Flaws in Minimum Wages Act 2009 for Hospitals in Kerala

In Dec 2009 Kerala government published the Kerala Minimum Wages Act 2009 for Hospitals with retrospective effect from Jun 2009. I was not actively involved with our hospital at that time and hence unaware exactly what transpired during that time. However what I know briefly is following:

-          QPMPA found issues in the Act and went to court against the same. (I didn’t get a chance to study exact details of the case yet.)

-          Court gave a stay order against prosecution if government/labour department finds non compliance in any hospital, and the case is still pending

In the last few months things started heating up with nurses unions putting pressure on government, conducting strikes and what not. (Also Read: Kerala Nurses, Minimum Wages, Fair Working Conditions). Subsequently labour officers started visiting each private hospital to check compliance (this is perfectly ok and not stayed by court).

In this context, I have been studying this Act from various perspectives in the last few months and I have observed that this Act is really half baked; it seems to have many flaws. Let me try to list some of them here.

Language Issue

Maybe some people might find it bit odd to highlight this as the very first flaw, but to me this proved to be a very annoying and frustrating flaw. I am a native Kannada of Kasaragod and don’t know how to read and write Malayalam, like numerous others (including many hospital owners) in the region. Kerala government ignores our rights (here Kannada is also officially recognized language) in many cases by publishing things only in Malayalam. This Act is a very good example for the same as it is available only in Malayalam. Hence, it was a struggle to understand its contents as I had to depend on others (Malayalees) through informal channels.

Also Read: “Kannadiga entrepreneurs in Kasaragod” vs. “Malayalam”

Alright, lets come to flaws with respect to contents now.

Unfair/Unscientific Wage Structure

As I hear, apparently nurses were not united during the drafting of this Act and hence their salaries were not revised scientifically and fairly at that time. Its sad that they kept quiet at that time, because a meaningful revision at that time would have avoided so many complications that we are seeing currently.

You can see that the salaries of nurses as per the Act is almost on par with that of sweepers with only a small increase. No disrespect to sweepers, but I personally think that this is clearly unfair to nurses. I definitely think that people should be paid higher for higher skilled work and I don’t see this clear demarcation in this Act.

Maybe in rural places this salary is fair enough considering the overall picture, but then salary of sweepers may be seen as unreasonably high in such places. So again, what we see is that statewide commonality principle is not practical or meaningful.

Grades/Levels not comprehensive enough

In certain cases the Act clearly identifies that with experience a person becomes much better professional and hence they deserve to be in a different pay grade altogether, instead of just getting regular salary hike. For ex: in case of Nursing Assistants, there are 4 levels defined – Special Grade, Grade III, Grade II and Grade I. This is a good thing.

Of course, such grading might not be applicable in case of unskilled workers like sweepers, but why the Act failed to give similar recognition to many other skilled/semi-skilled staff is a big question. For ex: X-Ray Technicians, Lab Assistants. Again, why those people kept quiet is an open question.

Scenarios are not explained

Initially when one tries to implement a new Minimum Wages Act, the first thing he/she needs to know is how to fit existing employees into the new framework. I have seen that certain other Minimum Wages Acts have clearly given examples as to how to do this under various scenarios, but this one hasn’t provided any scenarios and related calculations.

The Act does talk about service weightage, increments etc. but does not explain it with scenarios and calculations for clarity sake. There is a word ‘Nirakku’ in the Act which some of the (current and retired) labour officers themselves can’t interpret with full confidence.

This problem exists not just while fitting in existing employee to new wage structure, but also with respect to giving hikes, promotions etc.

Maybe people who prepared this had these scenarios worked out in their mind and probably even had consensus, but such things should have been put to writing as part of the Act making it comprehensive enough so that multiple interpretations are avoided as much as possible.

DA Calculation

Should DA calculation be revised monthly or is it ok to set it once/twice a year (apparently latter one is a common business practice across many sectors)? The Act does not give clear directions on this as it gives information only on how to arrive at final DA figure.

This flaw proved quite costly for many hospitals recently as interpretations of labour department was different than that of hospitals. Moreover, it is ironical that government doesn’t release the basis for calculation every month but expects hospitals to pay arrears on retrospective basis.

Hospital Classification and Extra Allowance

There is another interesting part in the Act regarding hospital classification and additional allowances for staff for 'higher' grade hospitals. For ex: a secondary level hospital should pay 10% of basic as an extra allowance to all the staff while the minimum basic is defined for a primary healthcare institute. I never understood the logic behind such a clause.

I can totally understand if a super specialty hospital requires services of a highly specialized worker who can perform superior job and hence he/she deserves a higher pay. But why such a clause is made applicable to all employees? For ex: what is the difference between a sweeper or a clerk or a computer operator in primary care hospital and super specialty hospital?

If quantity of the work is more due to bigger size of the hospital, more staff will be employed anyway. But what is the qualitative difference in their work that requires hospital to pay higher wages?

Let us also note that bigger the hospital is, better will be the facilities for patients as well as for employees. For ex: better cafeteria, better campus, cleaner working conditions, better security/protection, streamlined policies and procedures etc. When employee anyway enjoys such better overall working conditions, what is the logic behind higher minimum wage structure? Maybe I am missing a point, kindly help me understand if you know.

Does this also mean that higher level of hospitals can charge higher for anything and everything? For ex: if a primary care hospital charges Rs.30/- for a small treatment, is a super specialty hospital expected to charge 10%, 15%, 20% or 30% more for the same treatment depending on their status?

Finally, does government pay higher for RSBY, ESI related treatments if the hospital is of higher class? Do other private insurance companies also recognize this fact?

In other words, I think it makes sense to set minimum wages based on 'merit/qualification/experience & designation (what the person does)'. Along with these, if 'where person works' should also be considered as a parameter, I would like to understand the thought process behind this; I am really curious!

A related joke: One of the doctors recently joked to me when I raised this point. He chuckled “A driver in higher grade hospital drives faster and hence deserves higher pay”.

What is a solution?

Any discussion of an issue without a solution recommendation becomes useless. I think there can be a variety of solutions for the problems stated above and my thoughts on the same is detailed in a separate article:

Solutions for problems in private hospitals in Kerala (Coming Soon)

About Me

Here is a brief note about myself to give you some perspective about my writings related to Kerala healthcare sector. I am neither a doctor myself, nor a healthcare professional of any kind, I acknowledge that my knowledge is limited in this area. I am further limited by language problem being a native Kannadiga in Kerala and many related communication by government getting published only in Malayalam.

However, these days I am actively involved in management of a private hospital where my father is a partner. I have worked in depth to ensure that salaries of all the staff are paid at least equal to or greater than minimum wages specified; having around 9 years of employment history myself, I am quite passionate in this area. During this process, I got an opportunity to hear opinions of many staff and also a chance to study their incomes/hikes from various perspectives, and also impact of the same on the institute’s profitability/survival. I have also been participating in some of the QPMPA discussions and learning things. This entire experience is an ongoing learning process and I am just sharing my current thoughts here.

I hope you have found this article thought provoking and some suggestions worth considering.

Disclaimer: The views expressed here are purely mine and do not reflect views of owners/partners/staff of the hospital where I am currently working. The intent behind this article is to provoke further thinking towards greater good with respect to healthcare field and definitely not to hurt anyone’s sentiments or create imbalance of any kind. If you think I have missed or incorrectly written some points kindly pardon me for the same and feel free to bring such things to my notice so that I get a chance to stand corrected.