Non Profit Must Sell its Building to Pay Work Comp Loss
In continuing with the Work Comp theme today, here is another story out of small town America Non Profit goodness.....well.... sort of.
A Non Profit enterprise called The Roy Eagles are in danger of losing their roost after an employee’s catastrophic kitchen burns resulted in a $642,000 court judgment against the nonprofit charitable group.
What is so unusual about this case? Well, the Non Profit had let their Work Comp lapse and there was no coverage to be utilized for the injured employee.
What happened? Well, an employee was being trained in the group’s private club and bar on Oct. 24, 2014, when a manager drained 450-degree cooking oil into a plastic bucket on the floor next to Poulson.The bucket melted, spilling oil on the employees feet and across the floor, her attorney, Ron Nichols, said Wednesday. She fell to the floor, suffering more third-degree burns.“All of her back, from the tailbone to the neck and shoulders, and her feet,” Nichols said.
Not only is this employee injured for life, the tragedy also illustrates the perils of running a small nonprofit with limited resources and an apparent lack of attention to some basic business details.
“I was told when I got out of the hospital that there was no workers’ comp,” Poulson said in an interview Wednesday. She said she was under the assumption that the Eagles would still step in to cover her medical expenses.
Medical bill collectors, though, put a lien on her mobile home, garnished her wages and tapped her tax refunds.
“I’m not even blaming them, but they were in the wrong when they could have resolved it,” she said of the Eagles. “I knew they were scared. But had they had workers’ comp, none of this would have happened.”
She sued the Eagles in 2016 and won a default judgment this year of almost $443,000 in damages. Her lawyers were granted another $199,000 in attorneys’ fees.
The Eagles appealed, but ended up agreeing to a settlement signed by 2nd District Court Judge Michael DiReda on Sept. 14.
The club is surrendering its only asset, the clubhouse and bar, to be sold to pay at least some of the damages owed to Poulson.
The President of the Non Profit stated, "We were guilty." As it turns out, the business had not paid its iWork Comp premium, was a week late and the insurance company wouldn't provide any grace allowance. ( Now, I wasn't there and I don't know the facts, but I can tell you from 30 years of insurance work, an insurance company would only take this stance if there was a 'continual' pattern of late payments and probably an untimatum had been issued. Their decision to not 'grace' the claim would have been very carefully reveiwed by those in power and that decision most likely would have had undisputable merit to it.)
The hurt employee stated “This has been sad for everyone. It’s been very stressful and emotional,” she said. “And my life will never be the same.”She said she can’t go out into the sunshine because the heat causes “horrible” pain on her scarred back. “And I’m constantly sweaty even when I’m not hot.”Poulson also feels for the Eagles.“I loved my job there,” she said. “I know it’s hard for them too. It was like a family down there. I considered a lot of these people close friends.”But, she added, “being kicked out of a business, it’s not my fault. It was an accident, but that’s why we have insurance.”
With hindsight as 20/20......looking into this situation, a couple of issues rise to the top very quickly:
1. Always pay your insurance premiums on time.
2. Continually train your Management and Employees on Safety.
3. The grace, friendship and morality of others stops when something happens which
hurts....usually costing the business owner in more than just economics. Your business is
important...treat it that way.
We wish the best to all parties concerned. Any input on this case? Let us know what you think.