Civil Services Considered for Contracted Personnel Services - 403

Careful analysis must be given when determining whether to use contracted personnel versus civil service positions within state government. Contracting for personal services, in lieu of using civil service personnel is permitted only if the standards outlined in Government Code Section 19130, subdivision (a) or (b) are met.

Government Code Section 19130 (a) permits contracting for personal services to achieve cost savings. Any department proposing to execute a contract based on cost savings to the state as justification for not using civil service personnel, must first notify the State Personnel Board (SPB) of its intention.

Government Code Section 19130 (b) permits contracting for personal services when requirements are met and are subject to review at the request of an employee organization representing state employees.

• Departments must provide to the designated exclusive representative copies of executed personal services contracts, RFPs, and IFBs, that call for personal services found in the bargaining unit. The designated exclusive representatives are listed in the Policy Memo 2012-014 - Contracting Out Update.

• For each personal service and/or consulting service transaction, regardless of purchasing approach or category utilized (i.e. competitive, LPA, etc.), the department must prepare and retain in the procurement file all data and information relevant to the contract and necessary for a specific application of standards set forth in Government Code Section 19130 in the event that the CalHR's review is requested. For standards of review see Public Contract Code Section 10337.

Government Code Section 19130(c) requires that all persons who provide services to the state under conditions that constitute an employment relationship shall, unless exempted by Article VII, Section 4 of the California Constitution, be retained under an appropriate civil service appointment. Therefore, state law and policy require that each department's contract for services with individuals be executed and administered in a manner consistent with the establishment of an independent contractor status when a civil service appointment is not intended.

Pursuant to Government Code Section 19135, if a contract is disapproved by SPB or its delegate, a department shall immediately discontinue that contract unless ordered otherwise by SPB or its delegate. The department shall not: (1) circumvent or disregard SPB’s action by entering into another contract for the same or similar services or, (2) to continue the services that were the subject of the contract disapproved by the department. A department ordered to discontinue a contract shall serve notice of the discontinuation of the contract to the vendor within 15 days from SPB’s final action unless a different notice period is specified. A copy of the notice also shall be served on SPB and the employee organization that filed the contract challenge.