Governors at Heart of England NHS Foundation Trust (HEFT) claim they were "misled" after former Home Secretary Jacqui Smith was parachuted in with a £50,000 salary.
In a letter to the Post, members of the HEFT board were accused of "clandestine conduct" after it was revealed the former Redditch MP would receive the £50,000-a-year payment for working two days a week as chairman.
The row broke out after governors claimed they were initially told her role at the trust, which is currently gripped by a funding crisis, would be unpaid.
Ms Smith also chairs the neighbouring University Hospitals Birmingham NHS Foundation Trust (UHB) for two days a week.
UHB boss Dame Julie Moore has also been appointed interim chief executive of Heartlands Hospital.
At a roadshow held by Heartlands' former interim chief executive Andrew Foster in October, he said: "UHB's costs in relation to this support will be covered by arrangements to be agreed between HEFT and UHB.
"Neither Dame Julie nor Jacqui Smith will receive any extra personal remuneration for their new roles."
However, Heart of England have now apologised to governors following a U-turn.
Ms Smith was appointed at a governors' meeting in October after health body regulator Monitor launched an investigation into HEFT finances.
The busy trust, which runs Heartlands, Good Hope and Solihull hospitals, reported a £30 million loss in the first five months of the 2015/16 financial year.
The trust expects its deficit for the year to be between £53 million and £64 million.
According to the meeting minutes, HEFT governors were reminded that, under the legislation of the Health and Social Care Act 2012, Monitor would have power to remove them if they did not comply with the appointments.
Two governors abstained in the vote to appoint Dame Julie, while seven abstained against the appointment of Ms Smith over a number of concerns including her character following the parliamentary expenses scandal.
Ms Smith had claimed that her sister's bedroom in London was her main residence as she claimed more than £100,000 in expenses for her 'second home' in Redditch.
She was found to have "clearly" broken the rules on expenses and ordered to apologise.
But HEFT senior independent director David Lock, a former Parliamentary colleague of Ms Smith, reassured the meeting he was confident any previous mistakes regarding expenses were "innocent and resulted from the poorly communicated changes to the Parliamentary expenses policy".
He went on to compliment her on her "huge integrity".
A spokesperson for Heart of England NHS Foundation Trust said: "At the council of governors' meeting yesterday, the remuneration of Rt Hon Jacqui Smith, in her post as chairman, was unanimously approved with one abstention."