News  The Internal Special Audit Unit (ISAU) Review of the MBTA's Absence Management Contract with Workpartners

On October 17, 2022, the Internal Special Audit Unit (ISAU) for the Office of the Inspector General (Office) issued a report detailing its review of the MBTA’s absence management contract with Workpartners. The MBTA’s contract with Workpartners enhanced the authority’s ability to manage employee leave. Workpartners provided a centralized call center; active, real-time case management; and data-driven reporting. However, the ISAU could not fully evaluate the procurement of the contract or Workpartners’ performance under the contract due to a lack of records at the MBTA.

The ISAU also reviewed whether the contract achieved three of the MBTA’s stated goals for hiring Workpartners: curbing overtime costs, reducing the number of bus trips that the MBTA had to cancel due to employee absences and strengthening its FMLA process. The ISAU found that overtime wages increased during the first two fiscal years of the Workpartners contract and then decreased by one percentage point the following three fiscal years. Also, the number of dropped bus trips decreased by 50% between 2017 and 2020. Finally, the percentage of MBTA employees with approved FMLA leave decreased after the MBTA hired Workpartners. However, the ISAU cannot exclusively attribute all the above changes to Workpartners’ involvement in MBTA absence management.

Furthermore, during its review, the ISAU also identified $222,934.40 in overbilling that occurred between October 2016 and February 2021. Workpartners did not tell the MBTA about the overbilling until December 2021, after the ISAU began to inquire about Workpartners’ invoicing practices. Had the MBTA sufficiently reviewed invoices from the beginning of the contract, the authority likely would have identified the overbilling much earlier. 

Finally, as set forth below, the ISAU identified several measures that the MBTA should take to strengthen its procurement practices, contract administration and vendor oversight.

Background

In July 2015, as part of the fiscal year 2016 budget, Governor Baker signed into law Section 196 of Chapter 46 of the Acts of 2015 (Chapter 46), which eased the provisions of the Taxpayer Protection Act for the MBTA.¹ Chapter 46 exempted the MBTA from the provisions of the Taxpayer Protection Act for three years in order to make it easier for the authority to privatize services.

Pursuant to Chapter 46, in May 2016, the MBTA entered into a contract with University of Pittsburgh Medical Center Benefit Management Services, Inc. (d/b/a Workpartners) to provide absence management services. The contract ended on April 30, 2022, and the MBTA issued the final payment to Workpartners on July 19, 2022.

Chapter 46 also requires the Office to analyze all contracts that the MBTA entered into pursuant to Chapter 46 and to issue a report within 90 days after the complete performance of such a contract. These reviews must address the following four areas:

• The competitiveness and fairness of the procurement process resulting in the contract.
• The quality of the services provided by the contract.
• The expected and actual cost of the contract.
• An analysis of whether the cost of the contract exceeded the benefits derived from the contract.

In May 2016, the MBTA entered into a contract with Workpartners to provide absence management services. The MBTA’s contract with Workpartners concluded April 30, 2022 and the MBTA issued the final payment on July 19, 2022. Under the contract, Workpartners handled various aspects of the employee absence process. This included managing employees’ leave balances, taking calls when employees needed to take sick leave or other unplanned leave, and approving or denying employees’ FMLA applications.

Analysis and Findings

As more fully described in its report, the ISAU found:

• The MBTA fairly and competitively advertised and solicited responses to its request for proposal. Three bidders submitted proposals.
• In its procurement manual and request for proposals, the MBTA outlined a fair process for evaluating proposals and selecting a winning company.  However, the ISAU could not evaluate whether the MBTA followed its prescribed process when selecting Workpartners because the MBTA did not retain adequate records of its selection and evaluation process.  
• Workpartners consistently produced required reports that assisted the MBTA with data-driven decision-making.
• Workpartners answered employee phone calls in a timely manner, followed intake scripts, did not abandon a high number of calls and received satisfactory ratings on performance and professionalism from MBTA employees.
• Workpartners did not always approve FMLA applications within the federal five-day requirement; Workpartners approved 21% of FMLA applications between six and 98 days.
• A small sample of MBTA supervisors had mixed experiences with Workpartners’ management of unscheduled absences and accuracy of notifications.
• Between October 2016 and February 2021, Workpartners inaccurately billed the MBTA. Since the MBTA did not identify the invoicing errors, this resulted in a $222,934.40 overpayment to Workpartners. The company reimbursed the MBTA in February 2022.
• As a percentage of total wages, overtime wages increased during the first two fiscal years of the Workpartners contract and then decreased by one percentage point the following three fiscal years.
• The number of dropped bus trips decreased by 50% between 2017 and 2020.
• Prior to the privatization, 31.7% of MBTA employees were approved to use FMLA leave. The percentage of MBTA employees with approved FMLA leave dropped to between 6.4% and 16.4% during the contract period.
• The MBTA gained central reporting and actionable leave data for decision-making because of the contract. The MBTA could analyze and identify employee leave trends, which assisted the MBTA with operational scheduling and planning.

In May 2022, the MBTA entered into a second contract with Workpartners for absence management services. The MBTA must review all invoices to ensure that Workpartners bills correctly. Furthermore, the MBTA appropriately included performance metrics in the new contract. The MBTA must monitor Workpartners’ performance against these metrics and hold the company accountable if it does not meet the metrics.

Throughout its review, the ISAU also identified opportunities for the MBTA to strengthen its procurement practices, contract administration and vendor oversight. Although this review focused on only one MBTA services contract, in this report, the ISAU outlined how the MBTA could enhance its procedures for all contracts. The ISAU developed seven recommendations that the MBTA should implement to enhance procurement practices, contract administration and vendor oversight so that the authority appropriately uses its funds.

¹ In 1993, the Massachusetts Legislature passed the Act Providing for the Delivery of State Services in a Fiscally Responsible Manner (the Taxpayer Protection Act). The Taxpayer Protection Act establishes a process that state agencies and applicable authorities, such as the MBTA, must follow before hiring a private company to perform services valued at $500,000 or more that “are substantially similar to and in lieu of” services that employees of the agency provide.