This year, the nurses at St. Christopher’s Hospital for Children celebrated a major victory.
They had won powerful staffing guidelines in their new union contract, the first in the state with enforceable standards for how many patients one nurse could be required to care for at a time. Staffing has been a top priority for nurses’ unions across the country, who say that when nurses are stretched thin, the consequences can be deadly.
But now, the fate of the contract is in question.
As St. Christopher’s is purchased for $50 million by Tower Health and Drexel University as part of a bankruptcy sale, Tower says it will not honor a contract it didn’t negotiate — a standard move for a buyer — and nurses are readying for a fight to get its new owners to do so.
“All options are on the table if they don’t,” Sue Swift, president of the 500-member PASNAP local at St. Christopher’s, said in a statement.
There’s one thing, though, that could have helped the St. Christopher’s nurses: successorship language, a clause in the contract that requires a new owner to honor an existing contract.
In a time of increased instability for workers, these clauses have become more common as a way for union members to hold on to the gains they’ve made. New digital media unions, for example, have fought for and won this kind of language in their contracts as the media industry continues to consolidate.
In Philadelphia, the closure during the summer of Hahnemann University Hospital drove the nurses and techs at nearby Temple University Hospital, also represented by PASNAP, to make the language a top priority in their recently ratified contract.
Successorship, union leader Carlos Aviles told the Temple News, was the “heart and soul" of the contract.
A deal killer?
Ensuring that a buyer will honor an existing contract is an important way to protect workers in a merger, which is in part used to cut labor costs, said Rebecca Kolins Givan, a professor of labor relations at Rutgers University. If two hospitals merge and one hospital pays its workers more or gives them better benefits, it’s standard for the hospitals to “harmonize” the standards to the lowest common denominator, she said.
Without that kind of language in a contract, a new buyer has no legal obligation to honor an existing contract. But according to labor law, it does have to recognize a union if it hires a majority of the bargaining unit — which generally happens in health-care mergers, said Nan Lassen, partner at Philadelphia-based union-side labor law firm Willig, Williams and Davidson.
Sometimes, though, a new owner will try to dissolve a union it has acquired: The PASNAP nurses at Pottstown Memorial Hospital said that after Tower Health acquired Pottstown in 2017, it carried out an anti-union campaign with fliers and meetings.
There are potential risks for employers who agree to this kind of language because it’s on the current employer to make sure a buyer knows that the contract is part of the deal. Otherwise, a union could take legal action to stop the sale.
That could put a hospital that’s searching for a buyer at a disadvantage, said Joshua Nemzoff, a New Hope-based health-care consultant who specializes in mergers and acquisitions.
“When you’re the seller, you can force a buyer to do things if you have leverage,” he said. “But if you’re distressed, and virtually all hospitals being sold are distressed, you lose that leverage.”
Are union contracts ever a deal killer?
Sometimes, says Nemzoff, citing contracts he’s seen with what he called “ridiculous” work rules — those that make firing workers impossible, for example, or that govern the use of part-time workers so that employers can’t be flexible with staffing.
It’s not clear yet whether the nurse-patient staffing guidelines that St. Christopher’s nurses won will be a major sticking point for Tower. The sale is scheduled to close by Dec. 13.
Tower Health, which bought five hospitals in the region for $418 million in 2017, reported a $167.9 million operating loss in the last fiscal year. This issue with the nurses’ contract at St. Christopher’s is just the latest in a series of clashes between Tower and the unions representing workers at the hospitals it acquired.
Tower spokesperson Jessica Bezler said Tower looks forward to negotiating new contracts with PASNAP and 1199c, which represents service workers at St. Christopher’s.