Texas Workforce Commission
An Audit Report on the State's Contract Workforce
February 1999
Report No. 99-028
Overall Conclusion
Information is not adequate and improved agency management practices are needed to manage the State's $1.2 billion contract workforce better. State leaders need more useful and reliable information on the entire workforce (state employees and contract workers) to make informed decisions about the size of state government.
While the Legislature has made an effort to control the number of state employees, there has been an increase in the amount state agencies spend on contract workers. Contract workforce expenditures have increased 58 percent over the last five years, while expenditures for state salaries and benefits have increased only 14 percent. There are many valid reasons for using contract workers, but there could be serious consequences if contract workers are not appropriately used and managed.
Key Facts and Findings
The data state entities submit for Full-Time Equivalent reports and the Uniform Statewide Accounting System should be modified to improve information on the State's contract workforce. Also, not all agencies are collecting accurate information about the number of contract workers, length of tenure, or pay for services. Often, this information is not easily accessible at agencies.
Agencies should better manage their contract workers by performing regular cost/benefit analyses prior to hiring contract workers, applying comprehensive policies and procedures to manage and monitor contract workers, and consistently monitoring legal risks to avoid potential liability related to contract workers.
While many agencies use contract and temporary workers for seasonal surges in work or unique assignments, some contract workers have worked at the same agency for as long as nine years.
In many instances, former state employees have returned to state government as contract workers usually resulting in higher costs to the State for professional positions. At the Office of the Comptroller of Public Accounts, former state employees made up approximately 9 percent of the contract workforce. Rather than directly contracting with the State, these workers typically are employed by companies that contract with the State, resulting in company contract workers who are not subject to related state regulations.
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