Restaurants Must Pay $4.8 Million to Workers’ Comp Fund

January 29, 2008

A judge has ordered a group of restaurant owners to pay $4.8 million into a workers’ compensation fund that was mismanaged.

About 500 Tennessee Restaurant Association members will have to pay thousands each to shore up the fund.

They had hoped to pay much less.

“We are disappointed,” said Nathan Ridley, an attorney for several restaurant owners.

The state liquidated the group’s workers’ compensation fund two years ago and asked restaurant owners to come up with the shortfall to pay injured workers.

“I need out of this thing,” Smyrna restaurant owner Polly Walls-Balakhani told Davidson County Chancellor Claudia Bonnyman on Wednesday. “As a sole proprietor in an overbuilt restaurant market, I struggle every day.”

But after a seven-hour hearing, the judge ruled against the group.

In a related case, the Tennessee Department of Commerce and Insurance is suing the restaurant association’s chief executive officer.

Among other things, the suit claims Ronnie Hart received excessive fees for running the workers’ compensation fund.

Information from: The Tennessean,

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