Privatization

The VA’s outsourcing fervor was evident on two fronts last year. VA management continued to defy federal competition laws by handing out blue collar jobs held largely by veterans to contractors without any cost comparison studies. Meanwhile, the VA reached a new milestone in dismantling VA’s world-class health care system by awarding huge contracts to private contractors.

VA’s Blue Collar Jobs: Outsourcing Hurts Employment Opportunities for Tomorrow’s Veterans

The VA has a long history of wanting to outsource housekeeping, laundries, food service and grounds keeping, i.e., jobs held mainly by many veterans, minorities and women. These jobs have historically served as valuable stepping stones back to gainful employment for disabled veterans. With so many new veterans arriving home with Post Traumatic Stress Disorder, Traumatic Brain Injury and other serious illnesses, one wonders why the VA is so persistent in outsourcing these unique employment opportunities.

In late 2005, AFGE was successful in protecting VA blue collar jobs on two fronts. First, AFGE successfully fought back attempts to repeal a ban on using medical dollars for privatization studies, including studies conducted under the OMB A-76 Circular (A-76). Second, AFGE won new government wide protections for federal work in late 2005 that required the VA and other agencies to conduct fair public-private competitions prior to outsourcing federal functions performed by more than ten employees.

Since then, AFGE has received so many reports from members about management attempts to illegally contract out VA jobs that one can only conclude that the VA believes it is above the law that applies to the rest of the government.

Know Your Rights – The Rules Against Privatization

Thanks to the leadership of Senator Sherrod Brown (D-OH) during the VA appropriations process last fall, the VA now has its own contracting out law that makes clear that the VA must comply with these competition rules.

These competition rules just got stronger with the passage of the FY 2008 Omnibus appropriations law, specifically

• The VA is still required to conduct a public-private competition before contracting out any function (e.g. housekeeping, laundry) that is performed by ten or more employees.
• The affected employees still have the right to submit their most competitive bid (known as “most efficient organization plan”).
• The VA must still keep work in house unless the contractor can save more money than $10 million or 10% of in-house personnel costs, whichever is less.
• VA employees have the right to appeal to GAO if the VA ignores the A-76 requirements or if they want to appeal a bad A-76 decision. Contractors always had these appeal rights.
• Health care and retirement costs must be excluded from the cost comparison process if a contractor contributes less for its employees’ benefits than an agency is required by the Congress to contribute for federal employees’ benefits. This protects blue collar jobs where the main savings the contractor can offer is to cut or eliminate employee benefits.
• OMB political appointees are prohibited from telling agency officials to conduct A-76 studies, which prevents the VA from carrying out A-76 studies at the request of OMB political appointees as it has so many times in the past.

AFGE members across the country have had many successes in curbing contracting of hospital and cemetery jobs under 2006 competition requirements. With new statutory rights, the VA employees are on a more level playing field than ever in public-private competitions.