Pathology workers win 20% pay rise after 'David and Goliath battle'

Primary Health Care will have to grant pay rises of up to 20 per cent to more than 600 workers in its Victorian pathology division after a Fair Work Commission ruling that also awarded workers higher allowances and backpay.

The decision by the Fair Work Commission's full bench brings to an end an 11-year dispute, and comes after workers went on strike last year, forcing the state government to intervene over fears it could threaten patient health and safety.

More than 600 Victorian workers at Dorevitch Pathology workers went on strike last year over payCredit: Fairfax Media

In a statement to the market on Friday, Primary said that before any mitigation strategies, the decision had the potential to reduce its underlying net profit in 2018-19 by $4.5 million.

It said the Fair Work Commission determination on underlying and reported earnings for fiscal 2018 was estimated to be about $4.8 million.

“Importantly, the company aims to fully offset the impact through a range of mitigation strategies,” it said, but added that its pathology arm operated on a state-by-state basis, including different industrial instruments within each state, with multi-year agreements already signed in Queensland and Western Australia.

Primary noted the commission “made some adverse remarks” about Dorevitch’s historical approach to bargaining.

“Primary takes these matters seriously and had already made a number of changes at Dorevitch, including installing a new CEO [Malcolm Parmenter] in 2017,” it said, as well as promoting a better workplace culture at Dorevitch.

Primary chief executive Dr Malcolm Parmenter has made some changes at the company in a bid to improve workplace culture.Credit: Louise Kennerley

The Health Workers' Union (HWU) has argued Dorevitch workers are some of the lowest paid pathologists in the country, earning less than $21 an hour. They have waited over a decade for a pay rise, after their agreement lapsed in 2007.

HWU state secretary Diana Asmar said in a statement that the commission’s decision would deliver workers a pay rise of up to 20 per cent, increase allowances by up to 30 per cent, and grant them backpay to July 2017.

Once Fair Work’s determination is finalised later this month, she said there would be a further increase of about 3.6 per cent in real terms, and in 12 months there would be another 2.5 per cent increase.

“This is a big win for all Dorevitch employees,” she said. "The fight for fairer pay and conditions has not been easy.”

“This is a big win for all Dorevitch employees,” says Health Workers Union Victorian secretary Diana Asmar.Credit: Luis Ascui

"Our members have effectively been living with a 2007 level of income to pay 2018 costs. They’ve been left behind."

She described it as a "David and Goliath battle" and noted the pay rise was "a far cry from the zero per cent that was offered after a year of fruitless negotiations".

"Dorevitch has had to be dragged kicking and screaming at every stage in this process," she said.

"It took court applications, strikes, government intervention, weeks of forced mediation, and years of struggle to get this outcome."

When the 600 workers went on strike in August last year, Victorian Industrial Relations Minister Natalie Hutchins applied to the commission to terminate the industrial action on grounds that it was "causing delays in pathology services and patient diagnosis, is threatening patient safety and welfare". At that time, the then chief executive of Dorevitch Pathology left the business abruptly.

Ms Asmar said during the strike action last year Dorevitch locked out 89 frontline health workers – "many single mums and middle aged women earning a little over $20 a hour, all because they dared to stand up for believing that they were worth more".

Primary's share closed down 2.07 per cent to $2.84.