Are Madera hospital former employees victims of wage theft? They’re owed about $2 million

A Madera Community Hospital board member this week confirmed to The Bee that the hospital owes roughly $2 million to former employees the hospital couldn’t pay after it closed its doors in January.

Stell Manfredi, vice chair of the Madera Community Hospital board, said he didn’t know how many employees had accrued vacation, sick time and comp time based on the hospital’s records that show about $2 million is owed to former employees.

“No employee didn’t get their paycheck that worked that week or that two-week period, but anything that we had on the books, we weren’t able to pay at the time,” he said. “That will get paid, hopefully, at a later date.”

In response to questions about wage theft, Manfredi said board members had asked their attorney about that issue.

“The bottom line is, if you can’t pay your bills, you can’t pay your bills,” he said. “We are familiar with that, and it’s not like we had all the money there and we didn’t pay them.”

Manfredi said hospital board members were caught expecting that an affiliation with Trinity Health, the owner and operator of Saint Agnes Medical Center in Fresno, was going to materialize. When the deal fell apart, the Madera hospital didn’t have sufficient funding.

Madera Community Hospital continues to employ and pay 32 employees, including its Chief Executive Officer Karen Paolinelli, two months after the hospital shuttered its doors. Paolinelli said the skeleton crew is needed to complete the hospital’s closure while still hoping for an 11th-hour reorganization.

Madera Community Hospital former employees who didn’t receive their full wages, including pay for their paid-time off (PTO), could be victims of wage theft, according to Paola Laverde, a spokeswoman for the California Department of Industrial Relations.

California labor code requires employers to pay workers their full wages upon separation, including vacation, Laverde said. The law further says that if an employer terminates a worker or the worker quits with at least three days of notice, the employer must provide a final paycheck on the worker’s last day or work.

“Employees whose employers fail to pay them are victims of wage theft,” Laverede said in an email. “These workers can file a wage claim with the Labor Commissioner’s Office to try to get their back wages paid.”

Wage claims can be filed online, mailed, or in person, Laverde said. The Fresno Labor Commissioner’s Office is located at 770 E. Shaw Avenue, Ste. 222, Fresno, CA 93710.

Furthermore, if the employee is not paid on their last day, or within 72 hours if the worker quit without notice, they “should file a wage claim for waiting time penalties that include an additional payment for each day that the employer withholds the employee’s final paycheck for up to 30 days,” she said.

Workers can call 833-526-4636 for more information, Laverde said.

Paolinelli had not responded to a request for comment by midday Wednesday.

Riley Walter, an attorney for the Madera hospital, last week told The Bee that the layoffs and an expected filing for bankruptcy were not connected. He said the hospital had to shut down because it had no funds to pay employees or suppliers.

But Manfredi on Tuesday seemed to make a connection when explaining that closing businesses can’t pick and choose which employees it pays.

“In other words, if you had 10 employees and you wanted to pay the first two, and just get them off the books, but the others didn’t get paid, well, that’s not the way it works in bankruptcy process,” he said. “You can’t pick and choose who to pay if you don’t have sufficient funds to pay all your bills.”

It is still unknown how much the hospital is paying in salaries for the 32 employees, including Paolinelli, who are still working.

Manfredi said he didn’t have the figure at the top of his head. “Believe me, I’d like to get it lower as much as possible,” he said.