Mercyhealth agrees to $1M settlement for religious discrimination over COVID-19 vaccine mandate

Mercyhealth health care system has agreed to pay over $1 million to employees and offered to reinstate employees who were terminated for refusing to comply with its COVID-19 vaccine policy for religious reasons.

The settlement comes after an investigation by the U.S. Equal Employment Opportunity Commission, according to an EEOC news release posted Wednesday. The investigation found reasonable cause to believe Mercyhealth discriminated against employees based on religion and denying religious accommodation by either firing employees or deducting their wages.

Mercyhealth has locations in Woodstock, McHenry, Algonquin and Richmond within McHenry County, along with a Crystal Lake hospital most recently added in 2023. The health care system also has hospitals or clinics in Wisconsin, in the Rockford area and in Byron in Ogle County.

Affected employees alleged Mercyhealth discriminated against them when it denied religious accommodations to employees who requested to be exempt from receiving the COVID-19 vaccine.

Employees claimed that they were allowed to continue working only if they signed a form allowing $60 to be deducted from their wages per month, described by Mercyhealth as a “vaccine incentive charge.” Employees who did not get vaccinated and did not sign the wage deduction form were terminated, according to the release.

The EEOC investigation also found reasons to believe Mercyhealth discriminated against employees from September 2021 to May 2022 “by denying them an opportunity to request a religious accommodation, opting instead either to terminate their employment or withhold money from their pay,” according to the release.

“At the start of my tenure as Acting Chair of the EEOC, I committed to focusing our agency’s resources to address the very real problem of religious discrimination, and this resolution is just the beginning,” EEOC Acting Chair Andrea Lucas said in the release.

“This is an example of what our agency can accomplish when we work with employers to ensure that the doors of our workplaces are equally open to religious employees. I am proud of the monetary relief that we have obtained here, and I am equally proud that these employees – who remained committed to their religious beliefs and practice at great personal cost – will receive job offers.”

The allegations violates the Civil Rights Act of 1964 which prohibits discrimination based on religion, according to the release.

Mercyhealth agreed to provide back-pay and compensatory damages to the employees in a three-year agreement following a pre-litigation conciliation process. The agreement also requires the company to train human resources on religion accommodation requests, recirculate policies and report to the EEOC on any religious accommodation decisions and requests related to system-wide vaccination programs.

Mercyhealth’s vice president of clinical operations and chief nursing officer, Kara Sankey, released the following statement:

“Mercyhealth respects the religious beliefs and practices of its employees. During the COVID-19 pandemic, Mercyhealth had to confront and address extraordinary challenges in order to carry out its health care mission as the state designated northern Illinois high risk maternal fetal medicine provider, Level III NICU and Level I trauma center. The health system needed to do this while doing its best to protect the health and safety of its patients and employees and complying with federal rules requiring all hospital staff receive vaccinations.”

The statement continued: “The balancing of these critical goals could not be achieved without the dedication of our doctors and staff in times of significant personal risk, and Mercyhealth appreciates the work and assistance of the Equal Employment Opportunity Commission in resolving these remaining disputes. The process permits Mercyhealth to demonstrate its long-held commitment to employee rights and to close another chapter in its work during the pandemic.”