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1000.02137 – Subcontracting

Using the test PERB set forth in Anaheim Union High School District (1981) PERB Decision No. 177 for the negotiability of subjects not specifically enumerated by statute as within the scope of representation, the Board has found subcontracting decisions to be negotiable if the management decision does not change the scope or direction of the enterprise. While a subcontracting decision may involve a managerial decision “at the core of entrepreneurial control” and “be based on factors not amenable to negotiation” (Ventura County Community College District (2003) PERB Decision No. 1547, p. 19), decisions involving personnel matters, such as absenteeism, workplace efficiency and employee turnover, are suitable for collective bargaining. Decisions to outsource which are based on labor costs, viz., “overall enterprise costs,” are “peculiarly suitable for resolution through the collective bargaining framework,” because the union has control over some enterprise costs (labor costs) and may make concessions through negotiations that “substantially mitigate the concerns underlying the employer’s decision, thereby convincing the employer to rescind its decision.” (Ibid.) (pp. 36-37.)