In the meantime, three senior members of the trust have resigned: James Rawson, the chairman; Maggie Aikman, the chief executive and Dr Sam Pickens, the medical director.
Ian Mahady, the obstetrician and gynaecologist who had criticised trust management decisions, was made redundant on 15 September and asked to leave the hospital within three hours even though patients he had operated on were still in the wards.
Mr Mahady, 52, said that he was "very relieved" that an The Independent inquiry report had "vindicated my position''.
The British Medical Association took up his case after he was removed from his £51,000- a-year post. In addition, the trust agreed to set up an The Independent inquiry into the circumstances of the redundancy.
It had been claimed that Mr Mahady's workload diminished although nine months previously an extra gynaecologist had been taken on to help with the workload.
But yesterday the trust announced it was accepting a report by an The Independent inquiry that Mr Mahady be reinstated because the redundancy process was "flawed". He has been a consultant at the 850-bed hospital for 15 years.
The redundancy triggered Mrs Aikman's resignation after threatened votes of no confidence in the trust board. Then, under pressure from other consultants, Dr Pickens left but resumed work as a physician. Finally, Mr Rawson handed in his resignation.
Dr Fred Archer, Burnley Health Care NHS Trust's new chairman, said: "We accept the inquiry panel's findings that the redundancy process was flawed.
"The board are in agreement that an urgent review of the management structure is needed. The acting chief executive, David Chew, has already undertaken preliminary work.
"We are pledged to employ a more open style of management."
The report was critical of the role of certain existing or former senior officers, Dr Archer added. "Although the integrity of these individuals is not in question, several errors of judgement are alleged in the report."
But senior officers who still held their positions believed the report was "seriously incomplete and misleading in certain aspects". As a result, the board did not associate itself with criticisms of individuals in the report. Dr Archer added: "We will shortly be meeting Mr Mahady to seek his views on the best way forward to manage his reinstatement as an NHS consultant."
Mr Mahady said: "Personally, it has been a strain but I have felt from the outset that my case was being supported by patients, general practitioners and consultants.''Reuse content