Want to know why you need a union?

[2ndCareerRN]

To keep something like this from happening!!

Empire Health announces 9 percent pay cut

A total of 2,700 will be affected at county's second-largest employer

Carla K. Johnson

Staff writer

Ten days after announcing a wage freeze, Empire Health Services gave its non-unionized hospital workers more bad news Monday. This time, it's a 9 percent pay cut.

More than 2,700 Empire employees, from CEO Thomas White down, will see wages cut. Empire, Spokane County's second largest private employer, operates Deaconess Medical Center and Valley Hospital and Medical Center.

In tearful meetings Monday, employees learned they will see significantly smaller paychecks starting April 4.

''This is going to hurt -- big time," said Julie Maddox, a 21-year Deaconess housekeeper, who expects to see her hourly wage fall to less than $11.40. ''You know how it is when you're used to having a certain amount coming in to the cover the bills?

''Now what?"

Workers foresee more bad news this summer when their health insurance premiums are expected to rise. In addition, workers in food service, engineering, housekeeping, medical machine repair and laundry are waiting to hear whether Empire will hire outside contractors to provide those services.

The 9 percent pay rollback -- which adds up to about $10 million a year -- will have a modest effect on Spokane's economy, said retired banker Phil Kuharski, who tracks business trends.

''That's one-tenth of 1 percent of the personal income of Spokane County," Kuharski said. ''It's a hit, and it's one of those things that incrementally, as we add on hits, has an impact."

Hospital leaders called the pay rollback necessary for survival and defended a decision not to dip into the system's $35 million in cash reserves.

''The improvement of the (Deaconess) cardiac program and the emergency department will come out of those reserves," said Chief Financial Officer Garman Lutz.

The rollback will save the hospitals $9 million this year, Lutz said, and help avoid more layoffs. Last year, the hospitals laid off more than 100 people. Other positions went dark through attrition.

Facing losses of $19 million last year, and a $1.4 million additional loss in January, administrators hope the pay cut will protect the system's cash reserves.

That's a key to securing financing from bond underwriters for a planned expansion of the Deaconess heart-care center.

Hospitals make money off heart work. Reimbursements for heart care tend to be better than for other types of care.

''We need to preserve our share of that market as part of the financial underpinning of Deaconess and so we can continue to provide services such as maternity and the birthing center," Lutz said. ''We need programs like cardiac and NICU (neonatal intensive care unit) to provide the margins for those other services."

Many workers learned the news in Monday afternoon meetings. A letter mailed Monday will reach other employees today.

''Cost reductions are difficult, but necessary, to ensure the future of our hospitals," CEO White wrote in the letter. ''We remain optimistic that by working together, building our patient volumes, and controlling costs, we will be successful."

Empire struggles with challenges that face all U.S. hospitals: rising costs, and Medicare and Medicaid reimbursements that lag behind those costs.

In addition, a decrease in patients also plagued the Empire hospitals last year. Patient numbers are beginning to climb again.

Empire's operating expenses for 2003 are budgeted at $246 million. The pay rollback represents a 4 percent reduction in those budgeted expenses.

Meanwhile, Providence Services Eastern Washington, which operates Sacred Heart Medical Center and Holy Family Hospital, also recently directed department heads to cut costs by 3 percent.

But Providence bosses will have to find other ways to cut besides wages. Contracted salary levels with unionrepresented groups will be insulated from those cuts.

Empire hospitals are largely nonunion.

Unlike the Empire hospitals, Providence hospitals did not experience a decline in patient numbers last year, said Mike Wilson, Sacred Heart chief operating officer.

Maddox, the Deaconess housekeeper, already moonlights, supplementing her pay by cleaning private homes 10 to 20 hours a week. She said she may have to pile on more outside work.

''I cried today," she said. ''You hope things will get better, but instead they just keep getting worse."

This doesn't take into account the lack of merit increases, cost of living raise, or scheduled step increases, or the fact the insurance premiums are going up by about 40% pretty soon. 9% is looking a lot more like 12-14%.

9% turns out to be quite a bit more. To put it into perspective, 9% is a car payment, most if not all of a house payment. Some people will be severly hurt by this.

This is a good reason to go union. We tried a little over a year ago and people didn't want to because of various reasons. Now many of those same people are singing the blues.

bob

[delirium]

Is this where you work, bob? Are you taking a pay cut?

That's a bad situation. A good reason to have a union, definitely. Also a good reason to seek employment elsewhere.

[ERNurse752, RN]

That's ugly...

[JNJ]

I'd like to know if the CEO's pay cut was the same proportion of his/her pay as the rest of the staff.

[Uptoherern, RN]

what I really want to know is how much of a cut the "CEO White" took?

[2ndCareerRN]

Actually, before the news came out yesterday I had a one way discussion with the ER manager and told her to place me in an on-call status (was full time). So, as soon as a nice travel assignment comes my way, I am gone forever.

The hospitals in Spokane owned by Empire Health Services are the only two hospitals, with over 100 beds, in the state of Washington that are not union.

For some reason there seemed to be a pretty bad bug going around today...a lot of sick calls for the day shift.

bob

[sanakruz, ADN]

YEP

[oramar]

I bet they won't be the only non union facilities for long.

[chartleypj]

[The hospitals in Spokane owned by Empire Health Services are the only two hospitals, with over 100 beds, in the state of Washington that are not union.

This might be a good time for nurses employed here to advocate for themselves by voting for the right to have a bargaining unit in their facility. I cannot imagine working for a non-unionized facility.

Paula

[-jt]

That situation is such a shame. But who would continue to work at that hospital & live with this when most others are begging for nurses and pt care support staff? Its a buyers market for nurses & healthcare workers so why would anyone stay at that facility when they could get a new job tomorrow? Maybe this is a way for the hospital to downsize & cut labor costs without the bad publicity of lay-offs -- just make it so people will leave on their own.

Being a union really does make a difference. A few years ago, my hospital tried to do the same thing to us when it was in "financial difficuties", but they couldnt because we are a union & didnt give our permission for them to do this. Managers, executives, & faculty doctors took a 9% cut in salary but the nurses refused this "solution" and thought there was a better way to help the hospital. Because we are a union, we had the right to see the hospitals financial statements & they had to open up the books to us and prove the financial difficulty to us. Once we saw the difficulty was real, the nurses came up with a plan to help them out of it & save the hospital without them taking permanent givebacks from us - which they had tried to do but couldnt get away with because we are a union. Instead, we offered to freeze our raises & step increases for 18 months of the 3 year contract, with the stipulation that at the end of the 18 month period, we all jump ahead to where our salaries were supposed to be if they hadnt been voluntarily frozen. We worked with the hospital to help it get back on its feet & did our part to save it. By our offer to freeze our own wages temporarily, the hospital was basically given a "gift" of $1800 from each of the 600 RNs (a nice chunk of change) & the RNs had the legally binding assurance that this was only a one time gift & a temporary measure in a crisis. The nurses voluntary "donation" helped the hospital get back on its feet & at the end of the 18 months our salaries were unfrozen, as agreed, & jumped straight up to where they should have been. Being a union does not mean being adversarial & a fighting "us against them" environment. It just means having the right to a say in making the decisions that affect you & your job, and having things done with you - not to you.