April 23, 2014

History of Partnership

KP founder Henry J. Kaiser greets workers

When Henry J. Kaiser and Dr. Sidney Garfield created a health plan for Kaiser’s shipyard and construction workers in the 1930s, they created what became Kaiser Permanente. With a customer base consisting almost entirely of union members, Kaiser Permanente grew into the largest nonprofit health care organization in the country, serving a wide range of members. Today, the Labor Management Partnership (LMP), an innovative relationship among Kaiser Permanente managers, workers and physicians, is the largest and most comprehensive partnership of its kind.

The Labor Management Partnership was formed in 1997 after years of labor turmoil within Kaiser Permanente and competitive pressures within the health care industry. Two years earlier, 26 local unions representing KP workers had joined together in the Coalition of Kaiser Permanente Unions to better coordinate bargaining strategy. Kaiser Permanente and the Union Coalition created the LMP as a way to transform their relationship and the organization. Today it covers more than 92,000 union employees, some 20,000 managers and 16,000 physicians in nine states and Washington, D.C.

Working in collaboration

On a day-to-day basis, partnership means that workers, managers and physicians use joint decision making and a problem-solving process based on common interests. More than 90,000 employees now work in unit-based teams—collaborative work groups that improve performance as part of their ongoing work. The arrangement has been credited not only with improving patient care and satisfaction, but in making Kaiser Permanente a better place to work.

A model of mutual respect

Many prominent analysts consider the Labor Management Partnership a model. “Kaiser Permanente is one of the only organizations I know of that is trying to build a genuine partnership between its unions and management,” says Jeffrey Pfeffer, a professor at Stanford University’s Graduate School of Business. Kaiser Permanente and its unions “are attempting to build an innovative model of management—a relationship of mutual respect.”