The University of California violated guidelines governing the replacement of employees with contract workers, according to a state audit released Tuesday.
After reviewing 31 service contracts
at three UC campuses, two medical centers and the UC Office of the President, auditors found that two of these contracts did not fully adhere to UCOP’s displacement guidelines, which determine the process for replacing employees with contractors.
UC San Francisco and UC Davis did not adhere to University Guidelines on Contracting for Services when they failed to submit the necessary documentation to UCOP for review, said State Auditor Elaine Howle in a letter to Gov.Jerry Brown and state legislators.
UC San Francisco entered into a contract with HCL Technologies, a multinational information technology services company located in India, last year to outsource some of its IT functions. The move would save about $30 million over five years by displacing 49 career staff and 12 contract staff positions.
While auditors found that UC San Francisco followed displacement guidelines in its analysis of the outsourcing decision, the campus failed to formally disclose this analysis to UCOP’s human resources department, Howle said in her report.
Howle said auditors found that the outsourcing would only save the medical center $57,000 annually and added that the UC Davis Medical Center did not properly analyze the effects of the displacement.
Howle’s report also indicated that lead staff members at UC Davis and UC San Francisco were not aware of UCOP’s displacement guidelines. Howle said this is because UCOP does provide campus staff with training on displacement guidelines.
In a letter to Howle, UC President Janet Napolitano responded that the UC must balance its employee workforce with contracted workers and said the UC will consider state auditor recommendations to enforce compliance with displacement guidelines.