Workers comp insurer ordered to reinstate fired CEOPosted On: Jan. 23, 2017 10:18 AM CST
SAIF Corp., Oregon’s state-chartered workers compensation insurer, will hold a special board of directors meeting Monday to discuss an awkward situation in which the not-for-profit insurer was ordered to reinstate terminated Chief Executive Officer John Plotkin while current CEO Kerry Barnett continues to hold the position.
Marion County, Oregon, Circuit Judge Claudia Burton ruled Tuesday that Salem, Oregon-based SAIF improperly fired Mr. Plotkin in May 2014, after just three months on the job, by holding meetings about the matter in private — a violation of Oregon’s open meetings laws.
The ruling voids the board’s decision to terminate Mr. Plotkin, which effectively reinstates him to the position of CEO as if he never left, said Dana Sullivan, Mr. Plotkin’s attorney, in an interview with Business Insurance Friday. That entitles him to nearly three years of back pay and retirement benefits he would have accrued had he remained on the job, Ms. Sullivan said.
In light of last week’s ruling, Mr. Plotkin agreed to dismiss a second claim, which alleged wrongful discharge based on the theory that he was terminated in retaliation for requesting an open hearing, Ms. Sullivan said.
The ruling leaves SAIF in the awkward position of having to decide what to do with its two CEOs. Although the company cannot retroactively terminate Mr. Plotkin, it can reinstate him and then immediately terminate him, which eliminates the dual-CEO issue but leaves the agency on the hook for back pay and benefits. The agency also could elect to appeal the decision, Ms. Sullivan said.
“We recognize this ruling puts us in an unusual position, but we have confidence in our board’s ability to make the best decision for SAIF,” the insurer said in a statement sent to Business Insurance on Friday.
An SAIF spokesman said the closed executive session portion of Monday’s board meeting will address the litigation with Mr. Plotkin. No other topics are on Monday’s meeting agenda, he said.
In a phone interview with Business Insurance Friday, Mr. Plotkin said his termination from SAIF came as a surprise. After closing his law firm in Colorado and moving to Oregon to take the CEO role at SAIF, Mr. Plotkin believed he was working in harmony with the wishes of SAIF’s board of directors and was given no warning of any problem with his work as CEO. The agency’s board asked him to resign just three months into his tenure, but he refused to resign when he said he was provided with no reasonable basis for the board’s demand.
At the conclusion of a public meeting concerning Mr. Plotkin’s employment, the board terminated him.
Mr. Plotkin said he tried to get his job back as CEO of SAIF, even applying for the position when it was publicly posted in 2015, he said. He said he is delighted with the judge’s decision.
“I feel the same sense of purpose I did when I was CEO, and I still feel like I have a wonderful relationship with SAIF’s employees,” Mr. Plotkin said.