Strike alert in healthcare sector due to low wages

In the last three years, average wages in the healthcare sector have grown less than in other sectors in Slovakia. Although wages in healthcare rose last year, the trade unions representing healthcare workers are dissatisfied with current wage levels and thus issued strike alerts in May 2007. The Ministry of Health proposed to increase wages in the sector, but considers the trade unions’ demand of a 30% rise as unattainable.

Wages of healthcare workers

According to data from the Slovak Statistical Office (Slovenský štatistický úrad, ŠÚ SR), wage increases in the healthcare sector are among the lowest in the economy. From 2003 to 2006, the highest increase of nominal wages was recorded in public administration, defence and compulsory social security. Nominal wages in the latter sector increased by 44%, while real wages grew by 25%. During the same period, nominal wages in the healthcare sector increased by 25% and real wages rose by 9%. In the last three years, real wages in the healthcare sector increased, on average, by 3% annually, while real wages in public administration, defence and compulsory social security increased by more than 8% annually.

On several occasions, healthcare employees have demanded higher wages. At the beginning of 2006, the Medical Trade Unions’ Association (Lekárske odborové združenie, LOZ) organised a strike in faculty hospitals, demanding a 25% increase in wages (SK0604029I). After the general elections in Slovakia in the summer of 2006, the new government promised to increase wages in the healthcare sector. Nevertheless, LOZ remained on strike alert until September 2006, when the new parliament postponed the planned transformation of state-owned healthcare facilities by one year.

Trade unions threaten strike action

The sectoral collective agreement signed by the Slovak Trade Unions of Healthcare and Social Welfare (Slovenský odborový zväz zdravotníctva a sociálnych služieb, SOZ ZaSS) for 2006 established a framework for a 20% wage increase for healthcare workers covered by the agreement. This achievement by SOZ ZaSS put an end to the strike action organised by LOZ in the faculty hospitals. Although a wage increase was implemented in the healthcare sector in 2006, the trade unions operating in the sector consider the achieved wage level to be still too low. In April 2007, LOZ expressed its dissatisfaction with the current wage situation in the healthcare sector and demanded a further wage increase of about 30% for workers in faculty hospitals. In addition to the request for the wage rise, LOZ also demanded an end to the transformation of state-owned healthcare facilities into shareholding companies. As the government failed to respond to its demands, LOZ issued a strike alert on 1 May 2007. At that time, SOZ ZaSS negotiated on behalf of 27,000 employees the sectoral collective agreement for 2007. As the trade unions were unsuccessful in negotiating a 30% wage increase, SOZ ZaSS also issued a strike alert on 21 May 2007.

The trade unions involved in the wage dispute warned the government that the situation in the healthcare sector is serious and could lead to industrial action. According to the Slovak Medical Specialists’ Union (Slovenská lekárska únia špecialistov), if an overall wage increase takes place in the healthcare sector, private medical specialists will also require higher payments for their services from health insurance agencies.

Ministry’s proposal

The Ministry of Health (Ministerstvo zdravotníctva Slovenskej republiky, MZ SR) has examined wage levels in the healthcare sector and proposed some options for increasing salaries. The Minister of Health, Ivan Valentovič, recommended increasing the wages of doctors and nurses in faculty hospitals twice, by 10% each time, over the period from 1 July to 1 November 2007. According to the minister, the trade unions can only negotiate a wage increase with the management in hospitals. However, Minister Valentovič considers that the unions’ request for a 30% salary increase is unrealistic. Nevertheless, the trade unions want to negotiate with the government, in the hope that it could allocate some additional financial resources for the healthcare sector.

According to the sectoral collective agreement for public service employees for 2007, wage levels in healthcare services should be increased by at least 5% (SK0705029I). The proposal of the MZ SR exceeds the terms agreed in the collective agreement. According to an MZ SR representative, hospitals in Slovakia have signed more advantageous contracts with health insurance agencies than before, and they should also have more financial resources for wage increases in 2007. The ministry also considered the option that the state should continue to pay the 5% compulsory health insurance contribution for public sector employees. This measure could inject financial resources of approximately SKK 4.5 billion (about €1.3 million as at 5 July 2007) into the healthcare sector. Additional resources for a wage increase could also be found in a lower value-added tax (VAT) rate for medical and sanitary goods. According to Minister Valentovič, the government did not promise to increase the wages of healthcare workers by 30%. Rather, it promised a wage increase of 20%, which would be implemented in two stages in 2007. Along with the wage growth in 2006, this amounts to a total wage increase of 40% for healthcare workers. Therefore, the minister considers the strike alert issued by the trade unions to be unfounded (see Pravda newspaper article, ‘Valentovič: 30 percent sme lekárom nesľúbili (in Slovakian)’, 21 May 2007)

Commentary

According to the Association of Slovak Hospitals (Asociácia nemocníc Slovenska, ANS), it is necessary to increase the wages of healthcare workers in general hospitals, at least to the level of that received by workers in faculty hospitals. ANS considers that the financial resources of general hospitals should increase; however, these hospitals should not follow the pattern of the faculty hospitals, which do not rationalise their activities in order to generate resources to increase employees’ wages. However, improvements in the country’s healthcare sector should not be limited to wages. There is also a need to address the whole system of financing and the management of finances in the healthcare sector. According to the Health Policy Institute (HPI), wages in the healthcare sector can increase only at the risk of rising debts, which has been an ongoing problem in state-owned hospitals. The MZ SR has indicated that, in order to tackle this issue, it has prepared measures for the rationalisation of the healthcare facility network, preventing hospitals from running into further debt. However, the proposals have raised much discussion about which healthcare facilities should be closed down.

In the previous year, SOZ ZaSS was successful in the collective bargaining round for 2006 and did not join the strike action organised by LOZ (SK0605029I). This year, the trade unions affiliated to LOZ, as well as those affiliated to SOZ ZaSS, issued a strike alert regarding their demands for wage increases that reinforced their chances in the negotiations. SOZ ZaSS achieved partial success in the negotiations, by concluding a bilateral agreement with the management of larger hospitals with respect to a 10% salary increase from June 2007. However, LOZ, which was not involved in the negotiations, questioned the legitimacy of the agreement.

Ludovít Cziria, Institute for Labour and Family Research

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