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PSS weighs service contracts
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Posted on Dec 10 1998
A recommendation to introduce professional services contracts in the Public School System is seriously considered by officials as another option to meet its payroll requirements for this fiscal year.
Proposed by some members of the teaching staff, each contract would bring 28 percent savings on personnel cost to PSS while the take home pay of the employee remains intact.
Based on initial computations made by acting Budget Officer Bill Matson, PSS could realize over $5 million in savings if its entire work force agrees to this type of employment contract. This amount can offset its deficit of $3.6 million, estimated for this current budget.
In the fiscal and personnel committee meeting yesterday, Federal Program Coordinator Tim Thornburgh explained to officials that PSS will no longer pay its share for retirement and insurance. Both employer’s contributions total to around 28 percent cost for PSS.
With the regular contract, PSS appropriates around $10,000 fringe benefits package for an employee with an annual pay of $30,000.
Using professional services contract, PSS realizes $8,000 savings from the benefit package, while the employee continues to receive his salary.
According to Thornburgh, some teachers are amenable to this type of cost cutting measure than receiving a direct pay cut.
Together with the 10 percent pay cut, the committee will present this option to the staff in providing them a choice on what form they will take the reduction.
However, Vice-Chairman Thomas Pangelinan demanded a thorough presentation on this professional services contract to the work force since a number of requirements will be handled by the employee.
Those who would choose this contract is expected to secure business permits, pay taxes and retirement contributions. Certain PSS policies for employment will also need revision to accommodate this new contract.
