It is important to note that departments cannot fill positions, either through the competition or non-competition approach, without an existing approved full time equivalent or Board of Management approval for additional full time equivalents.

Under the Civil Service Act (section 6(2)), when filling a regular, permanent full-time, part time, term or seasonal civil service position, no appointment can be made to or from the Civil Service unless a vacancy exists in the portion of the Civil Service to which the appointment is to be made.

The Province of New Brunswick Administration Manual System, section AD - 2916, includes a policy dated September 1998 with respect to personal and professional service contracts. The policy includes the following:

• Distinguishes between personal and professional service contracts
• Personal service contract procedures
• Professional service contract procedures
• General information

The following conditions must be met for approval of a personal service contract:

• The work to be performed must not fall within a classification covered by a collective agreement
• The nature of the work to be performed must be of scientific, professional, managerial or highly technical nature requiring an individual with special qualifications
• The nature of the work to be performed must not involve ongoing program service delivery to the public covered by existing position classifications on a long-term basis
• Personal service contract employment must be charged to full time equivalent (FTE) allocations.
• A personal service contract must not provide additional employment to a person already employed in the New Brunswick Public Service
• It must be possible to employ the person in accordance with the terms and conditions of employment provided to employees in the appropriate classification within Part one of the Public Service
• The individual must not be in receipt of a New Brunswick Public Service pension (except in circumstances provided for by Board Minute 94.0212 - Re-employment of Retired Employees)
• The employing department must have satisfied itself that no qualified employee is available on any existing redeployment list

All professional service contracts are subject to the guidelines and policies established by the Department of Supply & Services, Purchasing Branch.

The department is responsible for the provision of central services to all departments and agencies of the Provincial Government.

The procurement group of the services division is responsible for the operation of central stores and the tendering service to meet departmental and agency requirements. The Executive Director, Supply and General Services is responsible for the overall supervision of the procurement group.

The Department of Supply and Services, Purchasing Branch is responsible for acquiring goods and services in excess of $10,000. Specific exceptions apply and are identified within the policy statement. Goods and services under $10,000, or subject to the exemption list, are the responsibility of the initiating department.

The policy and procedures utilized by Supply and Services were reviewed during our engagement, however excerpts are not provided given the size and detail of the manual.

Issues

Casual or temporary appointments are made to relieve short-term work pressures when extra assistance is required. A person hired by this means cannot be employed in any one section of the Civil Service for a total of more than 260 paid days in a 24 month period. This may be extended to allow a person to be employed for a total of no more than 28 months if covering off a position held by an employee on authorized leave.

Personal service contracts provide for the following features:

• Opportunity to negotiate and hire professionals and others with expertise required, creating an employee / employer relationship
• A recruitment tool with flexibility in negotiating for individual services
• An ability to match employment to project and funding timelines
• Ease of termination (usually 30 days notice)

We found no stated policy to determine when a personal service contract should be used versus casual or temporary employment. These appear to be decisions of the individual department at the time of hiring based upon the above noted features and constraints.

The issue to be reviewed is therefore, when personal service contracts are used, are all of the conditions for approval being met.

Professional Service Contracts

Professional service contracts provide for the engagement of an independent contractor to perform specific work. Contracts usually call for the accomplishment of a clearly defined task and normally do not require any further action by the contracting party. In these situations there is no employee / employer relationship as found in a personal service contract.

Throughout the past year there were 1,289 professional service contracts tendered by the Department of Supply and Services, Purchasing Branch.

The issue with respect to these contracts is, when professional service contracts are issued, do they meet the accepted criteria as established by the Department of Supply and Services.

Scope of Review Procedures

To address professional service contracts, we interviewed representatives from the Department of Supply & Services, Purchasing Branch and the Department of Finance. We discussed and reviewed the departments' guidelines, policies and file documentation.

We also gathered information and reached conclusions through informal discussions with various employees in government.

Analysis and Conclusions

In our view, departments are making efficient use of personal service contracts as a tool to hire expertise required for a specified period of time. Whether the type of expertise being hired is consistent with the intent, when the policy was written, would be subject to debate. It is very difficult to give precise guidance as to whether departments are using personal service contracts to strictly hire "scientific, professional, managerial, or highly technical resources". The meanings of these terms are of course subject to interpretation.

For the employment files we reviewed we were satisfied there was approval for the hiring by the Deputy Head or designate as is required by policy. Documentation in the files also supported the contracts as personal service rather than professional service contracts.

However, in answering the specific terms of reference, we found stated policy procedures are not properly implemented in all cases.

During our review, and specifically for the sample selected, we found no documentation in employment files to indicate all conditions for approval of the personal service contracts were reviewed and all of the requirements met.

Thirteen of the personal service contracts sampled had no full time equivalents (FTE's) available as required by policy. Samples from the Departments of Finance and Health & Community Services were found to be meeting this policy. The Departments of Fisheries and Aquaculture, Education, and Economic Development, Tourism and Culture did not have FTE's available for all personal service contracts.

It is our understanding that certain departments are hiring staff for projects with Federal or other cost sharing and funding arrangements. When funding ceases, the personal service contracts can be quickly and easily terminated within 30 days notice. Personal service contracts are a useful tool in staffing projects and initiatives that are not part of departmental primary funding. However, this does not alleviate the requirement for departments to charge the contract to FTE allocations or to obtain Board of Management approval of additional FTE's for these contracts. Should costs incurred exceed project funding, the excess can directly impact a department's primary budget.

Full time equivalent allocations are utilized as a budgeting tool and help control the monies spent on human resources. The use of personal service contracts with no approved FTE, presents control risks, even with the availability of additional project funding. Administrative burden and risk are increased, as departmental finance officers must ensure:

• The funding is in fact available
• Is achievable in the anticipated amount
• Employee costs are not in excess of expected funding
• Contracts are terminated upon completion of funding

One of the policies for personal service contracts is the nature of the work to be performed must not involve ongoing program service delivery to the public by existing classifications, on a long-term basis. The contracts we reviewed were for terms of one to three years, with some being renewals. Departments consider contract renewal appropriate as funding may be on a year to year basis, however, the positions appear to be providing ongoing service delivery.

Professional Service Contracts

Professional service contracts through The Department of Supply and Services, Purchasing Branch appeared to meet the procedures and policies set out by the individual departments.

Recommendations

These measures (questionnaire) will provide human resource officers with the detailed information required to assess proposed positions against classifications covered by a collective or other agreement. It will also provide a means to assess applicants' resumes against the requirements of the position description.

Observations

Consideration of a review of the process, timing and communications between Board of Management and departments with respect to FTE's may be useful. This may highlight areas where improvements on both sides can be implemented to alleviate concerns noted previously on the part of departments as to approval and timing.

Personal Service Contracts by Department