POLICY ANALYSIS SERIES

ISSUES RELATED TO STATE HOSPITALS/NO. 3

 A PROFILE OF MINNESOTA STATE HOSPITAL EMPLOYEES

 1. INTRODUCTION

The Minnesota Legislature directed the State Planning Agency to prepare a study and plan regarding the state hospital system (Laws of Minnesota, Chapter 654, Section 19, Subdivisions 1 and 3) . The Legislature recognized that the closure and consolidation of state hospitals have a negative effect on employees and stated its policy that reinstitutionalization policies shall be carried out in a manner that ensures fair and equitable arrangements to protect the interest of employees . . .affected by deinstitutionalization of state hospitals." The legislation further directed the study `to provide information on topics to include, but not limited to, the following: projected displacement of state hospital employees because of reinstitutionalization by number, location and job classification; and the extent to which displacement can be mitigated through attrition, retirement, retraining and transfer."

The purpose of this paper is to address the questions of the Legislature, provide information about the employees of the state hospitals, their expressed preferences regarding their employment future, and opportunities for future state employment.

II. METHODOLOGY

The demographic analysis and profile of the state hospital employees are based upon confidential data received from the Minnesota Department of Employee Relations. The authorizing legislation specifically granted the State Planning Agency access to employee and client data for the purposes of carrying out the requirements of the study.

 ...Notwithstanding the provisions of sections 13.43 and 13.46, the State Planning Agency shall have access to private personnel data and private client data as necessary to carry out the mandates of this act until June 30,1985. (Minnesota Laws, Chapter 654, Section 19, Subd. 3:6, 1984.)

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The analysis of individual employment preferences is derived from a 26 item survey which was administered from July 23 through August 28, 1984, to employees at their respective state hospital locations. The survey was administered by an outside consultant under contract with the State Planning Agency. Participation in the employee survey was voluntary.

A total of 3,665 people responded to the survey for an over all participation rate of 66%. The participation rate varied at each hospital: Anoka 64%; Brainerd 79%; Cambridge 59%; Faribault 43%; Fergus Falls 68%; Moose Lake 74%; St. Peter 60%; and, Willmar 80%. Sixty-four percent (64%) of the survey was completed by female workers. The length of service for the respondents was as follows: less than 1 year 6%, 15 years 36%, 610 years 26%,1115 years 11%, 1620 years 11%, 2035 years 7% and 3% invalid or unknown.

The Department of Employee Relations projected the number of suitable vacancies in other agencies with work locations within a 35 mile radius of each hospital. Following is a description of the methodology the Department of Employee Relations used to arrive at its estimate of the number of available work sites within 35 miles of each state hospital. The distance of 35 miles was chosen for two reasons:

 1. The stipulations of the collective bargaining agreements require that the state pay moving expenses for employees transferred more than 35 miles from their present work site.

 2. An arbitrator's ruling determined that a refusal to accept a transfer within 35 miles of an employee's current work site is a voluntary termination, which relieves the state from any further obligations with respect to unemployment insurance and other separation benefits.

Occupations were eliminated which required qualifications or skills not suitable to the transfer of state hospital employees. The staffing needs at the other work sites were estimated for a period of up to 14 months to determine the number of vacancies which could be available to state hospital employees.

The department also projected the number of retirements by state hospital; analyzed the separations at each hospital; and, summarized the employment at each hospital by class, age and length of service.

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The Public Employment Labor Relations Act of 1971 created sixteen (16) units for the purposes of collective bargaining. Table 1 provides a listing of the units, their respective union affiliations and the typical class of employees assigned to the units. Most of the data on employees will be presented by bargaining units.

III. RESULTS

 The results will be presented in three major sections:

 A. Employee Profile: the demographic characteristics of the state hospital employees by age, sex, length of employment, wages and salaries, and by bargaining units;

B. Employee Preferences: the state hospital employees responses to several questions on the employee survey concerning their career preferences for the future; and,

C. State Government Reemployment Opportunities: the prospects for continuing state employment and maintaining employee benefits and pension and retirement benefits.

TABLE 1
STATE HOSPITAL BARGAINING UNITS

STATE HOSPITAL BARGAINING UNITS
(continued)

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A. EMPLOYEE PROFILE

1. Total Employees by Hospital

Table 2 presents the total number of legislatively authorized full-time equivalent positions at each hospital for the last four fiscal years.(The state fiscal year begins July 1 and ends June 30).A full-time equivalent position may be occupied by more than one person during a one year period.

TABLE 2
FULL-TIME EQUIVALENT POSITIONS OF MINNESOTA STATE HOSPITALS FROM FY '80  FY '84


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2. Wages and Salaries of Employees

Table 3 provides information about the average hourly wage for each bargaining unit for all employees (including less than full time employees) at each state hospital by sex.

Females comprise 64% of the state hospital workforce. The majority of women, 2,126 are employed in the Health Care NonProfessional bargaining unit. Over half (50.6%) of all state hospital employees are employed in the Health Care NonProfessional Unit and their average statewide hourly wage is $8.53 per hour.

The next largest bargaining unit is the Service Unit with 12.5% of all state hospital employees. The average hourly wage for the Service Unit is the lowest among all bargaining units at $8.10 per hour.

The professional managers earn the most with an average hourly wage of $22.50 per hour.

Hourly wages are presented in greater detail in Table 4 by both bargaining unit and sex. The table indicates:

a. Over 70% of all workers at the hospitals earn less than $10.00 per hour;

b. The percentage of all female workers earning less than $10.00 per hour is 77%;

c. 59% of all male workers earn less than $10.00 per hour; and,

d. Generally, professional employees earn more than nonprofessional employees.

Table 5 provides a hospital by hospital breakdown of the wage cluster for each state hospital.

Anoka and St. Peter State Hospitals have fewer employees earning less than $10.00 per hour (55% and 59%, respectively). Cambridge State Hospital has the highest percentage (80%) of its employees earning less than $10.00 per hour. The wage structure of the state is negotiated through collective bargaining, there by ensuring uniformity throughout the entire hospital system. The factors which explain the differences are the length of service for employees and the differences in the mix of client services.

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TABLE 3
AVERAGE WAGE BY BARGAINING UNIT IN MINNESOTA STATE HOSPITALS


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TABLE 4
HOURLY WAGE BY SEX BY BARGAINING UNIT
IN MINNESOTA STATE HOSPITALS 1984


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TABLE 5 
WAGE CLUSTERS OF EMPLOYEES BY STATE HOSPITAL  1984


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3. Age of Employees

Table 6 presents the ages bargaining unit. The table

a. 19% of all employees are of all employees by hospital and by shows the following: between 24 and 29 years old;

b. 21% of all female workers are between the ages of 24 and 29;

c. 22% of all males are between 30 and 35 years old;

d. 52% of all employees are between the age of 24 and 42; and

e. 27% of all employees are 48 years or older.

4. Length of Service

The length of state service influences an employee's rate of pay because increases in hourly wages often reflect an employee's length of service.

The average length of service for all employees is 8.15 years. The average at each state hospital varies from a low of 6.2 years at Anoka to a high of 10.5 years at Fergus Falls. Table 7 presents the average length of service by hospital and by sex.

TABLE 7

AVERAGE LENGTH OF SERVICE OF MINNESOTA STATE HOSPITAL EMPLOYEES(Full Time Employees Only)


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TABLE 6
AGE OF EMPLOYEES BY STATE HOSPITAL--1984


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Table 8 presents a more detailed breakdown of length of service by state hospital and sex. There is wide variability in the number of years of service. Some individuals are mobile and seek work experience while others have committed their careers to state hospital service.

The length of service for employees is also significant in that benefits afforded employees are often a function of length of service. In particular, the length of service dictates the state's obligation to employees who may be involuntarily terminated.

Unemployment insurance, severance and extended health insurance are related to the length of service an employee has worked. To collect unemployment insurance for the maximum period of 26 weeks requires 37 consecutive weeks of employment prior to termination.

Severance pay is a function of an employee's unused sick leave and varies depending upon how much sick leave an employee used prior to termination. All full-time permanent employees accumulate four hours of sick leave per pay period (a pay period is two weeks)up to 900 hours. Beyond 900 hours an employee accumulates two hours per pay period. the employee receives 40% of unused sick leave as severance pay up to a maximum of 900 hours of unused sick leave for a total of 360 hours. For hours beyond the maximum of 900 hours, the employee receives 25% of the unused sick leave.

The state must pay six months of health insurance for laid off employees who have three or more years of consecutive state service.

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TABLE 8
LENGTH OF SERVICE OF EMPLOYEES BY NUMBER OF YEARS AND STATE HOSPITAL  1984

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5. Separations by Hospital

One of the major concerns raised in the enabling legislation is whether or not normal attrition at the hospitals can mitigate any possible adverse effects of a hospital phasedown or complete closing. Table 9 is the actual number of separations for all hospitals for the state fiscal year 1984, (July 1, 1983 to July 1, 1984). All types of separations are included in the table, such as: retirement, death, voluntary and involuntary separations. Because of these various reasons the reader cannot draw any conclusions as to the reasons for the different rates of separations by bargaining units or by hospitals. The bargaining units included are those covered under collective bargaining agreements which offer specific protections in the event of layoffs.

The legislation specifically asks what is "the extent to which displacement (due to closure) can be mitigated through attrition,..." The answers to this question are:

a. The number of separations could enable a gradual down sizing of the state hospitals operations, but, depending upon the speed of downsizing, could not account for all needed staff reductions, particularly because the attrition rates vary by bargaining unit and hospital;

b. The number of separations at any hospital could not facilitate the complete closure of a state hospital;

c. The total number of separations for FY '84 exceeds the total number of employees at all but three hospitals; however, it cannot be assumed that a combination of normal attrition and staff transfers would make possible the closing of one hospital without layoffs; and

d. The number of separations by hospital and by selected bargaining units are shown in Table 9. The table shows:

1) The number of separations varies from hospital to hospital and from bargaining unit to unit; 
2) Faribault State Hospital had the highest number of separations for FY '84; 
3) Anoka and St. Peter State Hospitals had the fewest number; 
4) The Health Treatment Unit, #13 had the fewest number of separations, 2; 
5) The Health Care NonProfessional Unit #4, had the largest number, 439.

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TABLE 9
NUMBER OF SEPARATIONS OF ALL EMPLOYEES BY STATE HOSPITAL BY BARGAINING UNIT  1984


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6. Retirement

The legislation asked what is, "the extent to which displacement can be mitigated through, ...retirement, ..."  Table 10 shows that in FY '84, 108 people retired from the state hospitals and it also shows there are an additional 369 people who are currently eligible to retire under the Rule of 85.

The state of Minnesota has a provision in its retirement laws which temporarily makes it possible to retire earlier than previous retirement provisions. This provision is known as the Rule of 85. In adding an employees length of service and age, if the number equals or exceeds 85, then the person is eligible to retire. This provision expires December 31, 1986. As Table 10 indicates there are currently 369 people eligible for retirement and if the Rule of 85 extended three more years that number would more than double to 742.

Retirement could help mitigate any possible adverse effects of a hospital closure or downsizing; however, until people reach the age of 70, the decision to retire is voluntary.

TABLE 10
RETIREMENTS (IMMEDIATE AND PROJECTED)BY STATE HOSPITAL


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B. EMPLOYEE PREFERENCES

In order to answer some of the major questions posed in the authorizing legislation, direct input from the employees was needed. The State Planning Agency engaged an outside consultant to survey the employees. A 26 question survey was developed with the assistance of employee organizations, the Department of Human Services and the Department of Employee Relations.

The survey asked a hypothetical question: "If this state hospital were to close within the next five (5) years, or if patient/resident reductions were to result in staff reductions, and if I were offered a transfer to another hospital for a similar position, I would most likely..." The hypothetical question was followed by a set of four (4) choices:

1. Maintain my current residence, refuse the transfer, and seek other employment elsewhere.

2. Refuse the transfer, seek other employment outside the area, and change my address accordingly. 

3. Accept the transfer and move to the area offered.

4. Accept the transfer but would attempt to maintain my current residence and commute if at all possible.

Table 11 provides the total responses for all hospitals. The total number of respondents are for full-time employees only (3,154 responses) . The table shows:

1. 46% of all respondents indicated they would refuse any transfer offer (choices 1 and 2 combined);

2. Employees who indicated they would not accept any transfer varied from hospital to hospital, with Brainerd (55%) and Anoka (38%) and MooseLake (39%) having the two extremes (choices 1 and 2 combined);

3. Conversely, 51% of all respondents indicated they would accept a transfer (choices 3 and 4 combined);

4. Anoka and Moose Lake employees were most willing to accept a transfer with 61% and 59% of the employees indicating this preference (choices 3 and 4 combined);

5. 24% of all employees indicated they would also be willing to move to accept the transfer (choice 3); and

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TABLE 11
PREFERENCES OF STATE HOSPITAL EMPLOYEES 
REGARDING TRANSFER (n=3,154)

QUESTION: "If this state hospital were to close within the next five (5) years, or if patient/resident reductions were to result in staff reductions, and if I were offered a transfer to another state hospital for a similar position, I would most likely..." The hypothetical question was followed by a set of four (4) choices:

1. Maintain my Current residence, refuse the transfer, and seek other employment elsewhere.

2. Refuse the transfer, seek other employment outside the area, and change my address accordingly.

3. Accept the transfer and move to the area offered.

4. Accept the transfer but would attempt to maintain my current residence and commute if at all possible.

Source: State Planning Agency, 1984.

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6. Fergus Falls had the largest percentage (35%) of employees who indicated they would be willing to move to accept a transfer. 15% of the employees at Anoka said they would be willing to move (choice 3).

The second hypothetical question posed in this survey, "If this state hospital were to close within the next five (5) years, or if patient/resident reductions were to result in staff reductions, and if I chose not to accept a transfer to another state hospital, my next career preference would be..."

1. Work for a state agency in the field of human services.
2. Work for a state agency outside the field of human service.
3. Work in another public sector (city, county, federal) in the field of human service.
4. Work in another public sector (city, county, federal) outside the field of human service.
5. Work in private industry in the field of human service.
6. Work in private industry outside the field of human service.
7. Retire, if possible. 
8. Self employment. 
9. Return to school.

Table 12 describes the future career preferences of state hospital employees. The findings are:

1. 31% of all respondents indicated they wanted to continue working for the state in some capacity in or outside of the human service field (choices 1 and 2).

2. 26% of the respondents indicated they wanted to continue to work for the state, but outside of the human service field (choice 2) .

3. Public sector employment is the overall preference of the employees with 31% choosing some type of state employment and another 20% indicated they would prefer some other public sector employment such as at a city, county, or federal level (choices 3 and 4) .

4. Private sector employment is the least favored alternative employment option with 12% of the employees selecting private industry, and 4% indicating privately owned human services. Seven (7) percent of the employees would choose retirement, 14% indicated a preference for self-employment, 5% would choose higher education and 11% were unknown (choices 5, 6, 7, and 8) . 

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TABLE 12
PREFERENCE OF STATE HOSPITAL EMPLOYEES REGARDING TYPE OF EMPLOYER (r. = 3,211)

 
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Table 13 provides the results to the question, "Should you wish to continue in the human services field, what would be your most preferred work setting?"  The majority of employees (59%) would prefer to continue working in state hospital settings while 22% indicated interest in state operated community based services.

The least favored options were continued work in the human service field for private operated community programs with an 11% response and county operated community programs (7%).

TABLE 13 
PREFERENCE OF STATE HOSPITAL EMPLOYEES REGARDING CONTINUED WORK IN THE HUMAN SERVICES FIELD ( n = 3,209)


QUESTION: "Should you wish to continue in the human services field, what would be your most preferred work setting?" The choices on the questionnaire were:

1. State hospital. 
2. Privately operated community program (day or residential) .
3. State operated community program (day or residential) . 
4. County operated community program (day or residential) .

Source: State Planning Agency, 1984.

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 C. STATE GOVERNMENT REEMPLOYMENT OPPORTUNITIES

The authorizing legislation also asked what is, "the extent to which displacement can be mitigated through . . . transfer." The question is whether or not hospital employees could be reemployed within state government in some capacity if any state hospital should phasedown. This question needs to be refined further, because even though 51% of all employees indicated they would accept some type of transfer to another position within state government (Table 11) , over half of those indicated they would prefer to remain at their current place of residence and commute to their new job. Therefore, the question might be, "how many employees could find an appropriate job within reasonable commuting distance."

The Minnesota Department of Employee Relations estimated the number of suitable vacancies in other state agencies with work locations within a 35 mile radius of each state hospital. Table 14 depicts the potential number of openings over a 14 month period, by bargaining unit, by state hospital.

Because of its proximity to the St. Paul Capital, Anoka State Hospitals the only state hospital whose employees have reemployment opportunities within commuting distance. However, even with Anoka's potential number of transfers, there are still approximately 166 employees who would not have a job after the 14 month time period. Seventy-five of those workers are nonprofessional health care workers and 47 are members of the Minnesota Nurses Association;

The state reemployment prospects for all other hospitals is negligible. The only possible exception would be the employees at Faribault State Hospital. If the 35 mile limit were extended to include Hennepin County, then 191 employees could be reemployed within state government.

The total number of vacancies available statewide (assuming employees were willing to transfer) could absorb all the employees of anyone hospital over a 14 month period with one major exception. The exception is the people employed in the NonProfessional Health Care Unit. Table 15 does not include state hospital vacancies, which would increase the number of positions in the NonProfessional Health Care Unit from 261 to 363 depending upon which hospital might be affected. This assumes that all the state hospitals continue their staffing level at their current level.

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TABLE 14
NUMBER OF EMPLOYEES AND NUMBER OF AVAILABLE STATE POSITIONS WITHIN A 35-MILE RADIUS OF EACH STATE HOSPITAL

TABLE 15
ACTUAL NUMBER OF STATE POSITIONS OPEN IN METRO/NONMETRO AREA BY BARGAINING UNIT DURING A 14-MONTH PERIOD
(Ending July 1, 1984)


D. RETIREMENT

Finally, the last legislative concern is the retention of pension and retirement rights. Minnesota Law, Chapter 352, governs all public pension and retirement funds within the state. This legislative concern can be separated into two parts. What are the employees rights and what are their portability options?

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1. Employee rights: Currently, an employee terminating public employment with less than ten years of service credit is eligible to receive a refund of all employee contributions plus 5% interest. An employee with more than ten years of service credit invested, and is eligible to receive benefits when the employee reaches retirement age (age 55) . If an employee terminates before retirement age, the amount of benefits is increased 3% and "augmented" each year until the pension payment begins. The employee with more than ten years of service credit's also eligible to withdraw all employee contributions. Withdrawal of contributions (taking a refund) terminates all rights to the payment of an annuity from the fund. Those rights can be reinstated by the repayment of the refund plus interest after the person returns to public service.

2. Portability options:  Minnesota has flexible portability provisions so that a person can combine service credit from most public funds to receive a pension based on all public service.

Public employees can combine service credit from the following public pension funds to obtain pension benefits:

Minnesota State Retirement
Public Employee Retirement Association 
Correction Plan 
Teachers Retirement Assoc. 
Unclassified Plan 
Minneapolis Employees
Constitutional Officers 
Retirement Association 
State Patrol Fund
Minneapolis Teachers 
Legislators Plan 
St. Paul Teachers 
Duluth Teachers

There is no portability for employees joining the University of Minnesota faculty plan which is governed by the Board of Regents. There is no portability between public plans and the 51 Municipal Police and Salaried Firefighters Relief Associations. However, only three of those associations, Faribault Police, Faribault Fire and Crookston Fire are accepting new members. All other newly hired police officers and firefighters in all other municipalities are members of PERA-P&F.

3. Portability to private funds: There is no portability to private pension funds. The state Legislature cannot authorize such portability because private pension funds are governed by federal law. The Employees Retirement Income Security Act of 1974 explicitly prohibits states from making any laws applicable to private pension plans. However, in most instances, public employees terminating public employment can "roll over" their employee contributions into Individual Retirement Accounts.

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E. SUMMARY OF FINDINGS

1. The hospital employees are organized into twelve bargaining units.

2. The total number of full-time equivalent positions for FY '84 was 5,442. 

3. A total of 5,912 employees were employed as of October 1,1984; this total includes all employees; e.g., part time, intermittent, etc.

4. 64% of the hospital work force is female; the majority of these women work in the NonProfessional Health Care Unit, which is the largest bargaining unit, and earn an average wage of $8.53 per hour.

5. The Service Unit has the lowest average wage at $8.10 per hour.
 
6. Over 70% of all state hospital workers earn less than $10.00 per hour.

7. 77% of all female workers and 59% of all male workers earn less than $10.00 per hour.

8. 52% of all employees are between the ages of 24 and 42.

9. 27% of all employees are 48 years of age or older.

10. The average length of service for all employees is 8.15 years.

11. Overall, the average length of service for females is less than their male counterparts.

12. Faribault State Hospital had the highest number of separations for FY '84.

13. Anoka and St. Peter State Hospitals had the fewest number of separations for FY '84. 

14. The NonProfessional Health Care Unit had the highest of separations for FY '84.

15. Over 3,000 employees responded to the State Planning survey. Of these,

a. 46% indicated they would refuse a transfer to another state position.  

b. Over half of the employees who expressed a willingness to accept a transfer to another position indicated they would not relocate to accept a transfer.

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c. 31% would prefer to continue working for the state regardless of whether the position was in the human services field. 

d. Private sector employment was the least favored (12%) option chosen by employees when asked about their future job preferences.

16. The Department of Employee Relations estimated the number of suitable state employment options within a 35 mile radius of each state hospital. Anoka State Hospital employees could find reemployment in state service because of proximity to the St. Paul Capital.

17. Current separation rates could enable a gradual downsizing of the state hospitals.

18. At this time, there are at least 369 state hospital employees eligible for immediate retirement under the Rule of 85.

IV. REFERENCES

Collective Bargaining Agreements between the State of Minnesota and: Minnesota State Employees Union, AFSCME, Council 6, AFLCIO; Minnesota Association of Professional Employees; Minnesota Middle Management Association; Minnesota Nurses Association; Minnesota Association of Professional Employees; and State Residential Schools Education Association (July 1, 1983  June 30, 1985) .

Department of Employee Relations. (1985, January 11; 1984, November 15; October 1, 8, 15).Computer tapes on Minnesota State Hospital employees. St. Paul: Author.

Minnesota Legislative Commission of Pensions and Retirement. (1984, June 21) . Personal communication. St. Paul:  Author.

Minnesota Statutes, Chapter 179.A-Public Employment Labor Relations Act, 1984.

State Planning Agency.(1984) . Minnesota State Hospital employee. St. Paul:  Author.


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November 30, 1984

The 1984 Legislature mandated that a study and Plan for Minnesota State Hospitals be prepared (Chapter 654, Section 19).

An Institutional Care and Economic Impact Planning Board was created composed of the following state agency heads: Sister Mary Madonna Ashton, Dept. of Health; Barbara Beerhalter, Dept. of Economic Security; Gus Donhowe, Dept. of Finance; Bill Gregg, Dept of Veterans Affairs; Sandra Hale, Dept. of Administration; Leonard Levine, Dept  of Human Services; Orville Pug, Dept. of Corrections; David Reed, Dept. of Energy & Economic Development; Nina Rothchild, Dept. of Employee Relations; James Solem, Housing Finance Agency: and Tom Triplett, Chair, State Planning Agency.

Responsibility for the studies was given to the Developmental Disabilities Program/Council of the State Planning Agency.

Eight technical papers have been prepared to respond to the legislative requirements. This paper may be cited:

State Planning Agency. (1985, January). Policy Analysis Series Paper No. 3:  A profile of Minnesota State Hospital employees. St. Paul, MN: Developmental Disabilities Program, State Planning Agency.

 "Residents" refer to people with mental retardation who live in state hospitals.

 "Patients" refer to people with mental illness and people with chemical dependency who receive services at the state hospitals.

Additional free copies of reports or information about this project can be received from:

Developmental Disabilities Program 
State Planning Agency 
201 Capitol Square Building 
550 Cedar St. 
St. Paul, MN 55101
612-296-4018