LifeLabs’ BC Strike Might Be Over, But Workers Are Still Worried About Its New American Owner

After more than a year at the bargaining table, and over two months on the picket line, LifeLabs workers in BC are back at their jobs with a new collective agreement, but their union is raising the alarm about the company’s new owner: a multi-billion-dollar American firm that’s looking to expand in Canada.

LifeLabs, which conducts blood testing and other diagnostic services in three provinces, saw over 1,200 of its BC workers, represented by the BC General Employees’ Union (BCGEU), start rotating strikes on February 20. Among their demands were pay parity with lab workers in the public sector, who they say make 4-16% more than LifeLabs workers.

Paul Finch, president of the BCGEU, told PressProgress that improvements to working conditions, like increased sick-leave benefits, solutions to short-staffing and an end to forced overtime, were key to addressing the “tremendous” levels of burnout amongst LifeLabs workers.

“Almost 10 weeks into a strike, we saw very little movement from the employer, and the bargaining committee believed (mediation) was the best approach towards getting a deal to recognize the needs of the membership,” explained Finch.

LifeLabs workers returned to work on April 26, and the mediator delivered his recommendations a month later.

The new collective agreement includes wage increases of up to 20% over three years and improvements to overtime and scheduling policies. LifeLab’s proposed cuts to sick-leave pay were taken off the table.

Finch said the last time LifeLabs workers were in bargaining was different. After a brief dispute, both parties were able to settle quickly and come to an agreement.

“​​I think this round, we saw a shift from this American-owned, Fortune 500 company that really changed the tone, and it led to a very protracted, very difficult dispute,” said Finch.

In August 2024, LifeLabs was acquired by Quest Diagnostics, a multi-billion-dollar diagnostic information services company registered in Delaware and based in New Jersey, for approximately $1.35 billion Cdn. The company reported more than $2.6 billion US in revenue in the first quarter of this year, and is projected to earn more than $10 billion US in 2025.

LifeLabs’ announcement of its August 2024 acquisition, via its Facebook page

In a 2024 investor call after the acquisition was completed (pdf), Quest Diagnostics CEO Jim Davis remarked that LifeLabs “provides a strong foundation for us to expand in Canada,” describing Canada’s population as having “more favourable demographics than in the US.”

Ayendri Riddell, director of policy and campaigns for the BC Health Coalition, told PressProgress that healthcare policy researchers brought Quest Diagnostics’ acquisition of LifeLabs to the coalition’s attention after the sale was finalized. She said the researchers were concerned about whether a formal review process was followed prior to the American multinational company acquiring an essential piece of the province’s healthcare system.

“I was concerned about a big service like this, that’s pretty fundamental to our healthcare system, being contracted out to a US for-profit corporation,” said Riddell.

(LifeLabs was previously owned by OMERS, the pension plan for municipal employees in Ontario.)

Riddell said Quest Diagnostics could see Canada’s aging population and healthcare-worker shortage as a benefit for their business, as the median age of Canadians is higher than that of Americans.

“We have a large seniors population (but) not the workforce to actually support them in healthcare.”

In a statement to PressProgress, a representative for LifeLabs wrote that Canada’s growing population and higher proportion of older adults “creates a sustained and increasing need for reliable, accessible health services across the country.”

In the United States, Quest Diagnostics has moved call-centre and laboratory operations from states like Pennsylvania to Florida and Kansas, both of which are “right-to-work” states with comparably lax worker protections.

A month into the LifeLabs strike, Riddell said the BC Health Coalition was encouraged by workers at community health centres and seniors groups to take action in solidarity with the workers.

“The strike was really about protecting working conditions that allowed people to do their work well and allowed for our systems to work efficiently,” said Riddell.

“It’s not a small thing for people to go on strike for multiple months. They’re people like me and everybody else who have kids, who have rents and mortgages,” said Riddell. “They want to defend our services for everyone who depends on them.”

The April 16th rally at the British Columbia Legislature in Victoria, via the BC General Employees’ Union on Flickr

On April 16, LifeLabs workers and members of the BC Health Coalition marched to the BC legislature, demanding that the BC government end its contract with the Quest-owned LifeLabs and bring laboratory services into the public system.

In an open letter (pdf), the BC Health Coalition wrote that through the acquisition of LifeLabs, Quest Diagnostics secured four contracts with the BC government totaling over $295 million.

“It’s unclear how much of this taxpayer money is being pocketed as profits and how much is being spent directly on services,” the BC Health Coalition wrote. “Unlike public providers, for-profit corporations are able to claim ‘confidential business information,’ evading accountability.”

In January, the board of Quest Diagnostics approved a 6.7% increase in the quarterly dividend paid to shareholders (from $0.75 to $0.80 US per share).

Shortly before the coalition sent its letter, BC Premier David Eby had directed the government to review and cancel contracts with American companies to “decrease the province’s dependence on goods and services from US suppliers.”

Riddell said the BC Health Coalition hasn’t received a response from the government. But in a statement to CBC News, the Ministry of Health rejected the idea of cancelling the contract, noting that while LifeLabs is owned by an American company, it remains incorporated in Canada.

“Cancelling the province’s contract with LifeLabs right now would cause significant delays in basic lab testing and put patients at risk,” the ministry said. “It would also cost hundreds of millions of dollars and take resources away from frontline services elsewhere.”

Finch said that he saw Eby’s directive to review contracts with American companies as a positive step for the government to take. He said he’s disappointed in the Ministry of Health for declining to review the contract with Quest Diagnostics, which he said is “essentially letting an American, for-profit, Fortune 500 company off the hook.”

“Not only did the Ministry of Health directly contradict and undermine a brief statement on preventing these contracts, they did something fundamentally against the interest of British Columbians,” said Finch. “We need the Ministry of Health to reverse their decision on that and review this company’s contract.”

Riddell said that while most people are used to thinking of healthcare privatization as involving patients paying directly out of pocket for services, it is a growing problem in Canada that for-profit companies like Quest Diagnostics receive public funding to run essential services.

“This type of contracting-out is legal under the Canada Health Act, and so that is public funding going to for-profit services,” said Riddell. “It’s just gotten worse with multinationals coming into the picture more and more.”

On an April investor call (pdf), Quest Diagnostics chief financial officer Sam Samad noted that while the company’s revenue per requisition (a doctor’s written order for lab tests) was up from the previous year, that increase was offset by the LifeLabs acquisition, “which carries a lower revenue per requisition.”

In a statement to PressProgress, LifeLabs acknowledged that requisitions in Canada differ from those in the US, “reflecting differences in our healthcare systems.”

Riddell said it’s likely that operating LifeLabs is a less profitable venture for Quest Diagnostics than their US-based services, but that getting a foothold in Canadian healthcare, and getting access to more patient data, is likely what Quest Diagnostics is after.

“We speculate that it’s also likely that it’s not the services where they’re going to make the most of their profits,” said Riddell. “Their ultimate goal is eventually getting more and more health data.”

Quest Diagnostics did not respond to questions submitted by PressProgress. When asked about patient data, LifeLabs responded that the company is governed by Canadian privacy legislation and stores patient data in Canada.

“There has been no change to how personal health information is accessed or used, and our ongoing responsibility to protect patient privacy remains at the core of our operations,” wrote a LifeLabs representative.