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Bank appeals Lake Lawn pay ruling

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ANN MARIE AMES
May 26, 2011
— Anchor Bank is appealing a state order that the bank repay $184,700 to 203 former Lake Lawn Resort employees.

The employees are owed the money for paid-time-off benefits, according to a May 17 letter written by Wisconsin Department of Workforce Development investigator Diane Tadych.


Because the bank appealed, the department’s Equal Rights Division now will review the initial decision, which was made by an Equal Rights Division investigator, Department of Workforce Development spokesman Dick Jones said Wednesday.


“It is now subject to further review, still within our Equal Rights Division,” Jones said. “It’s like the bank has said, ‘We think you missed some things.’”


The division likely will issue a final statement in June, Department of Workforce Development Communications Director John Dipko wrote in an email to the Gazette.


Anchor Bank in August 2009 filed a foreclosure against the former resort owners and in October bought the resort for $19.97 million in a sheriff’s sale.


Last week, Lake Geneva philanthropist Jim Drescher bought the resort for $9.5 million and is working to reopen the resort Anchor Bank closed in December. Nearly 300 people lost their jobs when the historic resort closed.


The employees filed a labor standards complaint that they weren’t paid for unused vacation or paid time off when the resort closed, Tadych’s letter states. Wisconsin does not require employers to offer such benefits, but employers that do offer them must pay them, the letter states.


Employees who left the resort prior to early November received their benefits payments, the letter states. The receiver for the property in early November told resort management to stop paying the benefits, the letter states.


A receiver is a position court appointed to protect an asset during foreclosure. In this case, it was Richter Realty & Investment of Brookfield.


Some employees received payments Dec. 10, but the direct deposits were reversed the same day, the letter states. That indicates the resort intended to pay, but the receiver prevented the payment, Tadych wrote.


“The employees earned the benefits as part of their employment agreement, and those benefits need to be paid in full according to their established practice,” Tadych wrote.


An attorney for the receiver told Tadych that 30 of the employees who filed the complaint were managers and therefore not protected under Wisconsin’s wage payment statute, the letter states.


Employees told the investigator that although those 30 had been hired as managers, they spent more and more time doing manual labor to keep the resort afloat under cost-saving measures set by the receiver. Many were managers in name only. Sales managers did not have any managerial duties, the letter states.


The Department of Workforce Development in December asked the Wisconsin Department of Justice to file a lien so the money could be set aside until the case is resolved, Dipko wrote. When the Equal Rights Division makes a final decision, two things could happen, Dipko wrote:


-- If the employees disagree with the final decision, they could file suit in court against Anchor Bank.


-- If the bank disagrees, it could refuse to make the payment. Then the Equal Rights Division would ask the district attorney or the Department of Justice to get involved.



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