Union Triage

Tenet could hardly afford an all-out labor war. Last August, it had to pay $54 million to settle allegations that two of its Redding doctors performed unnecessary heart surgeries. The company is now being investigated by federal authorities for Medicare fraud and for paying illegal kickbacks to physicians. In the midst of all of this, Tenet CEO Jeffrey Barbakow — once the highest-paid executive of a publicly traded company — resigned, walking away with $111 million.

In large part, it was the union’s immense political power, its close ties to powerful Democratic politicians in Sacramento, that brought the industry giant to the bargaining table. Just a few weeks before signing the May agreement, Tenet president and acting CEO Trevor Fetter turned to his investors and explained why making peace with the union was so important. “[M]ost of the negative publicity that the company faces in California and a certain degree of legislative activity is sponsored and fomented by the unions, and I must tell you that the unions are a formidable force in California,” he said in a conference call.

The compromise reached in the agreement was clear: Tenet agreed to employer neutrality, pledging recognition and good-faith bargaining if the SEIU could win informal private elections among the workers. Basic pay raises of up to 32 percent and improved working conditions were granted in the agreement. Additional perks could be won when final contracts were negotiated unit by unit.

The union, grasping the possibility of bringing in thousands of new members, also gave ground, abandoning, for now, the fight for company-paid pensions and surrendering the right to strike during the bargaining period. This was a compromise the SEIU was more than willing to entertain.

And Tenet knew that the union’s political power was a double-edged sword that could, potentially, also benefit the company. Tenet would be gaining a new, brawny political partner in its efforts to win more money from the state reimbursement system.

The SEIU ardently argues that the agreement with Tenet is of landmark value because only the muscle and political clout of a powerful union like the SEIU working in partnership with the employers can restore decent standards of patient care that — in recent ‰ years — have fallen by the wayside. “We think that union contracts are the only way to change health care and achieve access for everybody,” says Mary Kay Henry, director of the SEIU’s Southern California Hospital Campaign. The union proudly points to more than 2,500 workers at seven hospitals who have already voted to join SEIU under terms of the May agreement. And myriad other elections are still in the works as the union wages an uncertain battle against an often still adversarial Tenet.

As to the agreement, “it’s a choice we make gladly,” says a young SEIU organizer working on the Tenet campaign. “If we can make a deal that brings 25,000 workers a union contract, higher wages, better conditions, more power over staffing decisions and on top of that allows us to rein in a corporation like Tenet, what do we have to apologize for?”

 

A small group of SEIU organizers gathers at the union’s Inglewood office to jump-start the Labor Day weekend with a dizzying dose of fieldwork. The union is gearing up for elections among business, office and clerical workers at Tenet-owned Centinela Hospital Medical Center. This weekend they’ve planned several days of “house calls.” The idea: to catch workers at home, where organizers can talk to them freely about what the union is doing and collect cards of support, pledges to vote “yes” in eventual union elections.

The reality: more often than not, organizers don’t make it past the front door.

But 30-year-old organizer Lilly Vallee, a tall, green-eyed woman of Polish descent, has a modicum of luck. One worker is at home with his two young kids when she shows up at his door in Inglewood, across the street from Centinela. The TV set is blasting in the background. The man has been at the hospital for several years — since well before Tenet took over the facility in January 1997.

In his first years there, he was getting yearly wage increases as high as 10 percent. Then the raises were cut in half. Since Tenet took over, the annual increases have further dropped, to around 4 percent. Vallee tells him that he’s lucky in a certain way, that his raises are higher than in most Tenet hospitals. And then she plays one of her strongest cards. If he and his co-workers vote in the SEIU, they would, under terms of the agreement with Tenet, receive an immediate pay increase of 6 percent in the first year and 5 percent in each of the following three years.

“If I give 20 years to the facility, I want something back,” the man says, lamenting the lack of any company pension plan. “That’s a lot of time, a lot of work.”

“That’s right! That’s right!” Vallee says encouragingly, sensing an opening to talk union — though the SEIU/Tenet agreement offers no pension plan.

“It’s all about money and I understand that,” the worker says. “It’s just that . . . people have to get compensated for the time they’re putting in. We’re getting shoved around.”