Management Takes Pay Cut at 2 Hospitals

Two area hospitals confronting budget problems have temporarily cut the salaries of administrators by 10% and are asking other employees to voluntarily shave one hour off their workweeks.

The cutbacks will be in effect through June at the 365-bed Daniel Freeman Memorial Hospital in Inglewood and at the 184-bed Daniel Freeman Marina Hospital in Marina del Rey.

The measures were adopted in lieu of layoffs in the face of cash flow problems, public relations director Mary Schnack said. And while employees are not happy about the cutbacks, she said, “We’re also reading every day about layoffs going on” in other businesses, “and we still have a job.”

The quality of patient care will not be affected, Schnack said Friday.

The 10% salary cuts will affect about 80 management employees, including department directors, vice presidents and administrators, out of the hospitals’ total staff of 2,000.

Non-management employees are being asked to work one hour less each 40-hour week, a move that Schnack described as voluntary. Employees who choose to continue their regular work hours can do so, she said.

“There’s absolutely no repercussions, no keeping track,” she said.

Hospital officials will not know for several weeks how many people are joining in the voluntary effort, Schnack said.

The two hospitals, operated by the Sisters of St. Joseph of Carondelet with a combined budget of $145 million, hope to reduce expenses by 1% to 2% during the fiscal year ending June 30.

News of the cutbacks comes on the heels of 25 layoffs at South Bay Hospital in nearby Redondo Beach. And other Los Angeles hospitals have also experienced recent layoffs, said David Langness, vice president for communications at the Hospital Council of Southern California, a regional trade association.

Langness said that a “double whammy” is forcing health care layoffs: the recession coupled with an increasing number of hospital mergers and affiliations. In fact, he said Friday, 60% of all hospitals in the state are operating in the red this year.

The cutbacks at the two hospitals is “probably the mildest of all the (cost-cutting) actions they could take,” Langness said.