This article originally appeared on Iowa Starting Line
Posted September 19th, 2023 at 12:23pm by Amie Rivers
Around 11,000 employees of University of Iowa Health Care (UIHC), the state’s largest hospital system, are finally getting paid this month after a class action settlement was approved.
The Board of Regents will pay those employees and their attorneys $15 million after Chief Judge Stephanie Rose, with the US District Court for the southern district of Iowa, gave final approval.
The money is to be paid to everyone within 30 days of Judge Rose’s order, which was filed Sept. 6.
Wage theft is the largest form of theft. The Economic Policy Institute says companies that don’t fairly pay their employees steal an average of $15 billion per year from them in minimum wage violations alone.
What was the lawsuit about?
Employees argued they weren’t receiving their pay in a timely manner or were denied overtime.
Six employees—Melinda Myers, Barbara Stanerson, John Eivins, Liv Kelly-Sellnau, Christopher Taylor, and Shuna Tosa—brought the suit against the Iowa Board of Regents, which oversees UIHC, in August of 2019. The suit was filed on behalf of around 8,000 employees affected, which was later expanded to 11,000.
Those employees, which include both health care professionals and other types of workers, are covered under an AFSCME bargaining unit.
Employees argued that paying them monthly was a violation of Iowa’s Wage Payment Collection Law, which mandates employers pay wages within 12 business days after the end of the period in which the wages were earned. In March of 2022, Judge Rose agreed the employees were entitled to damages as well, and in October of 2022, the Regents and employees settled.
Who’s getting money?
Those 11,000 employees include:
- Those in the Wages Class will receive their fair share of $10,900,000, “based on adjustments and overtime pay they untimely received and how much the member could hypothetically recover in liquidated damages under Iowa Code,” according to Judge Rose. Half of those workers will receive less than $500, but just under 3% will get a payout in excess of $5,000.
- Around 3,590 people in the FLSA Class—those who didn’t get overtime correctly between January 2017 and November 2020—will be paid $100 each.
- Around 5,578 people in the Termination Class will be paid $50 each.
- Each plaintiff will additionally get $10,000 “for work done on behalf of the class” and “to make up for financial and reputational risk undertaken in bringing the action,” Judge Rose ordered.
- Attorneys will receive 22.5% ($3,375,000).
Literally changed the way future workers are paid
The settlement had the effect of changing the way all UIHC employees were paid across the board, said Nate Willems, an attorney with Rush Nicholson who represented the UIHC employees.
“We are happy both with the settlement and the fact this lawsuit caused UIHC to start paying people their wages in a timely manner that complies with the law,” Willems told Starting Line. “Holding on to a person’s wages without their consent every month is not legal and should not be tolerated.”