The Tribune

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

The Water & Sewerage Corporation is fighting claims it breached an industrial agreement by failing to give the union representing its management staff an “exclusive” first go at winning the contract for an Eleuthera reverse osmosis plant.

Tribune Business can reveal that this “exclusivity”, which the Water and Sewerage Management Union (WSMU) alleges is enshrined in its industrial agreement, is causing concern among private sector observers, who believe it prevents ‘outside’ bidders with better offers from getting a ‘look in’ at the Corporation’s outsourcing opportunities.

Both Glen Laville, the Water & Sewerage Corporation’s general manager, and Ednol Rolle, the WSMU’s president, confirmed that the two were locked in an industrial dispute.

“The union has a actually filed a dispute at the Department of Labour that has to do with issues of outsourcing,” Mr Laville told Tribune Business, declining to comment further.

Mr Rolle, though, said the matter related to the Corporation’s decision to issue a public tender seeking bids for a proposed 200,000 gallon per day water production (reverse osmosis) plant in Eleuthera.

He alleged that the public tender breached the WSMU’s industrial agreement, and alleged “exclusivity” provision, which requires that the union’s members be given the first opportunity to bid on all the Corporation’s outsourcing contracts - to the exclusion of any rival bidders.

“They went out [to bid] without informing us. They should have informed us,” Mr Rolle told Tribune Business of the Eleuthera plant. “We just feel we should have a right to bid on that as well.”

The WSMU president suggested the matter was now before the Industrial Tribuna, although that could not be confirmed.

He added that its decision would determine whether the reverse osmosis plant bidding had to be restarted, and WSMU members given the first opportunity to bid.

Tribune Business uncovered the industrial dispute as it investigated claims that the WSMU’s industrial agreement gives its members an exclusive ‘first shot’ at all the Corporation’s outsourcing contracts.

While the WSMU is adamant that its industrial agreement gives it this right, this newspaper understands that former ministers responsible for the Corporation, and Board members, feel it does not.

However, Tribune Business has obtained a May 14, 2014, document, titled ‘Outsourcing Policy for the Water & Sewerage Corporation’, which suggests that there are plans afoot to extend such bid ‘exclusivity’ to members of the Corporation’s line staff union, the BUSAWU.

The latter’s industrial agreement, the document says, does not give members of the BUSAWU bargaining unit an ‘exclusivity’ period to bid on Corporation outsourcing contracts or allow them to bid.

“However, in a meeting on May 12, 2014, representatives from the WSMU and BUSAWU agreed to allow the members of the BUSAWU to be eligible parties during the exclusivity period established under Article 29 of the WSMU’s industrial agreement,” the policy document said.

Mr Rolle confirmed the attempt to ‘grandfather in’ the Corporation’s line staff to ‘exclusive bidding’ on its outsourcing contracts, adding that the BUSAWU was now negotiating to have such a clause included in its next industrial agreement.

The May 14 document, meanwhile, agrees that the WSMU’s members do have the ‘exclusive’ first crack at all Corporation bids via Article 29 of its industrial agreement.

Only members of the WSMU, or companies where they hold a “minimum” 70 per cent equity interest, will be allowed to bid during the exclusivity period, which lasts for 90 days.

This period starts running from when the two unions are informed by the Corporation of its outsourcing plans, and their members then have two weeks to express an interest. If they fail to submit a proposal within two weeks, the exclusivity period ends, and the bid is opened up to outside groups via a public tender.

This document bears the name of Mr Laville, Mr Rolle and Dwayne Woods, the BUSAWU’s president, although it does not have their signatures.

It is unclear whether it has now become official Corporation policy, or if it has been approved by the Board.

However, one private sector observer who has seen the May 14 document said that giving the union members ‘first opportunity’ on all Corporation contracts, to the exclusion of any other bidders, risked losing better offers.

They suggested that this would result in the Corporation’s customers, and by extension the Bahamian taxpayer, failing to obtain the best solution and ‘value for money’.

“In this environment it’s not right for business, and not right for the country,” the source, speaking on condition of anonymity, said. “It means that those pioneers and entrepreneurs, who have ventured out, with their money at risk, that is all for nought. That is absolutely not right.”

They added: “My concern is that it ought not to be happening. No way..... This is nothing that we should be permitting and entertaining in our society, as it makes business more expensive and takes bread out of the mouths of entrepreneurs. It doesn’t make sense.”

The source also questioned the union’s exclusivity claims, pointing to the Blue Hills and Windsor water plant contracts awarded to BISX-listed Consolidated Water.

And, referring to the $81 million Inter-American Development Bank (IDB) project to revive the Corporation, they said there was “no way” that institution would allow the sourcing of bids from a single, exclusive source.

Mr Rolle shrugged off the concerns surrounding the WSMU’s alleged exclusivity period, while Mr Laville declined to comment directly on the May 14 document was it was not physically before him when contacted by this newspaper.

However, he suggested that there was nothing in there that “guaranteed” union members the contract despite being the exclusive first bidders.

“Theoretically speaking, does a right of first refusal guarantee a contract?” he asked. “That’s what people have to look at more than anything.

“That doesn’t negate the fact you have to be competitive. It doesn’t take away from having to be competitive and any proposal being in the best interests of the Corporation.

“All it does is they get the first crack. It doesn’t guarantee anything in terms of award.”

Mr Laville said that while the Corporation was moving towards outsourcing, any steps in this direction required that private sector providers perform the function “more efficiently and effectively, and with better quality and price, than the Corporation. It can be a combination of those things.

“If it doesn’t benefit the Corporation, it won’t be outsourced,” he told Tribune Business.