Opinion
No. 74-1057
Decided March 24, 1976.
Civil service — State university — Board of trustees — May hire independent contractors, when.
APPEAL from the Court of Appeals for Cuyahoga County.
A complaint was filed in the Court of Common Pleas, Cuyahoga County, by relator Herschel M. Sigall, a taxpayer, to recover expended public funds and to enjoin further expenditures of such funds arising out of a contract between Kent State University (KSU) and Aetna Cleaning Contractors of Cleveland, Inc. (Aetna). This contract was executed in June 1972, after competitive bidding, and requires Aetna to furnish custodial services to KSU over a three-year period for a specified sum of money.
Pursuant to this contract, Aetna employs between 90 and 110 persons at KSU. These employees were paid a starting wage of $1.94 per hour at the time of the trial in this cause. They worked the midnight to 6:00 a.m. shift, and performed custodial services in only 13 KSU buildings.
Aetna occupies an office in Verder Hall on the KSU campus, from which some individuals are hired to work for Aetna at KSU. Aetna and KSU have an "understanding" that 20 percent of Aetna's work force at KSU would consist of KSU students, if available.
The evidence presented before the trial court revealed that civil service employees, hired directly by KSU, perform 75-80 percent of all custodial work at KSU. These employees, at the time of the trial in this cause, earned a starting wage of either $2.55 or $2.73 per hour, depending upon classification as Custodial Worker I, or II, respectively. The remaining custodial work, then, is performed by independent contractors such as Aetna.
The custodial services provided by Aetna at KSU are substantially the same as those performed by KSU civil service employees, although Aetna is required by its contract with KSU to render certain additional services such as exterior high-rise window cleaning and, to a lesser extent, rug shampooing, which services are not generally performed by civil service employees of KSU.
Mr. Donald Zimmerman, Director of Personnel Administration and Employee Relations at KSU, testified that KSU has traditionally been unable to maintain a full complement of custodial workers, despite the fact that KSU actively recruits personnel from the state employment office in Ravenna, from a number of minority organizations in the communities located near Kent, and from on-campus and other local sources. As a direct result of this predicament, KSU has contracted out custodial services since at least 1967. Mr. Zimmerman estimated that the turnover rate for custodial workers at KSU is approximately 28-30 percent per year, and that five to fifteen vacancies in KSU's custodial work force of 125 persons exist on any given day.
Mr. Chester A. Williams, Director of Safety and Auxiliary Services at KSU, testified that the cost savings to KSU as a direct result of contracting out custodial services to Aetna amounts to $300,000 per year in personnel costs alone, not including additional savings generated by the reduction in equipment and supplies necessary to perform such work which, absent contracting out, would have to be purchased by KSU.
Mr. Williams testified further that KSU, as well as other state universities in Ohio, contract with private parties for the performance of other services (such as elevator maintenance, rubbish collection, window cleaning and carpet cleaning) not involved in this litigation, for which a civil service classification exists. He stated that no civil service employee of KSU has been laid off as a result of KSU's contracting out a portion of its custodial work, at least not in the two years in which he had been associated with the custodial department.
The trial court held the contract at issue herein illegal as in violation of the civil service laws of this state, and enjoined further enforcement of said contract. The trial court stayed its judgment pending appeal to the Court of Appeals for Cuyahoga County.
On November 7, 1974, the Court of Appeals rendered its opinion reversing the judgment of the trial court.
The cause is now before this court pursuant to the allowance of a motion to certify the record.
Messrs. Lucas, Prendergast, Albright, Gibson, Brown Newman, Mr. John A. Brown and Mr. W. Joseph Strapp, for appellants. Messrs. Guren, Merritt, Sogg Cohen, Mr. Kenneth G. Weinberg, for appellee Aetna Cleaning Contractors of Cleveland, Inc.
Messrs. Burke, Haber Berick, Mr. Joseph F. Lombardo and Mr. Stephen T. Parisi, for appellees President of Kent State University and President and Members of the Board of Trustees of Kent State University.
The ultimate issue before this court is whether a state university, consistent with the applicable civil service laws in this state, may lawfully enter into a contract with an independent contractor regarding the performance of services which could also be rendered by classified civil service employees.
Appellants renew in this court their argument, rejected by the Court of Appeals below, that "[t]he proper test for determining the legality of a contract between a state university and a private contractor is whether the services contracted for are of such a nature that they could be performed by civil service employees."
Appellants rely upon Section 10, Article XV of the Ohio Constitution, R.C. Chapter 124, particularly R.C. 124.01(A), 124.14 and 124.34, Canter v. Ohio University (unreported, Court of Appeals, Athens County, March 13, 1975, Case No. 803), and a line of California decisions beginning with State Compensation Ins. Fund v. Riley (1937), 9 Cal.2d 126, 69 P.2d 985, in support of their position.
The California decisions cited in appellants' brief ( State Compensation Ins. Fund v. Riley [1937], 9 Cal.2d 126, 69 P.2d 985; Stockburger v. Riley [1937], 21 Cal.App.2d 165, 68 P.2d 741; and California State Employees' Assn. v. Williams [1970], 7 Cal.App.3d 390, 86 Cal. 305) are based upon a constitutional provision and following legislation extremely comprehensive in scope. As such, the civil service laws of California differ markedly in purpose and effect from Section 10, Article XV of the Ohio Constitution and R.C. Chapter 124. Accordingly, we reject application of those cases as relevant to disposition of the present appeal.
Section 10, Article XV of the Ohio Constitution provides:
"Appointments and promotions in the civil service of the state, the several counties, and cities, shall be made according to merit and fitness, to be ascertained, so far as practicable, by competitive examinations. Laws shall be passed providing for the enforcement of this provision." (Emphasis added.)
The last sentence of that constitutional provision clearly requires the conclusion that enactment of legislation must precede execution of the constitutional mandate. Stated another way, Section 10, Article XV is not self-executing, but can be implemented through legislation.
Such legislation exists in Ohio and appears as R.C. Chapter 124. The provisions of R.C. Chapter 124, so far as pertinent to this appeal, are as follows:
R.C. 124.01, the definitional section of R.C. Chapter 124, provides, in pertinent part:
"(A) `Civil service' includes all offices and positions of trust or employment in the service of the state and the counties, cities, city health districts, general health districts, and city school districts thereof."
R.C. 124.06 provides, in pertinent part, as follows:
"No person shall be appointed, removed, transferred, laid off, suspended, reinstated, promoted, or reduced as an officer or employee in the civil service, in any manner or by any means other than those prescribed in this chapter, and the rules of the director of administrative services or the municipal or civil service township civil service commission within their respective jurisdictions."
R.C. 124.34 provides, in pertinent part:
"The tenure of every officer or employee in the classified service of the state and the counties, civil service townships, cities, city health districts, general health districts, and city school districts thereof, holding a position under this chapter of the Revised Code, shall be during good behavior and efficient service and no such officer or employee shall be reduced in pay or position, suspended, or removed, except as provided in Section 124.32 of the Revised Code, and for incompetency, inefficiency, dishonesty, drunkenness, immoral conduct, insubordination, discourteous treatment of the public, neglect of duty, violation of such sections or the rules of the director of administrative services or the commission, or any other failure of good behavior or any other acts of misfeasance, malfeasance, or nonfeasance in office. * * *"
R.C. 124.14 establishes pay ranges for numerous job classification titles in the employ of the state.
Appellants contend that all persons performing services for the state which fall within one of the job classifications established in R.C. 124.14, with certain exceptions not relevant herein, must be state-paid civil servants. We disagree.
R.C. 124.01 and 124.06 require that all employees of the state be employed in accordance with the civil service laws of this state. R.C. 124.34 applies only to persons in the classified service of the state. No provision of R.C. Chapter 124 commands that particular services to be rendered the state be performed exclusively by civil service employees. Accordingly, no statutory provision exists which prohibits the contracting out of the custodial services at issue herein.
Appellants next assert that the contracting out of custodial services by KSU would allow unlawful substantial modification of the civil service laws of this state. Again, we disagree.
In Curtis v. State, ex rel. Morgan (1923), 108 Ohio St. 292, 296, this court stated:
"There is nothing complex or difficult to understand about civil service laws and rules. The fundamental purpose is to establish a merit system, whereby selections for appointments in certain branches of the public service may be made upon the basis of demonstrated relative fitness, without regard to political considerations. To carry out this purpose elaborate rules have been formulated, designed to facilitate its operation, but not to extend it beyond its legitimate limits." (Emphasis added.)
In Curtis, this court upheld a temporary layoff of an employee in the classified service of a municipality, where the layoff was necessitated by reasons of economy. Accord, State, ex rel. Buckman, v. Munson (1943), 141 Ohio St. 319.
It is clear, therefore, that a purpose of the merit system in the civil service is to eradicate the spoils system by protecting an employee who has civil service tenure from being arbitrarily discharged and replaced with a political appointee.
Decisions of this court subsequent to Curtis, supra, make clear that a civil service employee may be laid off or discharged for reasons of economy. Buckman, supra; State, ex rel. Stine, v. McCaw (1940), 137 Ohio St. 13.
Canter v. Ohio University, supra, cited by appellants in support of their position, is factually similar to McCaw except for one salient point. In McCaw, a merger of two positions for the purpose of economy resulted in the discharge of a civil service employee and the retention of a provisional civil service appointee named to perform the duties of the single, new position created by the said merger.
In Canter, however, no new position was created. Accordingly, the attempted discharge of a civil service employee and the concomitant transfer of his former duties to a non-civil service employee was held contrary to the civil service laws of this state. Canter, then, does not support appellants' position in the instant case since no civil service employee was discharged due to the contracting out of custodial services by KSU. Canter does, however, illustrate that the courts of this state will safeguard against attempts to thwart the purposes of the civil service system and, in this regard, is supportive of the decision herein.
Since no statutory provision in this state expressly prohibits the contracting out of such services as involved in this appeal, and, since this court has held that a civil service position may be abolished for reasons of economy, we conclude that the contracting out by KSU of a portion of its custodial services, resulting in a saving of over $300,000 in state funds, does not violate the civil service laws of this state.
We adopt as the test in this case to be applied in determining the lawfulness of such service contracts the one promulgated by the Court of Appeals below, as follows:
"In the absence of proof of an intent to thwart the purposes of the civil service system, the board of trustees of a state university may lawfully contract to have an independent contractor perform services which might also be performed by civil service employees."
In applying that test to the facts of this case, the Court of Appeals correctly held:
"Plaintiffs introduced no evidence tending to establish that the Board of Trustees of Kent State entered into the contract in a bad faith attempt to circumvent the purposes of the civil service system.
"In fact, the evidence adduced at trial tends to establish the good faith of the Board. Aetna was awarded the contract on the basis of being the lowest of three bidders. Aetna did its own hiring, thus effectively eliminating the possibility of the operation of a `spoils system' by the University. Apparently, no civil service employee was ever displaced by an Aetna employee. Consequently, the contention that civil service employees were removed in bad faith is unavailable to plaintiffs appellees.
"Because plaintiffs sought the injunction, they had the burden to prove a clear right thereto. Spangler v. City of Cleveland (1885), 43 Ohio St. 526. See also, Schiff v. City of Columbus (1967), 9 Ohio St.2d 31; Oberhaus v. Alexander (1971), 28 Ohio App.2d 60; White v. Long (1967), 12 Ohio App.2d 136. Plaintiffs have not met this burden."
For the foregoing reasons, the Judgment of the Court of Appeals, dissolving the injunction issued by the Court of Common Pleas, is affirmed.
Judgment affirmed.
O'NEILL, C.J., HERBERT, CORRIGAN, STERN, CELEBREZZE, W. BROWN and P. BROWN, JJ., concur.