A little-noticed change in the state's civil service code will dramatically alter the relationship state employees have with the agency that employs them beginning July 1. Under current Indiana law, about 80% of state employees are classified as merit employees, a classification system that governs the way hirings, firings, promotions, disciplinary and layoff procedures are carried out by state agency supervisors. When the new law takes effect next month, nearly all but a small number of state employees will be categorized as "unclassified" employees. Only state employees whose positions are dictated by federal law, for example those administering unemployment claims or the state's Medicaid program, will be categorized as "classified" employees with similar protections merit employees currently enjoy under existing law.
As a merit employee, state agency supervisors may terminate a worker only for just cause and after the employee has been afforded a pre-deprivation hearing process. Merit employees that will become unclassified employees beginning next month will become at-will employees, which allows a supervisor to fire an employee for any reason or no reason at all, provided the basis for the termination is not otherwise prohibited by law, such as proscribed forms of discrimination, exercising a statutory right to make a claim for worker's compensation, or refusal to violate a law or policy.
The switch from merit employees to unclassified employees will substantially alter the hiring and promotion system. Merit employment and promotion is based on meeting a strict minimum set of qualifications and seniority. Unclassified workers will be evaluated based on knowledge, skills and abilities. In the event of layoffs, those with the most seniority will no longer be afforded the greatest protection as they are under the merit system. Instead, employees will be assigned a service rating that takes into account a number of factors, including performance, disciplinary history and seniority. As the new system is being explained on a new instructional video prepared by the state's Department of Personnel, seniority will merely become a tie-breaker as a factor in determining layoffs.
The new civil service code will streamline and shorten the complaint process considerably from the current multi-step process for merit employees. An unclassified employee will be required to demonstrate that an action taken against the employee by a supervisor violated a law, rule or policy. The complaint must be filed within 30 days of the alleged violation, and then the agency will have 15 days to respond to the complaint. The state's personnel department will have 30 days to review the complaint. The employee will have 15 days to file an appeal with the state employee's appeal commission after receiving a written response from the personnel department. The burden is on the unclassified employee in this complaint process to prove the violation. Classified employees will still be protected by the just cause standard, and the burden of proof will be on management in any challenged suspension, demotion or dismissal action.
The Daniels' administration touts the new civil service service system law as codifying the performance-based system it first implemented in 2006, which it says rewards the highest performing state employees. The current civil service system has been in place since 1941 in response to federal New Deal laws that required states to implement personnel systems. The new law has some significant exemptions, including all legislative and judicial branch employees, as well as statewide elected officials and their personal staffs. Also, political subdivisions and quasi-governmental bodies are excluded from the law as are Indiana State Police employees and offenders working within the state correctional system.
Critics will no doubt contend the new system will allow political favoritism to creep into the state personnel system more than it already does. Clearly, the new system will untie the hands of supervisors to pick and choose and exercise more freely decisions over hiring, firing, promotion, suspension and demotion. In that sense, Indiana most state employees will begin to experience the same workplace rules that generally govern most private sector employees.
UPDATE: It looks like WTHR is keeping close tabs on what this blog publishes. This evening's lead off story at the 6:00 p.m. broadcast? See Sandra Chapman's story here entitled "State workers seeing changes to promotion policy." That headline is misleading as it suggest promotion is the only policy that is changing. At-will employment status will apply to any current merit employee converted to "unclassified" status, which encompasses most state agency employees, except those noted above that are exempt due to federal laws and regulations, employees of the judicial and executive branch, the personal staff of statewide officials and State Police employees. Denny Darrow of the state's Personnel Department says only 10% of state employees will be impacted. I would like to see more specific data on how the shake-out happens between the classification of "classified" and "unclassified employees. That 10% figure seems too low if you consider that the vast majority of state employees are currently classified as merit employees. Chapman also indicates there are presently only 2,800 full-time state employees. Again, that number seems low, although the number of state employees has shrunk dramatically during the Daniels administration to levels not seen since the 1970s.
