By Eric Fleischauer
The Decatur Daily
DECATUR, Ala. — The employees of defunct Decatur Emergency Medical Services Inc. will receive past-due wages despite their employer’s bankruptcy, a court ruled Friday.
The order by Bankruptcy Judge Jack Caddell does not give DEMSI owner Roger Stanmore, of Huntsville, the same right to payment.
The ruling will reduce the money other DEMSI creditors can collect.
Some of the employees already have found other jobs at First Response, which now holds a city-wide ambulance monopoly on both emergency and non-emergency transports.
“The employees that Decatur EMS had were good employees, just in a bad situation,” said David Childers, First Response operations manager. “We reached out to several of their employees and hired several of their employees.”
He said First Response has hired about six DEMSI employees as it fills the gap left by DEMSI’s March 1 closure.
First Response had four of its six advanced life support ambulances in service Monday, according to Morgan County 911. It also had four basic life support ambulances in service, which are used for non-emergency transports and less-critical emergency calls.
Stanmore filed the motion to pay past-due wages — many resulting from bounced payroll checks — after a warrant was sworn out for his arrest in Etowah County.
Without court relief, Stanmore “will continue to be exposed to liability for charges instituted by local law enforcement and the district attorney’s office for failing to honor previously issued payroll checks,” wrote his attorney, Kevin Heard, in a court motion this month.
The Etowah County district attorney dropped warrants against Stanmore, who also owns Gadsden/Etowah EMS Inc., after he made payment on bounced paychecks and paid court fees March 6. Along with DEMSI, Gadsden/Etowah and Stanmore filed for bankruptcy Feb. 25.
DEMSI’s ongoing financial struggles reached a crisis point Feb. 7, a payday for its employees. Some employees walked off the job after they received no paychecks, forcing the company to take all its ambulances out of service for about three hours.
Decatur Fire and Rescue rules required DEMSI to have two medic ambulances in service at all times and a third in service 12 hours a day. Its Feb. 7 violation led to a Feb. 21 recommendation by the Decatur EMS Committee that the City Council revoke DEMSI’s license. DEMSI initially asked the bankruptcy court to intervene and prevent revocation, but on March 3, DEMSI’s lawyer informed Caddell in open court that the company planned to surrender its license to operate in the city.
DEMSI still has not surrendered its license, according to Assistant City Attorney Chip Alexander.
“We are working to get them to surrender the actual license or submit to us in writing that they are relinquishing their license,” Alexander said. “We will ask the bankruptcy court to authorize us to go ahead with the revocation of the license if we don’t get something from them soon.”
The bankruptcy motion DEMSI filed revealed the company owes its employees $15,089 for checks it issued that were returned for insufficient funds. It owed another $14,384 to employees who were on the clock but did not receive paychecks. The bankruptcy petition was filed before $7,207 in outstanding payroll checks could clear, and the company owes its employees $11,665 for hours worked in the pay period that ended after it filed the bankruptcy petition. All told, DEMSI said it owes its employees $48,345.
Bankruptcy records show 25 DEMSI payroll checks bounced between October and February. On Feb. 7, the day of the work stoppage, the company failed to issue paychecks to nine of its 20 employees. The employees’ pay rates ranged from $8.24 to $14 per hour.
According to bankruptcy records, Stanmore had $165,000 in income in the six months preceding the bankruptcy.
The largest unsecured claim — which includes secured claims where the amount of the lien exceeds the available collateral — against DEMSI is from the Internal Revenue Service, for $863,240, according to bankruptcy records. The next largest unsecured claims listed in bankruptcy filings are $231,540 by Ascentium Capital and $152,679 by Cadence Bank.
Childers said his company’s monopoly status is working smoothly.
“Things are going perfectly for us,” Childers said. “We can’t complain about anything.”
First Response may face competition again in the future.
“I have heard that there have been several inquiries from several different companies on what the process is to apply for a (license) but, to my knowledge, no one has actually submitted an application,” Alexander said.