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STATE Of

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The Task Force appreciates the assistance of the Project Coordinator, thecooperation of the Commi ssioner of Employee Relations and personnel ofthe Department, the Area Office of the United States Office of PersonnelManagement, r~presentatives of employee unions as well as the stateoperating agencies in making many qualified staff members available toassist the Task Force and its sub-committees.

August 15, 1980

The Honorable Albert H. QuieGovernor of the State of MinnesotaState CapitolState of Minnesota

Dear Governor Quie:

A number of issues have been studied by the Task Force which hasattempted to keep its recommendations oriented toward service to thepublic and its concerns, recognizing that state management and stateemployees have a highly legitimate stake in achieving satisfaction andpersonal success in the provision of that service.

The Task Force has recognized and brings to your attention many notableexamples of program quality within the Department of Employee Relationswhere it has been responsible for innovative changes and effectiveservices. At the same time, the Task Force has made recommendationstoward improvement of the State's management system in those areas whereit saw fit to do so.

It is a pri vi lege and a pleasure to present to you on behalf of theGovernor's Task Force on Personnel Management the report entitledPERSONNEL MANAGEMENT FOR THE 80' s, Report and Recommendati ons for theState of Minnesota.

Res~tfullY submitted,

~~~~~~E!mer R. John ,e Gtfai rmanGovernor's Task Force on Personnel Management

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ACKNOWLEDGMENTS

Patrick Halvorsen, Project Director

Director of Planning and EvaluationDepartment of Employee Relations

Vera J. Likins, Ph.D.

Project Coordinator

The Governor's Task Force on Personnel Management was fortunateand grateful for the assistance of the highly competent andknowledgeable career public employees appointed by the Governoras resource persons for its study of the personnel managementsystem in Minnesota state government. The Task Forceacknowledges the valuable contributions of its resource personsand the cooperation of appointing authorities who made theirservices available.

The Task Force is appreciative of the time and effort spent byall persons too numerous to name who volunteered issue papersfor its study or otherwise contributed to its review of theState of Minnesota's personnel management system.

The Commissioner and the staff of the Department of EmployeeRelations were most helpful and cooperative in assisting theTask Force. Managerial employees served as staff to thesub-committees while others participated in the conduct ofspecial studies in connection with Task Force activi ties andassisted in the preparation of issue papers.

Special thanks are due Jennifer Hance who provided exemplarysecretarial services and Colleen Schwanke, Dawn Walker, JoaniePream, Cheryl Ness and Bonnie Heir of .the Department ofEmployee Relations Word Processing Unit who cheerfullyresponded on short notice to requests for issue papers anddrafts and produced this final report.

The cover of the report was created by Gil Kinnunen of theDepartment.

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T

TABLE OF CONTENTS

Letter of Transmittal

Acknowledgments

The Governor's Task Force on Personnel Management

Resource Persons Appointed by the Governor

Charge to the Task Force

Task Force Process

Introduction

The Merit System:

What is a Merit System?

History in Minnesota

Personnel Management Issues

SUMMARY OF RECOMMENDATIONS

Recommendations: Rationale and Detail

Page

iii

1

2

3

4

7

10

11

13

16

i

1

I. Personnel Management Philosophy and Policy

1. Merit System Coverage

2. Study of Unclassified Positions

3. A Mechanism for Consideration

4. Centralization - Decentralization

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20

20

22

24

25

1. Management Development and Supervisory Training 42

2. Productivity Improvement 44

Page

II. Roles, Relationships and Authorities 27

1• The Governor 28

2. The Commissioner of Employee Relations 30

3. The Legislature 32

4. Operating Agencies 33

5. Department of Finance 34

III. Programmatic Concerns 34

1• Job Analysis 34

2. Career Executive Service 36

3. Per formance Appraisal 39

4. Alternative Work Patterns 40

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53

56

58

46

47

49

41

42Improvement in Performance and ProductivityV.

IV. Affirmative Action to Assure Equal Employment

Op portuni ty

Appendices:

Appendix A - Executive Order

Appendix B - Tas~ Force ODjectives

Appen~ix C - Activities of Sub-Committees

Employee Rights and Obligations

The State Work Force and Personnel Staffing

Future Study and Refinement - Clientele Input

THE GOVERNOR'S TASK FORCE ON PERSONNEL MANAGEMENT

Chairman:

Elmer R. John

Members:

*Raymond D. Black

Richard Brubacher

*Dan Gustafson

*John A. Hanson

*Ray Lappegaard

Jerry McNeal

Arthur Naftalin

Leonard Ramberg

Roy Richardson

William Thomas

Geraldine Wedel

*Roger Wheeler

Elizabeth White

Fred Williams

President, Elmer R. John and Associates, Inc.

President, Zero-Max Industries, Inc.

Executive Director, Minnesota Petroleum Council

Secretary-Treasurer, Minnesota AFL-CIO

Vice-President of Personnel, Minnesota Gas Company

Assistant to President, J.L. Shiely Company

Manager, Employee Relations and Personnel, Dayton's

Professor, Hubert H. Humphrey Institute of Public

Affairs, University of Minnesota

Retired Senior Vice President, Northwestern

National Bank

Vice-President, Corporate Employee Relations, Onan

Corporation

Assistant Vice-President and Director of

Personnel Administration, University of Minnesota

Field Representative, Minnesota Nurses Association

Vice-President, Personnel and Public Affairs,

Control Data Corporation

Director of Personnel, University of Minnesota

Hospitals

Executive Director, Hallie Q. Brown Community

Center

*Sub-Committee Chairmen

A number of the Task Force members previously had held top level

positions in the state service or were otherwise closely associated

with it. Mr. Thomas resigned early in the course of the Task Force

activities and was not replaced.

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RESOURCE PERSONS APPOINTED BY THE GOVERNOR

TO ASSIST THE TASK FORCE

Kent Bailey

Wayne Burggraaff

Harvey Caldwell

Daniel Magraw

Marilyn McClure

Robert McDonald

Ronald Olson

Kris Sanda

Joseph Sizer

Lance Teachworth

Jack Young

Area Manager, U.S. Office of Personnel Management

Commissioner, Department of Finance

Caldwell Associates, Inc. , former Assistant

Commissioner, Department of Public Welfare

Deputy Commissioner, Department of Administration

Commissioner, Department of Human Rights

D~puty Commissioner, Department of Transportation

Personnel Director, Department of Revenue

Director, Consumer Services Division, Department

of Commerce

Deputy Director, State Planning Agency

Labor Negotiator, Department of Employee Relations

Commissioner, Department of Corrections

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CHARGE TO THE TASK FORCE

The Task Force charge was to:

Study and analyze Minnesota's personnel law as it appliesto practices in examining and referral, total compensation,classification, work force size, turnover, training,affirmative action, labor relations and general personnelmanagement practices.

Prepare a report on its findings and recommendations forthe Governor and the Commissioner of Personnel (nowEmployee Relations) by August 15, 1980.

Assist in the development 1 of a model personnel managementlaw by September 30, 1980.

The charge was viewed as an opportunity and a challenge, notonly for those involved in the brief study undertaken by theTask Force, but also for state management, the public and itsrepresentatives and employees of the State, to help foster,maintain and continually improve the effectiveness andefficiency of the government of Minnesota through personnelmanagement improvement and assurances of equitable and fairtreatment of the pUblic and its employees.

1See Appendix A for complete text of Executive Order No. 79-37.

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TASK FORCE PROCESS

The Governor's Task Force on Personnel Managemen~ was created byExecutive Order of Governor Albert H. Quie. The Governorappointed fifteen members representative of business, labor, personnel,management and the community to study the personnel management system inthe State of Minnesota outlined primarily in Minnesota Statutes, Chapter43 (1978). The Governor also appointed eleven resource persons to assistthe Task Force, a corps of knowledgeable government personnel andmanagement professionals, the Area Manager of the local office of theUnited States Office of Personnel Management and ten career stateemployees with experience and expertise in personnel, management andlabor relations.

The Task Force became operational on December 5, 1979, according to law,fifteen days following the November 20, 1979 Executive Order filingdate. By the time the Task Force became operational, the LegislativeCommission on Employee Relations created by Minnesota Statutes § 3.985(Supp. 1979) had been functioning for some months. Prior to the 1980legislative session, the Commission concentrated on the labor relationsaspects of the system and a complete review of the Civil Service Act(Chapter 43) was held for interim study and action during the 1981legislative session. The importance of the personnel management systemin the effective functioning of the state government is borne out by thefact that both the legislative and executive branches felt that a reviewfollowed by appropriate action could strengthen and improve the system.

The Task Force functioned as a part of a larger one year PersonnelManagement Improvement Project partially supported by federalIntergovernmental Personnel Act funds. The budget for the total projectwas $77,776. The Task Force, itself serving without compensation, wasconscious of its limitations in both time and funds. Consequently,holding hearings or formally soliciting citizen or employee input which,under a less constrained deadline and with additional financing, the TaskForce would have preferred was not feasible.

The Legislative Commission on Employee Relations had developedlegislation revising parts of Chapter 43, the Civil Service Act, andChapter 179, the Public Employment Labor Relations Act, hereinafter"PELRA", to improve procedures and relationships involved in theinteraction of the provisions of the two statutes. The Commission heldfrequent public hearings. Task Force hearings in addition during thattime would have become unduly burdensome for major participants in thepersonnel management and labor relations processes and of questionablevalue prior to the close of the legislative session.

2Appendix A.

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Task Force members and resource persons had a deep appreciation of theimportance of their charge. The members were well aware of the changesin the personnel management system since the start of the merit system in1939.

Most sobering to the Task Force was the fact that the major provlslons ofthe Civil Service Act and of good personnel management had been deletedeffective July 1, 1981 by Laws of 1979, Chapter 332 as amended by Laws of1980, Chapter 617 § 43. They found that the State, without furtherlegislative action, would be without an examining system, aclassification plan, provisions for certification of eligible candidatesand a number of other essentials of a merit system. As the Legislaturehad sufficient uncertainty about the personnel management system toprompt a review by its Commission, the Task Force believed its assignmentincluded suggestion for legislative changes to assure the vital parts ofthe system.

Th T k F d I d t f T k F b " t" 3 "e as orce eve ope a se 0 as orce 0 Jec lves to guldeits thinking and concluded that its activities and recommendations shouldidentify and address issues that would:

1. Provide the State with a competent and productive work force.

2. Assure a balanced work force proportionately representative ofall societal groups.

3. Assure, fair and equitable treatment of the public and itsemployees.

To utilize its limited time period most effectively, the Task Force wasorganized into five sub-committees:

General Policy and PracticeClassificationExamining and ReferralLabor RelationsTotal Compensation.

A proportionately representative work force within the Minnesota civilservice was an overriding concern. Rather than having a separatesub-commi ttee to address questions of equal employment opportunity andaffirmative action, each sub-committee considered these important mattersin relation to its topical assignment. Each sub-committee assessed andmade recommendations for identifying and reducing the adverse impact ofthe various functions of personnel administration and collectivebargaining on entrance and career progression of members of protectedclasses in the state service.

3Appendix B.

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Drawing upon their considerable expertise, the sub-committees developedphilosophy and policy statements related to their areas of study, definedappropriate roles and relationships and discussed the present personnelmanagement system with an eye to possible improvements.

Each sub-committee chairman was free to develop his own approach to hisassigned subject area. The Classification and Total Compensationsub-committees had overlapping concerns and met jointly on occasion. TheGeneral Policy and Practice sub-committee invited experts in thepersonnel management-labor relations field to appear at its committeemeetings, such as the Commissioner of Employee Relations and the Directorof the union representing the largest number of state employees.

The Examining and Referral sub-committee chose to review and discuss eachprovision of the Civil Service Law relating to its topics ofconsideration, assessing the implications of each and makingrecommendations for changes. The Labor Relations sub-committee was moreaffe?te~ than any other by the. leijislation prepared by the LegislativeCOmmlSS10n on Employee Relatlons because of the intense interestin that legislation and the frequent amendments thereto as thesub-committee's work was in progress. There were many discussions of theTask Force Chairman, sub-committee chairmen and other members with theProject Coordinator on specific concerns.

The full Task Force including resource persons assigned to the personnelmanagement improvement study met in general session on four occasions.The first of these general meetings was held on November 27, 1979, whenthe Task Force and resource persons met with the Governor in apreliminary meeting to hear his charge and expression of concern andsupport. Three other full Task Force meetings were held, on April 10,May 28 and July 17, 1980, during which objectives were developed and workof the sub-committees and issue papers reviewed.

In order to focus on issues and to allow outside input, the Task Forcechairman had asked that issue papers be developed by staff and any otherswith a concern about the personnel management process and how it might beimproved statutorily or administratively. The policies developed by thesub-committees and the issue papers prepared by a great number of authorson which the Task Force was able to reach general agreement formed thebasis for many of the recommendations included in this report.

4SF 2085; HF 2154.

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II

INTRODUCTION

Challenges for the 1980's

The 1980's will present a challenge without precedent to pUblic personnelmanagement, in the State of Minnesota and other governments. Theevaluation process related to public personnel begun in the 1970' swillcontinue and a redefinition of roles may be anticipated. Demands formore effective public service can be expected to increase as taxpayersinsist on accountability for expenditures of decreasing "real" dollars.Improvement in productivity of government agencies and individualemployees will be a major concern of this decade and beyond. Improvingproductivity seems the only reasonable answer to maintaining service withlimited financial resources. The concern for productivi ty improvement,shared by the State of Minnesota, other governmental jurisdictions andthe private sector has to do with motivation, skill and managementdevelopment, reward systems, labor management relations, and a host ofother human considerations, all part of personnel management.

The increasing importance of personnel management in the public sector aswell as in business and industry is indicated by the growing realizationthat "people experts" are as important, if not more so, to an enterpriseas experts in finance, or, in the private sector, production andmarketing. It is people who make programs work. In labor intensiveenterprises like government, the most effective use of human resources isan imperative. Assessing personnel management achievements, establishingobjectives and performance indicators, will become a high priority.

A backward look at the 1970' s is instructive. During the last decade,public personnel management was in the process of change throughout thenation. During the 1978-79 biennium, twenty seven of the statesestablished study commissions 5to review their personnel managementsystems and recommend changes. Officials in most states found itadvisable to review and revise personnel policies in some form. Much ofthe activity in "civil service reform" can be attributed to reformactivity at the national level which culminated in the adoption of arevised civil service system for federal employees. The influence flowedboth ways. The federal reforms borrowed heavily from initiatives begunin state and . local governments. The United States Office of PersonnelManagement (OPM) and a Merit System Protection Board (MSPB) were createdto replace the three member Civil Service Commission which had been inexistence since 1883 with the passage of the Pendleton Act. A furtherlegacy of the federal government reform movement which has influencedstate legislation and practice is a revision of the "Merit SystemStandards" which must be met by state and local governments for employeesin federally funded jobs.

5Council of State Governments, Lexington, Kentucky, The Book of theStates, 1980-81, Vol. 23, "Civil Service Reform".

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3. The role of women in the labor force is expected to continue itsupward trend.

Personnel management systems everywhere including that of Minnesota stategovernment can anticipate many problems and opportunities for the 1980's.

number of women thannew workers, such as

A changing work force including a greaterpreviously anticipated and an influx ofHispanics and Vietnamese.

Increasing unionization in the public sector.

6Protected classes in Minnesota comprise minorities, women,handicapped and Vietnam era veterans.

Greater concern by employees for the quality of work life, leisureand family relationships which has led to experimentation with newpatterns of work.

Potential and current employees with changing attitudes and valuesand higher expectations for career progression and involvement indecision-making.

Equal employment opportunity concerns for protected classes which,since the passage of Title VII of the Equal Employment OpportunityAct of 19l3, includes the handicapped and, more recently, Vietnam eraveterans.

1. The number of young workers, particularly white youth, will fallsharply which will help to solve the unemployment problems of teenageyouth. Young workers, because of their reduced number, may expectrelatively higher earnings.

2. The 1980' s will see a "demographic bunching" of persons in the 25-44age bracket, the prime age work force. The number of persons in thisage group will have increased 55%, from 39 million in 1975 to 60.5million in 1990 • Intense competition for promotions, severedisappointments and increased pressures on management development,training and pay policies can be anticipated in most organizations.

Jerome M. Rosow forecasts a number of shifts in the labor market in the1980's that will affect all employers:

In addition to the reality of more stringent budgets and pUblic demandfor accountability, the 1970's were marked by other developments andpressures that impacted personnel management.

I

1

4. Heavier competition for desirable jobs can be expected not onlybecause of increased numbers in the labor force, but because of anincrease in the number of qualified minority and women workers, whichshould result in an increased labor force participation rate. Theremay be more participation of older workers with the raising of themandatory retirment age but this will be dependent on a loosening ofsocial security restrictions, more flexible working arrangments, jobre-design and a general set of personnel management policies toaccommodate older workers.

Addi tional concerns involve the general decline in job satisfaction, aphenomenon that has been substantiated in recent surveys; a number ofeconomic and sociological changes that have affected attitudes towardwork and authority; and a decline in the confidence in institutions.Public personnel managment will need to learn to assess and accommodatefactor~ that were relatively foreign to decision-making in earlieryears.

Both the external labor force and the internal labor force of the stateservice will impact the productivity and effectiveness of statefunctions. Managers will need to understand the subtleties of thechanges in the work force and react with innovative policies and programssuch as flexible working hours, job sharing, staggered hours and a systemoriented to special tasks or projects.

Perhaps personnel management has survived more turbulent times, but thedecade ahead may be expected to challenge the abilities and creativity ofpersonnel management in different ways than before.

7ROSOW, Jerome M., "Personnel Policies for the 1980's".Unpublished paper prepared for United Hospitals, St. Paul, Minnesota,January, 1980. Mr. Rosow is President, Work in America Institute, Inc.,Scarsdale, New York.

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THE MERIT SYSTEM

What is a Merit System?

classification plan, grouping and distinguishingon the basis of difficulty and responsibility, onbased an equitable compensation plan and other

program activities.

A currentpositionswhich ispersonnel

3. Referral procedures that provide for appointments of the mostqualified with sufficient flexibility to allow for equalopportunity in selection.

1. Dedication to active recruitment, a continuous searching outprocess to assure a diverse highly qualified group of applicantsand over time the achievement of a balanced work force.

The Task Force sees value in the merit system and in the collectivebargaining system, both of which are embodied in statute. The TaskForce encourages the State to seek the most beneficial interaction ofthese important elements of its personnel management system and makesits recommendations in pursuit of ways to assure this desirableaccommodati on in the public interest. Nothing in this report or itsrecommendations is intended to infringe upon or abridge the rights ofemployees under PELRA.

A modern merit system is a public personnel management system whichprovides the jurisdiction it serves with qualified, productiveemployees to serve the public in an effective, efficient andresponsive manner. A merit system is accessible to every citizenwith entry to and progression in the system based on qualificationsand performance on a non-political basis.

5.

In this spirit the "essential elements" or necessary c~ponents of apersonnel management system based on merit are outlined.

2. Valid, reliable and objective selection methods for originalappointments and promotion that assure fair and job relatedtests of individuals' abilities to perform competently and/ortheir potential.

4. Training and staff development directed toward raising allcurrent and newly hired employees to the desired level ofcompetency with reasonable access to such training.

8Issue Papers, Governor's Task Force on Personnel Management,St. Paul, Minnesota, August 15, 1980, "The Essentials of a Merit System."

6. Duties and responsibilities clarified and performance standardsor objectives established.

7. Pay and retention in the service based on performance.

8. Orderly separation procedures including, where appropriate,provisions for appeals, hearings and due process.

9. Protection from political coercion; encour?gement of legitimatedissent; and a code of ethical performance.

..

History in Minnesota

The State of Minnesota joined the "merit system states" in 1939 duringthe wave of civil service reform that swept the country in the 1930' s.Chapter 43, the Civil Service Act, became law on April 22, 1939. Itprovided for a system of merit emplftrIDent in the state service with broadcoverage in the classified service.

The statewide merit system established in 1939 was one of several reformsundertaken that year. It has well served Minnesota citizens, itsgovernment and its employees and earned Minnesota an enviable reputationin personnel management among the fifty states. The State functionedfrom 1939 until 1973 under a traditional merit system with a three memberpolicy making/quasi-judicial Civil Service Board and a Director appointedby that Board. In those 34 years, three directors of civil serviceserved as administrative head of the central personnel agency created bythe 1939 Act.

In 1973, major changes were made in the Personnel Act. Laws of 1973,Chapter 507 abolished the Civil Service Board which had appointed theadministrative director in the classified service. It created apolitically sensitive and responsive Commissioner of Personnel appointedby the Governor with a four year term concurrent with the Governor's.The three member pOlicy-setting - rule-making - quasi-judicial CivilService Board was

11eplaced with a seven member Personnel Board appointed

by the Governor with specific and limited functions includinghearings on appeals. Though only three directors served during the 34previous years under the Civil Service Board, five successiveCommissioners of Personnel had been appointed to office from 1973 to1979.

9Issue Papers, op.cit., "Political Activity and the Protection ofEmployees from "Coercion"; "Legitimate Dissent: Whistleblowing";Minnesota Code of Agency Rules, Chapter Nineteen: 2 MCAR §§ 2.275-2.282

10Code of Ethics.11 As defined in Minnesota Statutes § 43.09, Subd. 4 (1978).

Four members were nominees of the Legislature.

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---~~--~-

The 1979 Legislature enacted Chapter 332 which created a LegislativeCommission on Employee Relations to monitor the activities of theDepartment of Personnel and to study the interrelationships between theCivil Service Act and PELRA. The same 1979 Act provided for thedeletion, effective JUly 1, 1981, of major portions of the Civil ServiceAct comprising the essential provisions of a merit system. In theabsence of further legislation, the State would have been without a meritsystem.

Further legislation was forthcoming during the 1980 session. Majoramendments to both Chapter 43 and Chapter 179 were made by Laws of 1980,Chapter 617. In April of 1980, the Legislature passed and the Governorsigned Laws of Minnesota, Chapter 617 which changed the name of theDepartment of Personnel to the Department of Employee Relations,statutorily restructured the Department and strengthened its role incollective bargaining. The law also reinstated in statute the basicprovisions covering selection and classification which partially restoredmerit principles into Minnesota's policy for personnel management. Amongsome of the important provisions that were not returned to the law werethose on appeal provisions and hearings, the performance appraisal systemand provisions on various other matters.

The Personnel Board also was abolished by Chapter 617 and its dutiesdistributed between the Commissioner of Employee Relations and the ChiefHearings Examiner.

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PERSONNEL MANAGEMENT ISSUESCONSIDERED BY THE TASK FORCE

Many authors have indentified general public personnel management issuesfor the 1980's. Some of the most pervasive needs pointed out are:

1• Increased responsiveness to citizens in public personnelmanagement and reorganization to accomplish this end.

2. Increased flexibility in the personnel management system topermit managers to manage effectively.

3. Improvement in productivity and performance, of individuals andin effectiveness of programs.

4. Increased emphasis on performance appraisal and pay according toper formance •

The Governor's Task Force on Personnel Managementabove within the context of the merit systemspecifically, the Task Force deliberated overidentified as pertinent in the state service:

cons.idered all of thein Minnesota. More

the following issues

1. The extent of merit system coverage and appropriate exemptionsfrom the merit system.

2. Accommodation of the merit system and the collective bargainingsystem.

3. The roles and relationships of different offices, functions andpositions in the total personnel management system.

4. Political activity and the protection of employees from coercion.

5. Personnel management's role in budgeting and work force planningincluding timing of collective bargaining to precede budgetadoption.

6. The State as an equal opportunity employer in dealing with theintegration of merit system principles with those of affirmativeaction.

7. Modifications in patterns of work such as job sharing, variablework weeks and flextime to meet the needs of present day publicmanagement and employees.

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10. The career executive system and strengthening of management.

15. Legitimate dissent: "Whistleblowing. "

reward system,pay based on

theand

appraisal tocomparability

Relationship of performancestaff development, salaryperformance.

9.

17. Assessment of personnel management's achievements throughestablishment of objectives and performance indicators.

Overall, there were concerns for responsiveness of the personnelmanagement system to the needs of management and to the general public.Responsiveness to the public can be improved, in the opinion of the TaskForce, through the State's continuing to forge sound workingrelationships between the central personnel agency and operatingmanagement in their joint responsibilities in personnel management. Thecentral personnel agency can make and has made improvements, broadeningthe lists of names referred to agencies, for example, which indirectlyaddress the issue of responsiveness.

14. Appeals, hearings and due process on employee grievances.

12. Strategies for productive individual and group performance.

16 • Centralization vs. decentralization in the personnel managementfunction.

8. The development of statewide management systems, including theassignment of responsibilities and accountabilities, so that theState will be perceived by the public and by state employees asa single, coordinated empioyer.

11. Criteria for retention in, career progression through, andseparation from the system.

13. Trends in validation feasibility, "reverse discrimination",veterans preference, open competition, bandwidth certification,handicapped, alternative selection procedures to provide greaterflexibility for entrance into the system and other issues inselection.

The issue papers developed for the Task Force, which are available in itsworking papers, matched the concerns expressed above. The Task Forcenoted that a number of issues of national concern on whichrecommendations had been made in connection with federal civil servicereform and which are still under consideration in some states had in factbeen resolved in Minnesota. Innovations in the federal personneimanagement system, for example, a performance appraisal system, had beeninstalled within the Minnesota system previous to their adoption at thenational level.

==rI

Questions as to the appropriate extent of centralization ordecentralization of certain personnel functions and how to providemanagement more flexibility in personnel management decisions alsooccupied the Task Force. A careful effort was made to view all theseconcerns with perception of the similari ties and differences between thepublic and the private sector.

The Task Force did not consider other issues that are of concern to somegovernments in the United States such as:

1• Contractual arrangements with privatepublic services, such as, custodial,processing services.

sector employersprofessional or

fordata

2. Further restructuring of the central personnel agency.

3. Requirements that public employees reside in the jurisdiction bywhich they are employed.

4. Court decisions and trends relating to the employment of aliens.

5. Employee privacy rights concerning the use of "selfincrimination" devices in selection and retention and employeerights to examine and correct employer records.

6. The ethics of public employment.

7. Pension issues.

The Task Force was of the opJ.nJ.on with respect to the issues listeddirectly above and others that either the issue was beyond the scope ofthe Task Force study or had been dealt with effectively in the State ofMinnesota.

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SUMMARY OF RECOMMENDATIONS

The Task Force found that the personnel management system in Minnesota isbasically sound and has always had a reputation for striving toward asuperior system.

A number of issues which have received attention in other states andrecent reforms instituted are "non-issues" in Minnesota because the Statehas kept abreast of current concerns and has made creative changes inrespons.e to changing times. For example, sister states and the federalgovernment have initiated senior executive systems and/or performanceappraisal systems among their recent reforms. These featuref2 have beenpart of the Minnesota system since 1969 and 1973 respectively.

Some existing conditions, however, are disturbing and warrant attention.Although the Department has prepared a mission statement, it needs reviewand upgrading, with the Governor's concurrence, to the status of anoverall personnel management policy statement for the State. The TaskForce recommends that:

THE COMMISSIONER OF EMPLOYEE RELATIONS WITH THE GOVERNOR'SINVOLVEMENT DEVELOP A CLEAR STATEMENT OF PERSONNEL MANAGEMENTPOLICY IN THE PUBLIC INTEREST DESIGNED TO PROVIDE THE STATE WITHA COMPETENT AND PRODUCTIVE WORK FORCE PROPORTIONATELYREPRESENTATIVE OF ALL SEGMENTS OF SOCIETY AND EMBODYING CONCEPTSOF EQUITY AND FAIRNESS FOR EMPLOYEES.

Commitment to the following concepts and assurances is recommended forinclusion in the policy statement.

1. Maintenance of a competent work force.

2. Productivity and effectiveness due the public.

3. Application of merit system principles.

4. Recognition of the role of the collective bargaining process andits acceptability to management.

5. Recognition, in a clear statement, of management prerogatives.

6. Proportionate representation in the state service of allsegments of the work force.

12Minnesota Statutes, Chapter 43 (1978) (1969, c 144 s 1-3; 1973,c 507 s 32).

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7. A basic set of principles on which employees can rely to governstate employment.

8. Independent and impartial appeal mechanisms available to allstate employees.

9. Perception of the State as one employer.

The Task Force strongly recommends that the statutes relating topersonnel management, primarily the Civil Service Act, Chapter 43,provide philosophy and policy and that administration and proceduraldetail be left to the executive branch in order to provide necessaryflexibility in administration.

The Task Force further recommends for improved program development andadministration that:

1. The current appeal procedures be monitored to seek improvements,including consideration of the possible need to establish anon-partisan mechanism for review and investigation and to hearappeals of non-represented employees.

2. The principles for designation of positions in the unclassifiedservice developed by the Task Force be implemented and thatpositions in the unclassified service that do not fit theguidelines be placed in the classified service.

3. Emphasis be placed on accurate and professional job analysis asthe basis for staffing, compensation, job evaluation and otherpersonnel management functions.

4. The Department of Employee Relations, assisted by operatingagencies, maintain an active, continuous recruitment plan andprocess which assures a diverse, highly qualified group ofapplicants which contributes to a proportionately representativework force.

(Present law includes no provlslon for recruitment although theDepartment does recruit systematically and has utilized specialoutreach techniques.)

5. Examinations continue to be job related with high validity andreliability.

6. Certification practices continue to allow agency heads a wideselection among qualified candidates and additional names ofpersons in protected classes to assist in the achievement ofaffirmative action goals.

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10. Individual employee achievement awards be granted principally onthe basis of performance.

The State ought to seek out a variety of ways of reinforcinggood performance including the further development of incentivepay programs.

other agencies analyzepractice inadvertently

against members of

seen as a continuous learningand reinforced with refresher

Management and supervision beprocess, periodically updatedprograms and approaches.

The Department of Employee Relations andactivities to assure that no program ordirectly or indirectly discriminatesprotected classes.

It is recommended that the number of names now being certifiedbe further enlarged and if a certification lacks a sufficientnumber of eligibles to meet state policy requirements forprotected classes, additional qualified persons from protectedclasses only be certified.

(Significant improvements have been made recently in the CareerExecutive Service program. The establishment of a lump sum cashaward system for the completion of innovative projects is anotable example. Other problems can be resolved with help fromthe recently established CES Advisory Committee.)

14. Policies and practices in other than full-time, unlimitedemployment in the classified service, such as part-time or shortterm, and contractual arrangements for personal services bereviewed to assure that such employment conforms to the basicintent of authorizing provisions.

12.

11. A continuing effort be made toward improvement, more consistentimplementation and increased supervisory training in theDepartment's well developed and highly acceptable performanceappraisal system.

13. Steps be taken to provide additional flexibility in the CareerExecutive Service (CES) and that there be clarification,especially in the areas of labor relations and equity with theunclassified service.

7.

8. Internal equity in total compensation be maintained betweensimilar classifications regardless of sex or other non-jobrelated differentials that may have existed in the past. Theprinciple of equal pay for equal work should be re-affirmed.

9. External equity in total compensation be assured to equate statesalaries to those paid in the market place for similaroccupations, responsibilities and levels of position.

T

II

I~

15. No change be made regarding veterans preference provJ.slons butthat practices be continually analyzed for effect on protectedclasses.

16. Systematic and regular assessments be conducted in connectionwith overall auditing efforts among agency heads, managers,employees and the general public to determine the impact of thepersonnel management system on its clienteles so thatappropriate changes can be made in a timely manner.

17. The Department of Employee Relations and all other agenciesengage in continuous productivi ty improvement efforts toincrease the efficiency and effectiveness of the state service.

18. Relationships of the central personnel agency and othersinvolved in personnel management throughout the various agenciesbe clarified.

19. Appropriate accommodations be made to the provisions of PELRA.

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RECOMMENDATIONS: RATIONALE AND DETAIL

I. Personnel Management Philosophy and Policy

The basic principles for personnel management in state governmentshould appear in the law and standards in rules promulgated by theCommissioner. Labor contract language, although it may deal withcertain of the same topics, is not a substitute for public policystatements on personnel management. These statements must guidemanagers in operating the State system to serve public needs.Collective bargaining agreements or arbitrators'. awards governmanagement relationships with employees but not management'sresponsibilities to the public.

1. Merit System Coverage

A merit system is of limited effect. unless merit principlesapply jurisdiction-wide to all but a very few positions. Someof the strengths of the Minnesota merit system have been theextensive coverage of merit provisions in the executive branchand the innovative programs which have been adopted forclassified employees including the Career Executive Service andmanagement compensation and development plans.

A means should always be provided in law, however, wherebysenior policy making positions are exempt from merit provisionsbut their number should not be large. The incumbents of thesepositions are appointed, serve and can be released at theappointing authority's pleasure.

Positions in the Minnesota state service are in the classifiedcivil service by statute with certain exceptions as specifiedin law. Provisions of the Civil Service Law, as well asnumerous specific references in state agency legislationdesignate positions in the unclassified service. MinnesotaStatutes § 43.09, Subd. 2a (Supp. 1979) outlines criteria forthe unclassified designation of up to 106 positions in additionto those specifically established in law. Excluding the StateUniversity and Community College Systems, cons ti tutionaloffices and certain other boards and commissions in which allemployees are in the unclassified service by law, such as theBoard of Investment and the Ethical Practices Board,approximately 250 full-time, unlimited unclassified positionsexisted as the Task Force began its study.

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TCurrently, a great deal of inconsistency exists in statute and,the Task Force assumed, in practice. Some agencies have onlyunclassified positions and others have unclassified positionsthrough their line division managerial levels. Still others,and some relatively large agencies, have authority only forvery few unclassified positions.

A consistent set of principles and guidelines should govern theextent of unclassified authority for use by agency heads aswell as for approving authorities. Because of the nature ofthe question, the guidelines must be relatively general butshould be as specific as possible in order to be useful as aguide for both executive and legislative branch officials.

Minnesota Statutes § 43.09 contains a number of specialexceptions from the classified service which also would benefitfrom review. There may have been appropriate reasons forexisting differences among agencies at one time but the TaskForce questions their current validity and recommends acomplete review of the unclassified service in the executivebranch.

The Governor's Task Force became concerned that the meritsystem which once covered relatively many more positions in thestate service than at present may have been eroded over theyears. The Task Force has no quarrel with the exemption ofposi tions such as those of department heads, legislative andjudicial employees, and certain others from the classifiedservice, but it was interested in the 1973 revisions in theCivil Service Act which, in Minnesota States § 43.09, Subd. 2a(Supp. 1979), gave the Personnel Board (now the Commissioner),upon request of the Governor, additional authority fordesignation of positions in the unclassified service.

The Task Force assumes that the statutory change was made to"improve the responsiveness" of state government by increasingopportunities for a given administration more easily to appointpersons of its political persuasion in order to re-directprogram emphasis or introduce a preferred style of management.

The Task Force is cognizant of and in agreement with the callfor responsiveness in government. It is concerned, however,that the State and other governments may tilt too far in thedirection of responsiveness without due attention to theequally imperative, if not more insistent, public demands thatgovernment act openly and with consistency and fairness toall. Public expectation includes the assumption that theseconditions will be met by a productive work force at reasonablecost.

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It is not necessary to subvert the merit system to achieveresponsive changes in political direction and a willingness onthe part of public employees to accomplish the ends ofpolitical leadership as has been proved over many years. Uponinquiry of the Council of State Governments, the Task Forcelearned that its records revealed "no information indicatingpositions below the second level where state agencies areexempt from the civil service or merit systems. Generally, thesecond level is deputy director or assistant commissioner. Theprofessional division heads and technical program manager whichusually makes up the third tier in government are, in mostcases covered by merit rUles.,,13 Continuity andconsistency takes on greater emphasis, in the view of the TaskForce, during times such as experienced in recent years whenturnover of elective officials in all governments has beenrelatively frequent.

The Task Force felt the need to probe more deeply into thepractices being followed in designation of positions in theunclassified service, particularly at top management levels.Frequent references to unclassified positions in relation tothe Career Executive Service and the management schedule ofsalaries created some confusion among members as to whetherthese al ternatives were being used interchangeably.Inconsistency was suspected. The Task Force decided to reviewpolicy level and confidential unclassified positions in tendepartments and left the selection of those departments to theCommissioner of Employee Relations so long as they wererepresentative of both large and small agencies.

2. Study of Unclassified Positions

The study of unclassified positions commenced with thedevelopment of a set of principles or criteria which woulddifferentiate between a classified and an unclassifiedposition. Principles were agreed upon by the study group, andinterviews with ten selected department heads were conductedusing the principles as guidelines. The study started with thepremise that the public interest will be best served if stateemployees are selected, compensated and retained on the basisof merit within the classified service, and that unclassifiedposi tions must meet a set of standards for exclusion from themerit system.

13 .Letter from Davld R. Cooke, Council of State Governments,Lexington, Kentucky, June 23, 1980.

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4

Positions which meet the14criteria for exclusion from theclassified service include:

Commissioners/Agency Heads

Deputy Commissioners/Deputy Heads

Confidential Secretary to Commissioner/Agency Head

Assistant Commissioners, Institution Heads and dependingon the organization, some Program Directors and others whomeet all of the following criteria:

a) Report to the Commissioner or Deputy Commissioner.

b) Are designated by the Commissioner as part of his/hermanagement team.

c) Participate directly in agency policy development andimplementation.

d) Are required to have a special sensitivity to theGovernor's and/ or the Commissioner's goals and broadfreedom to act or are concerned primarily with theimplementation of new program concepts or majorchanges in existing programs as opposed to managingestablished ongoing internal administrative programswhere continuity and, therefore, precedent areimportant.

If the criteria c and d above do not clearlydistinguish a position in the classified/unclassifiedservice, an additional principle should be appliedwhich, if met, will suggest that the particularposition is appropriately in the unclassifiedservice; i.e., the position does not requireextensive experience or knowledge within a particularprogrammatic area such that emphasis in selectionneed not be placed on programmatic/technicalexpertise but rather on generalmanagement/administrative factors.

These standards were applied in a study of top level positionsin the following departments: Administration, Agriculture,Commerce, Corrections, Economic Development, Economic Security,Health, Natural Resources, Public Service and Public Welfare.

14Federal Merit System Standards, 900.609, include an additionalcriterion, i.e., public advocacy of policy as well as policydevelopment, which may have implications for state agencies usingfederal funding for such positions.

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The results were presented to the Governor and the Commissioneron August 5, 1980, in a separate report. The Task Forcerecommends that the criteria for exclusion from the classifiedservice listed above and used in its limited review be appliedto agencies statewide for positions in their management teamsand that, if necessary, the Governor and Commissioner proposesuch criteria for legislative action.

3. A Mechanism for Consideration

The organization form involving a board or a commission at thetop of the personnel management system has lost favor among thestates and at the federal level. The states now using thisform are in the minority, however, the gradual disappearance ofpolicy making/review boards and commissions has removed frompublic personnel management a mechanism which sought to assurea system oriented to the public interest.

The Task Force considered and rejected the suggestion that asmall, non-partisan, professional gubernatorily appointed Boardsimilar to that which existed in earlier years but with vastlylimited powers might be established to provide citizenoversight to the personnel management system, advise theCommissioner and the Governor and make final decisions onappeals from disciplinary actions for unrepresented employees.The type of advice and counsel that might be provided by aBoard of this kind can be secured without that formal mechanismand appeals better can be handled by experts. Mostimportantly, the Task Force felt that accountability would bediluted, the Board itself not being accountable to the publicor sanctioned by voters. Finally, in the opinion of the TaskForce, with the exception of the question of fiscalresponsibility, the availability of collective bargaining is assound a check as any on personnel management.

The Task Force is of the 0plnlon that unrepresented employees,like those represented by labor unions, should have access toan arbi tration procedure relating to appeals from disciplinaryactions such as dismissal, suspension, demotion and reductionin salary. The appeal procedure should guarantee to bothemployees and employers a neutral, expeditious and bindingresolution of all such disciplinary grievances. Theadministration of such a procedure might operate as follows:

The grieving party and the Commissioner of EmployeeRelations would agree on the selection of anarbitrator; absent such agreement, the parties selectan arbitrator from a panel submitted by the Bureau ofMediation Services.

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Timeliness for filing such appeals should beestablished in statute and should parallel thosegenerally found in state labor contracts.

Arbitrator's fees and expenses should be sharedequally by the grieving party and his/her appointingauthority.

The arbitrator should have authority to awardremedies which in his/her judgment are appropriateand necessary, including reinstatement, full orpartial back pay, remand of the decision and otherappropriate actions.

Allegations concerning deviations from the procedure,failure to implement the arbitrator's decision andrelated matters should be referred to theCommissioner, and if still unresolved, to theGovernor.

4. Centralization - Decentralization

The issue of centralization of the personnel managementfunction as opposed to decentralization is not clear cut. Themost judicious approach to this question is to locate somepoint between these extremes and define authority for differentaspects of personnel management. There are some personnelmanagement functions that should never be delegated tooperating agency users of the system if a comprehensivepersonnel management program is the ultimate goal. On theother hand, some delegated responsibility can accomplish a muchmore germane responsiveness to agency needs.

Every large industry has a centralized personnel managementfunction at corporate headquarters; every state in the unioncentralizes its personnel function in order to achieveconsistency, continuity and clarity of policy and practice andto manage the human resource equitably and fairly. The privatesector with the possible exception of very small organizations,finds a central personnel function a necessity in itsprofi t-making ventures. It is equally a necessity ingovernment if services are to be provided in a cost-effective,productive manner.

As the Task Force has observed elsewhere in this narrative, theState, as one of the largest employers in Minnesota, mustoperate as a single employer if it is to achieve theeffectiveness, efficiency and economy in its operations aboutwhich there is so much political and administrative rhetoric.

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Decentralization of major aspects of the personnel functionwould significantly increase the managerial flexibility ofoperating agencies, but flexibility generally means diversi ty,inequities among agencies and interagency competition forscarce human resources.

Decentralization should not proceed without adequate controlsto assure uniform adherence to policy and personnel standards.With major decentralization, costs could be expected toincrease. At present only a few, if any, of the largestagencies would be able to cope with major decentralization inall functional areas. To equip all agencies with the necessaryexpertise to function well in the personnel management fieldwould be costly and duplicative due to the loss of economy andefficiency of scale.

In the estimation of the Task Force, the Legislature would beill advised to establish in statute the decentralization ofpersonnel policy and direction, rule making functions orpersonnel program development and maintenance. Personnelprograms can be administered by operating agencies withinguidelines and rules promulgated by the Commissioner ofEmployee Relations. The risk of the emergence of over 100separate and different personnel management systems, one foreach state agency, is too great. The, Legislature faced thisquestion with respect to one aspect of personnel management,Le., its responsibilities in labor relations and determinedthat a coordinated, centralized function is preferable. Thebasic responsibility for other aspects of personnel managementshould also remain with the Commissioner of Employee Relations.

Like in so many other issues concerning personnel management instate government, what is needed is clear policy direction, thedetails of administration being left to those professionallyqualified to execute policy. Considerable personnel managementexpertise resides within operating agencies and where thisoccurs,delegation of authority can be more extensive. In theexecution of personnel management policy, there are manyopportunities for delegation of authority to operating agenciesso long as standards are maintained. This delegation ordecentralization should emanate from the Commissioner ofEmployee Relations with the Governor's concurrence underappropriate circumstances and not be a matter of legislativemandate.

Standards should be formalized by the Commissioner subject tothe approval of the Governor as to the conditions andcircumstances under which decentralization of certain personnelmanagement functions to operating agencies would be authorized.Some standards for decentralization have been developed by theCommissioner and some operating agencies are functioning withlimited delegated authority in personnel management.

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II.

The larger operating agencies with sizeable personnel staffwithin their organizations are the most likely candidates for asomewhat decentralized mode of operation. The Department ofPublic Welfare, for instance, now administers examinations forcertain classes of employment and has been delegated authorityto enter successful candidates on lists and hire qualifiedpersons without delay. Delegation of responsibility forallocation of positions to class has been extended to numerousagencies but the number of classes involved is quite limited.Administration of the performance appraisal system and of theaffirmative action program is the responsibility of alloperating agencies under standards set by the central personnelagency.

Further administrative decentralization can be accomplished,but only when the operating agencies have the interest,commitment and resources to take on these additionalresponsibilities. The argument for decentralization oftenaddresses the question of the inherent slowness of operationsin a typical merit system. Speed of operations is indeedsacrificed with control mechanisms built into the system, butif equity and fairness are to remain goals of the system, thistradeoff is a public good. A better reason than timeliness isthat a job content and performance oriented system cannot bemaintained unless decentralization occurs only under strictlymonitored established standards.

The Task Force recommends that the Department of EmployeeRelations continue to search for and initiate furtheropportunities to decentralize administrative personnelmanagement tasks to operating agencies, that standards ofoperation be maintained centrally and that agency performancebe closely monitored. In instances where audit resultsindicate inadequate or irresponsible administration inpersonnel matters, delegation should be withdrawn.

Roles, Relationships and Authorities

The State's complicated employer-employee relationships cannot bemanaged alone through a central personnel agency but must be anintegral part of general management in all agencies. The centralagency, the focal point of personnel management, must maintain aclose relationship with the Governor and the Legislature andinterpret and monitor their personnel management policiesconsistently throughout the State agencies.

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One of the concerns of the Task Force was the apparent difficulty inholding individuals accountable for the various aspects of personnelmanagement. Business-oriented members repeatedly found the dilutionof authority and accountability in state government a curiousbarrier in itself to improvement in personnel management. It wasnot suggested that the checks and balances built into the State'ssystem of government be removed, as this is a recognized anddeliberate difference between government and business, however, theneed for definition and clarification of accountabilities wasstrongly felt.

Clarification of relationships of the central personnel agency withall other individuals and bodies involved in personnel managementwas the first of several fundamental recommendations. Its concernwas that the State is and should behave as one employer, not as aloose coalition of semi-autonomous employers with differingphilosophies and policies of personnel management.

The roles and responsibilities of the various participants inpersonnel management in the view of the Task Force should bedelineated in terms of authorities and responsibilities of each.

The Task Force's suggested division of responsibilities is:

1. The Governor

Current law makes the Commissioner of Employee Relations anappointee of the Governor. Under this approach, as opposed tothe appointment of the head of the public personnel managementsystem by a Board or Commission, the chief executive isresponsible for ultimate policy development andadministration. Various statutory authorities are assigned theCommissioner, however, the Commissioner's relationship with theGovernor is extremely important.

With the 1973 change in law, the Governor was given an expandedrole in the formulation of personnel management policy. TheCommissioner of Employee Relations should be expected toprovide leadership in cooperation with the Governor to allstate departments and agencies in personnel management, laborrelations, and affirmative action.

The Governor should take whatever steps necessary to assurethat personnel management becomes an integral part of generaland fiscal management, and that all departments and agenciesuse personnel most effectively, in the interest of achievingtheir objectives in the most effective manner and in order thattheir respective missions are accomplished.

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The Task Force sees in personnel management opportunities forthe Governor to convene department heads for executivedevelopment on many human resource subjects. Delineation ofpolicies on affirmative action and equal employment opportunityshould eminate from the Governor's Office for implementationwithin agencies, with the guidance and assistance of theDepartment of Employee Relations which should also monitorprogress of the execution of the Governor's affirmative actionpolicies.

The Governor should hold the Commissioner of Employee Relationsand agency heads jointly accountable, not only for statutoryimperatives, but also for work force planning, performanceappraisal, employee training and development and otherpersonnel management functions. Effective guidance of allagencies with respect to state management's interests incontract negotiation and administration should be provided bythe Department of Employee Relations.

Personnel management systems function in all states. Some havelimited merit system coverage j other systems like Minnesota'scover the bulk of state employment. Minnesota's system now issimilar to the federal system in that the top personneladministrator is appointed by the chief executive. It departsfrom the federal system with the abolition in 1980 of apersonnel board. The federal system retains a bi-partisanpersonnel board with responsibilities for review andadjudication of appeals.

The most recent issue of The Book of the States, 15indicates that the head of the central personnel managementagency is appointed by the Governor, usually with legislativeconfirmation, in twenty-four states, contrary to the practicein the relatively recent past when board or commissionappointment of the chief personnel management officer was moreprevalent.

The decision as to the appointment of the top personnel manageris an important one. That decision for the time being appearsto have been made in Minnesota. Arguments in support of agubernatorily appointed personnel management administrator are:

a Chief Executive is free to appoint a person of his/herown choice and viewpoint to become the personneladministrator.personnel management administrators so appointed are moreresponsive to the administration's views and wishes.

15The Book of the States, op.cit.

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personnelequitable,

professional

Auditing periodically the outcomes of allmanagement systems to assure they areaccomplishing intent and are of provencaliber and soundness.

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Developing for the Governor a long-range personnelmanagement/employee relations plan.

Assuring the integrity of the personnel management systemthrough payroll certification.

Maintaining an active recruiting program in cooperationwith and using the expertise of operating agencies toattract qualified applicants from all segments of society.

Representing the State of Minnesota in all facets of laborrelations including setting objectives, contractnegotiations and contract administration and for relatingthose activities to pay, benefits, work rules andadministrative systems.

Providing management leadership to the employee relationsfunction and be accountable for its overall performance.

Maintaining an employee relations administration policythat is equitable throughout the state service, in accordwith sound professional standards and which takes intoaccount employees' rights in collective bargaining.

assures that candidates meet professional requirements forthe position.provides for continuity of human resource administrationthrough different administrations.enables able classified employees to aspire to promotionto the position.facilitates an organized recruiting effort to attractcapable people throughout the country.

These arguments do not produce mutually exclusive results. TheTask Force believes that an effective personnel managementsystem can be maintained under either model so long as policycommitments are made as recommended.

In support of the appointment of a personnel administrator by aboard or commission are these points:

2. The Commissioner of Employee Relations should have primaryresponsibility for:

Maintaining a testing program using valid, job related andnon-discriminatory selection devices and procedures.

Referring to operating agencies an appropriate number ofqualified eligibles from lists established as a result ofexamination.

Maintaining an equitable classification system.

Maintaining a program to assure that every employee iscurrently and accurately assigned to a classification.

Maintaining a total compensation system which assuresequity among individuals within the state service andcomparability in compensation with individuals working insimilar jobs for other employers in the same labor market.

Assuring that all systems accommodate equal employmentopportunity principles and affirmative action goals.

Providing leadership in the area of employee developmentthrough appropriate programs and guidelines.

Providing tools to guide supervisors in making sounddecisions concerning their employees.

Providing a system of individual performance appraisalbased on standards or objectives.

Providing a system of rewards related to performance.

Recommending and developing approved employee benefitsprograms and a system for their equitable administration.

With the aid of the Department of Finance, accuratelycosting the results of classification, compensation andadministrative systems to assure that costs are comparableto those expended by employers of similar size anddiversity.

Maintaining a personnel management information system.

Regularly reporting both the forecast and the actualoutcomes of the activities of the Department to theGovernor and to the Legislature via appropriate committees.

Developing a statewid~ personnel management/employeerelations operating manual and appropriate delegation ofauthority for administration.

Conducting staffing analyses and continuing personnelmanagement reviews.

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3. The Legislature

Within the scope of this study, legislative actions onappropriations are outside the purview of the Task Force. TheTask Force observes that personnel management is an executivefunction for which the Legislature should establish the base.The Task Force has made, however, the following observations:

The Legislature's substantial role in assuring itself and itsconstituency of the development and maintenance of an effectivework force cannot be underestimated. The Legislature sets thebasic statutory policy for the Department of Employee Relationsas well as other agencies of the State and has theresponsibility to approve budgets, a large part of whichinclude payments for personal services to the State's workforce.

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The Legislature's role in salary appropriations can affectmany personnel management functions. The legislatureshould establish broad policy in the classification andsalary setting area, as for the most part it has, andavoid placing specific contract language in the law. Theexecution of policy should be left to the Commissioner ofEmployee Relations to be carried out through expertise ofstaff for both non-unionized and unionized employees.

c.

b. The Department of Employee Relations should continue toprepare a budget and participate in the normalappropriations process in justifying its budget. TheDepartment best can be held accountable throughlegislative identification of its functions and purposes,general review of expected accomplishment, and adequatefunding. The Department should operate with sufficien'j:.administrative and fiscal flexibility so that it can reactto changing situations without seeking revision in thestatutes.

a. The current oversight and monitoring function of theLegislative Commission on Employee Relations is healthy inview of recent statutory changes and should continue untilat least one biennial cycle of collective bargaining hasoccurred. The Task Force feels that once deliberationshave been completed with respect to the law as it is toexist during the 1980's, the Legislative Commission shouldbe reviewed to determine whether it should bediscontinued, restructured or retained in its presentform.

Legislative philosophy and policy should provide anassurance to employees intending to make a career in stateemployment that their future salaries will bear arelatively consistent relationship to the external marketrather than being subject solely to changes in fiscalpolicy particularly those not reflective of generalchanges in the economy of the State.

d. Authority for decentralization, or delegation of theCommissioner's authority to operating agencies, withrespect to personnel management and a general statement ofthe joint responsibility of the central personnel agencyand the operating agencies should be established instatute.

It is the feeling of the Task Force that far too much detail iscontained in the law. In addition to requiring morelegislative updating, this amount of detail reduces flexibilityfor day-to-day operations and for administration of contractsnegotiated by representatives of employees. Much of thatdetail instead should be contained in two other kinds ofdocuments: a statewide operating manual and the contractdocuments negotiated with representatives of employees.

4. Responsibilities of Operating Agencies are to:

Participate in and assist in recruiting particularly forclasses unique to individual agencies and for persons inprotected groups.

Perform all agency functions relating to labor relationsand collective bargaining within a comprehensive statewidelabor relations program.

Participate in and assist in the development ofexaminations for special classes.

Select employees on original entry, promote, transfer,discipline and take other personnel actions within theagency.

Conduct an agency affirmative action program withinestablished guidelines.

Create specificclassifications.

positions and recommend employee

Evaluate performance of agency employees.

Maintain and execute an appropriate employee developmentplan.

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It is recommended that the Legislature:

5. Department of Finance

auditingagainst

Establish in the Department of Finance anresponsibility to assure that actual costsforecast are accurate.

Establish with the Department of Finance theresponsibility for determining the budgetary costs of theState's human resource programs.

Participate in surveys, serve on advisory committees andotherwise participate in efforts to improve the personnelmanagement system.

Keep the Department of Employee Relations informed ofplanned changes in agency organization and function asthey impact on personnel management operations.

Equitably administer within agencies the work rules, laborcontracts and employee relations policies of the State.

Continue responsibility for coordinating such humanresource costs with the biennial budget as a function ofthe Department of Finance.

Make individual pay decisions within the parameters of theState pay system.

The Uniform Guidelines on Employee Selection Procedurespublished in the Federal Register August 25, 1978, requirecompliance by all state agencies funded or regulated by thefederal Equal Employment Opportunity Commission, the Office ofPersonnel Management, the Departments of Labor and Justice andthe Office of Revenue Sharing of the Department of the Treasuryall of which have endorsed the guidelines and contentvalidation of selection procedures, provided such validation isbased on solid job analysis data.

1. Job Analysis

The Task Force urges emphatically that job content studies beincreased and accelerated and that the Department of EmployeeRelations be given sufficient resources to perform this taskwell in the interest of the entire state service.

III. Programmatic Concerns

Regulations issued by other federal agencies must also be metby state agencies. An example is the Department of Health andHuman Services' regulations for the implementation of Section504 of the Rehabilitation Act of 1973 which calls fornon-discrimination on the basis of handicap. Again, jobanalysis is required to document the essential requirements ofjobs and to determine what reasonable accommodations can bemade to employ handicapped workers.

Determination of job content has long been recognized as thekeystone of valid selection and classification programs. Forthese programs and for other purposes, the Department ofEmployee Relations has engaged in job analysis activities aspart of its on-going functions. It is becoming increasinglyimportant to build an accountability-based job analysisprocedure into personnel management activities of all kinds.Performance appraisal, training, career progression, laborrelations and affirmative action all require the application ofjob analysis techniques. The need is pointed up by anincreased sophistication in the process of job analysis and therequirement that state and local governments give increasingattention to the federal guidelines.

Aside from the fact that the State should attempt to avoidcostly, time-consuming and embarrassing litigation overcompliance issues in federal guidelines, there are internalreasons for an increased emphasis on job analysis.

1. The number of jobs in the state service has remainedfairly constant over the last decade and is expected toremain at about the same number or possibly decline.Opportunities for career advancement in the state servicehave also declined. This fact coupled with the reducedpurchasing power of the dollar have prompted numerousrequests for position evaluations. To preserve theintegrity of the classification system and to hold theline against allocations creeping upward because of salarypressures, the Department has a greater need than ever foridentifiable standards against which to scale positions.

2. Implementation of the Hay system for classification andcompensation purposes and recommendations of the PublicEmployment Study completed by the Department of Finance in1978 which suggested increased emphasis on job analysishave prompted an increasing number of requests forassistance in this area from operating agencies.

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2. Career Executive Service

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3. To provide flexible compensation with incentives toencourage responsiveness, innovation and efficiency.

develop andin state

To provide a workable system to identify,recognize key managers and professionalsgovernment.

1•

There appears to have been some tendency to see the CareerExecutive Service only as an opportunity to use expanded payranges. The use of the expanded pay ranges should be only areflection of, or recognition of, superior performance.

6. To provide a means to mobilize task forces to deal withmanagement and technical problems of concern to a broadrange of agencies.

2. To attract and retain highly skilled and experiencedpersons in managerial, professional andprofessional/supervisory positions.

The Career Executive Service (CES) functions under theguidelines outlined in the following objectives:

4. To give agency heads the opportunity to recognize personsand positions especially important to their programs.

The Career Executive Service, which has grown to over onehundred members, currently has been effective in identifyingand recognizing many high achievers in the state service. Theuse of outside screening panel members has given it anindependent screening process which has strengthened theprogram.

5. To prepare outstanding career employees for considerationby the Governor and agency heads when filling high-levelappointive positions.

The Career Executive Service, which was created by the 1969Minnesota Legislature, was designed to provide opportunity andencouragement for the development of high potential and highperforming managers and professionals, as well as to providegreater flexibility and options for use of their talents in thestate service.

To assure a strong program, the following areas need attention:

Identification and Nomination of Appropriate Candidates

Agency heads, with appropriate support from the Department ofEmployee Relations, should develop internal systems which wouldbring to their attention high performing employees fornomination to the CES. Use of the State's performanceappraisal program is appropriate for this purpose.

Monitoring of the Career Executive Service Program

To assure that the objectives of the CES program are achievedthrough the nomination, selection and retention of employees inthe Career Executive Service, there needs to be a sound andeffective monitoring system implemented by the Commissioner ofEmployee Relations. The Commissioner's reviews must assurethat the high standards set in the objectives are maintained.Further, CES members should be retained in the program only solong as they continue to perform at above average levels. Withevidence of inadequate maintenance of the CES within operatingagencies, the Commissioner should make appropriaterecommendations to the Governor.

Ability Utilization

The objectives of the Career Executive Service provide forflexibility in the utilization of its members. If the State isto identify, encourage and retain high caliber managers in thestate service and take full advantage of their talents, theState should assure their effective use. Mobility assignments,transfers, quality circles and task forces are some of avariety of techniques which, when properly used, can recognizethe capability of CES members as well as significantly add totheir utilization in state service. From all indications, CESmembers would welcome opportunities to be more effectivelyutilized.

CES -- Collective Bargaining Unit Employees

The basic objectives of the CES provide for flexibility andsubstantial variation in the utilization of individualsinvolved in the program as well as flexibility incompensation. This may tend to conflict with certaincollective bargaining principles and agreements. For thisreason, the Task Force recommends that eligibility for the CESbe limited to unrepresented employees.

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Eligibility of Local Government Employees

The current law provides for the inclusion in CES of employeesof political subdivisions of the State. The law also requirescompletion of a probationary period within the state service asone of the criteria for nomination to the CES. Taken together,these provisions do not appear to be very realistic orconsistent. The Task Force recommends that M.S. 43.12, Subd.19, Clause b, be amended to remove the reference to employeesin political subdivisions.

Local subdivisions could establish a program similar to the CESfor their own employees. Together with the current statutoryprovisions permitting employee mobility between state and localgovernments, a program might be considered which would fosterthe intergovernmental exchange of employees.

Unclassified Employees

Currently, CES members who are appointed to certain positionsin the unclassified service can retain the 20 percent salaryrange extension. Other employees who are appointed to theseunclassified positions who have not previously qualifiedthrough the CES are not eligible for this benefit. The basicconcept of CES is to recognize those employees who havedemonstrated outstanding performance in key high-levelpositions in the career service. Employees brought in fromoutside the state service into unclassified positions are notas likely to maintain tenure with the State nor are they likelyto have been able to demonstrate superior performance in ashort period of time or meet other criteria of the CES. Sincethe CES is a career program, it should be oriented towardscareer employees. Should there be inappropriate salarydifferentials between CES and unclassified employees, it isrecommended that the problem be dealt with apart from theCareer Executive Service.

Summary

The Career Executive Service program is a very constructive andpositive management tool which has been, and can be, of greatersignificance in terms of contributions to the quality ofleadership in the state service. Every effort should be madeto assure that the CES achieves its established objectivesthrough a continuing and careful review and monitoring programthat will assure its continued high standards and objectives.

- 38 -

- 39 -

2. Evaluation of the extent to which the agreed uponstandards have been achieved.

3. Discussion and counseling with employees to improveperformance and opportunities for career advancement.

appraisal system in the Minnesota stateIndustry members of the Task Force

performance appraisal systems used insuggested no improvements.

1. Consul tation between supervisors and employees on what isto be accomplished, how well and when, Le., performanceexpectations.

The performance appraisal system has achieved excellence at onelevel, i. e., in planning and development. The Department ofEmployee Relations, by developing a plan, a supervisor's manualand building the sUbject of appraisal into itsmanagerial/supervisory training courses has commendablyfulfilled its front-end responsibilities.

Performance appraisal pervades a number of issues whichconcerned the Task Force. It has implications for managementprogram policy planning, for the quality of supervision and,not least, the basic right of employees to systematically bemade aware of the degree of acceptance or the perceived quality

Performance appraisal in the State incorporates all of thecomponents recommended and approved by personnel professionals,that is, it provides for:

The Task Force contends, however, that a system is only as goodas its execution and observed that the performance appraisalsystem has not been universally implemented in the stateservice. Agency heads speak of their inability to rid theservice of inadequate performers, yet some have neglected tocommunicate to employees what is expected of them. Agencyheads complain that they do not have the management flexibilityto reward exceptional performance, yet in many cases the basicdocumentation to support exceptional salary increases isunavailable. In addition, some employees who have been in thestate service for months or years, according to informalreports, are still unware of what is expected of them. Somehave never had a discussion with their supervisors about thestandards of performance for their jobs.

The current performanceservice is impressive.compared it with thetheir organizations and

3. Performance Appraisal

of their performance. As performance evaluations have abearing on the employee's economic status and opportunities foradvancement, they should riot be ignored or postponed.Performance cannot be improved without feedback and withoutencouragement and support to do better. Performance appraisalhas always been of importance in employee motivation and inreward systems and it takes on even greater importance with theincreasing emphasis on productivity.

The Task Force recommends that the Commissioner continue toimprove the performance appraisal system as necessary andcontinue and strengthen a monitoring system to assure that allagencies in the executive branch perform this importantfunction. Increased effort should be made throughmanagerial/supervisory training to have the appraisal functionperformed well within the agencies. The Commissioner shouldalso continue to provide technical assistance to operatingagencies if problems develop.

The Governor should hold his appointees accountable forinstalling and/or maintaining effective performance appraisalactivities so that in each agency job standards or objectivesare set and reviewed and results evaluated. At least once eachyear, preferably more often, employees must be informed ofprogress, counseled and given assistance where appropriate tofoster performance improvement.

4. Alternative Work Patterns

Not only must a public employee's work be intrinsicallychallenging and rewarding, the conditions under which the workis performed also must be considered in order to attract andretain the best.

Society's view of work has been steadily changing. For'example, arbi tration cases on overtime now generally revolvearound labor's concerns about too much required overtime ratherthan not enough. Becoming more important are working hoursthat accommodate individual working habits and styles ofliving, work environments that are not only safe and functionalbut which can also contribute to productivity.

Working hours are susceptible to a wide array of variations,such as flextime, variable work weeks, part-time employment andjob sharing. Each variation may be appropriate for a differentagency or class of positions in an agency or statewide.

- 40 -

The physical environment in which an employee spends a largepart of his or her life does not have to be "institutional."Office layouts, office "landscaping" or even a simplerearrangement of desks can be well worth the expense and effortand can often result in greater productivity.

Experimentation in different approaches to working hours shouldoccur. Legislation should be developed to allow for variationsif statutes act as a constraint. Professional advice should besought if needed in creating working environments conducive toproductivity.

IV. Affirmative Action to Assure Equal Employment Opportunity

The Task Force is of the opinion that on the whole the selection,classification and appeals processes of the civil service haveprovided equal opportunity to potential and actual employees of thestate service in the sense that overt discriminatory acts have beenavoided. However, the Task Force does not feel that, in today'saffirmative action climate, the State's affirmative action programreflects sufficient progress.

An internal work force representative of all segments of society canbe and should be consistent with merit principles and affirmativeaction should be pursued to bring about a consistent and positiveeffort to achieve a balanced work force, i.e., proportionatelyrepresentative of the external work force.

In comparing the Minnesota personnel management system with those ofother states, the Task Force was impressed with the recommendedguidelines for affirmative action for equal opportunity inemployment included in the report of the Michigan Citizen's AdvisoryTask Force on civil service reform. Borrowing heavily from theMichigan report, the Task Force recommends the adoption by the Stateof Minnesota of a similar set of guidelines. The Michiganrecommendation is quoted below:

"Affirmative Action for Equal Employment Opportunity consistentwith merit principles shall be an integral part of all aspectsof personnel management in the State of Michigan. It shallinclude outreach recruitment to attract groups which aresubstantially under-represented, removal of artificial barriersto entry and advancement within the career service, upwardmobili ty programs, work force analysis to assess underrepresentation, development and implementation of systematicaffirmative action plans with appropriate goals and timetablesto corre95 problems identified, and periodic evaluation ofresults."

16Michigan Citizens Advisory Task Force on Civil Service Reform,Lansing, Michigan, Toward Improvement of Service to the Public, July,1979.

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:"'·~r' :~:....,.-.... ).)..,

- 42 -

'--;' :';~, ,';'; "

J,~ ....• Mana.-~ement Development and Supervisory Training

'i"h;3.r~e·:',:~cale organization is here to stay because it is, ,;,;essenf,1'~1 to solving large scale problems. The challenge to.... 'large" organizations is to minimize the negative aspects of

bureaucracy that often accompany bigness. Decentralizing thoseaspects of organizational activities which are best handled

~Af!~s,m.~tiX,~xn~ption as a means of achieving true equal employment,ism';'P~B9"t}MRity~&a~ discussed in all sub-committees of the Task Force.

el Mqst J1!Wprtantly it was observed that affirmative action has impact:;':IC/'(ts Rn",ii,q~J,lj.J{igg, selection , job analysis , separations, training,

c~hectiv-e" bargaining and all other personnel management practicestha t affect'" employment. Here, as in other areas of concern,

':nreF' ~4thpr:i,.\1;.~>anq responsibility for affirmative action are diffused and";]:~~_~1:~c":,ooIl)p,2eh~~si.ve plan for accomplishment is essential.

~~\.' ':Tg~:')chfe{executive officer of the State under the present systemhas the primary responsibility in affirmative action. The TaskForce recommends that the Governor, in cooperation with theCommi.$~io.ner... of Employee Relations, strengthen, reinforce andcommuhicate-ciiearly his affirmative action policy and hold agency

n'''' r-',,", !:kE?,§l.d§.,acc,,-9,unt,ab,le for its execution.~~ .. ,......_<"J ......., ...l"_."" .. ~_, "--,,~.,;._ ...-",-<.."~'''''J.~C

"E !~¥Ipr~,¥~~~~t~in ,performance and Productivity

Acceptable. progress in affirmative action should be one of thefae'tors for 'which the Governor holds agency heads accountable in hisevaluation of their performance and agency heads in turn should holdmanagers and supervisors responsible for affirmative action progress.

,~L. GriT' ~~ CbD: .The Office of Equal Employment Opportunity should be givenvisibility and support within the Department of Employee Relationsandh.13;.Y~3;a.v?~ce in policy development.

'_),:~~';~Kf\:,e~&8c:t~~~~;:ShOUldanalyze their personnel management functions tovt,as!~~r:%;o·i11lta.tr;,!10 plan or program administered within the agencies

2id.:: m;,:;!):es1f±t·~.",:8Areg:qy or indirectly in discrimination.

", -,-. ,~'-;'J-:.:.; .;.0 8::i'S\-;·C_({';.:I\~'::' ~;~._;~::.;j.'

(,.;;"""~c;\5;I.'he"GqY'eJ;Jnpp,,o~hould hold accountable the Commissioner of the central:,,:'" .. P~,n.sori~@,.r\.·aggpcy for monitoring the execution of affirmative action.,,,~-;;A:';' pq~ig~~-i'~"i~~'various agencies of the State, reviewing and approving

appointments in agencies where goals and timetables are not beingreasonably met, providing technical assistance to all agencies andkeeping the Governor advised as to when direct intervention isneeded tp ;,p,f?,:;3tlre continuing progress toward affirmative action goals.

,.' '_.,- _._._ .•~ ',. _•., <,' S. c· " ••'J,. • .",:"::.

near the base of the organizational pyramid can preserve someof the advantages of smaller organizations. Effectivedecentralization presupposes, however, that there are middlemanagers and supervisors throughout the organization fullycapable of handling a high degree of discretionary authority.Without on-going programs of management and supervisorydevelopment, it is highly unlikely that an organization willhave a sufficient number of capable managers and supervisors inplace.

A concrete, immediate illustration of the need for on-goingmanagement development and supervisory training is contained inthe situation state government presently faces through thepassage in 1980 of Minnesota Statutes, Chapter 617. Theimplications of this legislation are far-reaching and willaffect the daily operations at all levels in agencies of stategovernment. Although the current need is more dramatic than inmost years, each year requires attention to management andsupervisory performance if program productivity andresponsiveness are to be enhanced.

Good management development programs and supervisory trainingprograms fix responsibility for these functions on linemanagers rather than on the central personnel agency or stafftraining directors. The Department of Employee Relations inthe State system should be responsible for setting standards,approving agency training plans, providing programs and coursesto impart knowledge, explaining and providing practice intechniques and monitoring state training efforts. All managersand supervisors must be at a high, consistent performancelevel. To reach this state of readiness, there must be a clearcut policy statement assigning responsibility for staffdevelopment. There must be acceptance of responsibility by allagency heads for their responsibilities in this area because,to be successful, management development must be integratedinto the operating procedures of the agency so that on-the-jobas well as external learning experiences become part of anintegrated program.

The first-line supervisor is the main link between agency goalsand agency action. He/she is the interpreter of policy, thedaily problem solver, and the epitome of management to themaj ori ty of the workforce. For these reasons, all managementand productivity improvement strategies depend on able andcommitted supervisors. Modern management strategies involvingquali ty circles, performance management systems, participationmodels, situation leadership, the matrix model of organizationand others all hinge on having effective supervisors. Theeffective supervisor is the surest guarantee of effectiveprogram performance and high productivity yet found.

- 43 -

The on-going development of supervisory personnel must be,therefore, a high management priority in state government,assuring that the best, most current knowledge aboutproblem-solving, performance analysis, performance appraisal,leadership and work improvement is systematically disseminatedto supervisors. The law requires that supervisors complete asupervisory training course before or within one year of takinga supervisory job. Supervisory training, however, cannot beeffective as a one time experience; rather, the opportunity forupdating knowledge and gaining new skills should be continuous,perhaps required at least annually. Keeping supervisors up todate should include providing them opportunities for discussionand practice in the application of good supervisory techniquesto the benefit of both workers and the agencies.

2. Productivity Improvement

The State of M~esota is the employer of a work force of over32,000 persons whose attitudes, morale and productivityimpact the cost, efficiency and effectiveness of stategovernment. With the increasing need to control the cost ofgovernment, the Task Force believes the State must give greaterattention to unleashing the great potential for increasedproductivity within its work force. Taxpayers can be expectedto be increasingly intolerant of less than effectiveperformance of their governments.

Concern for produ9tivity is not unique to the Task Force but sofrequent a priority among businesses and governments that itmight well become the byword for the 1980' s. The Task Forcenoted that politically oriented public management, as historyhas proved, is not conducive to high productivi ty, and thisbecame a further concern. We are constantly reminded that thecountry as a whole will have to do more with less and adjust toa period of limited growth. As in all great challenges,however, there are opportunities. .

The majority of Task Force members were sufficiently familiarwith state government, having served it or having beenotherwise associated with it in various capacities, to be awareof the above average quality of its work force. State careeremployees who assisted the Task Force further confirmed itsopinion that the State has untapped, underutilized humanresources, the source of its greatest strength. Discussions insub-committee meetings frequently led indirectly to concerns ofproductivity, for example:

17Exclusive of faculty in the State University and CommunityCollege Systems.

- 44 -

What do you pay employees for? LengthSpecial skills? Performance and productivity?

of service?

What would happen if these tasks were not performed?

Do supervisors discuss productivi ty with employees? Ratethem on it?

The short duration of the Task Force's existence permitted onlybrief review of the activities of the Department of EmployeeRelations and no opportunity to develop prescriptions as to howoperating methods could be improved.

Productivity improvement projects in most cases will requireactive involvement and participation of employees engaged inthe operations being reviewed. When productivity improvementefforts are conducted in a collective bargaining environment,the concept of a Labor Management Committee, separate anddistinct from collective bargaining, might be considered toserve in an advisory or quasi-decision making capacity.Through such a committee(s), exclusive representatives of stateemployees would work with management in developing andrecommending specific programs. Participation would bevoluntary with the idea that both parties would work togetheron a non-adversarial basis. Additionally, consideration mightbe given to finding ways f98 obtaining appropriate citizenparticipation in such efforts.

From staff explanations the sub-committees received on specificfunctions on-going within the Department, strong impressionswere gained that various productivity improvement techniquesmight be applicable within the Department of EmployeeRelations. The Task Force can only assume that the Departmentis not alone among agencies in state government in itsinability or inertia with regard to productivity improvement.

The Task Force recommends that:

a. The Department of Employee Relations at its earliestopportunity engage in productivi ty improvement efforts toincrease its efficiency and effectiveness.

b. The State increase its capacity in productivityimprovement to improve organizational and individualeffectiveness, through cooperation and linkages with othergovernments and with union and private sector assistancewhere appropriate.

18Issue Papers, op.cit., "How to Improve Productivity in aCollective Bargaining Environment"

- 45 -

EMPLOYEE RIGHTS AND OBLIGATIONS

- 46 -

8. Request and receive an impartial review in disciplinary matters.

Exercise the political activity provisions provided by law andfreedom from political coercion.

Legitimate dissent.

Form and join labor or emJ¥9'yee organizations and not to formor join such organizations.

4. Maintain the skills and competency required for the job andchanges affecting it.

3. Support and help achieve the overall goals and objectives ofthe employing agency.

1. Perform the job assigned at a productive, effective level.

2. If a union member, abide by the conditions of his/her'collective bargaining agreement.

5. Observe in the public interest the 20tandards of conductoutlined in the Code of Ethics rule of the Departmentof Employee Relations or in any other applicable statutes orrules.

7. Give input into all aspects of the employee relations systemthat will contribute to greater effectiveness and productivityin the employee's job and related jobs and systems.

5. Knowledge of job purpose, requirements, objectives andstandards by which performance is evaluated.

1. Reasonable and fair treatment in all aspects of stateemployment.

6. A meet ing with one's supervisor on per formance appraisal tolearn how one's performance is viewed.

2.

3.

4.

19Minnesota Statutes, Chapter 179 (Supp. 1979) as amended by Laws200f 1980, Chapter 617.

Code of Ethics. op.cit.

An employee's relationship to the employer is focused most onrelationships with his/her own supervisor. To assure that this basicrelationship is sound, both parties need an understanding of therelationship which is made up of employee rights and obligations. Stateemployees have the right to:

In return for these rights, the employee must meet the followingobligations:

THE STATE WORK FORCE AND PERSONNEL STAFFING

In the light of Task Force recommendations on administrative matters,clearly the question must be asked as to whether the staff of theDepartment of Employee Relations is adequate in number to implement therecommendations.

A detailed examinationfunctional areas is bestprocesses. However, thethe size of the statefunctions.

of the staffing of individual agencies indealt with through the budgeting and legislativeTask Force did make observations with respect toservice and staffing for personnel management

One of the observations of the Task Force, based on the public employmentstudy prepared in May of 1979 by the Department of Finance, is thatMinnesota ranks 45th in the nation among the states with 721 full-timeequivalent employees per 100,000 population. Only the more populousstates of California, Illinois, Ohio, Indiana, and Wisconsin hadproportionately fewer state employees. Minnesota ranks 19th among thestates in population.

Personnel management as an integral part of general management is a costthat must be justified like all others, but it is a function which mustbe per formed. For comparative purposes, the Task Force referred to arecent survey on the personnel management staffing ratios forprofessional/technical personnel staff. 21 The state servicecompares with other organizations as shown below.

Number of professional/technicalpersonnel staff per 100 employees onorganization's payroll.

All Organizations (394)Non-business Organizations (79)2,500 or more employees (67)

FirstQuartile

.4

.3

.3

Median.6.4.5

ThirdQuartile

.8

.6

.7

Note: Of all organizations surveyed, 32% do not have union/laborrelations activities and 24% do not have pre-employment testing.

21Bureau of National Affairs, Washington, D.C., Bulletin toManagement, No. 1578, ASPA-BNA Survey No. 40, "Personnel Activities,Budgets, and Staffs: 1979-1980", June 5, 1980.

- 47 -

- 48 -

State of Minnesota (July 1, 1980)

Number of professional/technical personnel staff per 100 employees on theState's payroll:

= .65= .16= .49

StatewideDepartment of Employee Relations onlyOperating agencies only

The Task Force is aware that its numerous recommendations can not beimplemented simultaneously by the Department of Employee Relationsparticularly with the size of its present staff. In many ways the TaskForce recommendations represent a developmental burden to existing staffof the Department. For this reason the Commissioner of EmployeeRelations should develop for the Governor a plan of implementation and anassessment of staffing and financial requirements necessary for therecommendations to become operational.

Professional/technical personnel staff in operating agencies - 181(includes employees in the personnel aide, personnel officer,personnel director, affirmative action, employee development andlabor relations class series).

Professional/technical personnel staff in the Department of EmployeeRelations = 60 (includes employees in the personnel aide, personnelspecialist/representative, equal opportunity and employee developmentclass series and all managers).

Total employees on payroll = 37,000 (includes approximately 4,500faculty) •

Statewide the State of Minnesota's staffing for personnel services fallsrespectably at the median for all organizations, although agency byagency there are disparities in staffing ratios. The proportion ofposi tions alloted the central agency is low if the recommendedimprovements in personnel management are to be accomplished within areasonable period of time. .

FUTURE STUDY AND REFINEMENTCLIENTELE INPUT

The Department of Employee Relations has several clienteles: managementin state agencies, state employees, applicants for employment and thegeneral public. The Task Force would have liked to have·had input fromall groups regarding their opinions and impressions and their ideas forimprovement in the personnel management system, most particularly in theservices the Department of Employee Relations provides. Again, lack oftime and money, precluded probing deeply for the Department's impact onagencies and individuals.

An evaluation by top management in state operating agencies of theservices provided by the central personnel agency was, however, a~epara~e part ~~ the total project on Improvement of Personnel Managementln Mlnnesota. Structured interviews with agency heads and/ortheir deputies and other management team personnel were conducted by theProject Coordinator and members of the Department's personnel managementservices staff in February of 1980. The survey included all agencieswith over 35 employees.

The report to the Commissioner on agency management responses made threesignificant points pertinent to Task Force study. The report indicatedthat agency heads:

1• Are strongly in favor of merit as the basis for personnelmanagement. Some said alternatives would be unthinkable.

2. Would prefer more flexibility withinrather than greater authority tounclassified positions.

the classified serviceestablish additional

3. Appreciated and understood the Department of Employee Relations'responsibility for control but felt that much greater emphasisshould be placed on service to agency management.

While supportive of merit system concepts, they were frustratedwith the inherent delays in processing proposed personnelactions; for example, the need within the central personnelagency to pUblicize job openings adequately.

A questionnaire was designed by Department of Employee Relations staff tosurvey state employee' knowledge, opinions and attitudes about thepersonnel management system but was not used because the system was influx and it was evident that during the 1980 legislative sessionemployees had little knowledge or understanding of potential changes.

22Intergovernmental Personnel Act Project, 80-MN02.

- 49 -

- 50 -

2. Three-fourths support keeping merit system exams for choosingemployees.

23Market Opinion Research, Detroit, Michigan, Public Perceptions ofState Employment in Michigan, June, 1980.

Two-thirds of the residents think2~e State of Michigan would bea good employer for which to work.

Those who favor collective bargaining are slightly more in favorof retaining the merit system (77% would retain) than those whodo not approve of collective bargaining for state employees (70%would retain). Seventy percent would permit office workers theright to strike but only 40-41% think essential serviceemployees should have the same right.

4.

3. Two-thirds of Michigan adults hold pro-union attitudes (45% livein households in which some member belongs to a union). Seventythree percent are in favor of collective bargaining for stateemployees.

1. Eight out of ten Michigan citizens are aware of the centralpersonnel agency but only half can describe its functionsunprompted. The most recognized function is administration ofcivil service tests. When given specific statements about thesystem, three-fourths recognized the role of the agency inclassifying jobs and handling grievances.

An instrument of this kind under other circumstances would have added alarger dimension to the on-going surveys that are conducted regularly,agency by agency, by the Department of Employee Relations' personnelmanagement services staff. The mini-surveys are a valuable tool toidentify trouble spots within an organization and allow specific andprompt corrective action in matters in a given department. A statewidesurvey, which would better identify problems in the system, has not beenconducted since 1977-78 and that was part of a study of the Department bythe Legislative Audit Commission.

The Task Force would have appreciated the luxury of commissioning amarket opinions research survey, scientifically and independentlyconducted to determine general pUblic attitudes toward aspects of themerit system, measure public perceptions of state employment in Minnesotaand knowledge of the role of the Department of Employee Relations. Sucha survey was conducted in Michigan with unusually useful and positiveresults considering the disaffection sometimes expressed toward meritsystems. Although similar results cannot be assumed in Minnesota,responses in Michigan revealed that:

The Department of Employee Relations has assessed 0plnlons of the public,as represented by applicants, through the use of an instrument withexamination candidates seeking entry into the state service. Writtenexamination and oral examination questionnaires are regularly given tocandidates asking their opinions on the examination process in which theyparticipated. Al though the information gained through this process isuseful in improving the testing program, it is limited to examining anddoes not permit a broader view of the system.

The Task Force has concern for those who are dependent upon the personnelmanagement system to accomplish objectives and/or for a livelihood andfor public expectations that a merit system implies fairness and qualitygovernment. This leads the Task Force to recommend periodic objectivesurveys or inquiries to assess the impact of the personnel managementsystem on those who must work and live with it. There should be:

1. Systematic and regular evaluations by agency managementpersonnel to identify problem areas in personnel management andto provide formal opportunities to suggest improvements.

2. Annual or biennial professionally conducted employee surveyswith appropriate follow-up action.

3. Evaluation by the pUblic at three to five year intervals.

- 51 -

A P PEN DIe E S

Appendix A

- 53 -

WHEREAS, Minnesota's personnel management system is currently re­

ceiving considerable attention and review by the Minnesota Legislature

and interested groups; and

WHEREAS, merit system principles which meet federal guidelines on

civil service reform require identification and adoption into a model

personnel law which will strengthen Minnesota's personnel management

system;

NOW, THEREFORE, I order:

1. Creation of a Governor's Task Force on Personnel Management,

consisting of 15 members representative of the community,

business, labor, personnel, and management to conduct a study

on personnel management in cooperation with the Commissioner

of Personnel.

2. Establishment of a corps of knowledgeable career personnel and

management professionals, representative of the federal and state

executive branches, to assist the Task Force.

3. That the Task Force study and analyze Minnesota's personnel

law as it applies to practices in examining and referral, total

compensation, classification, work force size, turnover, training,

affirmative action, labor relations, and general personnel manage­

ment practices.

4. The Task Force to prepare a report on its findings and recommen­

dations for the Governor and the Commissioner of Personnel by

August 15, 1980.

- 54 -

5. The Task Force Chairman to make available a copy of its findings

and recommendations to the Legislative Commission on Employee

Relations.

6. That the Task Force work with the Commissioner of Personnel in

developing its recommendations for improvement in Minnesota's

personnel management system so that recommendations accepted

by the Commissioner can be incorporated into the Department of

Personnel's policies and processes.

7. That the Task Force assist in development of a model personnel

law by September 30, 1980, in accordance with the proposal for

which federal Intergovernmental Personnel Act (IPA) grant monies

have been provided.

8. That the Task Force will terminate on September 30, 1980.

Pursuant to Minnesota Statutes 1978, Section 4.035, this order shall

be effective 15 days after filing with the Secretary of State and publi­

cation in the State Register and shall remain in effect until September 30,

1980, or until rescinded by proper authority or its expiration in accor-

dance with Minnesota Statutes, Section 4.035.

IN TESTIMONY WHEREOF, I hereunto set my hand on this 20th day of

November, 1979.

Albert H. Quie, Governor

Filed According to Law:

- 55 -

,lAIE OF MINNESOIIDEPARTMENT OF STATE, F I L r [)

NOV 201979

1l.M1~~r ;'~~r8tar>l. ~f Star4t

4b0dSl ~o ~.

Appendix B

TASK FORCE OBJECTIVES

PRIMARY OBJECTIVE

TO OUTLINE A SYSTEM AND STRUCTURE THAT WILL PROVIDE THE STATE WITH ACOMPETENT WORK FORCE, RECOGNIZING THE PRINCIPLES OF EQUAL EMPLOYMENTOPPORTUNITY, IN ORDER THAT THE CHALLENGES OF THE 1980' S CAN BE MOSTEFFECTIVELY MET.

The primary objective will be reached through the assessment of existingconditions relating to personnel managment and the development ofrecommendations for improvement where appropriate in functions for whichthe Department of Employee Relations is primarily responsible, to ensurethat:

1. Personnel management is a staff function, providing assistanceand service to management in support of organizational goals andobjectives.

2. The Commissioner of Employee Relations, as the State employer,coordinates the relationships of the State with employeeorganizations in order to maintain positive labor-managementrelations.

3. Personnel management is responsible for conducting andcoordinating affirmative action programs in order to achieve arepresentative work force and maintain compliance with federaland state equal employment opportunity laws.

4. Personnel management is responsible for developing andcoordinating the implementation of various programs andactivi ties for classified and unclassified employees inclUdingrecruitment, testing, job analysis, classification;compensation, benefits administration, training, and variousspecial programs (e.g., the Career Executive Service, jobsharing, flextime, Vietnam era veterans' program, etc.) designedto ensure that the State maintains a qualified, motivated andproductive work force and plans for future manpower needs.

5. Personnel management is responsible for developing andcoordinating staff development, performance standards andemployee evaluation programs in order to foster productiveperformance in the state service.

- 56 -

6. Personnel management is responsible for ensuring the fair andequitable treatment of employees relative to layoffs,separations and other working conditions through the issuance ofstatewide personnel rules and policies, the negotiation ofcollective bargaining agreements and the implementation ofemployee grievance and appeal systems.

7. Personnel management is responsible for encouraging and ensuringproper employee conduct by issuing a code of ethics, byprohibiting undue political coercion and by defending legitimatedissent.

SECONDARY OBJECTIVE

To recommend guidelines for:

1. Effective working relationships within the Department ofEmployee Relations between the Commissioner and the Deputy forPersonnel and the Deputy for Labor Relations and otherrelationships as appropriate.

2. Effective working relationships with the Governor's Office, theLegislative Commission on Employee Relations and legislativecommittees.

3. Effective working relationships with other state agencies,particularly those staff agencies with which the Departmentshares management functions, and including the degree ofdecentralization of personnel functions appropriate undervarying conditions.

4. Effective working relationships with employee organizations.

5. Positions to be included in the unclassified service.

TERTIARY OBJECTIVE

To outline a Model Personnel Management Law, the provisions of which maybe considered in Minnesota or by other public jurisdictions.

- 57 -

Appendix C

ACTIVITIES OF SUB-COMMITTEES

In addition to general consideration of their subject matter, thesub-committees developed statements of philosophy and policy which mightbe incorporated into statutory revisions as follows:

General Policy and Practice Sub-Committee:

The general purpose of the merit system is to establish a system ofpersonnel management that meets the social, economic and programneeds of the people of Minnesota. This system shall provide means torecruit , select, develop and maintain an effective, qualified andresponsive work force and shall include policies and procedures foremployee hiring and advancement, training and career development, jobclassification, salary administra tion, benefits, discipline,discharge and other related activities. All appointments andpromotions in the Minnesota state service shall be made withoutregard to sex, race, religion, age, disability or politicalaffiliation and shall be based on merit.

The statement above was accepted by the sub-committee as reco~~nded

by the National Civil Service League in its 1970 version ofits Model Law with slight modification. This sub-committee also wasconcerned with the extent of coverage of the merit system, delegationof authorities, personnel rules and the question as to how the Stateshould function as a single employer.

Examining and Referral Sub-committee

The State of Minnesota should continue to follow a merit-basedemployment process. Selection and appointment standards should bejob related and designed both to select persons who possess theability to perform the required work and to meet agency needs'including achieving and maintaining a representative work forcethrough affirmative action.

Procedures to implement this policy should be simplified to thegreatest possible extent to promote efficiency of the process to thebenefit of all involved, that is, state agency management, jobapplicants, state employees and taxpayers.

24National Civil Service League, Washington, D.C., A Model PublicPersonnel Administration Law, 1970.

- 58 -

The Classification and Total Compensation sub-committees developed ajoint philosophy and policy statement as follows:

As direct a statement as possible as to what employee relationslegislation should accomplish for citizens of the State and for stateemployees. Such a statement of intent should cover broadly many ofthe areas contained in legislation. Contributions of the twosub-committees follow.

The interests of the citizens of Minnesota are best served by a totalcompensation system that can attract, retain, and motivate competentindividuals and maximize performance return on payroll dollarsinvested in the work force.

Such a system would be aided by:

- clearly defined and evaluated positions consistent with lawand sound personnel practices

- a current evaluation for every individual's position andassignment to an appropriate classification which iscommunicated by supervision to each employee

- reinforcement of productive individual performance

- support of affirmative action principles

- compensation costs comparable to that of other employers ofcomparable size and diversity

The Labor Relations sub-committee expressed its philosophy/policystatement in language that might be adopted in law as follows:

It is the policy of the State of Minnesota to strengthen and maintaina strong labor relations function in state government to the end thatpUblic, employee and management interests are effectively andequitably served through the process of mature and responsiblecollective bargaining under PELRA. The Commissioner of theDepartment of Employee Relations as the state employer, through adeputy delegated the operations of a statewide, comprehensive laborrelations program, shall assure that centralized contract negotiationand contract administration will prevail and shall represent theState before the

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Bureau of Mediation Services in all matters including thedetermination of the smallest feasible number of bargaining unitswhich shall be based on common occupational groupings. Stateagencies' concerns shall be duly considered, however, agencies shallconform to labor relations policies and procedures instigated in themanner in which the Commissioner shall prescribe.

In each of the sub-committees, independent conclusions were reachedthat the law should be broad, clearly stating legislative policy, andsufficiently flexible to allow administrative breathing space andinnovation.

The Examining and Referral sub-committee held five half-daymeetings. Each of the other sub-committees met for approximately thesame amount of time on three occasions.

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