Pay agreement signed in healthcare sector

In June 2003, trade unions and employers concluded a new pay agreement for the Estonian healthcare sector, laying down minimum wage rates for doctors, nurses and care assistants. In July, the government approved the new budget of the Health Insurance Fund, which will give hospitals the extra funding required to pay the new minimum rates.

On 13 June 2003, after a lengthy negotiating process in which the public conciliator became involved, the Estonian Hospitals Association (Eesti Haiglate Liit, EHL) employers’ organisation and three trade unions - the Estonian Medical Association (Eesti Arstide Liit, EAL), the Trade Union Association of Health Officers of Estonia (Eesti Keskastme Tervishoiutöötajate Kutseliit, EKTK) and the Federation of Estonian Health Care Professionals Unions (Tervishoiutöötajate Ametiühingute Liit, ETTAL) - signed a pay agreement for healthcare workers. The main objective of the agreement is to set minimum wage rates for the various categories of employee and to harmonise differences in minimum wages between regions and different types of hospitals. According to the new agreement, the hourly minimum wages were to increase to EEK 50 for doctors (a 25% increase), EEK 25 for nurses and EEK 16 for care assistants (an 18.5% increase) from 1 July 2003, assuming that the reference prices for medical services increased simultaneously. This increase in reference prices would enable the Estonian Health Insurance Fund (Eesti Haigekassa) to find the additional money required for the agreed wage increases.

An initial attempt by the council of the Health Insurance Fund to approve a new budget including higher reference prices failed at a meeting on 18 July. The main reason for the failure was the parties' differing understanding of how much money was required to fund the wage increases. According to the Health Insurance Fund's estimates, the amount of extra money required was EEK 72 million, while EHL’s estimate was EEK 91 million. The chair of EHL claimed that its estimate came from the Ministry of Social Affairs. Finally, on 25 July the council approved the additional budget of EEK 91 million for the wage increases demanded by the employers. On 30 July, the government approved the Fund's new budget.

Trade unions expect that the agreement will be extended to the whole healthcare sector, in line with the Collective Agreements Act. However, according to Katrin Rehemaa, the general secretary of EAL, there is a problem in that the previous agreement stated clearly that it would be extended to all providers of medical services. However, this point is omitted from the new agreement, as EHL claimed that it could not guarantee that all hospitals will apply the new minimum wage rates. EHL covers 19 major hospitals in Estonia but, according to Ms Rehemaa, wage problems arise mostly in small hospitals, which are not always members of EHL. She also stressed that on this occasion representatives of the Health Insurance Fund took an active part in the negotiations, while in previous years they have been relatively passive. Although in legal terms the social partners in the healthcare sector are the trade unions and EHL, the finances come from the Health Insurance Fund, which makes it very important that the Fund should be involved in the process of negotiations. According to Estonian law, the whole healthcare system is financed via the Health Insurance Fund, which receives its funding from social security contributions.

The negotiations over the new healthcare agreement were protracted, and trade unions had been preparing for warning strikes if their demands on increasing the minimum wage rates were not met. The first collective pay agreement for the healthcare sector was concluded in 1996 and the most recent agreement (concluded in April 2002) expired on 31 March 2003. Under the 2002 agreement, the minimum hourly wage was EEK 40 for doctors and EEK 13.50 for care assistants. Until the 2003 settlement, nurses had not had a pay agreement for more than six years, as all negotiations had ended in failure.

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