Move Puts Prime in Conflict with City of Lynwood, Which Unanimously Called for Contracts and Wages to be Maintained
[5-21-20] LOS ANGELES – The company selling St. Francis Medical Center to Prime Healthcare has filed a motion in federal court seeking to cancel collective bargaining agreements covering St. Francis workers, paving the way for Prime to slash the wages of more than 2,000 frontline hospital workers who have put their health at risk to treat patients with Covid-19.
St. Francis’ owner, Verity Health, which is in bankruptcy proceedings, filed the motion in U.S. Bankruptcy Court this week. The motion seeks to cancel hospital contracts with Service Employees International – United Healthcare Workers West and United Nurses Associations of California as part of the bankruptcy filings. If the motion is approved, the contracts would be nullified on the day the sale is finalized.
The move puts Prime on a collision course with the Lynwood City Council, which unanimously passed a resolution calling on Prime to retain all St. Francis workers and “that all existing labor contracts be honored so that these employees can maintain their current pay and benefits.”
Prime has made it clear in talks with the unions over the past month that it intends to slash wages by as much as 63 percent, despite the fact that St. Francis is profitable under the current wage scale. Many employees have stuck with St. Francis over years of turmoil, including multiple sales of the hospital and the dangerous and highly stressful treatment of Covid-19 patients, despite shortages of personal protective equipment.
“Prime wants to cut my pay by five dollars an hour. That’s the thanks I get for serving my community hospital all these years,” said Mayra Castaneda, an ultrasound tech at the hospital.
“I can’t imagine skilled nurses and technicians staying at St. Francis if their pay is cut by thousands of dollars a year,” said Jesus Amaryllis, an emergency room tech. “People will vote with their feet and it’s patients who will suffer.”
Under the current wage and benefit structure, St. Francis has been highly profitable. In a document filed with California Attorney General Xavier Becerra’s office and sent to potential buyers, Cain Brothers & Company, LLC, the investment firm handling the sale, showed St. Francis’ EBIDAM (Earnings Before Interest, Taxes, Depreciation, Amortization and Management Fees) were $113 million in 2017, $51 million in 2018, and $52 million in 2019.
Prime has a long history of defrauding Medicare, cutting important hospital services it deems unprofitable, and fighting with insurance companies and unions. The corporation also wants to be able to outsource work at will, often a means for employers to boost profits by hiring companies that pay low wages. And it is proposing to cut employee wages across the board at St. Francis, including a lab analyst who would see a pay cut of 63%. Other pay cuts:
In its resolution, the Lynwood City Council hailed the service of St. Francis workers, saying the “dedicated healthcare workers at St. Francis Medical Center have continued to provide the medical care and services to the community while the hospital has experienced the turmoil of the Verity bankruptcy, multiple sales, years of uncertainty, and are now bravely caring for our community during the COVID-19 pandemic; risking their own lives while the nation grapples with an insufficient supply of personal protective equipment and testing capacity.”
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SEIU-United Healthcare Workers West (SEIU-UHW) is one of the largest unions of hospital workers in the United States, with 97,000 members. Learn more at www.seiu-uhw.org.