Employees of the Red Wing Care Center Nursing Home found out late last week, after working a full pay period, that their employer Welcov Healthcare had filed for bankruptcy and refused to pay for work they had done. The payroll owed by Welcov was for over $200,000, and doesn't include vacation and sick time that these workers may lose.
Jamie Gulley, the President of SEIU Healthcare Minnesota, the Union that represents many of the employees, shared his frustration.
"It is frustrating that another employer is treating the people who care for our families this way. This is the latest case of Minnesota's growing wage theft crisis and also a clear example of why we have a care crisis, where families struggle to find the care they want and deserve," said Gulley. "Would you do this critical, important, incredibly hard work if you may not be paid for your hours or if you could lose your accrued sick and vacation benefits? It's time that our state takes this issue seriously, both addressing the actions of bad actors and proactively making sure these shady business practices are stopped once and for all."
In recent months Welcov Healthcare had signed an agreement to transition operations of the nursing home to a new operator effective last week, and as part of the transition agreement they were responsible for the payroll through last week and were to transition all accrued benefits (sick leave and vacation time) to the new operator.
Just before the end of the pay period, Welcov told the new operator they were declaring bankruptcy and did not pay the wages it owed.
Just last month the Star Tribune reported that “Welcov’s owners plan to start a new business that will focus on a handful of healthcare facilities in Wyoming."
This is just the latest example of nursing home operators going bankrupt and reneging on their responsibilities.
In 2015 Deseret Health Group in Owatonna went bankrupt, forcing the state to put them in receivership and put Volunteers of America in charge until they could place all the residents in other nursing homes, eventually resulting in the nursing home closing. It was later discovered the employer was deducting insurance premiums from workers checks and not submitting to the insurance company. Extendicare (Robbinsdale and Texas Terrace facilities) went bankrupt and the courts put another management company in charge, with one (Fortis) going bankrupt as well. Workers at two facilities lost their sick pay.
The workers and their Union, SEIU Healthcare Minnesota, have notified the AG’s office and are preparing to take any and all legal action possible to ensure Welcov pays workers what they are owed.