Public Contracting Tips and Traps

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by Carrie Connelly

As we’ve previously advised, the 2024 legislative session did not mandate any particular public contracting rule updates. Given this “lull,” we wanted to share a few emerging trends with you, provide some public contracting basic reminders, and let you know of one change to our standard engineer and architect contract terms required by legislation that took effect on January 1, 2025.

  1. First and foremost, an ounce of prevention is worth a pound of cure. Our office can provide your entity with the best legal advice if you call before a project is advertised (and long before contracts are awarded and signed.) It is possible – even likely – that the minor repair or installation project you have planned for early 2025 is actually a public work, requiring a written procurement, particular contract provisions, Bureau of Labor and Industries (BOLI) oversight, and the payment of prevailing wages. Speaking of . . .
  2. BOLI, BOLI, BOLI!
    a. Be sure to prepare and submit to BOLI a list of the public improvements planned for the upcoming budget period. Pursuant to ORS 279C.305, you must submit this list at least 30 days before adopting your budget, and revise the list if your plans change. For further information on this planned project requirement, see Mark Wolf’s article, “The Budget Process in Four Simple Steps.”
    b. Once a public works contract is awarded, you must notify BOLI of the award and pay a fee within 30 days following award. The fee is 0.1% of the contract price, but in no event less than $250 nor more than $7,500. Use BOLI’s form WH-81 found at http://www.oregon.gov/boli/WHD/PWR/docs/wh81.pdf). In most cases, a copy of the Disclosure of First-Tier Subcontractors must also be submitted with this notice.
  3. For engineer or architect contracts entered into or renewed after January 1, 2025, standard defense and indemnification provisions must be modified. The engineering lobby (and insurance industry) are incredibly effective, and managed to slip in a legislative amendment that precludes engineers from having any duty to defend a public body against a claim for their professional negligence, unless and until adjudicated responsible.Do not, however, believe that this legislative change requires your entity to accept liability limits in the amount of the contract or otherwise. While regularly requested by architects and engineers these days, we find that most firms will back down when such requests are denied.
  4. In this charged political climate, remember that personal opinions play no role in public contracting evaluation or award procedures. In other words, an entity cannot refuse to award to the lowest responsible bidder because of a contractor’s objectionable bumper stickers. As long as all applicable laws are met, award is based on responsibility and cost.
  5. You may have heard of the Governor’s executive order (EO 24-31) requiring the use of project labor agreements (PLAs) for state and state-funded construction projects? Well, breathe a sigh of relief – Governor Kotek’s office has clarified that local construction projects are not covered or impacted by EO 24-31, even if state funding pays for the work in whole or in part. Instead, the EO is primarily intended to apply to state-owned facility improvements, such as state highways.
  6. And finally, we are seeing far too many incidents of “vendor impersonator” cybercrimes. Clients receive emailed requests “from” their contractor to send amounts owed electronically via an identified Automated Clearing House (ACH.) However, many such requests are not sent by your legitimate contractor, but by a fraudulent impersonator. In such cases, instead of reaching the intended contractor, payment is sent to the impersonator. These scams have become so sophisticated, they are tricking even the most seasoned skeptics. Impersonators can now hack vendor email systems, so requests are sent on prior email strings between staff and the contractor. Be careful. Electronic transfers should never be instituted without multiple methods of verification, pursuant to duly adopted local policies – and potentially amended contract terms.

Who knows what the 2025 legislature will approve. Stay tuned for our Fall update, when we’ll let you know whether new rules will be required to address any changes. Until then, the above tips and traps to avoid should help to keep you out of trouble.

EEOC Updates Workplace Harassment Guidelines

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EEOC Updates Workplace Harassment Guidelines

Vanessa Crakes

In April 2024 the United States Equal Employment Opportunity Commission (EEOC) published its updated guidance on workplace harassment,  Enforcement Guidance on Harassment in the Workplace.  The EEOC said this guidance will “help people feel safe on the job and assist employers in creating respectful workplaces.”

The guidance does not create new laws or regulations, but instead consolidates and updates previous EEOC guidance. The updates reflect legal developments such as the Supreme Court’s decision in Bostock v. Clayton County (2020), which extended Title VII protections to include sexual orientation and gender identity. The guidance also addresses emerging issues such as online harassment in virtual work settings.

The guidance is intended to serve as a resource on legal standards and employer liability for harassment claims under EEOC-enforced federal discrimination laws.

Federal Discrimination Laws

Federal discrimination laws prohibit harassment based on race, color, religion, sex (including pregnancy, childbirth or related medical conditions; sexual orientation; and gender identity), national origin, disability, age (40 or older) or genetic information. The guidance reinforces that for harassment to violate the laws enforced by EEOC, it must be based on one of these legally protected characteristics.

Further, to violate the law, harassment based on a protected characteristic must either:

  • involve a change to the terms, conditions, or privileges of employment (e.g., an employee is fired because the employee rejected a supervisor’s sexual advances); or
  • create a “hostile work environment.” A “hostile work environment” exists when harassment is so severe or pervasive that a reasonable person in the employee’s position would find the situation to be abusive.

Liability for Employers

The guidance also outlines various forms of employer liability for workplace harassment. If the harassment includes or culminates in a change to employment, then the employer is liable for the harassment. One example given is that if an employee is denied a promotion because he rejected a sexual advance from his supervisor, then the employer is liable.  For hostile workplace harassment, employer liability depends on the harasser’s role.  Employers are automatically liable for harassment by a “proxy or alter ego of the employer,” which is an individual of such high rank that their actions can be said to speak for the employer.  Employers are also automatically liable for actions of a supervisor where the supervisor took a tangible employment action as part of a hostile work environment. However, an employer will be held liable for harassment by non-supervisory employees only if the employer was negligent by failing to take reasonable steps to prevent the harassment or failing to take reasonable corrective action once it knew or should have known of the harassment.

Key Takeaways for Employers

The EEOC noted that harassment remains a serious problem in the workplace, representing more than one-third of the charges received by the EEOC.

The EEOC strongly encourages employers to:

  • have a clear, easy-to-understand anti-harassment policy;
  • have a safe and effective procedure that employees can use to report harassment, including more than one option for reporting;
  • provide recurring training to all employees, including supervisors and managers, about the company’s anti-harassment policy and complaint process; and
  • take steps to make sure the anti-harassment policy is being followed and the complaint process is working.

The EEOC issued a “Summary of Key Provisions” for the guidance document.  The EEOC has also published Promising Practices for Preventing Harassment, a resource to assist employers in preventing and addressing harassment.

Union Bargaining Preparation for 2025

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by Diana Moffat

What???? Our Collective Bargaining Agreement (CBA) doesn’t even expire until June 30, 2025!

Trust me. I hear you. But labor negotiations, just like so many other things continue to evolve. One of those evolutions has been the preparation, and associated time, needed by the employer prior to that first negotiation session with the union.

And then once you actually meet with the union to begin bargaining, the Collective Bargaining process can, unfortunately, take many, many months to complete. At best, you are looking at two to five months of getting things settled. At worst, much longer! There is a distinct advantage to completing the process, if at all possible, prior to the expiration of the current CBA.

The following are recommended:

Early preparation:

  • Have your management team, your supervisors and your labor lawyer review the CBA for needed changes such as needed adjustments to language for ambiguity, past grievances, updates to the law, etc.
  • If possible, begin a compensation overview. That might be as simple as assessing if you have some indicators that you are behind the “market” or engaging someone to do a full compensation review, in consultation with your labor lawyer.
  • Try to encourage the union to come to the table early – perhaps November, December, or at the latest early January. It helps to get those dates on the calendar early before folks start leaving for holiday time off.

Advantages to early resolution:

  • If you can resolve your negotiations prior to expiration, you are not faced with any type of retroactive pay issues. This can go a long way with employee morale for both your regular and payroll employees.
  • If you have anything less than fully funded insurance premiums, you are not faced with the danger-zone of figuring out what your “status quo” obligations are under the Public Employee’s Collective Bargaining Act.
  • You can use “early resolution” to your advantage in getting a settlement.
  • If faced with a situation of non-settlement, you can get to mediation and/or arbitration/impasse shortly after expiration. By July and August, the waiting time increases. There are only three mediators for the entire State of Oregon.

Timelines:

  • Does your CBA require notice to “open” bargaining? If so, you need to meet that deadline with a notice to the union that you want to bargain for a successor CBA.
  • The required 150-day bargaining period, under the Public Employee Collective Bargaining Act (PECBA), does not even begin until the initial proposals have been exchanged. Because of that, early scheduling can be a real advantage.
  • Development of your proposals should begin early on. Precise contract language is of utmost importance. The development of your proposals should be done in a very thought-out fashion, with input from supervisors to Council/Board members. This process takes time.

Developing your plan:

  • Now is the time to review your contract to identify what is working and what needs to be changed. Are there any needed legal updates? Has your labor counsel reviewed your CBA for ambiguous language? Are there any MOUs that need to be incorporated into the main CBA?
  • Now is the time to decide if you want to do a comparable analysis, in conformity with the PECBA, to assess your financial place within the market.
  • Now is the time to look at your budget projections for your limitations or wiggle room.
  • Now is the time to decide who will be your representative at the bargaining table and who will be on your bargaining team.
  • Do your City Council, County Commissioners, or Executive Board need to be advised on the process, the rules and laws that regulate Public Employee Collective Bargaining? Now is the time to schedule that training.

Current “hot” issues to consider:

  • Paid Leave Oregon (PLO) is the 10,000-pound elephant! PLO proposals have already appeared in dozens of unions’ bargaining proposals during 2024. You can be sure that the unions will continue to pursue them. There has been a lot of litigation at the ERB level. It is important for you to understand what you do and do not need to bargain with the union.
  • For your strike-permitted groups, don’t overlook HB 2930 needed modifications to your CBA language on discipline and grievance.
  • Insurance language is the still a concern for some employers. Have you reviewed the insurance language in your CBA to see how your contract stands up to potential future litigation if there are mid-term plan changes?
  • Have you reviewed your CPI index language? Many public sector employers have ambiguous CPI index language. Bargaining is the ideal time to clarify the index with specificity.

 

So, when you find yourself planning for the approach of Fall, let that remind you to begin preparing for upcoming bargaining. Preparation comes before success, even in the dictionary!

Executive Sessions: Tricks and Traps

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Executive Sessions: Tricks and Traps

by Carrie Connelly

 Oregon Public Meetings Laws and Executive Sessions

Oregon’s public meetings laws were enacted to ensure that the “decisions of governing bodies [are] arrived at openly.”  ORS 192.620.  As a result, your governing body’s authority to close portions of its meeting to members of the public (known as “executive sessions”) is limited.  As such, ORS 192.660 lists the only allowed executive sessions, each of which should be read very narrowly.  Even if your subject matter does fall within a permitted executive session, be wary – prerequisites may apply.  As not all limits and requirements are set out in ORS 192.660, this area of the law is easily misunderstood and frequently misapplied.

  1. How to Open and Close an Executive Session.

A governing body may hold an executive session only after the presiding officer has identified the statutory authorization for holding the executive session.  Making this required announcement for a stand-alone executive session or one held before the regular meeting can be tricky.  To meet all requirements, list planned executive sessions on the meeting agenda, along with other meeting topics.  The agenda should identify the specific statutory cite.  For example, if your entity plans to hold an executive session to discuss candidates for an open executive officer position, the agenda would list an executive session pursuant to ORS 192.660(2)(a), to consider the employment of a public officer, employee, staff member or individual agent.  The agenda need not provide further details, but should be published following your entity’s general practice for noticing all public meetings.

While legal, we recommend against adding an executive session after an agenda is issued, except in rare situations.  Some governing bodies always place an executive session item on the agenda as a place holder.  We recommend against this practice.  Only place executive sessions on your agendas for planned discussions.

During the meeting, before entering into executive session, announce the statutory basis for the executive session.  Chairs benefit from following a script when making such announcements.  The Oregon Attorney General’s Office has a sample script available on its website;

https://www.oregon.gov/oda/programs/NaturalResources/Documents/SWCDSessions/ExecutiveSessionScript.pdf.

We recommend that the Board Chair tailor this script for each executive session, print it out, and have it handy for all executive sessions.

An “executive session ends when the meeting ceases to be closed to the public.” If a decision is required as a result of the executive session discussion, or the public meeting will otherwise continue after the executive session, “the governing body must use reasonable means to give actual notice to interested persons that the meeting is again a public meeting.” OAR 199-040-0015(3).

This requirement is not met by announcing at the end of the executive session that the meeting is now open, then proceeding with a vote.  Legal options include announcing the specific time the public may return prior to the executive session.  Alternatively, it may be enough to open the meeting door and invite in waiting members of the public.

  1. Employment of Public Officers, Employees, and Agents.

ORS 192.660(2)(a) allows a governing body to meet in executive session to consider the hiring of an employee (usually a chief executive officer).  What this statute doesn’t say is that ORS 192.660(7)(d) sets prerequisites that must be satisfied before such an executive session may be held.  Before considering a hiring decision in executive session, your entity must: (1) advertise the vacancy; (2) adopt regular hiring practices; (3) provide the public an opportunity to comment on the potential hiring; and, (4) for chief executive officers, adopt hiring standards, criteria, and policy directives in open meetings with the opportunity for public comment.  In sum, an executive session under ORS 192.660(2)(a) may only be held if the local government first complies with ORS 192.660(7)(d).

To satisfy these requirements, your entity must first hold an open meeting prior to its executive session.  At this earlier public meeting, the Board can authorize staff to publish the vacancy, adopt a hiring process for the position (if your personnel policies do not already provide a process), and open a public hearing to allow the public to submit comments on the position and hiring process.  With these prerequisites addressed, the Board can then go into executive session to consider candidates and manage its hiring process.

Keep in mind, a governing body cannot discuss a prospective employee’s salary in executive session; that discussion and any related decision must occur in open session.  Along these lines, no final decision on the position may occur during executive session.  A final decision includes selecting a finalist but does not include identifying top candidates, or even designating a finalist with whom an entity representative will negotiate a contract (the final contract would then be brought back for the full governing body to approve in open session).

Last, note that this provision does not allow a Board to meet in executive session to fill a vacancy.  The executive session allowance applies to the hiring of employees, not the appointment of individuals to elected positions.

  1. Legal Counsel

ORS 192.660(2)(h) allows a governing body to hold an executive session to discuss, with its legal counsel, its “legal rights and duties . . . with regard to current litigation or litigation likely to be filed.”  Governing bodies are routinely tempted to stretch this exception to include discussions on any “legal matter.”  Prior to scheduling such an executive session, confirm that: (1) the discussion is directly with legal counsel, who will be present; (2) the discussion concerns your entity’s specific legal rights and duties; and (3) those rights and duties arise in the context of actual litigation in which your entity is either named or which is about to be filed.  ORS 192.660(2)(h) does not justify general discussion of your entity’s legal rights, risks, or liabilities, with or without your attorney’s presence.

Conclusion

Executive sessions can be useful tools to allow governing bodies to discuss confidential matters not yet appropriate for general public knowledge.  However, as illustrated above, executive sessions are authorized for only a limited number of reasons under limited circumstances.  Be sure that your board or council is familiar with the allowances and limitations of ORS 192.660 and related statutes and rules before calling an executive session.  When in doubt, check with legal counsel before noticing the meeting to ensure that all requirements are properly met.