Aged Care Providers to Judicially Review DHBs

MEDIA RELEASE

16 July 2007

Aged Care Providers to Judicially Review DHBs

Aged care providers are taking judicial review proceedings against District Health Boards. This follows a break down in negotiations after DHBs failed to address concerns regarding the “strings” attached to the $35 million Budget funding increase.

At present, the increase requires a specific funding “boost” for caregivers and cleaners wages of 2.45% for rest homes and 2.12% for hospitals.

Providers agree the sector needs to pay higher caregiver and cleaner wages, and have agreed to pass on every dollar of the caregiver wage increase. Providers have also agreed to be audited to ensure compliance. However, DHBs refuse to accept this offer.

Instead DHBs are insisting they will only pass on the Budget increase if providers agree to (a) pass on an automatic wage increase of $1 per hour to all caregivers and cleaners regardless of what rate they are currently on, (b) accept a minimum sector wide pay rate of $12.55, and (c) accept new collective agreement clauses not found in any other contract in the country, or even in the Employment Relations Act.

“The clauses proposed by DHBs cover areas completely outside the concern of these government agencies. DHBs are attempting to impose obligations on aged care employers, which no other employer in New Zealand currently has. As such, our advice is that the clauses are unlawful and should be challenged in court,” said Martin Taylor CEO of Health care Providers NZ.

“The arguments we hear from DHBs and the Minister, are that these clauses are needed to increase caregiver wages. If that were true why would they refuse to accept our offer of passing on every dollar of the low paid worker funding we receive, and agree to submit to a third party audit to verify that fact? The reality is there is another agenda here, to see how far a government agency can regulate private sector employers via service agreements”, said Mr Taylor.

“Aged care providers are committed to improving wage rates and the current DHBs position ignores the sector’s good record of passing on funding increases to workers. Last year caregiver wages rose on average 4.7% and nurse wages by 6.7%, which was in line with the 3% inflation increase given to rest homes and the 5.9% given to geriatric hospitals”, said Mr Taylor.

ENDS

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