 positions at agency headquarters in Madison. But instead of saving money, Ricciardi's union local, the Wisconsin Professional Employees Council, says the state is paying contract employees about $3.17 more an hour on average, or $5,921 a year more each, including benefits, for the same work.

Union leaders say Ricciardi's scenario is not unique, and contractors often do the same work as state employees being paid less. If the union's right, the potential savings could be significant: the state spent an estimated $743.7 million on contracting in fiscal year 2003, according to figures just released by Doyle's office.

But getting a handle on contract spending is difficult because officials from three administrations have failed since 1999 to properly report and track the spending. Doyle announced plans last week to tighten the belt on contract spending.

Pressure to use contractors is likely to continue, however, as the governor works to fulfill a promise to cut 10,000 state government jobs by 2010. If he doesn't keep his promise, Republicans who control the Legislature could take him to task. On the other hand, he risks offending labor unions, a traditional Democratic voting base,

A 2001 legislative audit the last detailed analysis of contracting costs - supports some of the union's claims, suggesting the state could be wasting millions on IT contractors.

Ricciardi earned $17.24-an-hour at his help desk job, or about $24.30 an hour with benefits calculated at 41 percent of wages - the standard used by the state to determine the cost of benefits.

Pay for private contractors on the help desk ranged from $24 an hour to $32.50 an hour, WPEC said in a legal brief filed in the case, which could be decided by an independent arbitrator in the next couple months.

Ricciardi's case could be precedent setting, said Cathy Rought, a spokeswoman for the

American Federation of Teachers, which represents 17,000 public employees, including about 4,500 employees in WPEC.

Budget pressure may have led to layoffs, but Ricciardi and his co-workers weren't replaced by contractors, said Karen Timberlake, director of the state Office of Employment Relations.

"We didn't bring in new contractors at the time we let these employees go," Timberlake said.

WPEC contends that four contract workers remained on the help desk before and after the state employees lost their jobs, however.

The arbitration case is expected to decide whether the state violated a labor agreement provision that contract employees be laid off before state employees, Timberlake said.

Contracting makes sense on short-term projects or jobs that require a special skill set, Timberlake said. The expertise of some contractors also can help the state keep up with the rapidly changing nature of IT work, Timberlake said.

The 2001 state audit, however, showed computer consultants were regularly retained to do work also being done by state workers. In a few cases, state employees were being paid about half the hourly rate of contractors, benefits included. One state employee quit his $19.12-an-hour state IT job, only to return as a contractor making $101 an hour, according to the audit.

In a Legislative Audit Bureau sampling of 32 positions in which contractors and state employees did the same work, contractors cost less in just three cases, according to the 2001 study.

At the time, many department heads said they used contractors because they couldnt get authorization for state employee positions, said Don Bezruki, director of program evaluations for the Audit Bureau.

Thoroughly evaluating the state's use of IT contractors is difficult because the *system is decentralized, Bezruki said. Doyle administration officials say this year they will meet the requirement to file a report that outlines the cost and nature of contracting with the Legislature by Oct. 15, But the state's lack of attention to detail makes it nearly impossible to determine if the state is getting its money's worth from contractors, Rought said.

Unions are pushing questions about the use of contractors in hopes of swaying public opinion, Doyle and the Legislature as the 2005-07 state budget takes shape.