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The city should also consult its union contract to see if the contract gives the city the authority <br />to "subcontract ' for bargaining unit work. A city may want to subcontract smices that it <br />currently performs if there are potential cost savings by doing so (e.g., some cities are looking <br />into contracting police services with the county instead of providing their own police <br />protection). If the city does not have explicit authority in the contract, it will probably be <br />limited in its ability to subcontrau during the term of the contract. An arbitrator may rule in <br />favor of allowing subcontracting during a contract period if; <br />1 ) The action is performed in good faith; <br />2) It represents a reasonable business decision; <br />3) It does not result in the subversion of the labor agreement; and <br />4} It does not have the effect of seriously weakening the bargaining unit or important <br />parts of it. <br />Only very small-scale subcontracting of bargaining unit gobs is likely to meet all four of these <br />provisions. Therefore, as a practical smatter, a city probably needs to negotiate specific <br />language in order to subcontract during the term of a union agreement. <br />If the city wants to subcontract after the expiration of the current contract, it needs to notify <br />the union that it is considering this option (prior to formally making the decision to contract <br />out) and allow the union to negotiate over the effects of that decision (e.g., severance pay and <br />retirement benefits). If the city and union do not agree on these `'effects" issues, the parties <br />can strike/lock out over the issue. The bottom line is that the city should consult with a labor <br />attorney before making any decisions on the subcontracting issue. <br />Like any other personnel activity, it is important for the city to document the business runs <br />for a layoff. From a legal perspective, the city will be better able to defend its actions if <br />documentation shows solid business runs for eliminating certain positions. From a <br />management perspective, urea if employees are not happy abut a layoff, good documentation <br />provides employees with the business reasons for such an action. when employees <br />understand that the layoff is not directed at them personally, they are less rely to want to sue <br />e city* <br />C Assess benefit responsibilities. <br />Most employers are required by law to offer employees continuation of group mescal benefits for <br />a period of time following employment. such requirements apply to employees who currently <br />participate in the city's group health, dental, and life insurance plans and are laid off. Cities <br />offering health flexible spending accounts may need to offer continuation employees who have <br />under -spent their accounts. If considering an early retirement incentive for employees, the city <br />needs to offer retirees who currently participate in the city's group health insurance and who are <br />eligible for PERA the option of indefinite coverage. <br />The Consolidated Omnibus Budget reconciliation Act (COBRA) generally covers group he <br />and dental plans maintained by employers with 20 or more employees. ff an employer has less <br />than 20 employees, continuations of coverage for health, dental and life insurance is required per <br />M <br />