A Republican-owned hotel chain reportedly owes its employees $1.2 million for health insurance.
The Greenbrier Hotel in White Sulphur Springs, West Virginia, is “seriously delinquent” in its payments to its health insurer, according to a letter from the Greenbrier Council of Labor Unions.
The council also said the hotel, owned by the family of West Virginia Governor Jim Justice, has never reimbursed its employees for health insurance contributions that are routinely deducted from their paychecks.
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The Amalgamated National Health Fund said the Greenbrier is four months behind on its contributions, totaling about $2.4 million, and another $1.2 million is due soon.
“Greenbrier’s insolvency has seriously jeopardized our members’ health insurance benefits and is morally and legally wrong,” the Council of Labor Unions’ letter said. “Our members have fulfilled their obligation by working hard every day and paying their share to Greenbrier. Greenbrier has neglected its obligation to its employees.”
If Greenbrier does not fix the problem, it may face legal consequences for loss of health insurance.
“If Greenbrier doesn’t seek a resolution soon, legal challenges could be a question of when rather than if,” said Alex Beene, a financial literacy professor at the University of Tennessee at Martin. News week.
“It is alleged that Greenbrier has fallen behind on its health insurance payments, which could cause major problems for employees and the care they currently receive. More importantly, the union is critical of the fact that the company continues to withhold a portion of each employee’s salary for health insurance despite delinquencies in payments.”
But that’s not the only indication that trouble is coming for the Greenbrier. Recent listings have suggested that the historic hotel may be up for auction this month.
In July, the Justice Companies learned from JP Morgan that the hotel’s $142 million loan had been sold to Beltway Capital, which considered the hotel insolvent.
Newsweek has emailed Justice and Greenbrier for comment.
On Monday, Greenbrier’s lawyers filed for a temporary restraining order to stop the foreclosure.
The Greenbrier is majority owned by Justice’s children, Jay and Jill Justice.
If the auction takes place, it would be scheduled for August 27. By that time, all outstanding amounts must be transferred to the health fund.
In the statement filed Monday, the Greenbrier’s owners say the 2014 deed of trust is not valid because it was signed by Jim Justice and not Jay and Jill Justice, who have majority ownership of the hotel. They also claim the auction would violate oral agreements between JP Morgan and Jay Justice.
“Defendants are seeking a hastily arranged sale of a unique piece of property owned by Plaintiffs that contributes significantly to the economy of Greenbrier County. Defendants are seeking to foreclose on the deed of trust despite lacking the legal standing to do so,” attorneys for the Justice family wrote in the filing.
Owners also expressed concerns about the impact of Greenbrier’s job cuts on the local economy.
“The threatened sale would cause irreparable harm to plaintiffs,” the attorneys wrote. “Greenbrier’s reputation and business would suffer. Local jobs would be lost. And the foundation of Greenbrier County’s economy would suffer damage that will be difficult or impossible to repair.”
The Greenbrier employs about 2,000 people during peak season. The hotel was also on the verge of bankruptcy before the judges bought the property in 2009.
For workers who are now without health insurance, the loss of the money they paid in is particularly worrying, Beene said.
“The question now is not only whether an employee will lose their insurance, but also where exactly that portion of their salary will go,” Beene said. “In previous cases of this nature, legal action has usually been initiated quickly and could have serious consequences. Greenbrier must find a compromise with employees if it wants to avoid further escalation and serious consequences.”
