Former UK HealthCare CFO awarded $1.75M after he was fired for raising complaints to UK
A jury has awarded the former chief financial officer of UK HealthCare $1.75 million, saying he was wrongly fired after raising complaints to UK.
Sergio Melgar was hired at UK HealthCare in 2004 as the CFO with a salary of $330,000. His hiring package also included an incentive plan that allowed him to earn as much as 20% of his base salary, and by 2012, he made $479,000.
Melgar raised several complaints to UK human resources in 2012, including complaints about his salary. He said he should have been making closer to $533,000, which was the average at similarly-sized institutions. Melgar’s lawsuit, which was filed in 2017, stated that his duties were reassigned after he began to complain. In February 2012, he made a formal complaint of discrimination and retaliation.
He was fired in August 2012, and did not receive severance after being fired, according to the lawsuit.
Melgar, reached by phone on Thursday, said that after many years, the money being awarded to him is not what matters most, but he is happy to see that his name has been cleared.
“I have to be very happy and pleased that my name is cleared of any improprieties,” Melgar said. “I was retaliated against for bringing up, at the time, very legitimate issues. I ended up being the victim of allegations ... and all of the allegations have proven to be false.”
Melgar said he still considers Kentucky to be home, and hopes to retire in Kentucky. He is currently the executive vice president, CFO and treasurer of the University of Massachusetts Memorial Health Care system, and said he feels he will be able to return to Kentucky, knowing his name has been cleared.
The $1.75 million includes $1.5 million in lost monetary benefits, as well as $250,000 for emotional distress, said Robert Abell, Melgar’s attorney. Under the Kentucky Civil Rights Act, Melgar will also be eligible to petition for his attorney’s fees to be paid, which he plans to do, Abell said.
UK President Eli Capilouto testified during the trial that he had worked with Melgar at UK. Capilouto was called to confirm that Melgar had been fired and did not resign, Abell said.
Michael Karpf, the former executive vice president for health affairs at UK, also testified. Karpf and Melgar had previously worked together, and Karpf recruited Melgar to UK. The two had a falling out, Abell said, after which Melgar filed his complaint.
“We respectfully disagree with the decision reached yesterday, but will need time to further review before making any substantive comment,” UK spokesperson Jay Blanton said.
Melgar’s lawsuit also accused UK of discrimination based on national origin, after Melgar, who is of Guatemalan descent, was replaced with a non-Hispanic person.
While the jury did not find that Melgar had been discriminated against, they did find that he had been wrongfully terminated under the Kentucky Civil Rights Act after making his complaints, Abell said.
“I think he feels real vindication,” Abell said.
Melgar said his issues with UK have been ongoing for 10 years, and he thanked his lawyers, Abell and Jon Allison, for staying with him over a long period of time. The jury deliberated for less than an hour, Melgar said, and he was grateful that the jury found in his favor.
“The money is not the big issue,” Melgar said. “The important thing is that people can see retaliation is why I left UK.”