Privatization in Practice: Case Studies of Contracting for TANF Case Management. Managing Contractor Turnover

03/01/2003

No matter how well it is handled, contractor turnover is disruptive and requires that local administrators take steps to minimize the negative consequences. Administrators noted, however, that contractor turnover sends an important signal to providers. It communicates unambiguously to prospective vendors that the agencies are serious about performance expectations.

When there is contractor turnover, the manner in which clients transition to a new provider can vary. In Delaware, a change in contractor means individual clients receive a new caseworker in a new location. In other instances  including the recent turnover in Milwaukee  some case workers change, but the location of services remains the same. A new contractor in Lower Rio Grande Valley, for example, hired most of the staff of the previous contractor and delivers services in the same location. In fact, the workforce boards contract with the new provider required that it give first consideration to current employees of the outgoing contractor. In such cases, clients may be unaware of the contract turnover.

Turnover can be unsettling for staff, even if they retain their jobs with the new contractor. In Lower Rio Grande Valley, for example, managers and line staff alike noted that contractor transitions were stressful. A new contractor typically results in changes in work rules, policies, procedures, and health plans and other fringe benefits for staff.

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