Caritas blocks general wage increases in geriatric care

Article in the Perspectives series by Matthias Neumann. (Article as PDF) [caption id="attachment_4500" align="alignleft" width="313"] Care Revolution Dortmund[/caption] The fact that Caritas has rejected the extension of the collective agreement agreed between ver.di and the Federal Association of Employers in the Care Sector (BVAP) to the entire geriatric care sector has caused quite a stir. In order to understand the significance and to be able to position oneself here, answers need to be found to a few questions: 1) Why is a collective agreement that applies to the entire sector necessary at all; why is wage protection not simply left to trade union battles or the market mechanism? 2) Why is the unusual route via the Posted Workers Act chosen in order to secure an acceptable minimum level in geriatric care? 3) Why did the employers' side of Caritas decide to block the agreement, and what is to be made of their statement that they want to protect the good wages of church organisations? 4) And what needs to be done now? 1) Long-term care insurance, which is used to finance care for the elderly, was introduced in 1995 when neoliberal policies were on the rise. The current long-term care insurance is intended to reduce costs through competition between the providers and at the same time make profits possible. This is why, unlike health insurance, it is not regulated as full insurance but as a capped subsidy. The frequently used term "partially comprehensive insurance" is not accurate: while partially comprehensive insurance requires the insured person to pay a fixed amount and the insurance company pays the additional costs incurred, the reverse is true for long-term care insurance: the insurance company pays a fixed subsidy, leaving families and local authorities to deal with the large remainder on their own. As the subsidies have not been increased appropriately, the personal contribution continues to rise. As a result, higher wages for employees, who make up the majority of a care home's operating costs, lead to rising care rates. These are passed on to the cost bearers and, in particular, to those in need of care and their relatives. Even though collectively agreed wages have had to be recognised in care rate negotiations between care home operators, care insurance funds and local authorities since the Care Reinforcement Act I in 2015, this structure of care insurance exerts pressure to keep wages low and staffing levels low: The local authorities want to limit the costs they incur through the payment of care assistance, and the insurance funds also try to keep their expenditure low. Care home operators, in turn, are competing for the utilisation of care home places. In this competition, costs are a central argument in view of the high and rising co-payments for those in need of care and their relatives. Although collectively agreed wages must be recognised and financed in the care rate negotiations, the parties involved have an interest in low wages in geriatric care. It could be assumed that in geriatric care, an industry with a massive shortage of skilled workers, the labour market would already solve the problem of low wages. Although wages in geriatric care are actually rising at an above-average rate for both skilled workers and assistants, this progress is far too slow given the situation of the employees. According to data from the employment agency, skilled workers with a comparable level of qualification still earn 3% less than the average for the economy as a whole, while helpers earn 8% less. This difference, which may not seem that big, becomes even more dramatic in view of the fact that many more employees have to work part-time than in all other sectors, mainly due to the workload. The fact that the trade union is not using this situation to push through faster wage increases has to do with the special situation in geriatric care. This makes it very difficult for employees to build up the necessary pressure: In contrast to hospitals, where a strike reduces the income from the flat rates per case due to the restriction to an emergency service, a strike in a nursing home does not cause any direct financial damage to the operator. This is because the care rates continue to be paid during the strike; the operators therefore retain their income. In this respect, the situation is comparable to that in daycare centres. However, a daycare centre can be closed during a strike and the children can be left in the care of their parents. This is not possible in a care home. A friend who works in the sector told me that in the event of an emergency service strike, what the residents enjoy would also be cancelled. The employees' sense of responsibility towards those in need of care therefore limits their ability to act in industrial action. 2) The usual way to enforce a generally binding collective wage is via the Collective Bargaining Act. § However, Section 5 TVG only provides for a joint application by the collective bargaining parties to declare a collective agreement generally binding if it already applies to at least 50% of employees. ver.di and BVAP are a long way from this. However, as neither the labour market nor the minimum wage for nursing care sets a sufficient lower limit for wages in the care of the elderly, the German Posted Workers Act (Arbeitnehmerentsendegesetz) has created the possibility of applying for the extension of a collective agreement to the entire sector even without the 50 percent hurdle. However, the labour law commissions of Caritas and Diakonie were also granted a special right in that their approval is required for this extension application. If Caritas declares that the minimum care wage would represent a sufficient lower limit, the figures say otherwise: the collective agreement between ver.di and BVAP is 9%-10% higher than the minimum care wage, depending on the level of qualification. At least this amount, and considerably more in the case of long-term employment, is lost by geriatric nurses who currently work for the minimum care wage. 3) The special role of church organisations is explained by the so-called Third Way. Instead of a wage employment relationship with the right to industrial action, this constructs a "service community" in which, among other things, the right to strike is at least severely restricted. Defending this special regulation is also the only comprehensible reason why the "employer" side of Caritas is blocking a generally extended collective agreement. Norbert Altmann, spokesman for the "employer" side, made a relatively hidden statement to this effect in an interview: "Labour lawyers warn that this would fundamentally call the third way into question." This third way is in fact purely in the interest of the "employers", which is important to emphasise, because it is not Caritas or its Labour Law Commission as a whole that has adopted this blocking stance, but the opposition to the extension of the collective agreement comes from the "employers" on the commission, who have a de facto right of veto due to their equal representation. Like many Catholic social ethicists, the employees' side of the commission strongly criticised the decision: Thomas Rühl, spokesperson for the employees' side of the Caritas Labour Law Commission, said: "The employers' side has massively damaged the reputation and credibility of Caritas with its refusal to accept the agreement." Even Caritas as an organisation as a whole is critical of the result of its Labour Law Commission: Peter Neher, President of the German Caritas Association, "declared on Friday in Berlin that the decision of the Labour Law Commission (AKR) "damages the credibility of Caritas and it comes at an inopportune time for the Catholic Church", because Caritas, like Diakonie, is not one of the organisations that pay particularly low wages and would therefore be negatively affected by a collective agreement covering the entire sector. Low wages are paid in particular by private, profit-orientated organisations, but also by others such as the DRK. It was therefore no coincidence that the Red Cross did not participate in the BVAP collective agreement. Accordingly, it is the two associations of private providers (AGVP and bpa) that, along with the Evangelische Heimstiftung, strongly dispute the constitutionality of a collective agreement that is binding for all. Caritas has thus taken the work away from these operators and instead exposed itself to well-deserved criticism. The "employer" side of Caritas argues that it does not want to prevent higher wages, but on the contrary wants to protect its existing wage level. This is because a generally binding collective agreement would jeopardise the recognition of the better employment contract guidelines (AVR) of the church organisations. This statement has also caused uncertainty in progressive circles. It is said that a collective agreement covering the entire care sector could jeopardise church wage levels by only recognising this collective agreement in care rate negotiations, but no longer better regulations in church AVRs or in the public TV-Pflege. However, the law that forms the basis for this does not allow for this at all. Section 84 (2) SGB XI only states: "The payment of salaries up to the level of collectively agreed remuneration and corresponding remuneration in accordance with church labour law regulations cannot be rejected as uneconomical." There are different collective agreements and they are all recognised. Neither ver.di nor the employee side in the Caritas Labour Law Commission share the concerns raised here. The latter in particular would be the ones directly affected by a deterioration. However, they have argued in favour of a general extension. In defence of the argument that wages under the church's AVR are at risk, a legal opinion is cited, including by the thoroughly progressive theologian and social scientist Franz Segbers, who, like ver.di and Care Revolution, criticises the neoliberal construction of care insurance, which strengthens the concerns of the "employers". On closer inspection, however, this expert opinion proves to be an air number: the legal opinion has a different subject matter; the question relevant here is addressed in three sentences on the 70 pages, speculatively and without any discussion of legal norms or precedents. On page 68, it is indeed stated: "Care insurance funds could argue with an organisation that wants to pay more that remuneration above the generally binding collective agreement is no longer appropriate." However, the report is not more specific than this and therefore does not provide a legal argument. In contrast to this, the above-mentioned letter from Catholic social ethicists states that a legal ordinance that makes the collective agreement between ver.di and BVAP generally binding "does not invalidate existing collective agreements and ... also the Caritas collective agreement - provided that the new minimum conditions are met." (p.5) It is also politically obvious that in a situation of acute shortage of skilled workers in geriatric care, payment according to better regulations could be legitimised and, above all, enforced at any time. Conversely, an attempt to lower the wage level as part of the care rate negotiations would trigger massive social and company protests, which nobody would risk. It therefore seems logical in every respect that ver.di and the employee sides at Caritas and Diakonie see no risk in a generally extended collective agreement. 4) In his article linked above, Segbers explains that the aim is to take action against "the politically desired social dumping" that is at the heart of the care insurance system. He can be wholeheartedly endorsed here. However, the protest is being organised by those who are now demanding a generally binding collective agreement. By contrast, such protests from church organisations have only ever been heard from a few committed employees and branches. In fact, it is necessary to fight for a solidly financed full insurance scheme in the care sector. In view of the aforementioned difficulty of building up pressure in industrial disputes, the cooperation of carers, employees and all those outraged by the treatment of those in need of help and those who look after them is particularly important in the care of the elderly. Until we have made progress here, however, everything must be done to improve the situation of employees in the care of the elderly. This includes a collective agreement that covers the entire sector. This is opposed by the "no" of the Caritas service providers, who are thus defending their undemocratic ecclesiastical special path at the expense of employees in private homes, but also in many facilities run by "non-profit" organisations, who are being denied urgently needed pay rises. Using massive and persistent protests to pressure Caritas "employers" - and those of the Diakonie, who are currently able to hide behind the Caritas decision - to give in is certainly one of the most promising ways to achieve improvements.