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AFSCME Local 75 Portland contract sought opportunity to bid if outsourcing were to be considered

When the Oregon Health and Science University recently decided to put to bid one of its billing departments, the workers already doing the work in-house were able to place a bid. As a matter of fact, they were required to be allowed to do so.

The result was a boon to both the workers and taxpayers alike, in the form of a 15-20% savings (see Business Journal article).

In the original contract, written about five years before the possibility that the union workers might be displaced, the contract stipulated what might happen in an outsourcing scenario. Key to that language was the directive that the union workers be given the opportunity to bid against the private entities for their work.

The result was that the union workers indeed won the bid and are now doing the same work, albeit less hindered by bureaucracy, at a potential 15-20% savings.

"The Employer and the Union also agree to participate in a joint study for the purpose of developing a model which would allow the Union the opportunity to bid on work which is being considered for contracting out. This model will include both quantitative as well as qualitative criteria for consideration and evaluation."

Here is the contract language that AFSCME and OHSU had agreed to which helped trigger the current dynamic:

19.1 The Employer may determine to contract or subcontract work, provided that as to work which is presently and regularly performed by employees in the bargaining unit, the Employer agrees to negotiate the decision and impact concurrently of the pending action. It is specifically understood that such negotiations are not required in (1) emergency situations or (2) where the impact is minimal (and not mandatory).

The Employer and the Union also agree to participate in a joint study for the purpose of developing a model which would allow the Union the opportunity to bid on work which is being considered for contracting out. This model will include both quantitative as well as qualitative criteria for consideration and evaluation.

19.2 An employee displaced under this Article shall be afforded the rights and privileges of Article 20-Layoff. In lieu of layoff, an employee displaced under this Article may elect one of two severance benefit options as follows:

a. The cash equivalent of:

1. Two (2) weeks compensation for every year of service with the Employer for employees with seven (7) or fewer years of service, prorated according to the employee’s current FTE.

2. Three (3) weeks compensation for every year of service with the Employer for employees with more than seven (7) years of service, prorated according to the employee’s current FTE.

The Employer shall also provide each employee with the sum of Fifteen Hundred Dollars ($1,500.00) if eligible and participating in the Employer’s University Flex program. Once accepted, this severance benefit will be deemed to be the equivalent of a voluntary resignation and the employee shall have no further employment rights with the Employer.

b. The ability to participate in any educational retraining or other career development opportunities while remaining on the Employer’s payroll for a period of time not to exceed the equivalent expense associated with severance option “a” above, had the employee made such election. The employee may choose the manner in which to be compensated from a .5 FTE to full-time equivalent at the employee’s discretion. The employee may not modify the chosen manner of compensation. Once accepted, this severance benefit will be deemed to be the equivalent of a voluntary resignation. The employee shall have no further employment rights with the Employer and shall not be deemed to be a regular employee even though compensated by this Employer as a result of this severance option. The Employer’s obligation will be to provide only wages, staff fee privileges and health insurance (if eligible) as outlined herein, and no other benefits such as vacation accrual which would otherwise accrue to a regular employee. Employees electing this severance option shall also be entitled to the following educational/retraining benefit:

1. For employees with seven (7) or fewer years of service with the Employer, the equivalent of one (1) week’s salary for every two (2) years of service shall be available for the reimbursement of any educational/retraining expenses.

2. For employees with greater than seven (7) years of service with the Employer, the equivalent of one (1) week’s salary for every year of service shall be available for the reimbursement of any educational/retraining expenses.

19.3 This Article shall supersede all previously applicable employment conditions and obligations.

All employees previously displaced as a result of contracting, who have subsequently been placed pursuant to the previous provisions of this Article or accepted another position with the Employer, shall be subject to this Article.