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| | Union For Claims Adjusters At California's State Compensation Insurance Fund Files Request With State Personnel Board To Disapprove Contracts With Outside Vendor PIs
By Lonce LaMon - March 7, 2012
The Union representing the employee workers’ compensation claims adjusters and investigators of California’s State Compensation Insurance Fund (SCIF), filed a Request in February 2012 with the California State Personnel Board (SPB) to disapprove any existing or proposed contracts with outside vendor Private Investigator (PI) firms to conduct workers’ compensation claims investigations for SCIF. The Service Employees International Union Local 1000 (Local 1000 SEIU) asserted in a letter to SPB Senior Staff Counsel, Chian He, that the contracting of civil service work is prohibited unless it complies with the merit principle found in Article VII of the Constitution and falls within the exceptions listed in Government Code 19130.
“The SCIF did not obtain the SPB’s pre-approval for these contracts, thus it cannot be approved retroactively as a “cost-saving” measure under Government Code, 19130(a).” This letter composed by SEIU Senior Staff Attorney, Anne Geise, tells the California State Personnel Board that overall the
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An inside source has now informed adjustercom that it was two large PI firms who were targeted to get the contracts. |
services contracted out can be provided by civil service employees, as there is a long history of them doing so; plus, the vendor contracts do not comply with the “merit principle” and appear specious. They also do not fall within any of the exceptions listed in section 19130(b).
In late 2011, SCIF began a process of offering Request For Proposals (RFPs) to PI firms in order to vend out their entire work comp investigations needs to one or more large PI firms. An inside source has now informed adjustercom that it was two large PI firms who were targeted to get the contracts. This was all arranged to occur concomitantly with the substantial downsizing of SCIF, meaning the loss of jobs for many work comp adjusters and investigators. Several SCIF claims offices will be shutting down schematically over the next year. For one, the Oxnard claims office will be closed in August of 2012.
But the catalyst behind the plan to vend out investigations was the two PI firms who according to insiders tried to “corner the market”. They proposed the whole outsourcing scenario to the “powers that be” and kept pushing it until it finally turned into the recent RFP process. By virtue of the fact the two firms were behind it, they had enough input to ensure that the requirements in the RFP matched their own companies’ qualifications, but would not match the qualifications of 99% of other PIs, such as having a very expensive financial audit already completed. Most PI firms do not have a completed SAA70 or SSAE audit, for example, because one or the other is not needed or a reasonable requirement for performing investigative services.
Vera De Martini, Assistant Chief Counsel for SCIF, has now sent out a letter dated February 22, 2012 to 249 PI firms who have ostensibly done and/or are doing investigative work for SCIF, asking them if they have contracts with SCIF, and if so, to please present copies of the
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The point is, should SCIF redirect all their investigative services to two huge private PI vendors and take the investigative aspect of the claims adjusting work away from its own adjusters...? |
contracts as soon as possible. This request seems to overreach the point that it was only two large PI firms who wanted to handle the entirety of the work comp investigations work and then vend out jobs piece-meal to sub-contractor PI firms and their own employees. It’s clear from a Declaration that was written by a SCIF claims adjuster, Donna Campagna, that investigative work, such as subrosa, has been contracted out traditionally to contractor PIs on an as needed basis.
Thus, if those 249 PI firms had formal contracts to do work or just took on work on a request basis, it does not really seem to be the point here. The point is, should SCIF redirect all their investigative services to two huge private PI vendors and take the investigative aspect of the claims adjusting work away from its own adjusters--especially concomitant with undergoing a radical downsizing project--and is it legal to do so.
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