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UPMC to increase minimum starting wage to $15 an hour

| Tuesday, March 29, 2016, 10:15 a.m.
Stephanie Strasburg | Tribune-Review
Critics over the years have staged protests over UPMC's wages.

UPMC, the health care giant once derided by a Pittsburgh politician as a “national disgrace” for its salaries, announced Tuesday it plans to boost minimum entry-level hourly pay at most facilities to $15 from $11.73 by 2021.

The raises affect employees at urban UPMC facilities including UPMC Presbyterian, Shadyside, Mercy, Magee-Womens and Children's hospitals, said John Galley, UPMC's senior vice president and chief human resources officer.

Galley said the salary increases are based on an ongoing market evaluation and effort to remain competitive.

“This is part of UPMC's overall compensation budget, and therefore we do not look at this in a vacuum or separately from our broader compensation goals,” he said.

Pittsburgh City Councilman Ricky Burgess, who last year chaired a hospital wage review committee that called for $15 minimum hourly salaries, congratulated UPMC for taking what he described as a “bold step.” The committee found the nonprofit hospital system's wages to be insufficient, prompting Burgess to make the “national disgrace” comment to other council members.

“We do not believe this happened by accident,” he said Tuesday. “We believe that testimony before that committee helped change the climate and make this possible.”

Some employees, who have protested for higher wages and rallied in front of UPMC's Downtown headquarters, claimed victory.

“This will show Pittsburgh and UPMC employees that, when we stick together and fight, workers win,” said Louis Berry III, who works in the housekeeping division at UPMC Montefiore in Oakland. “It's a victory, but it's a small victory. I think the wages should increase tomorrow; waiting until 2021 is a bit of a smokescreen.”

Berry, 56, of Penn Hills said he's not giving up on an effort to unionize more workers.

Currently, less than 5 percent of UPMC's workforce is organized, according to UPMC. Pay rates for those employees are pre-determined by union contracts.

“A union is still extremely important,” Berry said. “Workers want to be able to sit down and have a voice about their jobs. We deserve that; we run these hospitals.”

Some wondered whether the wages will stave off any legitimate unionization attempts.

“You can argue that raising wages is a union-avoidance strategy,” said Mark Price, an economist at the Keystone Research Center in Harrisburg. “That has been an effective tactic in southern states.”

Either way, UPMC's announced salary structure greatly outpaces inflation, he said. Pennsylvania's minimum wage is $7.25 an hour.

“It's unconditionally a good thing,” Price said. “It's good for UPMC workers and good for future potential workers.”

With 62,000 employees, UPMC is the largest non-government employer in Pennsylvania. Implementation of the wage increases is expected to begin in 2017.

“We are very proud of our wages, generous benefits and other rewards and of the tens of thousands of jobs at UPMC that have meaning and purpose, and that fulfill an incredibly important mission for the region and the communities that we serve,” Galley said.

Galley said outlying community hospitals, such as UPMC East in Monroeville, will see minimum wages rise to $14.05 from $10.99 an hour. Farther away, minimum wages for employees at regional facilities such as UPMC Hamot in Erie will increase to $13.15 from $10.29.

About 10,000 employees will be affected by the entry-level salary increases.

“It is important to recognize that all UPMC salary ranges will be moving over the next five years,” Galley said.

Mayor Bill Peduto, who last year issued an executive order to raise the pay of about 300 city employees gradually to $15 per hour, lauded UPMC's announcement.

“We are honored to have our region's largest employer join us in our drive for $15 an hour,” he said. “We still have a lot of work ahead of us to ensure that our new economy is an economy for all Pittsburghers, but today is a big step forward. I commend UPMC for taking this step on behalf of low-income employees, many of whom are Pittsburgh residents, and for showing how good wages mean good business for employers.”

Allegheny County Executive Rich Fitzgerald concurred.

“This is an exciting announcement for our region, and I commend UPMC for making a decision to improve the wages for so many in our community,” he said.

Discussions about UPMC's controversial tax-exempt status continue, said Peduto's chief of staff, Kevin Acklin.

“This definitely complements that discussion, but I don't take away from UPMC's announcement,” he said. “This is a big step forward when the city's largest employer heeds the call for $15 an hour. We applaud UPMC and hope other local employers will follow their lead.”

Leslie Poston, a medical secretary at UPMC Presbyterian who organized Downtown protests over the health giant's wages, said she felt vindicated.

“UPMC executives said they would never pay workers $15 an hour, but hospital workers came together to stand up for our rights and for better pay, and we won the raises our families and communities need and deserve,” said Poston, who currently earns $13 an hour.

Ben Schmitt is a Tribune-Review staff writer. Reach him at 412-320-7991 or bschmitt@tribweb.com.

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