Report Discourages Privatization of Housekeeping at UNC-CH

According to a report by Roesel, Kent and Associates of Marietta, Ga., privatization of residence hall housekeeping at UNC-CH would not save money and would, infact, cost the university an additional $59,620. To arrive at that figure, RKA & Associates compared in-house and contracting out cost over a five year period. The study found that in-house cost over that period would be $1,876,569 compared to $1,936,189 to contract housekeeping services. This figure does not inlude housekeeping services for the entire university, but only for residence halls. The report has yet to be endorsed by Bruce Runberg, associate vice chancellor for facility services, but is a strong indication that UNC-CH will not privatize its housekeeping services.

Privatization has led to savings in many services at UNC. However, the report comes after a nearly decade long battle between the university administration and UNC housekeepers over employee salaries, benefits and racial discrimination. In 1996, the housekeepers filed a lawsuit alleging racial discrimination by the university. The suit led to an out-of-court settlement that included pay raises worth over $362,000 each year, better benefits, $60,000 more for a child-care program and career training for the housekeepers.

According to the UNC Housekeepers Association, a group founded in 1991 to support housekeepers, privatization would be a step back from better wages and benefits, an assessment the university disagrees with.

“You lose your benefits and salaries. You lose your job security. I have a lot of problems with privatization,” Barbara Praer, chairwoman of the Housekeepers Association, told the Daily Tar Heel in 1995.

Similar studies of contracting out were conducted by the UNC system’s Re-Engineering Task Force in 1995, but sentiment among UNC housekeepers and their supporters then was also strongly against privatization, despite the guarantee that, should the university privatize its housekeeping services, all incumbent employees would be guaranteed jobs at their existing salaries (Chancellor Michael Hooker also expressed his intention in 1995 to retain the same wage levels and benefits should the University decide to privatize its housekeeping services). Also, Jim Mergner, deputy to the associate vice chancellor for facilities services told Clarion Call that he did not think the report offered conclusive evidence that privatization would mean cuts in jobs, salaries or benefits for the housekeepers, but that the report proved there was “no significant financial incentive to outsource.”

UNC-CH already contracts out many of its services to over 100 private companies and many of those changes have proved successful. Privatization of The Carolina Inn, for example, led to a net $300,000 gain that was used toward UNC-CH’s libraries. “I would guess we were losing about as much as we are making now,” Chancellor Hooker told the Chapel Hill Herald in 1996. On April 12 at 9 am, the report will be presented at an open meeting in room 208 of the Student Union.