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Coalition of Kaiser Permanente of Unions Achieves Historic Wage Increases

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Oakland-based healthcare giant Kaiser Permanente (KP) and the Coalition of Kaiser Permanente Unions (CKPU) announced a four-year tentative agreement that addresses staffing shortages and progressive increases in staff hourly wages on Oct. 13. 

Leading up to the agreement, over 75,000 workers nationwide participated in a three-day strike from Oct. 4 to 7 to demand a comprehensive solution to the short staffing crisis in healthcare, exacerbated during the COVID-19 pandemic, and increased wages in adjustment to inflation, according to CKPU. The CKPU, which represents over 85,000 workers in California, Colorado, Oregon, District of Columbia, Hawaii, Maryland and Washington, led the October strike and planned to strike long-term in November if no progress was made.

KP surgical technician Joshua Barba addressed the disparity between employee wages and KP’s $2.1 billion in revenue for the first quarter of 2023 in a statement to ABC7.

“You are making more money with the fewer people you have doing the same job,” Barba said. “You are charging the same [amount] to your patients, but you are not paying the labor to do so. It’s hard. We are burning out. We are quitting.”

Following the conclusion of the strike, negotiations on both sides led to the proposal of a new contract that aims to match union demands. The contract outlines a three-year minimum wage increase from $15.50 to $25 per hour for coalition-represented workers in California and an increase from state minimum wage to $23 per hour for those in other states. In total, workers will see a 21% increase across four years, according to a Kaiser Permanente press release.

To address chronic staffing shortages, executives promised to invest in the current workforce through expedited hiring practices and to amplify employee protections against subcontracting and outsourcing that allocate jobs elsewhere. The contract also promises to increase the maximum profit-sharing payout plan that increases employee bonuses based on company revenue, according to KP

The newly negotiated contract follows the Sept. 30 expiration of a pre-existing contract between KP and CKPU. Leading up to and following the October strike, U.S. Secretary of Labor Julie Su participated in the overnight negotiations, applauding KP and CKPU’s efforts to compromise.

“What the parties have achieved here in Oakland demonstrates, once again, that collective bargaining works,” Su said in an Oct. 13 press release. “When workers have a voice and a seat at the table, it can result in historic gains for workers, their employer and our country.”

Gov. Gavin Newsom signed a gradual pay increase to $25 per hour for healthcare workers by 2033 into law under SB 525 on the same day.  CKPU similarly requested a “$25 hourly minimum wage, as well as increases of 7% each year in the first two years and 6.25% each year in the two years afterward” in August 2023, but failed to win these increases according to ABC News

KP Senior Vice President of Labor Relations Steve Shields affirmed that the terms in the new contract will not affect the current cost of patient healthcare at an Oct. 13 press conference on Zoom.

“It was a bumpy ride,” Shields said. “We do have a common interest and we are committed to caring for people in our communities.”

First-year UC Irvine political science student Sarah Murdaah elaborated on why striking among unified employees has become a common tactic in recent times.

“In my political theory class, they touch on how the worker-employer dynamic can often be unbalanced. Civil disobedience in general can be effective because of our democratic ideals,” Murdaah said. “We see this reflected a lot in the real world a lot, especially for the workers at Kaiser.”

Employees ratified the new contract on Oct. 27. The contract provisions will take effect beginning from Oct. 1, 2023 and will be paid out in March 2024

CKPU has since canceled plans to strike again in November in light of achieving employee-oriented reforms in what CKPU Executive Director Caroline Lucas has deemed the biggest healthcare strike in US history.

“Millions of Americans are safer today because tens of thousands of dedicated healthcare workers fought for and won the critical resources they need and that patients need,” Lucas said on the CKPU website. “This historic agreement will set a higher standard for the healthcare industry nationwide.”

Karen Wang is a City News Intern for the fall 2023 quarter. She can be reached at karenw14@uci.edu.