Federated State Employees Union Local No. 343 | Memo To: Mr. Cesar Padilla (President, FSEU Local No. 343)
From: Ms. Barbara Glenn (FSEU Director of Human Resources)
CC: None (Confidential)
Date: August 25, 2010
Re: Illinois State Department of Transportation (DoT) Outsourcing

This is in response to your request for us to evaluate the notification sent to you by the governor indicating that she intends to privatize the state’s DoT information systems management function. You wanted to know if the union should oppose the outsourcing proposal. 1.0 Background Governor Sally Bernstein sent a letter on July 12, 2010 notifying our union that the state intends to outsource and privatize the information systems management function within the Department of Transportation. This function is currently being performed by 75 state employees, 43 of whom are members of FSEU Local 343. The governor indicated that this proposed transition to a private sector service provider would save the state approximately $250,000 per year in budgeted personnel costs and would help to ensure that the DoT would continue to receive state-of-the-art information systems hardware, software, and professional expertise. Finally, the governor promises that our union members will be offered similar positions in other departments within the executive branch of government as vacancies arise through attrition. 2.0 Discussion This proposed privatization is an assault on our union. It is anti-American. Foreign agents will bid for this privatization contract and accept wages lower than our members receive. This will set the stage for state government to decrease employee wages in the future. Moreover, by dispersing our members to other departments, the governor is just trying to demonstrate that management controls the union. The governor is a bully. If we allow this to happen in the Department of Transportation, it will happen in all departments everywhere. The stage will be set. We must oppose this action now, or we do a disservice to our members and will regret it later. The governor offers displaced union members so-called "similar" positions in other departments. What does this mean? Employees will be forced learn new jobs or "relearn" their jobs in a new environment. This is an attempt to drive out experienced older workers who won't want to learn new jobs at this stage of their lives. And what assurance do we have that suitable vacancies will be available in sufficient numbers? Most likely it will mean that our members will be out on the street with no jobs at all. Outsourcing is the cause of the current recession; with the downturn in the economy and the rising gas prices, where are all these replacement "similar" jobs supposed to come from? My brother-in-law was downsized out of a job in Michigan last year and he is still unemployed. According to him, management uses a promise for rehire to gain union support for outsourcing and 80% of the time they don’t keep their promise. Moreover, according to the online website Wikipedia, privatization is a potential violation of the Pendleton Act of 1883 which curbed arbitrary and capricious acts of management and established that civil servants will be hired and retained on the basis of merit. Therefore, if you rebut the governor’s proposal, you will win the admiration of all our members. I had lunch the other day with a group of our members, and everyone was in agreement that if you opposed this measure, they would vote for you. This will set the stage for your re-election next year at the end of your present term. We don’t have to go along with this; the governor will respect our wishes. I speak for truth and common sense and advise you to resist allowing the state to privatize the DoT information systems management function. If we give in to this proposal, the government will also not respect our power in future negotiations of any kind. We have to be strong and show no weakness. Finally, privatization of public sector responsibilities is a bad idea, not just for the union, but for the citizens of our state. The state will lose control of information systems and data will be compromised. Corporations are accountable only to the bottom line. Providers of public service should be accountable to the public. Outsourcing public services to private corporations creates instability. If corporate greed isn't satisfied, the companies will pull out leaving the public high and dry. And it doesn't save money either. According to a recent article posted in a prestigious Wall Street newspaper, the additional costs of overseeing third-party contractors adds 20% of hidden costs to the price of each government outsourcing contract. In addition, as anyone who has dealt with customer service outsourced overseas knows, if the contract goes to a foreign country, we will have to deal with communication and culture clash problems as well, which will add further costs. We can point this out in our reply to the governor. 3.0 Conclusion and Recommendation FSEU Local No. 343 should challenge the governor’s proposed privatization of the DoT information systems management function as an unfair management practice. Our members will lose their jobs not because of low productivity or malfeasance but merely to gain questionable -- and at most marginal -- efficiencies in government operations. This is unfair and violates the merit principle enshrined in the Pendleton Act of 1883. If the Governor wants to save money, she should abandon that wasteful convention center project, and leave our Union alone. Just say the word and I will draft a reply to this effect for your signature.