Ozark deductible hiked $95K after harassment settlement

After Ozark recently settled a harassment complaint from a former employee, its insurance deductible on future claims has soared — from $5,000 to $100,000.

In response, aldermen say the city still has unresolved issues and want a human resources consultant to conduct a review.

The city fired Cara Borneman, its human resources director, in May. Mayor Shane Nelson said the city eliminated her position to save money. Borneman said she was the victim of harassment and filed a complaint against the city that cited rumors allegedly spread by Nelson and Alderman Randy Wright.

The city settled with Borneman for $78,000 in August but paid only $5,000 out of pocket. Its insurance paid the rest.

Soon after, Midwest Public Risk, Ozark's insurance provider, sent a letter to the city giving notice that the deductible on its employee practices coverage would rise, effective Sept. 1. If the city has to pay up on a future claim, it will have to foot the first $100,000 on its own.

"There is obvious concern on our part that not all avenues of available assistance have been utilized by the City in eliminating these types of claims," the letter said.

At a Board of Aldermen meeting Tuesday, City Administrator Steve Childers said he had spoken with Midwest Public Risk and that the company had told him the statement meant that the city had not taken full advantage of the insurer's legal counsel.

But some aldermen said they were concerned that the statement in the letter indicated the insurance provider was attempting to say the city has not done everything it can to prevent harassment claims.

"We've got some issues, obviously. We need to do whatever is necessary, we need to do our due diligence as stewards of the city to keep this from happening again," Alderman Christopher Wegley said.

Borneman, in a written statement to the News-Leader, said that several city employees had approached her between October 2013 and May, saying Nelson and Wright had confronted them with a rumor that Borneman was romantically involved with a superior.

Borneman said on May 5 she sent an email to Nelson saying she knew they were discussing the rumor and that it was untrue. She said she asked them to stop because it was offensive. At the next Board of Aldermen meeting, Borneman was dismissed.

Alderman Brad Jackson said he had spoken to Matthew Gist, the Kansas City attorney who handled the settlement agreement with Borneman for Ozark. Jackson said Gist had told him it was a good thing the city had settled because it likely would have lost much more in a lawsuit.

"He said the claims were not unfounded; there's merits to the claims," Jackson said.

Gist was unavailable Wednesday when the News-Leader called the firm he works for, Ensz and Jester. A voicemail was not immediately returned.

On Tuesday night, the aldermen decided they want to hear more from Gist and Midwest Public Risk as well as Lynette Weatherford, a human resources consultant. Weatherford has worked with the city previously and the aldermen uniformly indicated they would like to see her investigate issues in the city again.