EurWORK European Observatory of Working Life

Croatia: Push to revise the complex pay system in healthcare sector

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There is a significant gap between the pay of Croatian healthcare workers and those in the rest of the EU and in the last four years more than 500 physicians have left Croatia to work abroad. The sector is heavily in debt, rules for calculating salaries are complex, and the collective agreement is not applied consistently.

Background

Since Croatia acceded to full EU membership four years ago, more than 500 physicians have left to work abroad, largely because poor remuneration in the healthcare sector has been a problem for a long time. The sector is also in debt. The calculation of wages and salaries in healthcare system is governed by several different sets of regulations and this has created ambiguities in the way the sector’s collective agreement is applied.

Causes of the problem

The Croatian Physicians’ Chamber has called on the government to act to encourage doctors to stay in Croatia as their departure presents a serious threat to the quality of life and prosperity of the country’s citizens. The chamber’s proposals for improvement include easier access to internships, for which there is currently a long wait, and also collective bargaining for physicians, better organisation of work in the healthcare system, and rewards for excellence.

The nature of healthcare work makes salary calculation difficult because the regulatory framework is complex and demands careful recording of an employee’s time-keeping. In addition to calculating monthly working hours, ‘effective’ working hours and their structure also have to be taken into account, especially in the case of shifts and overtime work.

The types of jobs in the health sector and their remuneration are covered by the regulation on job descriptions and the complexity of public service jobs (Government Order 25/13), the Healthcare Act (NN 150/08…70/16) and various collective agreements such as the basic collective agreement for public servants and employees, (NN 24/17). According to the collective agreement for healthcare and health insurance (NN 143/13, 96/15), basic salary is calculated by multiplying the coefficient of the job complexity for each individual position by a supplement of 0.5% for each previous year of working experience. It also stipulates that the basic salary is increased by 40% for night work; 25% for work on Saturdays; 35% for work on Sundays; 50% for overtime work; 10% for second shift work (work in the afternoon); and 150% for working on public holidays, on non-working days stipulated by law and on Easter Day. The calculations must be based on ‘effective’ hours of work, and the supplements are not mutually exclusive and can be combined. As most healthcare employees are entitled to other supplements (for example, a special supplement for working conditions), it is not clear whether these supplements increase the basic salary or are expressed separately and are irreversible.

Complex regulatory framework

There are two major accounting problems; calculating basic salary, and how supplements for shift, overtime and holiday work are combined. Article 18 of the health sector collective agreement stipulates that a joint committee is responsible for the interpretation of its provisions. The committee is made up of three representatives from each contracting party and their interpretations are binding. In December 2015, the committee published a report analysing the issue of overtime and salary supplements (PDF), but did not define the concept of basic salary.

Interpretations of exclusion, or the merging, of supplements for shifts, overtime and holiday work is often discussed. The merging of supplements is calculated using the hourly rate for regular work at the basic salary rate rather than the combination of supplements for additional effective hours. The joint committee does not give a clear guidance on the calculation of supplements and only partially addresses this issue. For example, Conclusion 101 (PDF) stipulates that ‘a worker is entitled to a salary increased by 150% only for the hours of work performed on holiday’ (it can be assumed that ‘hours of work’ refers to ‘effective’ working hours).

Of the other supplements to which healthcare workers are entitled, a special supplement is given to those who have a PhD in medicine or dental medicine. This is set out in Article 59 of the collective agreement and, from 1 October 2015, has been set at 12% of an employee’s basic salary. It does not change, regardless of the actual number of monthly hours worked.

Varying interpretations

In practice, interpretations of how healthcare workers’ salaries should be calculated and implementation of the regulations vary. The calculation of supplements for shifts and overtime is often done by adding percentage increments rather than by multiplying. For example, some employers calculate work on Saturdays on the basis that the pay for a regular work hour increases by 25%. They then add 10% of basic salary as the supplement for afternoon work, rather than adding 10% of the sum of basic salary plus the 25% Saturday work supplement. An analysis of the legal work status of Croatian citizens published in June 2017 pointed out that this leads to the addition of 35% to the basic hourly salary, rather than the correct 37.5%. More than 20 court rulings have acknowledged that healthcare employers wrongly interpret the legislative framework that covers their workers’ salaries.

Commentary

As the calculation of wages and salaries in healthcare system is defined by several differing sets of regulations, and because of ambiguities in the way the collective agreements are applied, parties to the collective agreement should set clear percentage increases for each possible situation and clearly define the way they should be used. It would also be advisable to create clear formulas and tables for salary calculation when concluding a new collective agreement.

Because there is a significant gap between Croatia and west European countries in healthcare staff pay, it is unlikely that the many proposed improvements will prevent further departures of Croatian physicians. They might, however, provide a solid basis for the future development of this sector and better pay for its employees. This might offer hope for the retention of some physicians and even the return to Croatia of those who have already left.

 

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