Privatizing Senior Care: Contract Flipping at New Horizons

By Daniel Tseghay

In late May, workers at New Horizons senior care facility in Campbell River, B.C. voted to strike against CareCorp, the contractor that manages the home. Sunridge Place, in Duncan, also voted for a job action. The workers are members of the Hospital Employees Union (HEU).logo

The day after the vote, CareCorp applied for mediation, with the mediator recommending arbitration.

And despite being awarded a collective agreement this month January, the persisting low wages and casual work will still be a challenge to both workers and seniors in care.

The most recent dispute is a  culmination of a lengthy history. In December of 2013, New Horizon’s previous employer, Park Place, gave the unionized employees a 90-day layoff notice and told them the home’s operations would be contracted out. When CareCorp took over, the company brought the workers back in a non-union capacity, with lower wages and benefits. While the workers applied to rejoin the union in November of 2015, this phenomenon of contract flipping, where private companies take over the operations of facilities, still threatens New Horizon employees and others in senior care facilities across the country.

“In the case of these two facilities,” says Neil Monckton, an organizer with HEU, in an interview with RankandFile, “these were newly built facilities and at some point the owner said we’re no longer wanting to be the direct employer so we’re going to bring in a contractor so they laid everybody off and brought in a contractor.”

When work is contracted out, pay can be dramatically reduced, sometimes by more than 40 per cent. This has a dramatic effect on the lives of workers. “It is almost impossible for a housekeeping aide or dietary worker in a privatized health support job in British Columbia to achieve earnings above Canada’s Low-Income Cut-Off (LICO) standard, unless they are a full-time employee with no dependents,” say the authors of a 2005 report, The Pains of Privatization: How contracting out hurts health support workers, their families, and health care.

With contracting out, benefits are reduced, workload increases, and job security vanishes. Even though the care homes are financial stable, the employers routinely implement austerity measures when it comes to labour costs. “The money is there,” says Monckton, “or it’s either being kept by the new contractor or its being kept by the owner of the facility who hires a contractor at a lower bid and pockets the difference.”

March 2014 rally against layoffs at New Horizons. Photo via HEU
March 2014 rally against layoffs at New Horizons. Photo via HEU

Facilities are often under-staffed, with workers losing hours yet having the same workload, forcing them to take shortcuts and endure workplace injuries. The increased turnover of dissatisfied workers consequently affects the quality of  care being offered. Rather than developing long-term, deeper, relationships with the seniors, the personal connections are weaker as a result of austerity and contracting out.

At privatized health care facilities, the high turnover also means that more experienced workers are spending a lot more time assisting their new co-workers.

“That affects the quality of care,” Monckton says. “Different people coming in who don’t know the routines of the residents. People not staying because of the working conditions and the retention has an impact on workload because they can’t always backfill for people.”

According to Monckton the outsourcing of services, or privatization, in long-term care has accelerated with the B.C. Liberals since the early 2000s. The trend towards privatization has proved profitable for corporations but has hurt the quality of senior’s care in the province.

“From a business perspective, high returns on investment in the service sector are predicated on low labour and supply costs,” write the authors of The Pains of Privatization. “From a health care perspective, good quality services are predicated on well-trained and well-supported staff…Corporations are accountable to their shareholders, not to workers, patients, and local communities. The entrenched insecurity that workers experience is not an unintended by-product of privatization, but rather is directly tied to corporate goals of labour flexibility and low costs, in pursuit of the bottom line.”

On January 20th and the 21st provincial health ministers met with federal health minister met in Vancouver to discuss public health care. One of the points of discussion was the Health Accord, along with an accompanying funding model. The shift towards privatization of essential health care follows the gutting of public funding and it is possible that things could get worse. The Health Accord, for instance, will expire next year and that could result in  a $43.5 billion cut to medicare.

What this state of affairs means to both seniors in care homes and the workers who tend to them is clear: rushed and distracted care, greater costs to the families of residents, and lower wages and benefits to the workers. The debate now is is how to address these challenges.

HEU saw some success re-organizing workers who either lost their jobs or had their wages reduced or frozen at sites taken over by private contractors. But the real fight might be outside the workplace and with the provincial government.

“There’s a bigger policy problem around the contract flipping that we’ve experienced in long-term care and in contract and support services and acute care,” says Monckton. “It’s a problem that doesn’t necessarily get resolved at the bargaining table. It has to get resolved in government policies.”


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One thought on “Privatizing Senior Care: Contract Flipping at New Horizons

  1. I agree with Neil Monckton-it will take a change of government in B.C. from the Liberals to the NDP. A government that supports public services to seniors rather than promoting the private sector takeover. We have seen significant changes in the acute care hospitals where better trained LPN’s and R.N’s are being replaced with Health Care aides who have much less training especially regarding the assessment skills so necessary with critically ill patients. There is a critical need to implement the recommendations of the Ombudsperson’s office regarding seniors services such as residential care and other forms of care. The current Clark government has largely ignored those recommendations.

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