BOISE, Idaho (AP) -- A Boise call center that helps people sign up for health insurance under the Affordable Care Act is laying off 1,600 people — nearly its entire workforce — as the federal exchange open-enrollment period ends.
Maximus Inc. hired about 1,800 people for the Boise facility last year.
In a letter to employees on Monday, company officials announced that 1,600 employees will be laid off in April because they won't be needed when the federal enrollment period ends. Company officials say some employees may be hired back this fall, in preparation for the next enrollment period. The Boise call center operated under a federal contract administered by the Centers for Medicare and Medicaid Services (CMS).
Similar layoffs are happening at the Maximus Inc. call center in Brownsville, Texas, according to the letter sent to Boise employees.
"After open enrollment ends, call centers operated by CMS contractors that have supported our effort to enroll millions of Americans in quality, affordable health coverage will be ramping down much of their activities," Richard Olague, a CMS spokesman, wrote in an email to The Associated Press. "Similar to our Medicare call line, the call center will staff up and down over the year to meet consumer demand and maximize operational efficiency. As such, our contractors are notifying their seasonal employees of this fact through WARN Act notices, as required by law."
The news came as a surprise to a group of nine employees suing Maximus over alleged violations of overtime laws. Their attorneys, Jeremiah Hudson and Howard Belodoff, say workers believed their positions were permanent, not seasonal.
"Our clients were shocked to find out that their positions at Maximus were not permanent positions. They were led to believe that they were being recruited for permanent positions at Maximus, and accordingly, many of them left behind secure employment elsewhere," Hudson wrote in an email.
The workers sued Maximus in Boise's U.S. District Court last month, contending they were forced to work unpaid overtime. Maximus has not yet filed a response to the lawsuit.
When the Idaho Department of Labor announced a series of job fairs last summer to recruit employees for the call center, it described the positions in a news release as "up to 1,800 permanent and seasonal customer service representatives and operation support staff for a major call center."
"The employees we spoke to were never told they would be seasonal when they were offered their positions," Belodoff wrote in an email to the AP.
According to the letter to Boise employees from Maximus vice president Helene Fisher, regular employees who weren't hired in a limited capacity will be eligible for up to two weeks' severance pay, as long as they keep working until their layoff date.