Tentative Agreement on New National Contract!

Los Angeles, May 28 – Early Friday morning, after a three-and-a-half day marathon bargaining session, the Coalition of Kaiser Permanente Unions reached a tentative agreement with Kaiser Permanente on a new, two-year National Agreement.  The tentative agreement provides for annual 3% across-the-board wage increases, maintenance of current benefits, an enhanced sick leave cash-out option, stable funding for workforce develop-ment trust funds, and strengthening the Labor Management Partnership, the 13-year old agreement under which we have successfully bargained three national contracts using interest-based negotiating.  Our unique partnership – the most enduring, largest, and most successful of its kind in any industry – puts industry-leading performance improvement tools into the hands of empowered workers in unit-based teams.

The tentative agreement will go to the Union Delegates Conference on June 12 for endorsement.  It will also be reviewed by the Kaiser Permanente Partnership Group and the Kaiser Foundation Boards of Directors.  The agreement will then be submitted to the members of individual unions for ratification this summer.  If ratified the contract, and the first annual wage increase, will be effective October 1, 2010. 
This tentative agreement is the result of many hours of meetings, brainstorming, and caucusing – conducted by a record-high number of 111 negotiating committee members and more than 100 rank-and-file union observers – affirming the strength of the National Agreement, and requiring only a few language changes. 
Economics:

• Two across-the-board wage increases, effective October 1, 2010 and October 1, 2011, for all Coalition members in every region.
• An additional 0.5% for Southern California registered nurses, and a 0.5% retention bonus for clinical lab scientists in every region.
• Maintenance of all current benefits.
• Funding for the Workforce Planning and Development Trust funds, which provide for worker training and skill upgrades both for current and displaced workers, at the rate of 0.27% of annual payroll.
• Two-year agreement expires September 30, 2012.
• Sick leave cash-out incentive increased to 75% (see below).

Sick Leave: New language in the National Agreement will increase a cash-out incentive for employees who bank their sick leave. Currently, employees with at least 10 days of banked sick leave at the end of each year can cash out up to 10 days of unused annual sick leave at 50 percent of value (or the proportional equivalent for part-time employees). Employees now have the option of cashing out up to 10 days at 75 percent of value if they have at least one year’s worth of annual accrued sick leave in their post-January 1, 2006 bank.
A change was also made to shift the date when employees receive their allotted sick time. The National Agreement currently frontloads employees’ sick time in January.  New language changes sick leave distribution to an employee’s anniversary date. A transition year will be put in place as we move to this system. No days or benefits will be lost in the process.
“This work shows that when the parties stay in the room, speak frankly, respect others and listen, good work happens,” said Ken Dietz of UNAC/AFSCME.

Workforce Planning & Development: New language addresses communications, redeployment, hard-to-fill positions, and funding of the education trusts.

The new agreement provides education trust funding annual of .27% of payroll. Those funds support base services, such as the Individual Stipend, Forgivable Loan and Career Counseling programs.  An additional $3 million a year will go to the Ben Hudnall Trust Fund. 
New language ensures that when positions are eliminated or staff redeployed, Workforce Planning and Development will be engaged as soon as the unions are notified, so Coalition employees receive assistance as early as possible.

A task force will be created to identify the barriers in hard-to-fill/critical positions, and the subgroup called for communication about services such as career counseling and tuition reimbursement.

Labor Management Partnership: Language changes will strengthen the Partnership through new mutually acceptable accountability systems, uniform national rating and tracking of unit-based teams, and progressive goals for increasing the number of high-performing unit-based teams over the life of the contact.

For the first time, the Value Compass is included in the National Agreement as a key operating strategy for KP.  Improving performance requires that everyone focus on the needs of our patients and members.  The Agreement envisions a path moving from projects, to pilots, to whole systems improvement, recognizing that all four points of the value compass (affordability, quality, service and the best place to work) impact the total value that the organization creates.
“Everybody was heard,” said Walter Allen of OPEIU.  “There were a lot of examples of where we could do better, and a lot of good ideas about how to do better in Partnership.”

Performance Improvement & Performance Sharing Program (PSP): Language changes encourage and sus-tain high performance, and strengthen the connection between performance and rewards.  Unit based teams were reaffirmed as part of the operating model of Kaiser Permanente and their goals will now be aligned with national, regional, facility and unit goals.

Performance improvement and PSP (the Performance Sharing Program, which rewards Union Coalition-represented employees for meeting certain regional goals) are key elements of KP strategy. New language was added to bring greater clarity, consistency, and effectiveness to the programs, to maximize the returns for KP, for frontline teams that do the work, and ultimately for our members and patients.  Among the recommendations are clearer timelines for PSP goal-setting; periodic communication about progress against PSP goals; LMP training for new employees; and a continued emphasis on “line of sight” goals whenever possible.

The subgroup co-leads said these discussions would inform the future work of task groups, design teams, and implementation groups.  “We really came together as a group,” said Sandy Wohler of the Teamsters, “We heard management and they heard us, and we got results.”

“There is nothing comparable to this process anywhere in the world, where an organization of this size and complexity, and a group of unions of this size and complexity, squarely confront the issues of wages, hours, working conditions, and performance – and do it quickly, efficiently, and constructively,” said Union Coalition Executive Director John August.  “Our goal was to get through this quickly and peacefully, securing a fair raise and protection of benefits, so we can move ahead and address the challenges of the economy, the opportunities of health care reform, and the hard work of building our UBTs – so we can secure the future of our organization and our work.”