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Shuttered mental health hospital settles lawsuit brought by laid-off employees

Palm Beach Post - 10/11/2021

The Jerome Golden Center for Behavioral Health, which abruptly closed and laid off its workforce two years ago, has settled with former employees who said the shuttered West Palm Beach mental health hospital violated federal labor law.

The Golden Center will pay $400,000 to be distributed to the more than 300 employees who lost their jobs, as well as their attorneys, according to a settlement agreement approved by U.S. Magistrate Judge Bruce Reinhart last month.

"The court-approved settlement was the maximum possible amount the former employees could recover given the Center's financial position," said Ryan Barack, the Tampa-based labor lawyer who represented the employees.

More: Jerome Golden Center sells for $11M

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Subtracting attorney's fees from the settlement, which were also approved by Reinhart, a pot of just over $252,000 remains to be paid to the employees.

The settlement won't be distributed evenly. The pro-rata payments will be calculated based on an employee's average pay during a 10-week period before the hospital closed.

"What happened at the Jerome Golden Center to the patients and the employees was very sad and unfortunate. The staff at the Center were professionals devoted to serving our community. They worked long hours in difficult conditions for low pay," Barack said.

The lawsuit, filed by two former employees in October 2019, said the Golden Center violated the law known as the WARN Act, which stands for Workers Adjustment and Retraining Notification.

The purpose of the law is to give employees sufficient time to seek other employment by requiring companies to provide 60 days' notice of mass layoffs.

The Golden Center, located on 45th Street just west of St. Mary's Medical Center, was integral in providing mental health care to low-income or indigent patients.

Many patients moved to assisted living facilities, apartments or sober homes.

The nonprofit's finances were in dire straits, but the situation was not publicly revealed until its former CEO announced in September 2019 that the Golden Center would be filing for bankruptcy. The nonprofit pulled out of the bankruptcy shortly thereafter to entertain offers for sale.

The sale to Sunview Medical of New Jersey for $11 million was made official in September 2020. The company plans to run the mental health hospital as a for-profit operation, but it has yet to open.

The settlement said that while the Golden Center did not think the lawsuit's claims were valid, and both parties "participated in extensive mediation efforts," the settlement was agreed upon due to "economic efficiency."

Golden Center board chair Jimmy Miller said he was "disappointed" in the lawsuit, saying he believes "the law is wrong and should not be applicable to nonprofit institutions."

"We're not General Motors. We're not Ford. We're not a large manufacturing company that is closing down. We didn't retain large capital amounts that would be distributed to shareholders by closing our doors," he said. "We did everything we possibly could to try and keep the facility open. I think that using that law in that scenario is going to hurt nonprofits in the future."

Barack pushed back on Miller's sentiment.

"I cannot imagine why anyone would think that employees who work for not-for-profit employers and devote their lives to serving others are less important or less entitled to protection from unlawful terminations," he said.

Hannah Morse is a reporter covering Palm Beach County. She can be reached at hmorse@pbpost.com or 561-820-4833. Follow her on Twitter at @mannahhorse.

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