Outsourcing Hurts Workers and San Francisco


Plus, the City rejects non-discrimination proposals and moves to shrink the EDF


The use of expensive contractors to carry out city work has risen dramatically, impacting the City budget, the quality of the services provided, our jobs, our development as workers, and our promotional opportunities. The City encumbered a staggering $3.583 billion in FY 2017-18, which is equivalent to 34.6% of the total San Francisco budget. The City has committed a total of $14.3 billion to outsourcing since FY 2012-13 – including over $3 billion for each of the past three-years.


Local 21 passed proposals across the bargaining table that would; shed light on the City’s practices by requiring detailed public reporting on all new and modified Personal Service Contracts (PSCs), prohibit contracting out of bargaining unit work where our classifications can perform the work or be trained to perform the work within 180 days, and assess a fee on outsourced work that would fund the Unfunded Actuarial Liability of our pension system, thereby recouping the contribution that should be flowing into our retirement system from permanent civil service workers instead of contractors.


Bargaining Team member Krysten Laine told City negotiators that employee morale suffers when our members see funds going to contractors and not towards retention and development of city workers. “We have these contractor positions that pay rates far higher than what an equivalent job class gets as a city employee, in some cases two or three times higher, working side by side with the same class employees. The City of San Francisco needs to appreciate the employees who are responsible for continued growth in this City, and it needs to create permanent positions with full job rights to do this work,” says Laine.


Members spoke about the negative effects of outsourcing our work. Relying on contractors to do city work means fewer permanent, merit-based, middle-class jobs in our city, which is seeing the middle class disappear. A decrease in institutional knowledge amongst workers is another problem with San Francisco’s reliance on contractors. In the long run, building a workforce with deep knowledge of city projects will be more economical and beneficial to the public, and it will further promotional opportunities for city workers.


Bargaining Team member Danny Yeung said that the sample PSC the City showed at bargaining is a perfect example of what is wrong with the rampant outsourcing the City and County engages in. The PSC in question was so broad as to encompass 12 classes of Engineers, Architects, and related services, with duties to be performed “as needed”. The PSC grew from a 5 year, 3 million dollar contract to a 9 year, 22 million dollar contract over the course of several modifications. The entire multi-million dollar proposal summary is only 3 pages long, and is mostly filled with stock text. “This is not the kind of transparency and accountability we deserve,” says Yeung. “There should be measurable deliverables and details about the PSC that are fully transparent and allow for us to dispute outsourcing when our classes can and should do the work.”


The Team also proposed an endorsement of the California Schools and Local Communities Funding Act, which would restore billions of dollars to the public sector.  San Francisco alone would gain over $500 million if this ballot initiative passes.


Unfortunately, the City is only making concessionary proposals to members.  The City has proposed to reduce funding for the Employee Development Fund back to where it was several years ago, and to cap comp time at 80 hours. Most concerning of all, the City rejected our proposals on non-discrimination, and only after much pressure at the table, countered with a proposal for a subcommittee of an existing committee to discuss discrimination in city departments. This rejection was particularly outrageous, as it comes on the heels of the report released by the City which found that “a number of MTA employees and managers describe bullying and verbally abusive behavior as being tolerated in the workplace”, and also after months of demands from a coalition of city unions to address critical racial equity problems.


City unions are standing up and fighting back. RSVP for the Informational Rally on March 7 at noon in front of One South Van Ness to join the union coalition in saying that discrimination has no place in our departments!