St John’s Hospital must reduce its chief executive’s salary or she and its board will be at “significant risk”, potentially affecting pension entitlements, the Health Service Executive (HSE) has warned.
Last month The Irish Times reported that the salary of Emer Martin, chief executive of the Limerick voluntary hospital, was increased to that of a higher pay band – breaching the consolidated public pay scales.
According to the HSE, the hospital is considered H2, under which chief executives can earn €99,829-€106,866
However, the board in 2023 agreed to increase Ms Martin’s salary to that of a H3 hospital, which has a scale of €119,571-€140,747.
READ MORE
In a letter on July 15th, Sandra Broderick, regional executive officer for HSE midwest, told Bishop Brendan Leahy, chairman of the hospital’s board, that it was “imperative that the final decision on the CEO’s pay and conditions – being a matter of public pay policy – is implemented immediately”.
“As previously discussed, failure by St John’s Hospital to enforce this decision places both the board and the employee at significant risk, including implications for pension entitlements,” she said.
“The HSE expects the board of St John’s Hospital to implement the correct pay, terms and conditions without further delay. We remain fully committed to maintaining a strong working relationship with St John’s and do not wish for this relationship to be compromised by noncompliance with public pay policy.”
The letter, which was obtained under the Freedom of Information Act, was one of two, with the second being sent on August 14th.
In the second letter, Ms Broderick said she had not yet received a response to the first and sought “assurance that this matter has been resolved”.
Correspondence shows that the Limerick hospital, which received €41.8 million in HSE funding last year, submitted a business case to the HSE in relation to regrading its chief executive’s salary to that of a H3 hospital.
In March, Anne Marie Hoey, the HSE’s chief people officer, said the Department of Public Expenditure decided the business case did not meet their criteria to approve a band change.
As a result, she told the hospital it was “in breach of its service level agreement with the HSE and public pay policy”.
In response to queries, Bishop Leahy said the decision to implement the salary increase was made and brought to the attention of the HSE in December 2023, “yet the HSE’s issue with this was only raised for the first time with the board of St John’s in March of this year”.
“It is important to note that the pay increase approved by the board in December 2023 still leaves remuneration of our CEO below the average salary for CEO posts in the HSE and significantly below the private sector,” he said.
Bishop Leahy said the decision introduced in 2015 to reduce salaries across the voluntary hospital sector would have meant Ms Martin would earn “less than the deputy CEO at St John’s”.
“The board also acted in good faith to avoid the risk of losing the CEO and repeating the difficult situation in recruiting a CEO which caused a two-year delay between the retirement of the previous CEO and her appointment,” he said.
“The board acts in accordance with its Constitution and Revised Scheme of Arrangement. It is bound legally to do so. As a charitable trust it also has fiduciary standards set by the Charity Regulator.”
