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July 17, 2023 12:31 PM

Allina Health announces layoffs affecting around 350 workers

A brick building of a clinic — Allina Health is laying off some 350 workers, according to an announcement from the health system Monday.
Tony Webster | Flickr

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Updated: July 18, 11:33 a.m. | Posted: July 17, 12:31 p.m.

Allina Health is laying off some 350 workers, according to an announcement from the health system Monday. The reduction is happening systemwide, and while Allina would not confirm which facilities would be impacted, internal emails shared with MPR News say the layoffs include staff at Mercy and United hospitals.

In the health system’s statement, Allina said it is facing “unprecedented financial challenges,” and said the jobs involved in the layoff are in leadership and non-direct caregiving roles. It currently employs 28,500 people in both full and part-time positions.

In a video message to Allina staff, reviewed by MPR News, CEO Lisa Shannon said they “did not take this step lightly.”

“I know that for many of you there is a disconnect on how people are feeling against this information. It's not what you experience every day. We are extremely busy. So how can we be losing money?” Shannon said in the video. “Simply put, it comes down to our expenses [which] continue to outpace our revenues. We're experiencing higher costs across the board for supplies and labor, and we continue to get paid less for the care that we provide.”

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The company said employees who are part of the labor reduction will be offered severance and health benefits, as well as outplacement resources. “While they will not work after being notified, they will continue to receive their benefits and will be paid through August 4,” said Shannon in an internal email to Allina staff.

“I know this decision is difficult for all of us, especially those that are impacted,” Shannon said in the video. “While redactions will be occurring systemwide, we will continue to prioritize our caregiving roles, which are essential to our ability to serve the community.”

Allina said it is following federal and state laws related to the labor reduction.