George Raine, Staff Writer San Francisco Chronicle Sunday, September 2, 2007
In July, 65,000 Southern California grocery workers ratified a labor contract with a health plan that pays 100 percent for preventive care procedures ranging from exams to immunizations.
That's good news for a labor movement that is struggling to get a grip on the health care issue. The bad news is that such deals are few and far between.
Accordingly, health care is once again Topic A for labor and working people this Labor Day. And the trend of employers elsewhere seeking to reduce benefits continues.
"In every bargaining scenario, health and welfare is the No. 1 issue," said Ron Lind, president of Local 5 of the United Food and Commercial Workers, an amalgam of seven UFCW locals in the Bay Area. "We will be dealing with that straight on."
Those in the labor movement aren't the only ones gravely concerned about health care. A record 6.8 million Californians, or 1 in 5 residents, were without health insurance at some time during 2006, the U.S. Census Bureau said last week. A record 47 million Americans, including 8.7 million children, lacked health coverage, a bureau report said.
The pressure for health care reform is on in Sacramento, because - as the Center for Labor Research and Education at UC Berkeley notes today in its annual Labor Day assessment of jobs, wages and health care - the labor market is, without policy interventions, likely to provide even less employment-based coverage to moderate- and low-income workers.
The labor center reports that job-based insurance for California adults has decreased by nearly 5 percent since 2000, to 57.1 percent. The largest decline has been job-based coverage for children. It's down 12 percent to 49.8 percent in the same period.
"And with premium costs and health costs continuing to rise, you can expect job-based coverage to continue to decline," said Ken Jacobs, chairman of the UC Berkeley labor center. "And if the Legislature doesn't do it this year, next year is going into an election year, and it gets harder."
The Southern California grocery contract is a good place to study the issue.
A sea change is under way in health care for California grocery workers, and the Berkeley labor center focuses on it this year in the report funded by the California Program on Access to Care, an applied policy research program administered by the California Policy Research Center in the Office of the President at the University of California, and the UC Labor and Employment Research Fund.
The Southern California grocery workers, represented by the United Food and Commercial Workers union, had considerable ground to make up. They had been buffeted by the consequences of a 141-day strike and lockout that ended Feb. 29, 2004, and they accepted a contract at the time that significantly restructured health insurance coverage.
That contract increased the length of waiting periods for health care eligibility for new hires from four months to 12 months for individuals (18 months for clerks) and 30 months for families. The effect of that was dramatic. The Berkeley labor center found that employer-sponsored insurance coverage for grocery workers between September 2003 and September 2006 fell from 94 to 54 percent in Southern California.
Fifty-one percent of those without job-based coverage in 2006 were uninsured, 10 percent were in Medi-Cal and 39 percent in some other health plan, the center said.
"The reduction in coverage was primarily driven by reduced eligibility as a result of the longer waiting periods," said the authors, Jacobs and center economist Arindrajit Dube.
Only 29 percent of workers hired under the new contract were eligible for coverage between September 2003 and September 2006, the study said.
Turnover was constant. The annual turnover rate for Southern California grocery workers rose from 19 to 32 percent between 2003 and 2006, and explains about a quarter of the reduction in eligibility rates, the report said.
The contract signed in July by the grocery companies in Southern California - Ralphs, Vons (Safeway-owned) and Albertson's Inc. - has shorter waiting periods for eligibility and covers workers hired after April 2004. It's 6 months for individuals (not including clerk helpers, which remain at 18 months), 6 months for children and 24 months for spouses). The UC study noted that had the new waiting periods been in place over the last three years, 78 percent of workers would have been eligible for coverage and 55 percent of new workers would have been eligible.
"We were able to bargain back much of what we think was stolen from us three years ago," said Greg Conger, president of United Food and Commercial Workers Local 324 in Buena Park (Orange County). "I think it bodes well for every other UFCW negotiation coming up, and the major portion of those talks is going to be health care. I think the preventive care element is very smart business - when you keep employees healthy. So we went from a lose-lose in 2003 and 2004 to a win-win in 2007," he said.
The new contract also eliminated the two-tier wage and benefit structure introduced in the 2004 contract, under which new hires received less compensation than veterans. It was widely seen as divisive and led to high turnover, labor leaders said. It was replaced by a model in place in Northern California, which is not two-tier but has a longer progression to maximum compensation.
The preventive care element has long been promoted by Steve Burd, the chief executive of Pleasanton-based Safeway, who created a similar program for nonunion employees that, the company says, is paying dividends via a healthy workforce.
"Through prevention and behavior incentives we have produced remarkable results for employees by providing a better, more comprehensive health plan with significantly lower out-of-pocket costs," Burd said.
Art Pulaski, the executive secretary-treasurer of the California Labor Federation, the state AFL-CIO, said, "It's easy for Burd to talk about preventive care when he did not have to cover spouses for a couple years" under the old contract.
Pulaski added, "But this is such an important investment in long-term cost savings and also long-term employee productivity."
Said Chuck Mack, Western regional vice president of the International Brotherhood of Teamsters: "You catch something early on and prevent heavy cost increases for responding to life-threatening illness and disease."
On Wednesday, union-represented grocery workers in the Puget Sound region ratified a contract with almost identical language on preventive health care. It's almost certain that when negotiations between retailers in the Bay Area - Safeway, Save Mart (Lucky stores) and Raley's - and the 35,000 regional members of the United Food and Commercial Workers commence later this year, worker health care and preventive care will loom large.
Brian Dowling, a Safeway spokesman, said of the company's long-term goal, "Our objective is to continue to provide our employees with quality health care benefits, but at a manageable cost. We made progress in Southern California and in western Washington. In both cases, the contracts created restructured health care plans focused on wellness and prevention while simultaneously helping control escalating health care costs."
He added that the matter will be on the table for Northern California negotiations.
Jacobs, of the UC labor center, said shortening the wait for insurance for children was seen as critical in Southern California and it, too, should be replicated in Northern California.
In 2004, Safeway and the other major retailers said they were concerned about Wal-Mart, a low-cost, nonunion competitor, building "superstores" that include groceries - thus, the major retailers said, they had to put a lid on costs. Wal-Mart said at the time it was planning from 40 to 50 superstores in California over five years.
However, today there are only 24, according to Trade Dimensions, a part of Nielsen Co., which reports on retail real estate and consumer goods manufacturing. UC's Jacobs thinks that in part explains the retailers' about-face in the new contract.
He noted that Safeway in particular will be competing for higher-end consumers when British retailer Tesco enters California later this year. In that contest, Safeway will not want to alienate employees, said Jacobs.
He added, "That bodes well for Northern California grocery workers."
http://www.sfgate.com/cgi-bin/article.cgi?f=/c/a/2007/09/02/BUISRRQHN.DTL
This email was cleaned by emailStripper, available for free from http://www.papercut.biz/emailStripper.htm