Hos­pi­tals hit with law­suits over im­proper pay cal­cu­la­tions

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As lawyer J. Nel­son Thomas tells it, a lot of bologna sand­wiches are eaten at hos­pi­tals. Scratch that. His point is that a lot of them are not eaten, or only par­tially eaten. Thomas’ firm, Rochester, N.Y.-based Thomas & Solomon, has filed class-ac­tion law­suits against 26 health­care sys­tems in Mas­sachusetts, New York and Penn­syl­va­nia. The suits make a va­ri­ety of al­le­ga­tions that hos­pi­tal work­ers are not get­ting the wages they’re owed. The core charge is this: Com­put­er­ized time­keep­ing sys­tems au­to­mat­i­cally deduct halfhour meal breaks whether or not the em­ployee ends up work­ing.

“In a hos­pi­tal, you’re not en­sur­ing that peo­ple stop work­ing—quite the con­trary,” Thomas says. “A pa­tient is cod­ing right now. Oh, ex­cuse me, I have to fin­ish my bologna sandwich,” Thomas says, sug­gest­ing some­thing a nurse would never say. It’s true for jan­i­tors too, he sug­gests. “I can’t say, ‘I’ll clean up that blood later, I’m eat­ing my bologna sandwich,” he says. “Vir­tu­ally ever po­si­tion in the hos­pi­tal is un­der the same de­mands.”

Part­ners Health­Care Sys­tem in Bos­ton re­cently agreed to pay $17.3 mil­lion to set­tle one of the law­suits brought by Thomas & Solomon on be­half of hos­pi­tal work­ers. “We greatly value our em­ploy­ees, and re­main fully com­mit­ted to en­sur­ing that they are prop­erly paid for all the hours they work,” Part­ners said in a memo dis­trib­uted to em­ploy­ees Nov. 5, the day the agree­ment was filed in U.S. District Court in Bos­ton. It re­mains sub­ject to court ap­proval.

The U.S. La­bor Depart­ment’s Wage and Hour Di­vi­sion may be tak­ing a more ag­gres­sive look into com­pli­ance laws. A re­port is­sued in June 2009 by the Govern­ment Ac­count­abil­ity Of­fice found that the di­vi­sion had a shoddy record of in­ves­ti­gat­ing com­plaints, and then newly sworn-in La­bor Sec­re­tary Hilda So­lis re­sponded in a state­ment that the depart­ment was hir­ing 150 new field in­ves­ti­ga­tors.

Part­ners paid $2.7 mil­lion in July 2009 to re­solve al­le­ga­tions that over­time pay wasn’t cal­cu­lated ap­pro­pri­ately when work­ers put in hours at mul­ti­ple Part­ners fa­cil­i­ties dur­ing a pay pe­riod.

Part­ners was the sec­ond or­ga­ni­za­tion to set­tle a suit brought by Thomas & Solomon on be­half of hos­pi­tal em­ploy­ees al­leg­ing wage and hour vi­o­la­tions, with au­to­mat­i­cally de­ducted meal breaks at the core. This past June, Beth Is­rael Dea­coness Med­i­cal Cen­ter, Bos­ton, and two other Mas­sachusetts hos­pi­tals af­fil­i­ated with it through a bond-hold­ing group, Care­Group, agreed to pay $8.5 mil­lion to set­tle one of the law­suits. The rest, most of them filed in 2008 and 2009, are slog­ging along in the courts. Thomas & Solomon has its sights on the rest of the coun­try as well, so­lic­it­ing com­plaints from hos­pi­tal work­ers via letters and the Web, where it se­cured the do­main name hos­pi­talover­ The au­to­matic de­duc­tion of meal breaks saves hos­pi­tals mil­lions of dol­lars a year, and it’s dif­fi­cult for a hos­pi­tal to pay em­ploy­ees for that time if its com­peti­tors don’t, Thomas says. “Even hos­pi­tals that have been sued have not changed their poli­cies,” he says. “That’s how lu­cra­tive the prac­tice is.”

From a hos­pi­tal’s per­spec­tive, fend­ing off such law­suits is gru­el­ing, says Nancy Shee­han, vice pres­i­dent and gen­eral coun­sel at Catholic Health Sys­tem, which has two hos­pi­tals in Buf­falo, N.Y., and two more in the sub­urbs of Ken­more and Cheek­towaga. The sys­tem was tar­geted in law­suits filed in 2008. “It’s a very timein­ten­sive, la­bor-in­ten­sive process,” Shee­han says. “The over­all premise re­ally lacks merit, but cer­tainly the im­pact is sig­nif­i­cant.”

In prac­tice, some­one man­u­ally over­rides the sys­tem’s au­to­matic de­duc­tion when an em­ployee re­ports not get­ting a full break. As Catholic Health slogs through the law­suit’s dis­cov­ery process—court-man­dated me­di­a­tion failed—the staff is pulling five years of data from the time­keep­ing sys­tem to show the over­rides, as well as track­ing down paper records of over­ride re­quests, which aren’t kept by all de­part­ments but could prove that re­quested over­rides are ex­e­cuted. The sys­tem also is com­pil­ing train­ing logs show­ing em­ploy­ees have been in­structed to re­port to man­agers when they’re owed pay for work­ing through breaks.

“There may be in­stances where a nurse may get paged from lunch and then ei­ther for­gets to tell a man­ager or some­how it does get missed,” Shee­han says. “I was a nurse be­fore I be­came a lawyer and worked a lot of mid­nights, and you do what you need to do and you don’t re­ally think about it.” But, she adds,” We have poli­cies in place to try to pre­vent it from hap­pen­ing.”

Other hos­pi­tals con­tacted about be­ing hit with the firm’s law­suits de­clined to be in­ter­viewed or pro­vide com­ment be­cause they gen­er­ally don’t talk about pend­ing lit­i­ga­tion.

Kevin Trout­man, a for­mer health­care ex­ec­u­tive in hu­man re­sources and now a la­bor lawyer, says he is ad­vis­ing clients to care­fully re­view their time­keep­ing sys­tems for vul­ner­a­bil­i­ties to law­suits or en­force­ment ac­tions.

“If an em­ployee is not get­ting a full meal break and there’s an au­to­matic sys­tem as­sum­ing they did, that’s go­ing to be a prob­lem,” Trout­man says. “If you go all the way to trial, they’re go­ing to find a vi­o­la­tion,” he says, adding that the dam­ages will be dou­ble the amount of the wage dis­crep­ancy, plus attorneys’ fees. “Sud­denly that be­comes a pretty big num­ber,” he says.

Plain­tiffs’ lawyers and the govern­ment also are in­ter­ested in in­stances when em­ploy­ees get work done off the clock be­fore and af­ter sched­uled shifts, Trout­man says. An­other risk area is round­ing. Un­der fed­eral law, when em­ploy­ers round to the top of the hour when work­ers clock in and clock out, the round­ing can’t al­ways fa­vor the em­ployer. That is, if the sys­tem rounds to 9 a.m. when some­one clocks in at 8:55 a.m., the sys­tem can’t then round down to 5 p.m. when the worker clocks out at 5:10 p.m.

“No­body’s try­ing to do any­thing wrong, but you could end up with a vi­o­la­tion be­cause of a tech­ni­cal­ity, and it could be a costly tech­ni­cal­ity,” Trout­man says.

Na­tion­ally, the fed­eral govern­ment has not iden­ti­fied health­care as an area of par­tic­u­lar in­ter­est, but an on­go­ing ini­tia­tive by the La­bor Depart­ment’s New York of­fice in­di­cates sig­nif­i­cant vul­ner­a­bil­ity in the in­dus­try. Be­gin­ning in with nurs­ing homes in 2005 and adding hos­pi­tals in re­cent years, in­ves­ti­ga­tors in New York have se­lected a few health­care fa­cil­i­ties for site vis­its and au­dits. Just over a third have been deemed in full com­pli­ance with the Fair La­bor Stan­dards Act.

Shee­han: De­fend­ing a suit is a time-and la­bor-in­ten­sive process.

Thomas: Hos­pi­tals have been re­luc­tant to change their poli­cies.

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