Former employees say company betrayed their trust - KXXV-TV News Channel 25 - Central Texas News and Weather for Waco, Temple, Killeen |

Former employees say company betrayed their trust

CAMERON, TX (KXXV) -

Former employees at a Cameron manufacturing plant say they feel betrayed by the company after losing their jobs and insurance coverage.

Royal Seating closed its doors in early November after laying off its last round of 100 employees. The plant produced furniture for schools since the late 1960s, and was once one of Milam County's largest employers.

Luis Vela dedicated 25 years to the company, commuting from Austin to Cameron every morning. His parents, Roberto and Irma, described their son as a "workaholic," someone always willing to go the extra mile.

"We always talked about those kinds of things at home," explained Irma Vela. "You do the best job you can and more, and don't expect to be praised for it."

Luis' father, Roberto, said his son started to get sick sometime last August.  He continued to go to work, despite suffering a fever. After a trip to the doctor, Luis learned he had cancer. He died on Sept. 4, just two months before Royal Seating closed its doors and laid off the entire workforce.

"We saw it coming, but I wasn't prepared for what happened," said Blake Phillips, former Human Resources Manager at Royal Seating.

Phillips said trouble started when Royal Seating stopped paying its insurance carriers, but continued to deduct payments from employee paychecks.

"The money was coming out of the paychecks, but not getting paid to the carriers," said Phillips.

Eventually, insurance policies were canceled altogether, cutting off medical, dental and short-term disability benefits to employees. Employees lost their coverage, and in the case of Luis Vela, his family lost out on a $46,000 life insurance policy from Lincoln Financial.

"It's really a shame," said Ana Vela, Luis's sister. "They were being dishonest to all their employees - taking their money for their insurance premiums and not paying and them not being covered.  It's really disappointing."

Since its closure, Royal Seating has attracted the attention of several federal agencies. The Texas Workforce Commission confirmed that 11 wage claims had been filed by former employees.  The U.S. Department of Labor also told News Channel 25 an investigator had been assigned to the case.

Blake Phillips said he believed Royal Seating was in violation of the Worker Adjustment and Retraining Notification Act (WARN) because it failed to notify workers of their termination 60 days ahead of time.

"They were given maybe a week's notice in some cases. In other cases, it was a matter of who's on the list this week," said Phillips.

Royal Seating could face penalties if it's found to have violated the WARN Act. According to the Dept. of Labor website, companies are liable "to each affected employee for an amount equal to back pay and benefits for the period of violation up to 60 days." Companies in violation of the act are also "subject to a civil penalty not to exceed $500 for each day of violation."

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