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Dennis Taylor: CEO pay hinders SVMH in labor strife
Call it the 800-pound executive in the room.
With nurses at Salinas Valley Memorial Hospital having authorized a strike earlier this week, the rhetoric between labor and management is flying. But management's arguments, regardless of how powerful they might be, are overshadowed by the resentment created by the $622,000 annual salary of Chief Executive Pete Delgado.
The California Nurses Association, one of the labor unions representing SVMH nurses, argues that delays in patient care are occurring because of low staffing levels (SVMH is looking at reducing roughly 120 positions). The delays come in the form of slow responses to call bells that could result in patients not receiving timely pain medications, patients not being moved frequently enough to prevent bed sores and not providing timely physical therapy to recovering patients, according to the union.
Other union issues include nurses' fatigue from extending work shifts and management's refusal to hire an effective number of interpreters and instead rely too heavily on faulty electronic translation systems, the CNA said.
SVMH management responded with a four-paragraph statement chastising the CNA for seeking strike authorization during labor negotiations.
"We are disappointed that California Nurses Association is considering asking our nurses to strike when we are committed to working with the union to reach agreement on a new contract," the statement read. "Strikes are expensive and divisive; at a time when hospitals face significant change and challenges, asking nurses to walk a picket line is the wrong approach to resolving differences at the bargaining table."
Adrienne Laurent, chief strategic communications officer, whose name appears at the bottom of the SVMH release, is correct when she argues that strikes are expensive and divisive. But so is Mr. Delgado's salary.
Executive compensation is out of control. And those who spin a narrative in defense of outlandish executive pay seem out of touch with reality – certainly the reality at street level. They operate in a fantasy world where an argument such as "we need to pay Delgado that much because that is the going rate for hospital CEOs," seems insulting to those making an average income in this county.
Even more of a fantasy are beliefs that members of the community, particularly wage earners, don't care, are too busy to notice, or they see CEO pay as a divine mystery that they have no control over and will never understand. Yet management is foolhardy if they are banking on those assumptions at a time when they are battling for the hearts and minds of the public.
CEOs today earn 331 times as much as average workers nationally, and 774 times as much as minimum wage earners, according to Forbes magazine – not exactly a bastion of liberal thought. While those numbers sink in, consider that in a free-market economy hospitals and all businesses are free to pay their executives as much as they want.
I've no reason to doubt that Delgado is a skilled and effective leader for the hospital. He's also a personable guy who has always been gracious toward me. This is not about Pete Delgado; it's about his salary, and trying to win public support with two bullet holes in your feet.
There are consequences to all of this, and a loss of empathy is one that can have grave consequences far down the road. Who are wage-earners going to sympathize with – hospital nurses or an administrator with a bloated salary? Those who receive six-figure salary increases or those who earn an hourly wage? There is an undercurrent of more than just jealousy and resentment; wage-earners are increasingly aware of how they produce the goods and services that make executives wealthy, while their own incomes continue to fall.
"Jobs are coming back, but wages aren't," wrote Robert Reich, Chancellor's Professor of Public Policy at the University of Californian, Berkeley, in mid-November. "Every month the job numbers grow, but the wage numbers go nowhere. Most new jobs are part-time or low-paying positions. They pay less than the jobs lost in the Great Recession."
The sting of this reality is being felt by wage-earners throughout the Salinas Valley, who are the lion's share of residents from which SVMH management wants empathy – as it pays its CEO $1,700 a day.
Good luck with that.