Kaiser Strikers to Vote Today on 2-Tier Pay Plan

SAN FRANCISCO — Negotiations to end a six-week strike against 27 Kaiser Permanente medical facilities in Northern California concluded Wednesday when union negotiators agreed to submit to a membership vote a new contract proposal that includes a controversial two-tier wage plan.

The 9,400 striking members of the Service Employees International Union Local 250 will vote on a proposed new three-year contract today. Voting is not expected to be completed until after midnight. Union members, who include clerical, technical, housekeeping workers and licensed vocational nurses, have been on strike since Oct. 27 against Kaiser Permanente medical facilities that serve about 2 million subscribers in the northern half of the state.

Kaiser Permanente’s Southern California facilities were not affected by the walkout. However, union and management officials said Wednesday that Kaiser Permanente may seek a similar two-tier wage system in negotiations with Southern California unions scheduled to begin shortly after the new year begins.

Some to Be Paid Less

The Northern California contract offer calls for newly hired Kaiser workers in selected areas--including Napa, Sacramento, Santa Rosa and Vallejo--to be paid less than newly hired workers in Bay Area cities such as San Francisco, Oakland and San Jose.

Kaiser, the nation’s oldest and largest health maintenance organization, maintained that it needed to lower its labor costs in areas where competition for the health care dollar is most intense.

Union negotiators are submitting the contract to workers without a recommendation.

“Although Local 250 negotiators have maintained their opposition to geographic wage arrangements, they have stated that this employer proposal is the best possible under current circumstances and if ratified would avoid an indefinite continuation of the current work stoppage,” said a joint statement issued by the union and Kaiser.

“After six weeks, the bargaining committee (members) felt they had to go back to the members,” said union spokeswoman Maureen Anderson. “The bargaining committee and the union leadership will be behind the members if they want to stay on the picket line or if they decide to go back in,” she said.

On the picket line outside Kaiser’s San Francisco medical office building Wednesday morning, sentiment remained strong against the two-tier wage clause.

“Two-tier would be a slap in the face to all these people who have been pounding the pavement for six weeks, trying to get by with creditors chasing them,” said Carolyn Perkins, a licensed vocational nurse with Kaiser for 14 years. “Kaiser can stick it! I mean that, they can keep us out here until next year, but no two-tier.”

But others suggested that the union would gain nothing by continuing the strike. “You get what you can when you’re in the strongest position. I think we’ve reached our peak point,” said one union source who spoke on condition that he not be identified. Thus far, the union has expended over $1 million in strike benefits.

The strike has been closely watched in labor circles because Kaiser, a profitable, growing company, was taking its most aggressive stance ever in a contract negotiation.

Kaiser did not say that its two-tier demand was based on financial hardship. In 1985, Kaiser health plans across the country generated $4.1 billion in revenues and $350 million in net income.

Rather, Kaiser said it needed the two-tier system because a study it did showed that its workers were paid a range of 9% to 35% above comparable workers in various regions and that it was losing members to other prepaid health plans that could charge lower premiums because their labor costs were lower.

Exaggeration Charged

The union responded that Kaiser’s claims of wage differentials were exaggerated.

Robert Tiernan, spokesman for Service Employees Local 399 in Los Angeles suggested that Kaiser might make similar demands in negotiations next year with 9,000 workers in Los Angeles and Orange counties.

Michael McCabe, Kaiser’s manager of labor relations in Southern California, said: “I would expect to see some of the same issues being on the table in these negotiations. Many of the same conditions that were prevalent in Northern California are prevalent in Southern California with respect to wages and the community.”

The Northern California contract proposal calls for a 20% wage differential, down from an initial company demand of 30%. Workers will get lump sum bonuses, in lieu of percentage wage increases for the first two years of the contract, sources said, and will get a 3% raise in the third year.

The Service Employees Union also secured restrictions on Kaiser’s ability to subcontract work to non-union employees, according to sources close to the negotiations.

Retraining Funds

Kaiser agreed to work with the union to obtain state retraining funds for employees who might otherwise lose their jobs because of technological change, sources reported.

And Kaiser agreed to a joint union-management committee on service and staffing issues. Strikers said in interviews that lack of staff at Kaiser facilities meant that patients were not given quality care, a charge vehemently denied by Kaiser.

The union and Kaiser have disagreed sharply over what impact the strike has had on hospital operations. Doctors have had to take over some nursing functions and administrators have had to answer telephones, file charts, clean bathrooms and mop floors since the strike began.

“The staffing level has always been appropriate” to handle patient needs, said Daniel D. Danzig, Kaiser’s Northern California public affairs director, in an interview.

Cancel Appointments

Still, Kaiser officials said, they had to cancel 1,500 optometry appointments in San Francisco during the strike. Officials at Kaiser’s Oakland hospital-clinic said 6,000 routine appointments had to be canceled in the first two days of the strike but that the situation had improved markedly since then.

Jeff Schrader, Service Employees Union strike coordinator, said unions had withheld more than $10 million in premiums from Kaiser during the strike. But the union said that Kaiser had collected many more millions in advance premiums, fortifying it to endure a strike. The union also estimated that Kaiser was saving $750,000 a day in wages during the walkout.

During the strike, the state Assembly held hearings on whether Kaiser was living up to its contractual obligation to members. Assemblyman Art Agnos (D-San Francisco) said he will introduce legislation to enable members of a struck HMO to receive premium refunds or charge treatment at another facility to the strike-bound hospital.

Henry Weinstein reported from Los Angeles and Lonn Johnston from San Francisco.