A number of 'serious problems' were identified within Walsall Healthcare NHS Trust during a Care Quality Commission (CQC) three-day visit, according to a report out today.
Inspectors declared that 'significant improvement' is immediately needed in a number of areas including maternity services and emergency care.
It stated whistleblowers told the CQC that there is a 'heavy handed' approach from senior management which they said bordered on a bullying culture.
Bosses at the hospital claim that work is already underway to improve the situation through extra staff and investment, while targeting an escape from special measures by next year.
Key findings from the CQC report include claims that patient safety was compromised in the hospital's maternity ward, where concerns were raised over 'multiple issues with staffing, delivery of care and treatment'.
The trust's consistent failure to hit A&E waiting time targets was also a major issue, as the number of patients treated within the four hour national target fell below expectations for 'almost all of the period between April 2015 and May 2015'.
The report suggested that high workloads in the emergency department and maternity had resulted in care falling below the standards patients should be able to expect.
Another major issue related to staff satisfaction, with the CQC claiming that 'low morale and a heavy handed approach bordering on a bullying culture from senior management' had led staff across the organisation to not feel respected.
The CQC's chief inspector of hospitals, Professor Sir Mike Richards, said: "We found a number of serious problems when we inspected the services run by Walsall Healthcare NHS Trust and I have made a recommendation to the Trust Development Authority that the trust should be placed into special measures.
"Following our inspection we issued the trust with a warning setting out that significant improvement was immediately required in a number of areas including maternity services and emergency care. However, we found that in many areas staff were dedicated and committed to patient care despite the pressures of staff shortages.
"The trust has responded to our inspection findings and warning with a detailed plan for remedial action and we will return to undertake further inspections, including unannounced visits, to check that the necessary improvements have been made."
Richard Kirby, chief executive, said he was keen to emphasise the compliments paid to staff who were described as 'friendly' and 'caring' in the report.
He said: "We have been clear that the trust has faced challenges as a result of increased demand for some time, particularly in maternity services and the emergency department and I would like to thank all our teams for their caring approach and commitment at a difficult time. We accept the outcome of the report and agree we need to take action to make our services safer and better.
"I want to reassure people that the report emphasises how hard our staff work and how they continually go the extra mile for their patients.
"I am convinced their determination, creativity and commitment – with better support from management – will bring us out of Special Measures.
"We have already taken important action especially in Maternity Services and are committed to working with our teams across the Trust to continue this improvement in the next 12 months.
"We have also taken on board the concerns over staff satisfaction and will look at resolving that as we move forward."
The trust has brought in more midwives since the inspection, reducing the midwife to birth ratio from 1:37 to 1:32, with the aim of hitting 1:28 by next year.
There will also be significant investment pumped into the hospital over the next 12 months, including the construction of a new £9 million Integrated Critical Care Unit and a £3 million extension of the neo-natal unit.
Mr Kirby reassured people in Walsall that they can trust the service the hospital provides as it strives to move out of special measures.
He said: "We have already acted since September but we understand that there is still a lot of work to be done over the next 12 months.
"We will be honest about where we are making progress and where we are not and will provide regular updates on our improvements and their impact. I want to reassure people we are on the case, we are working hard to get out of this situation."