 By Kevin Dayton
Advertiser Capitol Bureau
United Public Workers leader Gary Rodrigues said he will fight a proposal at the Legislature to allow layoffs of public employees when the state and counties contract with private companies to do government work.
The House Labor Committee has approved a bill to create a "managed competition" system that in some cases would allow state and county managers to hire private companies to handle work now done by public employees.
But the layoff provisions of House Bill 620 may face resistance by House members as well as the unions. A survey by the The Advertiser last December found a bipartisan majority in the 51-member House does not want to allow layoffs when public services are privatized.
Twenty-seven House members — 17 Democrats and 10 Republicans — said they opposed layoffs.
Union leaders, including Rodrigues, argue that all public employees should be retrained and offered new government jobs when government contracts out the work those government employees had been doing.
But some privatization proponents say if government must keep every public employee on the payroll, it won’t make economic sense to buy services from private companies.
Labor Committee Chairman Terry Nui Yoshinaga said House Bill 620 doesn’t require layoffs of public employees, and said state and county managers will try to avoid layoffs. She said she will press for passage of the bill.
"I think I’m a good advocate, and I can sell it because it’s the right thing to do," said Yoshinaga, D-22nd (Mo‘ili‘ili, McCully, Pawa‘a.).
Rodrigues said the proposal for managed competition would create a "humongous bureaucracy just to start the process, and it wouldn’t accomplish much of what they wanted to do because there would be all kinds of hurdles, complaints and challenges."
Privatization in Hawai‘i has been strictly limited since 1997, when the state Supreme Court overturned a county contract to privatize the Pu‘uanahulu landfill on the Big Island.
In that ruling, the court said all work that has been "traditionally and customarily" handled by civil servants must continue to be performed by them unless the Legislature gives permission to privatize the work.
In many cases, the state and counties had entered into contracts without that permission from the Legislature, which meant those contracts were vulnerable to legal challenges by the public employee unions.
The Neighbor Island mayors suspended or threatened to cancel scores of contracts with private companies and nonprofit agencies, ranging from janitorial services to road paving and tree-trimming.
In 1998, lawmakers passed Act 230, which allowed the state and counties to continue their contracts with nonprofits and private companies until the state developed and adopted a system of managed competition. But Act 230 prohibited any new contracts that would cost any public employees their jobs.
That act expires June 30, and many state and county contracts could again be vulnerable to legal challenges by unions unless lawmakers adopt a new policy this year.
However, this week the Senate Labor and Transportation, Military Affairs and Government Operations committees opted to extend Act 230 until 2003, freezing the privatization issue for another two years.
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