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Company eases way for unionization of low-paid home health care workers

by Liz Hoffman
Feb 10, 2009


Liz Hoffman/MEDILL

SEIU Illinois & Indiana President Keith Kelleher (left) and Addus HealthCare CEO Mark Heaney flank two home health care workers after signing an agreement that will allow the union to organize thousands of workers.

Home health workers by the numbers

Home care workers help elderly and disabled people with daily tasks like bathing and dressing, and perform some medical duties – and do so at a fraction of the cost of a nursing home or other long-term care facility. They also allow patients to stay in their homes and communities and maintain some of their independence.

But they are among the lowest-paid workers in the health care industry. They are compensated at much lower rates than similar aide positions.

Here, a look at home care workers, by the numbers. This data was compiled from the Bureau of Labor Statistics 2007 data and a 2001 General Accounting Office review of the health care workforce.

Percent of home care workers who made minimum wage in 2007. Because home health care workers fall under a “companionship exemption” to the federal Fair Labor Standards Act, they are not entitled to minimum wage or overtime compensation, upheld by a 2007 Supreme Court decision.

Median hourly wage of a home care worker in May 2007. That is a third  less than pharmacy aides make, about half of what massage therapists make, and about a third of what occupational therapy assistants make per hour -- even though home care aides do many of those same tasks.

Percent of home care workers who lived below the poverty line in 2000. Nearly 15 percent were eligible for food stamps. Across all health aides, just 10.5 percent were living below the poverty line, and 5.5 percent were eligible for food stamps.


Percent of home care workers without health benefits in 2000.


Median annual income  wage in May 2007 -- the lowest of 15 health care aide jobs that the Bureau of Labor Statistics groups together.

Percent of home care workers in 2000 who earned less than 200 percent of the federal poverty line, which means they are eligible for the very care they provide, much of which is paid for through Medicaid.

'They've had no voice'

Tuesday’s announcement of a renewed partnership between SEIU and Addus HealthCare is the most recent triumph for home health care workers.

These employees – the vast majority of whom are black or Hispanic women – have historically been underpaid, underappreciated, and underrepresented in organized labor, said SEIU President Andy Stern.

The complexity of labor law and the diversity of the industry itself have made it hard for unions to organize home care workers.

The result has been a disenfranchised group of health care workers whose importance to the industry is growing as baby boomers age and health care costs skyrocket, said Stern, who spoke at Tuesday’s press conference.

“They’ve really had no voice,” Stern said. “And until we came along, they had no union that really paid attention to them.”

For decades, home care workers’ status under labor law was murky at best. They were mostly paid by the government – through Medicare and Medicaid reimbursements – but were not considered federal or state employees. Instead, they were labeled independent contractors, who cannot unionize.

In addition, a 1974 amendment to the Fair Labor Standards Act created a “companionship exemption,” which says that workers like home health caregivers are not entitled to minimum wage or overtime.

Logistically, home health care workers have been harder to unionize, largely because of the nature of the work itself and the diversity of the providers, said Bill Dombi, vice president for law at the National Association of Home Care & Hospice in Washington.

Most workers do not come into a central office, but rather spend most of their time in the field. There is not one single certification program or regulating body. Companies range from mom-and-pop operations with annual revenues of a few hundred thousand dollars to multibillion-dollar giants.

“It’s not like Walmart, where a union rep can stand outside the door and whoever walks out with a blue vest is a potential member,” Dombi said.

And a single facility might only have two dozen workers, which means high investment costs for union organizers with no guarantee of a result.

“This group of employees had been largely written off as unorganizable,” said Peggie Smith, a professor at the University of Iowa College of Law and an expert on home care labor law.

But several breakthroughs in the past decade changed that thinking.

In 1999, SEIU unionized 74,000 home health care workers in Los Angeles County – the largest single unionization in the country since the 1940s. Successes in Oregon and Washington state followed, and SEIU began aggressively trying to bring home care workers into its fold.

Agreements like the one renewed Tuesday between SEIU and the Palatine-based Addus HealthCare are a major step in that direction. Management has agreed to remain hands-off as SEIU organizers approach their workers, which realigns the incentives for the union, Smith said.

Rather than fighting tooth-and-nail for a dozen workers at a time, the union can invest its  time, money and staff at facilities with a guarantee of new members and none of the hassle of dealing with hostile management.

“Before, you had to think about how much energy and resources will it take for me to try to get these workers organized and what’s going to be the level of resistance coming from that local agency?” Smith said. “This changes that process.”

A leading Illinois-based health care provider announced an agreement on Tuesday that will continue to pave the way for thousands of home care workers – among the lowest-paid and least organized in the industry – to unionize.

Addus HealthCare, based in Palatine, and the Service Employees International Union announced the renewal of a “neutrality agreement” originally signed in 2006. Under the agreement, which runs through 2010, Addus will not oppose the union’s continued efforts to organize workers at its 119 facilities in 11 states.

SEIU has been organizing Addus employees – with the company’s blessing – for more than 20 years. Only about a quarter of Addus’ 12,000 employees are not unionized, mostly in Sun Belt states like Nevada and New Mexico, and the coming efforts will target those workers, said SEIU Illinois & Indiana President Keith Kelleher.

The move is being heralded as a win-win for labor and management: Historically underrepresented workers join the nation’s largest union of health care employees, and Addus gets a more stable workforce and a powerful partner for its lobbying efforts.

“If you cast away ideology and just focus on the bottom line, this partnership works,” SEIU President Andy Stern said. “What’s sad is that too many people in business let their anti-union ideology get in the way of their bottom line.”

Home health care, in which workers help elderly or disabled patients with daily tasks and perform some simple medical duties, is one of the fastest-growing segments of the economy.

More than 800,000 workers delivered $58.7 billion in home health care in 2007,  according to the Bureau of Labor Statistics and the Centers for Medicare and Medicaid Services.

The two government programs pay for more than three-quarters of all home health care, according to National Health Expenditures.

As baby boomers continue to age, the Bureau of Labor Statistics has projected the number of home care workers to increase by almost half by 2016.

“We’re really talking about the face of the next 30 years of health care,” said Bill Dombi, vice president for law at the National Association of Home Care & Hospice in Washington.

But even as the demand for their services increases, these workers remain among the lowest-paid in the health care field. The average home care worker earned just $9.62 per hour in 2007, according to the Bureau of Labor Statistics, far less than similar positions like occupational therapy assistants or nursing aides.

One in 10 is eligible for Medicaid and almost one-fifth live below the poverty line, a 2006 University of California at San Francisco review of federal data found.

“No one standing behind me is overpaid,” said Addus CEO Mark Heaney at Tuesday’s press conference, to applause from the three dozen workers and union organizers in attendance.

Home caregivers often work odd hours and long days and spend a lot of time on the road. Helping the elderly or physically disabled includes heavy lifting and other demanding physical activities, and can take an emotional toll on workers, too.

“This is really tough work,” said Peggie Smith, a professor at the University of Iowa’s law school and an expert in home health care. “It’s not being valued by the health care system the way it should.”

The agreement does not address any of these issues, which will be handled by collective bargaining  at the local union level. 

But in Illinois, collective bargaining has brought tangible benefits for the state’s 5,400 Addus employees. A contract signed this fall included a $1-per-hour raise and – for the first time ever – health insurance.

“Having access to health care and better wages put a pep in our step,” said Alberta Walker, a home care worker and a member of SEIU’s bargaining committee.

It’s easy to see the benefit for workers and for the union, which can continue to expand its ranks. But what does Addus get by inviting in a union known for getting its workers wage and benefit increases?

A professional, happy and stable workforce, said Heaney, who called the decision to work with SEIU “simple business math.”

Low pay and tough conditions cause high turnover rates for home care workers – more than 30 percent annually, according to some studies. A more stable workforce means that Addus can spend less money recruiting and training workers.

“The upside of this relationship is tremendous,” Heaney said.

In addition, Addus benefits from SEIU’s political clout as it continues to lobby Springfield and other state legislatures for higher Medicaid reimbursement rates. A unique provision in the agreement gives workers paid days to meet with officials, and they will advocate side-by-side with the union’s powerful political lobby.

“We have proven that the faces of the workers and the clients … combined with the professional expertise of the management, is a winning combination,” Stern said.

Bill Dombi, vice president for law at the National Association of Home Care & Hospice in Washington, which  represents some 6,000 home care and hospice companies nationally, said the  cooperation between SEIU and Addus could have ripple effects across the industry.

“In Addus, you have a well-known, well-respected company that is saying that they are capable of working with a union,” Dombi said. “The natural fear some companies have about the potential of unionization might be tempered.”