August 13, 2019

Our response to SEIU-UHW strike authorization vote

A statement from John Nelson, vice president, Kaiser Permanente.

Kaiser Permanente and SEIU-UHW have been working together toward a mutually beneficial agreement as part of the national bargaining with the Coalition of Kaiser Permanente Unions that began in April. Unfortunately, SEIU-UHW leadership has decided to use the threat of a strike as a bargaining tactic, designed to divide employees and mischaracterize Kaiser Permanente’s position, even though most of the contracts don’t expire until October.

We believe the approval of the strike vote reflects obviously misleading ballot questions used by the union:

  • “I vote YES to authorize our bargaining team to call for a strike to protest Kaiser’s illegal behavior and unfair labor practices and to show my support for a contract with good raises, no takeaways and a ban on subcontracting.”
  • “I vote NO and am willing to accept a contract that increases our medical costs, cuts our pensions and retiree medical benefits, offers lower pay scales and raises that are less for Oregon and Washington than California.”

To be clear, Kaiser Permanente has presented a contract proposal that would provide annual pay increases that would keep our employees compensated at higher than market averages and maintain excellent benefits. Contrary to the union’s claims, there are no pay cuts and no changes to our employees’ defined pension benefit under our proposal. 

It is important to understand that a strike vote does not mean that a strike is imminent, although it does place Kaiser Permanente in the position of having to spend millions of dollars preparing for the threat of a strike event. Our first priority is always continuity of care for our patients and members.

SEIU-UHW leadership is more interested in a power play to position themselves vis-a-vis other Kaiser Permanente unions — rather than focusing on what is best for their membership. At a time when we are working hard to keep our care affordable, the Coalition’s demands are not fair to our members and the communities we serve. Coalition-represented employees are already compensated 23% above market rates — we pay well, and we have markets where our wage rates are challenging our ability to be affordable. The Coalition’s proposal would actually set our wages to 32% above the market on average over the next five years, adding a billion dollars to our labor costs.

Despite the union leadership’s disruptive tactics, we are hopeful our employees will value our proposal and SEIU-UHW and the other Coalition unions will move forward with us to reach a new agreement. Our goal is to continue to make Kaiser Permanente a great place to give and receive care.

Proposed Contract Offer

Kaiser Permanente’s bargaining proposal would provide employees with the following best-in-class conditions:

  • Solid wage increases. The average salary of Coalition-represented employees is already higher than market averages. Mindful of our goal to improve the affordability of health care and engage our employees in the effort, the current proposal provides guaranteed wage increases of 3% across the board each year through 2022 in Northern and Southern California. 
  • Opportunities for new hires. Kaiser Permanente and the Coalition are proposing a $40 million Workforce Development Fund and creation of new-hire training positions — all part of the solution to address the national shortage of health care workers and help develop the next generation of unionized workers in health care.
  • Retirement security. The proposal preserves the existing defined pension plan along with other strong retirement benefits.
  • Career mobility. The proposal includes a more robust tuition reimbursement program for employees that allows more funds to be used for travel.
  • Affordable health care. The proposal includes a pharmacy utilization approach that incents employees to take greater responsibility for their health by rewarding them for increasing their use of mail-order prescriptions.

Just last year SEIU-UHW touted what it described as “strong wages and benefits” in the agreement it reached with Dignity Health, which included lower wage increases (13% over 5 years plus a one-time 1% bonus) than those being offered by Kaiser Permanente, and only $2.5 million for workforce development, as compared to $40 million in Kaiser Permanente’s current proposal. (Source:SEIU-UHW press release, March 2018)