LBJ Medical Center has set aside more than half a million dollars in expenditures to resolve a Wage & Hour issue with the U.S. Department of Labor over incorrect calculation of overtime for certain hospital employees, while the Labor Department has opened an investigation into LBJ and ASG.

The overtime discrepancy came to light during a House Health/LBJ Committee hearing on Tuesday when it was raised by Rep. Larry Sanitoa, who last week requested an explanation from LBJ chief executive officer Mike Gerstenberger for an item labeled “One Time Entry” for the hospital’s payouts for December this year.

According to LBJ expenditures spreadsheet for December, the “One Time Entry” totals  $578,024 and Gerstenberger informed Sanitoa via e-mail that this expenditure for December is payout to resolve a Wage & Hour issue, following a visit this year by a Department of Labor surveyor, who visited many employers in the territory, including LBJ.

“As it turns out, LBJ had never correctly calculated overtime. Although there was no penalty, we are required to make whole all employees ‘shorted since 2009,” he said via e-mail to Sanitoa.

Responding to Samoa News questions for further clarification, after this issue was raised briefly during the House committee hearing on LBJ fee hikes, Gerstenberger explained that the surveyor visited not only LBJ but other local employers — ASG and the private sector — in late September and early October this year.

“It was a routine review of compliance with Wage & Hour and other federal labor law practices,” he said.

“The principle finding at LBJ was that we had no policy on the calculation of overtime. As a result, each supervisor used his or her own best judgment; some rounded up, some rounded down; some to the nearest half-hour; some to the nearest quarter-hour, etc.,” said Gerstenberger. “We now have a consistent policy and all statutory supervisors have had training in how to apply the law.”

“The Department of Labor assessed no penalty to LBJ, but directed that we must make corrections to all employees who may have been affected in the period October 1, 2009 to September 30, 2011,” he said.

DOL spokesperson Deanne Amaden confirmed to Samoa News there is an open investigation on this case.

“I’ve confirmed with our Wage and Hour staff that we have open investigations on American Samoa Medical Center/ LBJ Tropical Medical Center and on the American Samoa Government, but the cases are still open so we can’t further comment at this time,” said Amaden via e-mail yesterday from her regional office in San Francisco, adding that she cannot  reply to other Samoa News questions until the cases are closed.

“There were no cases in the private sector,” she said and noted that she does not have the exact timeline for when the cases will be closed.

Meanwhile, Gerstenberger returned to the Fono building yesterday morning for a House Budget and Appropriations Committee hearing on the proposed LBJ fees hikes where the main witnesses to testify were to be ASG Treasurer Magalei Logovi’i and Office of Budget and Planning director Malemo Tausaga.

However, the hearing was a last minute cancellation after the committee was informed by the Executive Branch that Magalei left Monday night for a last minute important meeting and the deputy treasurer was on vacation. The committee was also informed that Malemo was unable to attend due to other pressing matters.

It’s unclear if the committee will reschedule another hearing on the rate hikes that go into effect Christmas Eve, while the Fono leaders are working with Gov. Togiola Tulafono for a resolution to financially assist the hospital.