Tenet Signs Contract With Union for Nurses

Tenet Healthcare Corp. said Wednesday that it signed a pact with California’s largest registered nurses union, a move aimed at buying labor peace and helping the troubled hospital company meet the mandates of a new state law on nurse staffing.

Under the accord with the California Nurses Assn., Tenet said, CNA nurses at Tenet hospitals in the state would receive pay raises of 8% in the first year and 7% in the next two years.

In exchange, the San Francisco-based nurses’ union -- one of Tenet’s harshest critics during the last year -- agreed to a six-year no-strike provision and mandatory arbitration of disputes.

The terms of the agreement will take effect immediately at five Tenet hospitals that are represented by the CNA and would apply to other Tenet hospitals in the state that the nurses’ association organizes.

The CNA has filed petitions to unionize 19 Tenet hospitals in California, and the labor pact essentially paves the way for their organizing.

Tenet owns about 40 hospitals in the state, mostly in Southern California, and has 32,000 employees, including 9,800 registered nurses.

Last spring, Tenet struck a similar labor agreement with two other unions, drawing the wrath of the CNA, which accused the Santa Barbara-based hospital chain of illegally sidling up to the Service Employees International Union, a longtime rival of the CNA.

Earlier this week, the SEIU and the CNA announced they had put aside decades of differences and would join forces to protect nurse staffing levels and help settle corporate labor disputes. They also agreed to divide up representation, with the CNA representing registered nurses and the SEIU representing other types of nurses.

Wall Street analysts said Wednesday’s agreement would give Tenet long-term labor stability despite some added costs. “This is a positive for the company as it makes the nurse labor situation calmer for Tenet, but it also means wage increases next year,” said Sheryl Skolnick, an analyst with Fulcrum Global Partners in New York.

Tenet and California’s other hospital chains long have been struggling with a nationwide shortage of nurses. Beginning next year, hospitals in the state must comply with new minimum staffing requirements. Tenet has said it needed to hire about 1,000 more nurses to comply with the law.

“The bottom line is that we will be able to meet the nurse staffing ratio, either by hiring more nurses or by adjusting health-care services,” said Steven Campanini, a spokesman for Tenet.

Tenet said that as part of the new union agreement, it would allow expedited union elections in the first half of next year. The CNA, which just ended a yearlong strike at a Tenet hospital in San Pablo this week, had accused the hospital operator of trying to block its organizing efforts.

On Wednesday, Charles Idelson, spokesman for the CNA, said the agreement gave registered nurses at Tenet hospitals “a dramatically strengthened voice, which is very important for patients.”

Tenet’s stock closed down 9 cents at $14.75 on the New York Stock Exchange. Its stock has declined about 70% since late last year when the first of several scandals broke at the company, including an investigation into whether the company overbilled the government for health-care charges.