The U.S. Department of Labor obtained a court
judgment on Friday against Houston- based Donovan Business Systems, Inc. and a
present and former company officer for allegedly firing two employees, a
husband and wife, when one questioned administration of the companys
health plan. The company and the officers, without admitting liability, agreed
to pay former employees a total of $30,000 in cash to settle the issues raised
in the departments lawsuit.
Under the terms of the consent order and judgment,
defendant Kathleen Ross, who no longer works for Donovan, has paid $5,000 and
the company and James D. Baker will pay $25,000.
Donovan Benefit Systems, Inc. was in the business
of providing its clients with administrative services for the clients
self-funded group health plans. The company served as the plan administrator of
its own health plan as well.
The department alleged that the company and two
corporate executives, James D. Baker and Kathleen Ross, violated rights of two
employees which are protected by the Employee Retirement Income Security Act
(ERISA). The law explicitly prohibits the discharge, fine, suspension,
expulsion, discipline or discrimination against any participant or beneficiary
for, among other things, exercising their rights under a plan.
According to its lawsuit, the Labor Department
alleged that an employee and her husband were fired from the company when the
employee questioned company officials about checks for medical claims issued by
the company to her health care providers that were returned by the bank for
insufficient funds.
The consent judgment is the result of an
investigation conducted by the departments Dallas Regional Office of the
Pension and Welfare Benefits Administration, responsible for administering the
federal pension law. It was entered July 7 in federal district court in
Houston.
(Herman v. Donovan Benefit Systems) Civil Action
H-00-0126 |