Gov. Code, § 20510

When a hospital becomes a contracting agency pursuant to subdivision (p) of Section 20057, the contract shall be construed as a continuation of the city’s contract for all purposes of this part, and the sponsoring city, the hospital, and the board shall enter into an agreement under the terms of which hospital employees shall retain, under the hospital’s contract, all of the retirement rights and benefits that have accrued to them under the city’s contract. The board shall compute the unpaid costs, if any, of the accrued rights and benefits, and the city shall pay to the board that amount in a manner and at times satisfactory to all parties to the agreement. Thereafter, the city shall be relieved and discharged from all liabilities on account of rights and benefits that have accrued to the hospital employees, and the hospital shall then become liable for those rights and benefits under its contract with the board.

On and after the effective date of the hospital’s contract with the board, neither the city nor the hospital shall be an employer as defined in Section 20790.

All employees of the city who have retired or separated from employment prior to the effective date of the hospital’s contract shall be treated as retired city employees or former city employees, as the case may be, for all purposes of this part, whether or not they ever worked in the hospital.