NEW REPORT: State Funding Increases Going to CEO Pay Over Direct Care Workers

As Senate considers amending Chapter 257, research uncovers provider organizations padding CEO pay, admin costs with funding increases

Provider organizations, economists, and policymakers agree that Massachusetts faces a workforce crisis in human services. Yet a new report released today by SEIU Local 509 finds that increases in state funding for human services, intended to raise wages for frontline workers, have been disproportionately going toward administration cost and exorbitant CEO compensation at some of the state’s largest providers.

Among the report’s key findings:

  • The legislature enacted Chapter 257 to increase wages for direct care workers and reduce turnover, yet these workers still are below a living wage despite the demanding nature of their work.
  • Frontline workers at the state’s largest private provider make on average $12.47/hour, yet its CEO receives a total compensation package of over $750,000 annually.
  • Most provider organizations have sufficient net revenue to bring workers to a $15/hour benchmark, without additional state funding. Yet, these organizations prioritize increased administrative spending and CEO compensation.

Absent accountability, provider organizations have not raised direct care workers’ wages proportionate to the increased Chapter 257 funding. Senate Budget Amendment #257, filed by Senator Jamie Eldridge, would ensure that increased state funds are actually being used to help make human services work a sustainable career. The measure requires providers invest 75% of funding increases on direct care workers’ wages, or at least invest in wage increases such that all workers reach the $15/hour benchmark.

SEIU Local 509 is the union for human service workers, including thousands of the frontline, direct care workers at provider organizations that received major increases in funding after Chapter 257 was enacted. For interviews or more information about private sector direct care working conditions in the state, contact Christie Stephenson: (413) 374-6370.

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