MultiCare set to pay $42M in wage-and-hours settlement; terms to be finalized in August
A Tacoma health system is set to pay millions in a class-action settlement over lost wages regarding meals and rest breaks in a lawsuit brought by two former workers.
Tacoma-based MultiCare Health System has agreed to pay $42 million to settle the lawsuit brought by lead plaintiffs Tabitha Koshman and Jodi Schreiner. Thousands of health care workers are covered by the settlement.
Koshman worked as a registered nurse at MultiCare Auburn Medical Center from June 2017 to December 2019 while Schreiner worked at MultiCare Tacoma General Hospital from August 2019 to September 2021.
The pair alleged that the health system’s time clock rounding policy did not comply with state law, resulting in hourly employees being underpaid.
They also alleged that MultiCare did not provide second meal periods when employees worked shifts longer than 10.5 hours and failed to ensure employees “take all legally required rest breaks and first meal periods at Auburn Medical Center,” according to the settlement document. Their complaint also contended the health system did not compensate Auburn employees when breaks or meal periods were “missed, interrupted, or shortened.”
Marce Edwards Olson, MultiCare media representative, told The News Tribune in an emailed statement, “MultiCare denies these claims and asserts that all of its policies and practices in this regard are lawful.
“However, to avoid a lengthy and costly legal battle, the organization agreed to this settlement.”
She added, “The court has not ruled on any of the claims in this case.”
Koshman first filed against the health system in October 2020 in King County Superior Court, with Schreiner added as co-plaintiff in the second amended complaint filed a year later.
Superior Court Judge Catherine Shaffer signed off on an order granting preliminary approval of the settlement in April.
The settlement covers approximately 18,000 hourly employees at MultiCare during the period between Oct. 22, 2017, and March 31, 2022, according to Edwards Olson, and is set to be finalized in August.
Payouts according to the plaintiffs’ settlement proposal filed with the court March 30 would be distributed from a net settlement fund of more than $29 million, after attorney fees and other litigation costs.
The settlement described the represented classes and percentages of the net settlement fund as follows:
▪ Rounding Subclass: All hourly, non-exempt employees who were employed at any of MultiCare’s hospitals at any time during the settlement period, 30 percent, “proportionally based on the amount of wages each participating class member would have earned had they been paid based on actual punch times instead of rounded punch times.”
▪ Auburn Medical Center Subclass: All hourly, non-exempt Auburn Medical Center employees employed any time during the settlement period, 10 percent, “in proportion to total amount of hourly compensation each participating class member earned during the class period.”
▪ Second Meal Subclass: All hourly, non-exempt employees at any of MultiCare’s hospitals who were employed at least one shift of 10.5 hours or longer at any time during the settlement period, 60 percent, “in proportion to the number of shifts in excess of 10.5 hours in length worked by each participating class member.”
The settlement also covers attorneys’ fees “in an amount that does not exceed 30 percent of the gross settlement fund, plus actual litigation costs,” according to the filing.
A class representative service amount of $10,000 each was awarded to Koshman and Schreiner.
The workers were represented by attorneys with HKM Employment Attorneys of Seattle and Stutheit Kalin LLC of Portland, Oregon.
“The MultiCare matter resolved favorably pursuant to the terms of the settlement agreement,” attorney Jason Rittereiser of HKM told The News Tribune in an emailed statement Wednesday. “We believe that it is a very fair and reasonable resolution of the wage and hour claims brought by the representative plaintiffs.”
According to earlier filings in the case, the plaintiffs alleged that MultiCare paid workers in 15-minute increments “through an automated time-clock rounding policy that systematically denies workers their lawfully earned pay.”
They also contended the health system automatically deducted 30 minutes of pay for meal periods “when it knows that workers often fail to receive those meal periods.”
The lawsuit also alleged MultiCare failed to provide adequate rest breaks and scheduled workers “for long shifts (of 10.5 to 12.5 hours), yet refusing to give those workers their statutorily-required second meal periods.”
In the settlement filing, it was estimated by the plaintiffs’ team that more than $7.5 million was lost by workers to the time clock rounding; more than $36 million went unpaid “with missed second meals that were not covered by a written waiver;” and more than $1.3 million lost in unpaid wages “associated with missed first meal periods and missed rest periods.”
“Unlike some other Court-approved settlements, where Class Members receive only a fraction of their lost wages, here, Class Members will recover roughly half of their potential lost wages due to missed second meal periods, more than all of their potential lost wages due to rounding (plus penalties), and more than twice their potential lost wages (plus penalties) due to missed first meal periods and rest breaks,” the settlement filing noted.
MultiCare isn’t alone in settlements of this nature involving health care networks in the area, but it appears to be among the larger payouts.
In the settlement filing, an attorney for the workers wrote, “According to a leading authority on class action settlements, had this case resolved in 2021, it would have been the fifth largest wage and hour settlement in the country in 2021.”
In 2021, another Tacoma-area health system, CHI Franciscan Health, faced its own multi-million dollar settlement in a similar case, while also denying violating any wage and hour laws.
The health system 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.
That case, filed in 2019, included more than 7,000 employees of the health care system CHI Franciscan Health, which merged with Virginia Mason in 2021 to become Virginia Mason Franciscan Health.
