One of North America's largest operators of seniors' care homes is laying off all of its unionized staff at Malaspina Gardens in Nanaimo and will replace them with contracted-out workers by July, part of a plan to build a new facility.
The 177 workers at the 135-bed long-term care home got word just after New Year's Day from employer Chartwell Seniors Housing Real Estate Investment Trust, which operates in 180 Canadian and U.S. locations.
Chartwell's senior vice-president of operations said the "rebuild" isn't possible unless financial decisions are made.
"Resources are limited in health care," Donna Marasco said from Vancouver.
But she refused to confirm that the contracted-out workers would be paid less.
"I'm not going to say any more," she said of possible wage reductions.
The Mississauga-based company is committed to providing quality service for residents while remaining a viable business, Ms. Marasco said.
Keeping shareholders, residents and staff happy is the goal, she added.
After paying all 177 employees severance as well as providing job-seeking assistance, she didn't know if net savings would be generated.
What's more certain is that if the seismically unsafe facility isn't rebuilt, it could close.
"It's a very aged building," Ms. Marasco said of one of the oldest properties in Chartwell's North American portfolio. It is in fact two buildings, the older one, the former Nanaimo Hospital, having been built in 1928.
The spokesman for the union representing the bulk of the laid-off employees expects wage reductions to be more than 30 per cent, based on past instances in B.C. where unionized workers were replaced by non-union staff.
"The company, a for-profit corporation that receives funding from the province, made a decision to lower its wage bill to protect profit," said Hospital Employees' Union communications director Mike Old.
HEU represents 150 union employees who work as licensed practical nurses, care aides and support staff at Malaspina Gardens. Roughly 80 are full- or part-time and 70 are casual employees. The remaining 27 union employees are predominantly nurses.
At Malaspina, care aides earn about $22 an hour under HEU's current agreement. In non-union workplaces, a care aide's hourly wage drops to about $15 an hour, Mr. Old said.
It was the passage in 2002 of the Liberals' Bill 29 that charted the path for Chartwell. The still-contentious legislation allows B.C. care facilities to contract out unionized health-care jobs.
In 2002, the previous owners of Malaspina Gardens contracted out unionized dietary and housekeeping staff. Chartwell purchased the facility in 2005.
Ms. Marasco is confident that even with non-union workers, the level of resident care will not diminish. Staffing levels will remain the same. She assumed some of those laid off will apply for their former positions.
Chartwell intends to soon begin redevelopment discussions with the Vancouver Island Health Authority, said Chartwell spokeswoman Sharon Henderson.
According to VIHA spokeswoman Shannon Marshall, Chartwell hasn't approached VIHA with redevelopment plans.
"Whatever the case, they'll need to operate in accordance with contract they have with us," Ms. Marshall wrote in an e-mail response.
VIHA's contract provides funding for 135 beds at Malaspina Gardens. Chartwell collects the room and board amount directly from the client. VIHA fully funds the cost of care, plus any amount that the client can't cover for their room and board, wrote Ms. Marshall.