Salinas Valley Memorial Hospital Workers to Engage in 24-hour Strike on October 18

NewsOctober 9, 2011

Salinas, California – Yesterday, the National Union of Healthcare Workers (NUHW) issued official notice to Salinas Valley Memorial Hospital (SVMH) management of the union’s plan to engage in a 24-hour strike by over 650 SVMH caregivers should management continue to refuse to bargain in good faith toward a fair contract that safeguards quality patient care and that leaves workers’ benefits intact. The walkout will be the second one-day strike by SVMH workers this year.

SVMH has spent tens of millions of dollars on out-of-state consultants and executive salaries and pensions while demanding over $1 million in concessions from caregivers at the expense of quality patient care. Hospital administrators and directors have rejected SVMH caregivers’ proposals to safeguard patient care by improving staffing ratios for nursing staff, even after the Department of Health Services cited the hospital for deficiencies in care caused by staff cutbacks.

Members of the hospital’s Board of Directors have been plagued by scandal and mounting evidence of corruption for the better part of a year.

In July, The Salinas Californian revealed that a majority of the hospital’s Board of Directors authorized the hiring of the McKinsey Group, a controversial management consulting firm linked to the Enron fiasco, to compile a report laying out options for privatizing the district hospital. The firm was retained at a cost of nearly $1 million through a third party, the district’s outside law firm, in order to shield the document’s contents from the public under attorney-client privilege.

Under California law, the board members’ private discussions of plans to sell the hospital were illegal. Section 32106 of The California Healthcare District Law delineates what subjects may be discussed in closed session, and explicitly prohibits closed door discussion of “(t)he sale, conversion, contract for management, or leasing of any district health care facility.”

Nine local labor and community leaders asked State Attorney General Kamala Harris and Monterey County District Attorney Dean Flippo to launch investigations into the Salinas Valley Memorial Healthcare District Board’s illegal conduct.

At a public Board meeting on September 15, the Board’s own newly-hired attorneys confirmed that the Board’s regular practice of holding closed-door discussions to discuss a potential merger or sale of the hospital is in violation of the law, as is its continuing refusal to disclose privatization plans drawn up in secret by a majority of Board members and their consultants.

Also in September, the Public Employment Relations Board (PERB) issued a complaint against the Salinas Valley Memorial Healthcare System for engaging in unfair labor practices that interfered with SVMH employees’ rights and that violated sections of the Meyers-Milias-Brown Act.

These recent controversies followed a major scandal that exploded in May, when the Los Angeles Times reported on the “extreme” public pension benefits of former SVMH CEO Sam Downing, whose pension payouts added up to nearly $4 million on top of his $150,000 annual disbursement. Downing’s $790,000 salary in 2009 made him the third highest-paid public employee in the state that year, according to an earlier Times story. Editorial boards at the Times, the Monterey County Herald and The Salinas Californian uniformly condemned the outsized payouts.

State Assemblymember Luis Alejo requested a state financial audit of Salinas Valley Memorial Hospital in order to investigate fiscal mismanagement by SVMH’s Board of Directors and the diversion of hospital funds by Board members “to organizations and causes of which they are personally associated.” While governing SVMH,  Board Member Harry Wardwell, who simultaneously runs the bank that oversees SVMH’s payroll and that holds over $15 million of the hospital’s funds as savings deposits, “may have used his positions to profit at public expense,” a letter from Alejo stated. Alejo’s letter further explained that “SVMH has made large donations to entities directly tied to Board members,” including the California International Air Show, which was co-founded by Board President Jim Gattis and for which Wardwell serves as Executive Director.

“We’re just asking to be treated fairly as frontline caregivers, and to be provided with the staff we need to keep our patients safe,” said George Ross, a Licensed Vocational Nurse. “But it seems as if the majority of the Board is more interested in turning the hospital into a cash cow to enrich themselves personally. The secret privatization schemes, the diversion of patient care dollars to Board members’ organizations and businesses, the millions in taxpayer dollars wasted on out-of-state consultants with histories of scandal — it all needs to end. This hospital should belong to the community, not to these self-interested Board members and their Wall Street friends.”