Wed11262014

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ECH salary-cap measure thrown out of court

The El Camino Healthcare District is in the clear on Measure M, a voter-approved November 2012 initiative that sought to limit the salaries of top executives.

El Camino officials reported Monday that Santa Clara County Superior Court Judge Socrates “Pete” Manoukian declared the initiative unconstitutional July 16, ruling that El Camino Hospital may provide compensation to its executives without regard to the limit imposed by Measure M.

The court rejected Measure M, claiming that the statutory initiative does not apply to local health-care districts, and that the measure does not have initiative power because it does not enact a statute or ordinance.

“We are pleased with the court’s decision, which will enable El Camino Hospital to continue to deliver high-quality and compassionate care by recruiting and retaining a strong leadership team,” said Neal Cohen, M.D., chairman of the El Camino Hospital Board of Directors. “As a public community hospital, we have a mission of affordability, a responsibility we take very seriously. Our compensation philosophy enables us to make thoughtful decisions around employee salaries and align them with the hospital’s overall strategic goals.”

The El Camino Hospital Board of Directors manages the hospital’s compensation program. Each year, the board conducts market research to ensure that employees are compensated at the median (50th percentile) of national health systems and hospitals similar in size and complexity to El Camino Hospital, and adjusted for higher costs of labor and living in Silicon Valley.

Measure M, a Santa Clara County ballot initiative, sought to cap annual salaries for El Camino Hospital executives at twice the California governor’s salary, or $350,000. The measure passed by a narrow margin in the Nov. 6, 2012, election.

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