The Social Development Commission has missed the state’s Jan. 3 deadline to pay what it owes former employees.
“I am praying this is the last month of this nightmare,” said Sarah Woods, a former SDC employee who estimates that SDC owes her $4,800.
SDC laid off its entire staff, including Woods, in April when it shut down operations. The agency has not paid some former employees for pay periods in April.
The beleaguered agency reopened in December after a seven-month closure, offering limited services to the public.
Both the Wisconsin Department of Workforce Development and SDC say they are moving forward to meet their obligations as far as former employees are concerned.
SDC needs reimbursements to pay wage claims
SDC attorney William Sulton said his agency learned of the deadline from the Wisconsin Department of Workforce Development, which oversees wage and labor practices, in mid-December but missed it.
The reason? The SDC does not have the money to pay the filed wage claims until it receives more funding, Sulton said.
He said SDC is waiting to receive reimbursements of block grant funding from the Wisconsin Department of Children and Families, or DCF, to pay former employees.
SDC seeks repayment for services provided in April before it closed operations and possibly additional reimbursement.
“I would expect it to happen sometime in February, but that’s really on DCF to tell us,” he said.
As Milwaukee County’s community action agency, SDC is eligible for the Community Services Block Grant funding, which supports community action agencies’ programming to address poverty at a local level. The Department of Children and Families oversees the application process and distribution of this block grant funding to Wisconsin’s community action agencies.
Back and forth on reimbursements
A representative from Department of Children and Families said the department has already repaid SDC for past expenses.
Gina Paige, communications director, said the department paid SDC approximately $1 million last year in Community Services Block Grant reimbursements and skills enhancement program costs. This amount is slightly less than what SDC initially requested, Paige said.
Paige also said that as of Jan. 15, SDC has not made any additional requests for 2024 funding.
However, Sulton does not agree.
“That doesn’t square with what I’ve been seeing,” he said.
Sulton said he would confirm whether SDC submitted payment request forms, adding that SDC is doing everything it can to get employees paid.
“It really is true that DCF and others owe SDC money, and part of the issue is that SDC didn’t submit timely payment requests, but also part of the issue is nonsense delays,” Sulton said.
Sulton and Jorge Franco, interim CEO of SDC and chair of its Board of Commissioners, said that in addition to the block grant funding, SDC is pursuing other reimbursements, private funding and is asking government agencies and foundations to continue to support SDC’s work.
“Those individuals who are owed money will receive the pay that is owed to them,” Franco said.
SDC paid out $51,000 to owed employees in the fall, mostly using a contribution from Unite WI.
The state’s position
After evaluating wage claims, the Department of Workforce Development made a decision that SDC owes former employees $342,871 in wages (hours worked) and paid time off, Sulton said. More than $77,000 is paid time off.
“I’m not sure that we totally agree with that, but that’s what they decided,” Sulton said.
However, Sulton did not provide an exact amount that he believes SDC owes former employees.
“We understand that SDC is still attempting to secure additional funding, and enforcement measures remain in place while DWD’s investigator works to resolve the claims,” a Department of Workforce Development spokesperson said in an email.
Department of Workforce Development would not say what these enforcement measures include, but the department filed a lien for $168,759 against SDC, according to court records.
A lien is a legal method by which employees can make a claim on an employer’s assets, prioritizing their back pay before other debts.
Meanwhile, Woods and other former employees are still waiting.
“We just want our money,” Woods said.
“I am praying something comes through before February.”
She said that she also is praying for SDC.
“I miss working there, but this whole thing has been sad.”
More on the SDC
Four takeaways from the Social Development Commission’s latest board meeting
Community leader Walter Lanier joins the Social Development Commission board
Former SDC employees still waiting to be paid
SDC is back in business but full recovery remains uncertain
SDC reopening: Here’s what you need to know
SDC plans to reopen in December, focusing on key programs
How the Social Development Commission failed its Milwaukee residents
Why did the Social Development Commission fail? Here are takeaways from our investigation
Meredith Melland is the neighborhoods reporter for the Milwaukee Neighborhood News Service and a corps member of Report for America, a national service program that places journalists in local newsrooms to report on under-covered issues and communities. Report for America plays no role in editorial decisions in the NNS newsroom.
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