Thursday, July 14, 2005

IWA's health care deals causing big problems

VICTORIA - Usually corruption charges against a union local are a problem for the members, and the parent union.
This time it's different.
The union under a cloud is United Steelworkers Local 3567, the former IWA local that signed sweetheart contracts with the companies that took over health sector support services.
A Steelworkers' audit found big problems at the local, including "extremely serious financial misconduct." The auditors found the local was spending $2,000 a month on alcohol, had misused union money and made unauthorized loans.
The local, and its president Sonny Ghag, were already reviled in the union community for signing what looked like sweetheart deals with the health sector companies. Now those agreements are unravelling, and the labour stability they were supposed to provide is falling apart. The current hearings into the local will just hasten the process.
The Liberals saw privatizing health sector support services as a way to reduce costs, with the the savings coming mainly by cutting wages.
But the plan faced some problems. The people doing the work had contracts that limited contracting out. The labour code said that even if a new company took over the service, the contracts would apply. And Gordon Campbell had specifically promised to honour the Hospital Employees' Union contracts.
He didn't. The government passed a law to remove job protections from the union contracts, and exempt the private companies from successorship obligations. The health authorities were free to fire their employees, and sign deals with the companies.
But the health authorities were still nervous. What if they contracted the work out to a corporation, but the employees of that company decided to form a union? The whole deal was built on reducing wagelevels - firing someone paid $650 a week to do laundry, and replacing them with someone paid $400 a week. If they had a real union, the employees would soon be seeking higher wages.
Some of the companies were ready to take their chances, prepared to address employee concerns directly, or deal with a union if that was the employees' choice. The health authorities said no way.
Enter the IWA, ready to negotiate contracts with the three main companies bidding for the work before a single employee was hired. Job applicants had to first join the union and agree to accept the contract terms before they were interviewed by the company. (They weren't allowed to take the contract home and read it.)
The contracts weren't great, and obviously didn't address employees' concerns - there were no employees when they were drafted. The employees never got the chance to decide if they wanted a union, or the terms of their contract.
The union local did well though. The IWA’s forest-sector contracts include an education fund, paid for with a three-cent-an-hour employer contribution and managed jointly by the industry and the union. The health contracts called for 15 cents an hour to be paid into a fund controlled solely by the local.
The whole arrangement is now falling apart. The HEU has successfully challenged many of the certifications at the labour board, and signed up enough people to win back about half the members it lost.
Negotiations on legitimate contracts have started, under difficult circumstances. The companies - counting on their deal with IWA - signed agreements with the health authorities. They have tight financial constraints. The union is looking for significantly more than the IWA's contracts provided. It's a formula for conflict. Employees with Sodexho in the Lower Mainland and Victoria have given their union a 96-per-cent strike mandate.
Job action isn't the only risk. Companies facing unexpected wage costs may press the health authorities for more money, or simply walk away.
The transition to private service delivery, at much lower wages, was certain to be difficult, as wide concerns about cleanliness and food quality have shown.
By signing dubious contracts, the IWA local and the companies have made the process even riskier.
Footnote: The Steelworkers are holding hearings on the allegations, which could prove embarassing all around. Former IWA president - and federal Liberal candidate - Dave Haggard was warned of problems in the local 18 months ago, but nothing happened.

1 comment:

Blue Cross of California said...

It's unfortunate to hear health care deals are causing such trouble. I hope it does not affect our health care system and making the costs higher.