Advisory Opinion No. 1994-13
Individuals Hired Through
Special Payroll Account Or
Under Personal Services
Agreement
How the Code will apply to special payroll employees depends
on whether such employees are considered state employees as that term is used
in the Code. If special payroll hirees
are considered state employees, they would be subject to the outside employment
and other conflict-of-interest restrictions of Conn. Gen. Stat. §§1-84(b) and
1-84(c), as well as the revolving door provisions of §§1-84a and 1-84b. If the special payroll hirees are not state
employees, the open and public process contracting requirements of §1-84(i)
will have to be met if a proposed hiree is a member of a state employees
immediate family. Peter Rozantes, Personnel Services Section Chief at the
Department of Administrative Services (DAS) indicates that higher education
facilities are some of the only, if not the only, state agencies utilizing
special payroll accounts. Other state
agencies use personal service agreements to accomplish similar goals; i.e.,
to obtain short-term assistance to complete a specific task or to fill a
specific, limited need. Mr. Rozantes
states that DAS does not consider these individuals to be state employees as
that term is defined by the State Personnel Act, Conn. Gen. Stat. §5-193 et seq. These employees do not
receive the same benefits as state employees nor do they fill a position under
§5-196(u). On the other hand, some
special payroll hirees (for example, special payroll lecturers at the The State Ethics Commission believes that, on balance, individuals
hired on a special payroll account or under a personal service agreement are not
state employees for the purpose of applying the Code of Ethics. First, the state Personnel Division does not
consider them to be state employees, which, while not dispositive, is
significant. Secondly, and more
importantly, the intent of the Code is best served if these individuals are not
considered state employees. Special
payroll accounts and personal service agreements appear to be administered on a
more independent basis than contracts which are administered, for example, by
DAS, and they appear more likely to be filled by word-of-mouth than through an
open process. Thus, if the immediate
family member of a state employee or public official wishes to compete for the
contract, the process should be opened to public scrutiny. Also, applying the outside employment and revolving door
restrictions to these individuals (which would occur if they are considered
state employees) appears to be of secondary importance. The temporary and often part-time nature of
the work makes other employment more likely, and should limit the quantity and
quality of insider conduct which the revolving door provisions are intended to
curtail. Of course, as independent
contractors, individuals hired in this manner are subject to the restrictions
of Conn. Gen. Stat. §1-86e, which prohibits such persons from: (1) using their authority or confidential
information gained under the contract to obtain financial gain for themselves,
their own employees, or a member of their immediate family; (2) accepting
another state contract which would impair their independence of judgment with
regard to the performance of the first contract, and; (3) accepting anything of
value based on an understanding that the actions of the person on behalf of the
state would be influenced. Turning then to Attorney Rubins specific questions, if a
spouse of a state employee or public official wishes to be hired on a special
payroll or under a personal services agreement, in the amount of $100.00 or
more, the hiring must comply with the open and public process requirements of
Conn. Gen. Stat. §1-84(i). These requirements include prior public offer
and subsequent public disclosure of all proposals considered and the contract
awarded. Prior public offer may be
satisfied by posting an advertisement in an appropriate location or by placing
such an advertisement in a newspaper or relevant trade publication, for
example. Of course, the spouse/state
employee must refrain from any involvement in the hiring process. See Conn. Gen. Stat. §1-84(c) and
State Ethics Commission Advisory Opinion No. 88-8, Relatives Employed As Faculty In The Same University Department, 49 Finally, with regard to Attorney Rubins second question,
oversight of the day-to-day work of a spouse, whether hired on special payroll,
under a personal services agreement, or otherwise, is generally not
appropriate, since the individual who supervises the spouses work is naturally
the one most able to make recommendations or determinations regarding the financial
situation of the spouse; e.g., renewal of contract, increase in
contract price, etc. Thus, whenever the
spouse/supervisor is required to take any action which would significantly
affect the financial interest of the spouse, the supervisor must avoid the
potential conflict of interest by following the procedures laid out in Conn.
Gen. Stat. §1-86(a). See Advisory
Opinion No. 88-8, above. By order of the Commission, Christopher T. Donohue
Chairperson