Steward Health Care System eliminated the security staff at four of its Massachusetts hospitals earlier this month, outsourcing about 50 jobs to a New Jersey-based contractor with connections to Steward’s parent company. The hospital guards, several of whom had been on staff for more than 20 years, trained some of the workers who replaced them under the new company.
Most of the Steward guards at Quincy Medical Center, Merrimack Valley Hospital in Haverhill, Holy Family Hospital in Methuen, and Saint Anne’s Hospital in Fall River were told they could reapply for a job with the new contractor, APG Security. Many declined to do so because it meant taking a pay cut of as much as $10 an hour, according to several former guards.
Steward said the action was taken to cut costs at a time when insurers are reducing payments to doctors and hospitals, forcing the health care provider “to do more with less.”
“Steward is a health care company, not a security company,” Steward Hospitals president Joshua Putter wrote in a letter to the for-profit chain’s executives. Outsourcing security jobs “allows us to continue to invest in clinical staff, clinical technology, and facilities so our patients continue to receive world class health care in their community,” he said.
Steward guards said they found out they were being replaced, effective immediately, the morning of Jan. 7. Sheena Duval, 23, a Quincy Medical guard who earned $16.30 an hour, said she was on her way to work when she received a voice message on her phone telling her that she had been let go. Duval, who was not technically full time but worked about 40 hours a week, said she was not offered a job with APG. Even if she had been, Duval said, she could not afford to accept the $12-an-hour rate her colleagues were told to expect.
“I was pretty upset,” Duval said when she heard the news. “I didn’t expect a phone call 10 minutes before my shift started.”
Several APG employees were already working at the hospitals and had been trained by the guards they would eventually replace, said former Quincy Medical guard Mike Mac Pherson, who made as much as $21 an hour for weekend shifts. Mac Pherson said APG did not offer him a security job.
None of the Quincy staff guards, about 12 of them, took a security job with APG, Mac Pherson said, although one accepted a position as a shuttle driver. That means the new guards do not have any veterans to train them for work that includes taking bodies to the hospital morgue and restraining psychiatric patients, he said. “If you have inexperienced people, patients can get hurt,” Mac Pherson.
APG declined to comment.
The company was selected because of its expertise in health care, particularly behavioral health, said Steward spokesman Chris Murphy, who added that many US hospitals contract out security work. Steward’s parent company, New York private equity firm Cerberus Capital Management, also has a connection to the new security contractor, according to APG’s website. Tucker Quayle, APG’s managing partner, is the son of former vice president Dan Quayle, who is a senior executive at Cerberus.
Steward Health Care System was formed by Cerberus in 2010 to run the six Caritas Christi Health Care hospitals. Since then, it has expanded the network to 11 hospitals in Eastern Massachusetts. The company’s model is built on offering lower-cost medical care with an emphasis on efficiency and innovation.
Three Steward hospitals had contract security guards before the health care company acquired them, Murphy said. At the four remaining hospitals, the guards are unionized.
Guards at Holy Family had heard they might be replaced and started organizing a union campaign, they said. The day they were let go, the guards had planned to send Steward notification about the union.
Holy Family security workers were offered new jobs at their current salaries, although APG said it could lower their pay for any reason, according to a guard who took a job with APG and asked to remain anonymous to avoid retribution. The guard was told he could keep his old health insurance, he said, but his 32 days a year of vacation, sick, and personal time were reduced to five paid days off.
More companies have been outsourcing janitorial and security in recent years to reduce expenses. Three Boston-area Hyatt hotels fired all 100 of their staff housekeepers in 2009 and replaced them with contract workers earning about half their salaries. The housekeepers were offered jobs with the new company, but only a handful accepted.
A bill sponsored by state Senator Sonia Chang-Diaz, a Boston Democrat, would keep contract workers from immediately losing their jobs if a new vendor takes over, but it does not apply to in-house staff whose positions are outsourced. The legislation would require the new employer to offer existing workers — including janitorial, maintenance, security, or aviation services employees — the opportunity to keep their position for at least 90 days.
“Whenever this happens in Massachusetts, it causes real problems — obviously for the workers’ families, but also for Massachusetts taxpayers,” Chang-Diaz said in a statement. “Laying off workers for no reason related to their performance, with only a day or two’s notice, places a totally unnecessary strain on our public assistance programs.”