CHI medical group to pay $2.5M to settle wage-theft case tied to Gig Harbor clinic

A recent multi-million dollar class-action settlement brings an end to a nearly decade-old legal battle for local health care workers, a case in which one of the original doctors filing suit died before seeing resolution.

According to terms announced this month, Catholic Health Initiatives will pay $2.5 million in back wages owed to 67 health care workers.

The group was represented by attorneys with The Blankenship Law Firm of Seattle, who issued a news release with terms of the settlement.

Those eligible for payouts include physicians, physician assistants and advanced registered nurse practitioners who entered into contracts with the Franciscan network “providing that they receive compensation ‘per hour’ for time worked at any of Respondents’ prompt care or urgent care facilities from November 13, 2010 to the present,” according to the law firm’s earlier class description posted online and case filings.

The settlement is the second portion of a lawsuit involving a then-CHI Franciscan clinic in Gig Harbor, in which a partial award dealing with the wrongful termination portion was issued in 2020.

Two physicians, Michael Romney and Faron Bauer, and advanced registered nurse practitioner Kristen Childress filed individual claims and a class action on behalf of employees in the health system’s area prompt care and urgent care clinics in November 2013 in King County Superior Court.

The case eventually moved to arbitration.

The three worked at St. Anthony Prompt Care in Gig Harbor, now operating as Franciscan Prompt Care, 4700 Point Fosdick Dr.

At the heart of the wage portion of the case were allegations that the Franciscan Medical Group “failed to credit Plaintiffs and Class Members for all hours worked and failed to pay Plaintiffs and Class Members contracted for and earned wages,” according to the original complaint.

FMG initially agreed “to pay providers for hours outside of the shift per the contracts and did so,” according to the law firm’s release about the settlement. “Many witnesses testified that Prompt Care providers accepted walk-in patients who arrived before the scheduled closing and were required to be seen, necessitating providers to work outside of clinic hours.”

“At some point, FMG began a common practice of refusing to credit or pay providers all the hours they worked despite the contract, a criminal practice known as wage theft,” lead attorney Scott Blankenship said in the release.

In the years following the initial filing, CHI, CHI Franciscan and Franciscan Medical Group became part of Chicago-based CommonSpirit Health, which was formed through the merger in 2019 of Dignity Health and CHI.

In 2021, CHI Franciscan and Virginia Mason completed their merger to form Virginia Mason Franciscan Health.

The consent final award was signed Aug. 31 by U.S. Federal Magistrate Judge Louise LaMothe, serving as arbitrator. The award noted, “The Settlement Agreement and this Consent Final Award are not an admission by Respondents, or a finding of the validity of any claims being asserted by the Claimants, individually or as a class, or of any wrongdoing by Respondent.”

Kelly Campbell is vice president of marketing and communications for Virginia Mason Franciscan Health. In a statement sent via email to The News Tribune in response to the settlement, Campbell said:

“Virginia Mason Franciscan Health is committed to the fair treatment and compensation of our employees. This employment dispute took place nearly 10 years ago. Similar to the prior wrongful termination portion of the charge, we strongly deny that we have violated any wage and hour laws.”

Campbell added: “While we do not believe there were grounds for the claims, we believe that a settlement was the best path forward to allow us to focus on patient care, instead of even further extending this legal case.”

Bauer, Childress and Romney’s estate, represented by his widow, each will receive $20,000 as class representatives.

The class will receive the combined award from CHI, CHI Franciscan and FMG. The settlement received preliminary approval in May and was finalized in August.

According to the final approved order, class members will receive “a proportional share of the remaining class funds after deduction of the amounts awarded for attorneys’ fees and costs, services awards, and settlement administration expenses.”

It noted that the amount received “will be calculated based on the individual class member’s dates of service, employment contracts, contracted pay per hour rate, and the approximate number of prompt care or urgent care shifts working during the relevant time period.”

Bauer said in a statement, “The deserving class members can now rejoice in the knowledge that they will finally be compensated for the important work and time they have put into their community.”

Earlier arbitration award

Romney and Bauer, in an earlier portion of the arbitration, were awarded more than $8.78 million in March 2020 for wrongful dismissal after raising concerns over an impaired doctor at the clinic.

The case also described struggles over scheduling, employee turnover and what the physicians contended was a lack of oversight.

Childress was not part of that arbitration as she did not bring a wrongful termination claim, and the class also was not part of that earlier partial settlement.

Romney and Bauer “were fired without warning and ‘without cause’” from the Gig Harbor clinic in May 2013, according to case filings. At that time, Romney and Bauer were the longest serving providers in FMG’s prompt-care facility.

Blankenship said in the release, “The termination happened just days before they could formally present their concerns to the physician compensation committee for resolution.”

According to the partial final award on individual claims issued in 2020, Romney “died just three weeks after his deposition concluded in early 2015. He refused even to have a memorial service or any celebration of his life. This termination crushed and demoralized him.”

Romney died after being diagnosed with terminal cancer.

Other settlements

This is the second such wage settlement involving a CHI entity in as many years. In 2021, CHI Franciscan Health paid $5.5 million to settle a class-action lawsuit involving thousands of nurses, who contended they were not properly compensated for lunch and other breaks. The health system denied violating any wage-and-hour laws in that case.

CHI is not alone in these types of settlements affecting Pierce County health care workers. Earlier this year, MultiCare agreed to pay $42 million in a wage-and-hour class-action settlement regarding meals and rest breaks, also involving thousands of workers. The terms in that case were finalized last month, with MultiCare also denying any wrongdoing.

Blankenship, in a statement following the latest CHI settlement, said, “This case should send a loud and clear message to the health care industry. Wage theft is illegal and hurts health care workers and the community they serve.”