Privatization Through Related Corporations

• Author: Stefanie A. Lindquist
• Date: 01 December 2003
• DOI: 10.1177/0734371X03259166
• Published date: 01 December 2003
• Subject Matter: Journal Article

10.1177/0734371X03259166 ARTICLE

REVIEWOFPUBLICPERSONNELADMINISTRATION/Dec.2003Lindquist/LEGALBRIEF

Privatization Through

Related Corporations

Liability Considerations

STEFANIE A. LINDQUIST

University of Georgia

What are the legal implications for personnel management of governmental pri-

vatization through incorporation of a subsidiary or related entity to perform

public functions? The manner in which a governmental entity establishes or

interacts with a private corporation performing public services can be crucial to

answering that question. Entanglement between government and private corpo-

rations can lead a court to apply certain personnel laws and rights that would

otherwise not apply in the private context. Using various court cases as examples,

this legal brief highlights some issues worthy of further consideration.

Keywords: privatization; public corporation; public entity; corporate veil;

body politic

Arecent legal brief for this journal reviewed the implications of the privat-

ization decision in connection with constitutional torts committed by

private employees who perform governmental functions (Lindquist & Bitzer,

2002). In that brief, we explored whether private defendants may be held lia-

ble for constitutional violations committed while performing government

contracts, and whether and under what circumstances individual private de-

fendants enjoy qualified immunity from such lawsuits. An earlier brief in this

journal explored the extent to which Congress may abrogate states’ sovereign

immunity and subject states to liability under federal law, either in federal or

state court (Kuykendall & Lindquist, 2001). In this brief, I discuss a topic

related to both of these prior briefs: the legal implications for personnel man-

323

Author’sNote: All correspondence concerning this article should be addressed to Stefanie

A. Lindquist, Department of Political Science, Department of Public Administrationand

Policy, Schoolof Public and International Affairs, University of Georgia, Athens, GA

30602-1615; e-mail: cmslind@arches.uga.edu.

Review of Public Personnel Administration,Vol. 23, No. 4 December 2003 323-327

DOI: 10.1177/0734371X03259166

© 2003 Sage Publications

LEGAL BRIEF