HF 192

1st Engrossment - 87th Legislature (2011 - 2012) Posted on 02/14/2011 03:21pm

A bill for an act
relating to state government; proposing the Reinventing Government
Employment Act; providing a public employee compensation freeze and a
method for determining future compensation; establishing a state employee
gainsharing system; removing restrictions on state contracts with private vendors;
amending Minnesota Statutes 2010, sections 16C.08, subdivision 2; 16C.09;
43A.20; proposing coding for new law in Minnesota Statutes, chapters 15; 15A;
16A; repealing Minnesota Statutes 2010, sections 16C.085; 43A.047; 179A.23.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

ARTICLE 1

REINVENTING GOVERNMENT EMPLOYMENT

Section 1. new text begin CITATION.
new text end

new text begin This act may be known as the Reinventing Government Employment Act.
new text end

ARTICLE 2

EQUAL PAY AND BENEFITS

Section 1.

new text begin [15A.25] STATE EMPLOYEE COMPENSATION.
new text end

new text begin Subdivision 1. new text end

new text begin Compensation freeze. new text end

new text begin (a) From the effective date of this section
until implementation of compensation required under subdivision 2, a legislative or
executive branch employer must not increase the compensation of any employee.
This subdivision prohibits any increase including, but not limited to, across-the-board
increases; cost-of-living adjustments; increases based on longevity; increases as a result of
step and lane changes; increases in the form of lump-sum payments; increases in employer
contributions to deferred compensation plans; and any increase in employer contributions
toward the cost of medical, dental, life, or other insurance.
new text end

new text begin (b) This subdivision does not prohibit:
new text end

new text begin (1) an increase in the rate of salary and wages for an employee who is promoted or
transferred to a position with greater job responsibilities; or
new text end

new text begin (2) an increase in the employer contribution to a public pension plan, if required
by other law.
new text end

new text begin Subd. 2. new text end

new text begin Future compensation. new text end

new text begin (a) The commissioner of management and budget
must contract for a compensation study for legislative and executive branch position
descriptions. The study must compare the total compensation, including salary and
benefits, of each position description with positions in the private sector in which the skill,
effort, responsibilities, and working conditions are similar. The commissioner must report
the results of the study by March 1, 2012.
new text end

new text begin (b) By July 1, 2012, each legislative and executive branch employer must implement
compensation for each position for its employees that, as nearly as practicable, is
comparable to the compensation of private sector positions with similar skill, effort,
responsibilities, and working conditions, as determined by the commissioner under
paragraph (a).
new text end

new text begin Subd. 3. new text end

new text begin Contracts in effect. new text end

new text begin This section does not prohibit a change in
compensation required by a contract or collective bargaining agreement in effect before
the effective date of this section. However, an employer may not:
new text end

new text begin (1) enter into a new contract or collective bargaining agreement that changes
compensation in a manner that conflicts with this section; or
new text end

new text begin (2) extend an expired contract or collective bargaining agreement or any other
arrangement that conflicts with this section.
new text end

new text begin Subd. 4. new text end

new text begin Relation to other law. new text end

new text begin This section supersedes chapter 179A and any
other law to the contrary. It is not an unfair labor practice under chapter 179A for a public
employer to take any action required to comply with this section. Executive branch
employees may not legally strike due to an employer's action that is required to comply
with this section. Neither an employer nor an exclusive representative may request interest
arbitration regarding any element of compensation prescribed by this section, and an
arbitrator may not issue an award that would conflict with this section.
new text end

new text begin Subd. 5. new text end

new text begin Executive branch. new text end

new text begin For purposes of this section, "executive branch" has
the meaning given in section 43A.02, but does not include the Minnesota State Colleges
and Universities.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day following final enactment.
new text end

ARTICLE 3

GAINSHARING

Section 1.

new text begin [16A.90] EMPLOYEE GAINSHARING SYSTEM.
new text end

new text begin The commissioner shall establish a program to provide onetime bonus compensation
to state employees for efforts made to reduce the costs of operating state government or for
ways of providing better or more efficient state services. The commissioner may make a
onetime award to an employee or group of employees whose suggestion or involvement in
a project is determined by the commissioner to have resulted in documented cost-savings
to the state. The maximum award is ten percent of the documented savings in the
first fiscal year in which the savings are realized. The award must be paid from the
appropriation to which the savings accrued.
new text end

ARTICLE 4

VALUE-ADDED SERVICE

Section 1.

new text begin [15.062] COST-EFFECTIVE PROVISION OF SERVICES.
new text end

new text begin (a) The head or governing board of each state department or agency, including the
Minnesota state colleges and universities, must carry out the agency's powers and duties
in the most cost-effective manner possible. The agency head or governing board must
determine if the most cost-effective manner of carrying out each of the agency's powers
and duties is to hire state employees or to contract with outside sources.
new text end

new text begin (b) If an agency decides to seek an outside vendor to perform work currently done
by state employees, the agency must permit groups of state employees to compete for the
business by submitting responses to the agency's solicitation documents. Notwithstanding
section 16A.127 or any other law to the contrary, no statewide or agency indirect costs
may be assessed to a group of agency employees with respect to work performed under
a contract awarded to a group of employees under this section. This section supersedes
any provision of law preventing a state agency from entering into a contract with a state
employee.
new text end

Sec. 2.

Minnesota Statutes 2010, section 16C.08, subdivision 2, is amended to read:

Subd. 2.

Duties of contracting agency.

(a) Before an agency may seek approval of
a professional or technical services contract valued in excess of $5,000, it must provide
the following:

(1) a description of how the proposed contract or amendment is necessary and
reasonable to advance the statutory mission of the agency;

(2) a description of the agency's plan to notify firms or individuals who may be
available to perform the services called for in the solicitation;

(3) a description of the performance measures or other tools, including accessibility
measures if applicable, that will be used to monitor and evaluate contract performance; and

(4) an explanation detailing, if applicable, why this procurement is being pursued
unilaterally by the agency and not as an enterprise procurement.

(b) In addition to paragraph (a), the agency must certify that:

deleted text begin (1) no current state employee is able and available to perform the services called
for by the contract;
deleted text end

deleted text begin (2) deleted text end new text begin (1) new text end the normal competitive bidding mechanisms will not provide for adequate
performance of the services;

deleted text begin (3) deleted text end new text begin (2) new text end reasonable efforts will be made to publicize the availability of the contract
to the public;

deleted text begin (4) deleted text end new text begin (3) new text end the agency will develop and implement a written plan providing for the
assignment of specific agency personnel to manage the contract, including a monitoring
and liaison function, the periodic review of interim reports or other indications of past
performance, and the ultimate utilization of the final product of the services;

deleted text begin (5) deleted text end new text begin (4) new text end the agency will not allow the contractor to begin work before the contract is
fully executed unless an exception under section 16C.05, subdivision 2a, has been granted
by the commissioner and funds are fully encumbered;

deleted text begin (6) deleted text end new text begin (5) new text end the contract will not establish an employment relationship between the state
or the agency and any persons performing under the contract; new text begin and
new text end

deleted text begin (7) deleted text end new text begin (6) new text end in the event the results of the contract work will be carried out or continued
by state employees upon completion of the contract, the contractor is required to include
state employees in development and training, to the extent necessary to ensure that after
completion of the contract, state employees can perform any ongoing work related to the
same function deleted text begin ; and
deleted text end

deleted text begin (8) the agency will not contract out its previously eliminated jobs for four years
without first considering the same former employees who are on the seniority unit layoff
list who meet the minimum qualifications determined by the agency deleted text end .

(c) A contract establishes an employment relationship for purposes of paragraph (b),
clause deleted text begin (6) deleted text end new text begin (5) new text end , if, under federal laws governing the distinction between an employee and
an independent contractor, a person would be considered an employee.

Sec. 3.

Minnesota Statutes 2010, section 16C.09, is amended to read:

16C.09 PROCEDURE FOR SERVICE CONTRACTS.

(a) Before entering into or approving a service contract, the commissioner must
determine, at least, that:

deleted text begin (1) no current state employee is able and available to perform the services called
for by the contract;
deleted text end

deleted text begin (2) deleted text end new text begin (1) new text end the work to be performed under the contract is necessary to the agency's
achievement of its statutory responsibilities and there is statutory authority to enter into
the contract;

deleted text begin (3) deleted text end new text begin (2) new text end the contract will not establish an employment relationship between the state
or the agency and any persons performing under the contract;

deleted text begin (4) deleted text end new text begin (3) new text end new text begin new text end the contractor and agents are not employees of the state new text begin , except as authorized
in section 15.062 new text end ;

deleted text begin (5) deleted text end new text begin (4) new text end the contracting agency has specified a satisfactory method of evaluating and
using the results of the work to be performed; and

deleted text begin (6) deleted text end new text begin (5) new text end the combined contract and amendments will not exceed five years without
specific, written approval by the commissioner according to established policy, procedures,
and standards, or unless otherwise provided for by law. The term of the original contract
must not exceed two years, unless the commissioner determines that a longer duration is
in the best interest of the state.

deleted text begin (b) For purposes of paragraph (a), clause (1), employees are available if qualified
and:
deleted text end

deleted text begin (1) are already doing the work in question; or
deleted text end

deleted text begin (2) are on layoff status in classes that can do the work in question.
deleted text end

deleted text begin An employee is not available if the employee is doing other work, is retired, or has decided
not to do the work in question.
deleted text end

deleted text begin (c) deleted text end new text begin (b) new text end This section does not apply to an agency's use of inmates pursuant to sections
241.20 to 241.23 or to an agency's use of persons required by a court to provide:

(1) community service; or

(2) conservation or maintenance services on lands under the jurisdiction and control
of the state.

Sec. 4. new text begin REPEALER.
new text end

new text begin Minnesota Statutes 2010, sections 16C.085; 43A.047; and 179A.23, new text end new text begin are repealed.
new text end

ARTICLE 5

PERFORMANCE APPRAISAL AND PAY

Section 1.

Minnesota Statutes 2010, section 43A.20, is amended to read:

43A.20 PERFORMANCE APPRAISAL AND PAY.

new text begin (a) new text end The commissioner shall design and maintain a performance appraisal new text begin and bonus
pay new text end system under which each employee in the civil service in the executive branch shall
be evaluated and counseled on work performance at least once a year. new text begin The performance
appraisal and bonus pay system must include three components:
new text end

new text begin (1) evaluation of the individual employee's performance relative to goals for that
individual;
new text end

new text begin (2) evaluation of the performance of the individual employee's program, defined by
the agency head, toward meeting targeted outcomes for the program; and
new text end

new text begin (3) evaluation of the performance of the entire agency toward meeting targeted
outcomes for the agency.
new text end

new text begin (b) new text end Individual pay increases for all employees deleted text begin not represented by an exclusive
representative certified pursuant to chapter 179A deleted text end shall be based on the deleted text begin evaluation deleted text end new text begin
evaluations required by paragraph (a) new text end and other factors new text begin consistent with paragraph (a) that new text end
the commissioner new text begin negotiates in collective bargaining agreements or new text end includes in the plans
developed pursuant to section 43A.18. deleted text begin Collective bargaining agreements entered into
pursuant to chapter 179A may, and are encouraged to, provide for pay increases based
on employee work performance. deleted text end new text begin An employee in the executive branch may not receive
an increase in salary or wages based on cost of living or progression to another step or
lane unless the employee's supervisor certifies that the employee's individual performance
has been satisfactory and justifies spending additional public funds on the employee's
compensation.
new text end

new text begin (c) This section supersedes any conflicting provision of other law.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective July 1, 2011. For employees covered
by a collective bargaining agreement, this section applies to collective bargaining
agreements entered into on or after that date.
new text end

Sec. 2. new text begin SALARY FOR UPCOMING BIENNIUM.
new text end

new text begin During the biennium ending June 30, 2013, each executive branch appointing
authority shall construct a performance bonus component as part of overall compensation
earned during that biennium. Under the performance bonus component, at least five
percent of the total base salary and wages otherwise payable to an employee may be
paid only after completion of the performance appraisal conducted under Minnesota
Statutes, section 43A.20, paragraph (a), and upon the appointing authority's determination
that the employee's performance has been satisfactory and justifies spending additional
public funds on the employee's compensation.
new text end

new text begin This section supersedes any conflicting provision of other law.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective July 1, 2011. For employees covered
by a collective bargaining agreement, this section applies to collective bargaining
agreements entered into on or after that date.
new text end