Cox subcontractor End 2 End Communications failed to pay overtime to field employees

For 246 current and former employees of an Arizona cable installation company, a fair day's pay for a fair day's work is finally ringing true as their employer has pay them a total of $350,150 in back wages after failing to pay them overtime rates, as required by federal law.

An investigation of End 2 End Communications by the U.S. Department of Labor's Wage and Hour Division found the Gilbert-based company paid field technicians on a per-task basis for all installations without regard to the number of hours they worked. For example, a technician performing enough tasks to earn $500 was paid that amount — whether it took 30 or 50 hours. As a result, the employer failed to pay legally required overtime at time and one-half for each hour worked beyond 40 in a workweek, in violation of the Fair Labor Standards Act.

"Commonly, cable installation industry employers do not pay overtime to employees who work long hours in the field," said Eric Murray, director of the division's Phoenix District Office. "Employees paid on a piece-work basis are still entitled to overtime for hours worked beyond 40 per week. Those employers who don't pay workers correctly should take note of this case." 
 
End 2 End Communications, which does business as End 2 End Technologies, signed a consent judgment and agreed to ensure future compliance with federal labor law and pay the back wages. The company is a subcontractor for Cox Communications, the nation's third largest cable and broadband company. 
 
As part of its agreement, End 2 End has notified current and former employees of the case's resolution and redesigned the company's payroll system to ensure that all overtime-eligible employees receive pay stubs that properly record the wages paid for overtime hours worked. The employer also provided companywide training on the updated payroll system and on workers' rights under the FLSA and included a reference to the Wage and Hour Division in employee handbooks.

Source: DOL

This information is intended to be educational and should not be considered legal advice on any specific matter.

Employer, staffing agency avoided paying overtime to temporary workers

More than 160 workers at a Philadelphia direct mail and printing company will receive $1.45 million in back wages and damages after a federal investigation found their employer and a staffing agency failed to pay overtime wages.

The U.S. Department of Labor's Wage and Hour Division conducted an investigation that resulted in a consent judgment, filed in U.S. District Court for the Eastern District of Pennsylvania, in which ICS Corp., New Century Integrity Corp. and its owner Hokkito Teddy agreed to pay 166 workers $725,583 in overtime wages, and an equal amount in liquidated damages. The investigation found ICS, New Century and Teddy employed the workers jointly.
 
"Temporary staffing agencies are valuable contributors to our economy," said Wage and Hour Division Administrator Dr. David Weil. "These agencies should not be used by employers to attempt to avoid their obligations under the law. Those who do will be held accountable, as today's action shows."

An investigation of direct mail processor ICS and two staffing companies it retained, found significant violations of the Fair Labor Standards Act. Violations included paying some workers in cash at straight time rates for all hours instead of paying overtime when employees worked beyond 40 hours in a workweek. Other employees, provided by New Century received checks for their first 40 hours from ICS. New Century then paid these employees in cash for their overtime hours at rates less than their regular pay. For example, a worker who received $13 per hour for his first 40 hours received $11 per hour in cash for overtime hours.
 
Investigators also found that Richy Services Inc., a second staffing agency used by ICS, failed to produce time and payroll records.

In addition to back wages and damages, the consent judgment requires ICS to appoint a compliance officer to ensure that the company maintains proper records, and pays temporary workers in compliance with the FLSA.
 
"Companies that use temporary agencies have a responsibility and duty to pay legally required wages," said Oscar Hampton, the department's Regional Solicitor in Philadelphia. "ICS violated the law when it failed to pay its workers the wages they earned. The company cheated its employees and sought an unfair business advantage over competitors that abide by the law."

The FLSA requires that covered employees be paid at least the federal minimum wage of $7.25 per hour for all hours worked, plus time and one-half their regular rates, including commissions, bonuses and incentive pay for hours worked beyond 40 per week. Employers also must maintain accurate time and payroll records. The FLSA provides that employers who violate the law are liable to employees for their back wages and an equal amount in liquidated damages. Affected employees receive liquidated damages, as well.

Source: DOL

This information is intended to be educational and should not be considered legal advice on any specific matter.

San Antonio oil workers due back wages benefit from DOL enforcement effort

The latest investigation in the U.S. Department of Labor's Wage and Hour Division ongoing enforcement initiative, focused on the oil and gas industry in New Mexico and Texas, has helped 188 workers who will receive $157,000 in back wages after investigators found their employer violated the Fair Labor Standards Act.
 
Wage and Hour Division investigators in the San Antonio District Office found that Elite Production Services LLC failed to include the workers' bonus payments when calculating their rates of pay for overtime hours.

Since the initiative began in 2014, the agency has recovered more than $1.3 million owed to more than 1,300 workers.

"There is a misconception in the oil and gas industry that, because workers typically earn more than the minimum wage, they are being paid legally. That is not always the case," said Cynthia Watson, regional administrator for the Wage and Hour Division in the Southwest. "Employees must be paid properly for every hour worked, and employers need to calculate the total amount of pay to pay overtime correctly."

Employers must base overtime pay on an employee's total earnings, including their normal hourly rate and most bonus payments. For example, a $10-per- hour employee who works 50 hours and receives a $50 bonus in that workweek must be paid overtime based on a rate of $11 per hour. The FLSA excludes certain payments, such as reimbursement of work-related expenses, from the regular rate calculation.

Based in San Antonio, Elite Production Services provides on-site services throughout the drilling, completion and production cycles of oil fields. The company has agreed to correct the violations, comply in the future and pay the full amount of back wages.

The division's ongoing enforcement initiative has found overtime violations associated with various illegal pay practices, including the following:

• Improperly applying exemptions from overtime.
• Failing to include bonus payments made to employees when calculating overtime pay rates.
• Not paying for time spent working off-the-clock and before and after scheduled work shifts.
• Paying flat, daily shift rates without regard to how many hours the employee worked and without additional time and one-half pay for overtime.

Focused on this fast-growing industry, the initiative seeks to inform workers of their rights and ensure FLSA compliance among oil and gas companies and other related businesses including, but not limited to, trucking, lodging, haulers of water and stone, staffing service providers and other types of oil and gas supporting trades.

The division also is reaching out to employers and employer associations to provide them with compliance assistance information and to secure their cooperation in promoting industrywide compliance. Similarly, the division continues to conduct outreach to workers and community groups to inform them of the initiative and departmental services and to encourage employees to come forward with potential violations.

Source: DOL

This information is intended to be educational and should not be considered legal advice on any specific matter.

Federal enforcement effort finds Gulf Coast workers owed nearly $3.5 million in back wages

US Labor Department determines agencies illegally paid wages as per diem reimbursement

Six Gulf Coast staffing agencies have agreed to pay thousands of workers nearly $3.5 million in back wages after U.S. Department of Labor Wage and Hour Division investigators found part of their wages were mislabeled as "per diem" payments as reimbursement for expenses they never incurred.

Federal investigators found the agencies owed back wages to more than 3,000 workers – welders, electricians, pipe fitters, and other craftspeople – on maritime vessels and other oil and gas industry projects.

The investigations are part of an ongoing, multi-year initiative aimed at ending an illegal and alarming trend of employers labeling part of employee wages as per diem payments, often to avoid overtime, payroll taxes and other costs. Investigators are actively monitoring staffing agencies and other employers in the 1,600-mile Gulf Coast region for signs of this practice.

"Workers don't often complain about receiving per diem pay in place of regular wages because they believe they make more money being paid this way," said Wage and Hour Division Administrator David Weil. "The truth is these workers are losing out. They are not getting all of the short- and long-term benefits their employer owes them."

Companies break the law when they label part of a worker's regular wages as per diem expense reimbursement instead of wages to lower labor costs, avoid paying overtime, and avoid making payments toward federal and state taxes, workers' compensation, unemployment insurance and Social Security payments. By attempting to reduce these obligations illegally with this scheme, these employers also gain an unfair advantage over their competitors.

Per diem pay is intended as a way for employers to reimburse workers for lodging, meals and other travel expenses incurred on behalf of their employer.

Regular wages mislabeled as per diem cheat workers out of correct overtime wages. The payments may prevent workers from receiving full benefits in the event of a lay-off or workplace injury, and do not make full contributions toward a worker's Social Security benefits.

"Illegal per diem pay also hurts law-abiding employers, defrauds local, state and federal governments and cheats all of us who pay increased taxes as a result," Weil added. "Our division has dedicated the people and resources we need to stop this illegal pay practice on the Gulf Coast and throughout the nation."

The six companies found to be engaged in this practice in the latest investigations, the back wages found and the numbers of affected employees are as follows:

Employer Name	Back Wages	Employees
Masse Contracting	$909,667	1,257
Permanent Workers	$1,110,103	604
TREO Staffing	$511,877	428
Flexicrew Staffing	$94,496	195
Winston International	$390,361	490
Government Support Services, Inc. (GSI)	$474,938	289
TOTAL	$3,491,442	3,263

 
The initiative has also found troubling trends in the region's staffing industry in Alabama, Florida, Louisiana, Mississippi and Texas. Employers that use temporary staffing agencies may be liable if investigations find workers employed jointly by the staffing agency, and the business that contracted them, received illegal per diem payments. 
 
The FLSA requires that workers receive at least the federal minimum wage of $7.25 per hour for all hours worked, plus time and one-half their regular rates, including commissions, bonuses and incentive pay, for hours worked beyond 40 per week. Employers must maintain accurate time and payroll records. Under the FLSA, employers who violate the law are liable for employees' back wages and an equal amount in liquidated damages. Affected employees receive liquidated damages directly.

Source: DOL

This information is intended to be educational and should not be considered legal advice on any specific matter.

BabyVision Inc. willfully violates federal wage and hour law, obstructs investigators and threatens employees

Poughkeepsie, New York, employer must pay more than $121K to 49 workers

A Poughkeepsie-based maker and distributor of baby apparel and accessories denied 49 workers overtime pay and then attempted to thwart federal investigators by hiding workers and threatening them if they spoke to U.S. Department of Labor Wage and Hour Division agents.

A yearlong federal probe found that BabyVision Inc. and the company's owners, Shreenivas Shah and Malti Shah, paid employees — including some not on the company payroll — straight time in cash and denied them the required overtime rate of one and one-half times their regular hourly wage when they worked more than 40 hours in a workweek. The owners also improperly classified some employees as exempt from overtime. Additionally, the Shahs failed to maintain proper payroll records.

The Shah's actions violated the federal Fair Labor Standards Act. As a result, the agency determined that the workers are due $121,349 in overtime back wages and liquidated damages.

Early in the investigation, the Shahs told employees they were to hide from investigators or provide false information. Workers were threatened with termination if they cooperated with investigators. The department responded by obtaining a temporary restraining order to protect the workers and their rights, allowing the review of the company's employment practices to continue.

A consent judgment was also secured by the department that ordered the Shahs to pay the back wages and damages, take extensive corrective action to prevent future violations and pay $13,744.50 in civil money penalties, given the willful nature of their violations.

"Deliberately denying employees their earned income is illegal, and it makes it harder for workers to care for themselves and their families," said Sonia C. Rybak, the Wage and Hour Division's assistant district director in the White Plains Area Office. "We will use every enforcement tool at our disposal to ensure a fair and level playing field for employers and fair pay for employee work."

"This case shows our commitment to take all necessary legal steps, including using restraining orders, to protect workers and their rights," said Jeffrey S. Rogoff, the department's regional solicitor of labor in New York. "The judgment here does more than secure back wages. It commits BabyVision and the Shahs to a comprehensive compliance plan that includes corrective action and worker education to keep these violations from happening again."

The compliance plan requires the defendants to use a time clock or another automated timekeeping device to record all hours worked by their employees accurately; prohibits employees from working off-the-clock; record employees' work hours and break time correctly; prominently post an employees' rights notice and poster in Spanish and English; and provide all current workers and new hires with a copy of the consent judgment in Spanish and English.

BabyVision designs and distributes baby apparel and accessories to retail stores and on the Internet under brands such as Luvable Friends, Hudson Baby, Yoga Sprout and Nurtria. It operates a warehouse and offices at 30 Firemens Way in Poughkeepsie. The underpaid employees prepared customer orders, loaded and stocked items in the warehouse and maintained the company's website.

Source: DOL

This information is intended to be educational and should not be considered legal advice on any specific matter.

Danica Group LLC underpaid workers, misclassified some as independent contractors

The U.S. Department of Labor has obtained a settlement by consent judgment that provides for the recovery of $1.42 million in back wages and liquidated damages for more than 300 current and former employees of four Long Island City plumbing and heating contractors. The related businesses are Danica Group LLC; Copper Plumbing & Heating LLC; Copper II Plumbing & Heating LLC; Copper III Plumbing & Heating LLC, and the owners are Thomas Andreadakis, Leonidas Andreadakis and Helen Andreadakis.

Investigations by the department's Wage and Hour Division found that the contractors violated the overtime and recordkeeping requirements of the Fair Labor Standards Act. Specifically, they paid employees straight time wages rather than time and one-half when employees worked beyond 40 hours in a workweek, and issued separate paychecks for the overtime hours from a petty cash account.

Additionally, they misclassified at least 25 employees as independent contractors, paying them a weekly salary that did not compensate the employees at time and one-half when employees worked beyond 40 hours in a workweek. The defendants also frequently paid many employees late, sometimes requiring workers to wait several weeks to be paid. Finally, they maintained incomplete and inaccurate payroll records.

"Hundreds of workers were denied their lawful pay when they were not paid promptly and correctly or were misclassified as independent contractors," said Dr. David Weil, administrator for the Wage and Hour Division. "The misclassification of employees as independent contractors deprives workers of wages and benefits they are entitled to under the law, thereby hurting our economy. It also leads to unfair competition because businesses that play by the rules operate at a disadvantage to those that don't."

Under the terms of a consent judgment entered with the U.S. District Court for the Eastern District of New York, the defendants will pay the workers $710,000 in back wages covering the time period between September 2010 and April 2014, and an equal amount in liquidated damages. The judgment also includes enhanced compliance provisions that will commit the defendants to taking effective steps to improve their payroll recordkeeping, ensure that employees are paid on time each week, reclassify as employees those who were previously misclassified as independent contractors and properly pay them.

"Underpaying and misclassifying employees as independent contractors are illegal and unacceptable actions. The Labor Department will pursue all available legal measures to ensure that workers are properly classified and compensated for their work," said Jeffrey Rogoff, regional Solicitor of Labor in New York. "If the defendants fail to adhere to the terms of the judgment, they could be subject to contempt sanctions by the Court."

The case was investigated by the Wage and Hour Division's New York City District Office and litigated by the Department's regional Office of the Solicitor in New York City.

Source: DOL

This information is intended to be educational and should not be considered legal advice on any specific matter.

US DOL conducts compliance and enforcement initiative in Bay Area nursing homes, residential care facilities

$6.8 million in wages, damages recovered for more than 1,300 workers since 2011

A multiyear compliance assistance and enforcement initiative conducted by the U.S. Department of Labor’s Wage and Hour Division has found that Bay Area residential care facilities and nursing homes have underpaid more than 1,300 workers by millions of dollars.

The agency’s investigations concluded that between 2011-2014 minimum wage and overtime violations resulted in more than $6.8 million dollars in back wages and damages for the workers, money desperately needed to cover basic life expenses, such as rent, food, transportation and child care. Additionally, the initiative has served to level the playing field among the businesses by ensuring compliance with the federal Fair Labor Standards Act.

At the same time, the Wage and Hour Division has worked with business owners, worker advocacy groups and employees to educate the industry on basic federal labor law requirements. However, investigators continued to see widespread abuses where many employers took advantage of workers vulnerable to exploitation because they often don’t know their rights. As a result, they were subject to wage violations and retaliation.

“The hardworking men and women who take care of our relatives and friends need to be compensated fully for their time,” said Ruben Rosalez, regional administrator for the department’s Wage and Hour Division in San Francisco.
“We know that rewarding hard work with fair and full pay leads to happier and more productive workers. The trend of violations is therefore not only harming workers, but patients alike who might suffer with less quality care. We will continue to investigate and penalize employers who cheat their employees and gain an unfair competitive advantage over their law-abiding competitors at the expense of their workers.”

Working conditions in some residential care facilities can be difficult for many caregivers. Many of the facilities require employees to stay overnight on the premises to ensure round-the-clock care for patients. Despite the fact that they are on call assisting residents overnight, investigators found that some workers were not paid for such time, and some were denied adequate sleeping facilities and were forced to sleep on the floor. Such conditions can erode the quality of care patients receive.

Additionally, investigators found that employees who are paid hourly often worked 10 to 14 hours per day, six days per week, but were only paid for eight hours per day. Some workers were paid a flat weekly salary regardless of the hours they worked and were therefore denied time and one-half pay for hours worked beyond 40 per workweek. Employees were also threatened and harassed if they questioned their working conditions. Some employees were intimidated or retaliated against by their employers and were instructed not to cooperate with Wage and Hour investigators.

Investigations completed in the past year reflect the disturbing trend in violations. These include:

• The owners of Retirement Plus of San Carlos and four other Bay-Area facilities paid its caregivers as little as $5 per hour and misclassified one employee as an independent contractor. The employer paid more than $630,000 in minimum wage, overtime and damages to resolve the case.
• Lake Alhambra Assisted Living Center violated a protective order prohibiting retaliation against caregivers for cooperating with the investigation. Ultimately, the business paid $304,000 in back wages and damages to 32 caregivers, plus $25,000 in civil money penalties, as ordered in a consent judgment filed in the U.S. District Court for the Northern District of California. The order also included the appointment of an independent monitor to ensure the business pays its workers properly in the future.
• Anne’s Guest Home, which operates six facilities in Pleasanton and Livermore, was found in violation of the minimum wage, overtime, and record-keeping provisions of the FLSA. The company paid some workers below the federal minimum wage of $7.25 per hour and failed to pay overtime at time and one-half for hours worked beyond 40 in a workweek. The firm was ordered to pay more than $447,000 in back wages and damages in a consent judgment filed in the U.S. District Court for the Northern District of California.
• Farol’s Residential Care Home paid caregivers salaries below the minimum wage in many cases and did not pay overtime when employees worked over 40 hours per week. The business was ordered to pay a total of $405,284 in back wages, damages, interest and penalties in a consent judgment filed in the U.S. District Court for the Northern District of California. Twenty-seven workers will receive back wages in this settlement.
• Vicky Rebecca Quedado, doing business as We Care ICF/DD-H and Becker Home Inc. of Northern California, operates three intermediate residential-care facilities and will pay $261,356 in back wages and liquidated damages to 21 low-wage workers for violations of the FLSA. The division found that the business paid the workers flat salaries for all hours worked instead of paying them overtime when they worked more than 40 hours in a workweek, as the law requires.

Source: DOL

This information is intended to be educational and should not be considered legal advice on any specific matter.

J&J Mongolian Grill and Spa Therapy workers were cheated and threatened

Jury awards more than $1.3M in back wages and damages to 101 former employees at defunct Bellingham businesses

Although a Bellingham restaurant and a spa have closed, 101 workers once employed by the businesses will receive more than $1.3 million in back wages and damages, thanks to a Washington State jury. The decision is the result of a U.S. Department of Labor investigation that revealed numerous violations of federal labor law.

A unanimous verdict found that the workers were systematically denied minimum wage and overtime pay under the Fair Labor Standards Act by business owners Huang “Jackie” Jie and Zhao “Jenny” Zeng Hong. The lawsuit was filed in 2013 against the two owners and their companies, Pacific Coast Foods, Inc., doing business as J&J Mongolian Grill, and J&J Comfort Zone, Inc., doing business as Spa Therapy. The jury also found that the defendants interfered with and retaliated against workers, most of whom spoke little to no English, who cooperated in the Labor Department’s investigation.

“No one who works hard and plays by the rules should be cheated out of the wages to which they are legally entitled,” said U.S. Secretary of Labor Thomas E. Perez. “In this case, the business owners took advantage of their workers and continued to do so even after being informed by investigators that they were operating in violation of federal labor law. That’s unconscionable. We will hold accountable those businesses that break the law, and just like in this case, ensure that justice prevails for workers.”

The department’s Wage and Hour Division found that employees of the J&J Mongolian Grill and Spa Therapy put in on average more than 70 hours during a six to seven day workweek. A number of the workers were paid less than the federal minimum wage of $7.25 per hour, and none of them received overtime pay for hours worked beyond 40 in a workweek. Both businesses were located in Bellingham’s Bellis Fair Mall.

“Dozens of brave men and women will now get the long overdue back wages they rightfully earned following years of abuse, trickery and retaliation,” said Janet Herold, the department’s regional solicitor in San Francisco. “This verdict is a warning to others: We will find you and the courts will back us when employers try to shortchange their workers to maximize profits.”

The department brought the case to court to stop the business owners, who have since divorced, from continuing to break the law and to recover wages owed to 101 cooks, kitchen helpers, cashiers and masseurs. The jury awarded the back wages and also awarded compensatory damages to four employees who had suffered retaliation, including threats, reduction of hours and, finally, termination of employment because they refused to be silenced about the defendants’ labor law violations.

Source: DOL

This information is intended to be educational and should not be considered legal advice on any specific matter.

Supreme Court Upholds Rule Requiring Overtime for Loan Officers

The Supreme Court today upheld a Department of Labor rule that required
banks to pay mortgage loan officers overtime, finding in a unanimous decision that the Administrative Procedures Act does not require federal agencies to employ notice-and-comment rulemaking when it issues a rule interpreting an existing regulation.

In the case of Perez v. Mortgage Bankers Association, the court overturned a lower court ruling that the department could not change its determination of exemption under the Fair Labor Standards Act without going through a formal rulemaking process. The Supreme Court rejected the precedent relied on by the lower court, arguing that it would impose obligations on federal agencies not envisioned by the text of the APA.

The Labor Department had ruled in 2006 that mortgage loan officers were exempt employees under the FLSA, but it reversed itself in 2010. The Mortgage Bankers Association sued DOL, arguing that the government could not “significantly revise” its “definitive interpretation” without conducting an official rulemaking with notice and comment.

Source: ABA

This information is intended to be educational and should not be considered legal advice on any specific matter.

Oregon developer makes retaliatory threats against employees

A federal court has ordered local developer David Emami and three of his affiliated companies to pay 33 Portland-area employees $512,290 in unpaid wages and liquidated damages. The U.S. District Court for the District of Oregon agreed with a U.S. Department of Labor investigation that found that Emami and companies Oak Grove Cinemas Inc., Barrington Management LLC and Barrington Venture LLC willfully violated the overtime and record-keeping provisions of the Fair Labor Standards Act. The court also held that Emami violated the anti-retaliation protections of the FLSA by threatening employees who cooperated with the department’s investigation.

“Those who flagrantly disregard basic wage obligations and then try to cover up those actions should think twice before threatening workers when they simply exercise their right to be paid fairly, as the law requires,” said Janet Herold, the department’s regional solicitor in San Francisco. “This judgment makes clear that we will not allow employers to violate the law and then try to bully their way out of trouble.”

The department concluded that those Emami employed as general maintenance, landscaping and construction workers at commercial properties he owned or maintained had two time cards for most pay periods. On one time card, an employee recorded their morning start time and a midafternoon end time. The employees immediately clocked in on a second time card to record the remainder of a day’s work hours. The workers’ duties and rates of pay remained the same each day at each work location.

Workers typically received two paychecks each time they were paid—one from Emami’s Oak Grove Cinemas and another from Barrington Management or Barrington Venture. The employer claimed that the employees were independent contractors during the hours they spent working for the Barrington companies. The combined paychecks covered all of the employees’ hours, including those over 40 per week, paid at straight time. The department found, and the court agreed, that Emami’s “scheme” was deliberately concocted to avoid paying his employees overtime.

“This employer found out the hard way how serious we are about stopping an employer’s attempts to profit by willfully violating the wage laws and employment rights that protect the most vulnerable members of the workforce and level the playing field for other law-abiding employers,” said Ruben Rosalez, the Wage and Hour Division’s regional administrator in the West.

The court also found that Emami violated the anti-retaliation provision of the FLSA by threatening to retaliate against employees for cooperating with the department’s investigation or becoming a witness for the government. Threats of retaliation included intimidation and threats of physical force against cooperating employees.

Source: DOL

This information is intended to be educational and should not be considered legal advice on any specific matter.

AT&T Prime Communications LP to pay back wages

Workers in 11 states impacted

Prime Communications LP, doing business as AT&T Prime Communications LP, has agreed to pay $122,254 in back wages to 255 current and former employees as a result of investigations by the U.S. Department of Labor that found violations of the Fair Labor Standards Act.

An initial investigation by the department’s Wage and Hour Division Albuquerque District Office found FLSA violations that led to a corporatewide investigation coordinated by the division’s Houston District Office. The investigations found that AT&T Prime Communications violated the overtime provisions of the FLSA by failing to include commissions earned by hourly nonexempt employees into the regular rate of pay for overtime purposes at all affected office locations. The affected employees worked in Alabama, Florida, Indiana, Georgia, Louisiana, New York, North Carolina, Ohio, Pennsylvania, Texas and South Carolina.

“This was a systemic, corporatewide issue that affected workers throughout the country,” said Cynthia Watson, regional administrator for the Wage and Hour Division in the Southwest. “The FLSA has been in effect for 75 years, and employers are responsible for knowing and following the laws that apply to their businesses. We are pleased that AT&T Prime Communications has agreed to change its pay practices at all its locations.”

AT&T Prime Communications is an authorized dealer for AT&T wireless telecommunication plans. The company operates in 17 states with approximately 385 stores and has more than 1,300 employees nationwide.

AT&T Prime Communications has agreed to comply with all applicable FLSA provisions by correctly calculating and paying employees the overtime premium of time and one-half the regular rate of pay for all hours worked over 40 in a week and incorporating commissions earned by nonexempt hourly employees into the regular rate of pay for overtime purposes.

The FLSA requires that covered employees be paid at least the federal minimum wage of $7.25 per hour. Workers who are not employed in agriculture and not otherwise exempt from overtime compensation are entitled to time and one-half their regular rates of pay for every hour they work beyond 40 per week. The law also requires employers to maintain accurate records of employees’ wages, hours and other conditions of employment, and it prohibits employers from retaliating against employees who exercise their rights under the law.

Source: DOL

This information is intended to be educational and should not be considered legal advice on any specific matter.

Shell Oil and Motiva Enterprises to pay nearly $4.5M in overtime back wages

Shell Oil Co. and Motiva Enterprises LLC, which markets Shell gasoline and other products, have agreed to pay $4,470,764 in overtime back wages to 2,677 current and former chemical and refinery employees as a result of investigations by the U.S. Department of Labor that found violations of the Fair Labor Standards Act.

The department’s Wage and Hour Division conducted investigations at eight Shell and Motiva facilities in Alabama, California, Louisiana, Texas and Washington, which found that the companies violated FLSA overtime provisions by not paying workers for the time spent at mandatory pre-shift meetings and failing to record the time spent at these meetings.

“Employers are legally required to pay workers for all hours worked,” said U.S. Secretary of Labor Thomas E. Perez. “Whether in the international oil industry, as in this case, or a local family-run restaurant, the Labor Department is working to ensure that responsible employers do not experience a competitive disadvantage because they play by the rules.”

The Wage and Hour Division’s Houston District Office coordinated investigations with the Gulf Coast, New Orleans, San Francisco and Seattle District Offices to ensure nationwide compliance by Shell and Motiva. The findings revealed that those eight Shell Oil and Motiva refineries failed to pay workers for time spent attending mandatory pre-shift meetings. The companies required the workers to come to the meetings before the start of their 12-hour shift. Because the companies failed to consider time spent at mandatory pre-shift meetings as compensable, employees were not paid for all hours worked and did not receive all of the overtime pay of time and one-half their regular rate of pay for hours worked over 40 in a workweek. Additionally, the refineries did not keep accurate time records.

Shell, with U.S. headquarters in Houston, is an oil and natural gas producer involved in processing crude oil to manufacture energy products, including gasoline, diesel fuel, jet fuel and petroleum coke. Motiva, which is partially owned by Shell, is a leading refiner, distributor and marketer of fuels in the Eastern and Gulf Coast regions of the United States. It markets petroleum products under the Shell brand.

Shell and Motiva have signed settlement agreements that call for training of managers, payroll personnel and human resources personnel on the FLSA’s requirements. The training will stress the importance of requiring accurate recording and pay for all hours worked with emphasis on pre- and post-shift activities.

Source: DOL

This information is intended to be educational and should not be considered legal advice on any specific matter.

Warehouse service provider to the HEB grocery chain to pay overtime backwages

Costa Solutions LLC, a warehouse service provider to the HEB grocery chain, has agreed to pay $146,459 in overtime back wages to 63 current and former employees after an investigation by the U.S. Department of Labor’s Wage and Hour Division.

The investigation, conducted by the division’s San Antonio District Office, found that Costa Solutions violated the overtime provisions of the Fair Labor Standards Act by failing to pay overtime to a group of hourly supervisors and assistant supervisors, many of whom worked well beyond 40 hours in a workweek. The company also failed to include all earnings when calculating employees’ overtime rates.

“Employers are responsible for knowing and applying the federal labor laws that govern their businesses,” said Cynthia Watson, regional administrator for the Wage and Hour Division in the Southwest region. “Failure to pay legally required overtime pay not only harms workers and their families, but puts companies who follow the law at a competitive disadvantage.”

Costa Solutions agreed to comply with all applicable FLSA provisions by correctly calculating and paying overtime for all non-exempt employees and ensuring that all legal requirements are met before considering employees exempt from overtime.

The FLSA requires that covered employees be paid at least the federal minimum wage of $7.25 per hour. Workers who are not employed in agriculture and not otherwise exempt from overtime compensation are entitled to time and one-half their regular rates of pay for every hour they work beyond 40 per week. The law also requires employers to maintain accurate records of employees’ wages, hours and other conditions of employment, and it prohibits employers from retaliating against employees who exercise their rights under the law.

Source: DOL

This information is intended to be educational and should not be considered legal advice on any specific matter.

Ongoing Initiative Reveals Evasive Pay Practices in the Temporary Staffing Industry

B & D Contracting Inc., a labor recruiting and staffing agency that caters to oil field services and maritime fabrication facilities along the Gulf Coast, has agreed to pay $1,660,438 in back wages to 1,543 current and former employees. An investigation by the U.S. Department of Labor found that the company engaged in improper pay and record-keeping practices that resulted in employees being denied overtime compensation in violation of the Fair Labor Standards Act. The employees were assigned to client work sites throughout Louisiana, Mississippi and Alabama to work as welders, pipe fitters and shipfitters.

Investigators from the Wage and Hour Division's New Orleans District Office found the company mischaracterized certain wages as per diem payments and impermissibly excluded these wages when calculating overtime premiums, denying employees earned overtime compensation.

"Temporary staffing agencies serve valuable and legitimate business needs in today's economy," said Dr. David Weil, administrator for the Wage and Hour Division, "But employers may not manipulate these arrangements and use evasive pay practices to avoid paying workers their rightful wages."

"The labor violations we found in this case are not unique to B & D Contracting Inc.," said Cynthia Watson, regional administrator for the division in the Southwest. "We are increasingly finding the use of per diem schemes as a means of decreasing overtime pay and tax obligations in the staffing and support services industry in this region. The resolution of this case demonstrates our continued focus on combating such labor violations in order to improve compliance in this industry."

Following the investigation, B & D Contracting agreed to pay back wages owed to employees. The company also signed a settlement agreement with the department, committing itself to implement specific measures to prevent future FLSA violations. These measures include: setting standards to accurately identify and compensate workers who qualify for bona fide per diem payments; paying accurate overtime and ensuring per diem payments are not automatically excluded from overtime calculations; informing employees about their pay and employment conditions; and obtaining written acknowledgment from employees that they understand the criteria for receipt of per diem payments.

Additionally, B & D Contracting agreed to maintain accurate records demonstrating that employees received bona fide per diem payments and that such payments are based either on applicable Internal Revenue Service guidelines or upon a reasonable approximation of the expenses incurred.

Pursuant to the department's partnerships with the IRS and the Louisiana Workforce Commission, this case has also been referred to those agencies for review under their respective laws.

This investigation was conducted under the Wage and Hour Division's ongoing initiative focused on strengthening labor compliance among temporary labor providers, such as staffing and support services companies in the Gulf Coast region. The division's enforcement and compliance assistance efforts are focused on identifying and remedying labor violations involving temporary employment arrangements, and the agency is also working with stakeholders and state agencies to ensure compliance with all applicable laws. Between fiscal years 2011 and 2013, the division's New Orleans District Office conducted 24 investigations in the temporary help industry securing more than $2.5 million in back wages for more than 3,000 workers.

An employee's regular pay rate, upon which overtime must be computed, includes all wages for employment, except certain payments excluded by the FLSA, such as reimbursements for work-related expenses. Payments reasonably approximating travel or other expenses incurred on the employer's behalf may be excluded from the employee's regular rate of pay when computing overtime. However, where an employee receives such payments but actually incurs no such additional expenses, such payments do not constitute bona fide reimbursements and must be included in the employee's regular rate of pay for purposes of computing an overtime premium.

Source: DOL

This information is intended to be educational and should not be considered legal advice on any specific matter.

Justiss Oil Co. Inc. pays nearly $620,000 in overtime back wages

Company failed to pay employees for mandatory meetings
   
Justiss Oil Co. Inc. has paid 270 current and former employees $619,830 in back wages after an investigation by the U.S. Department of Labor’s Wage and Hour Division found violations of the Fair Labor Standards Act’s overtime and record-keeping provisions. The investigation found that the company violated the FLSA when it did not pay its workers for the time spent at mandatory staff meetings and failed to record the time spent at these meetings.


The investigation, conducted by the division’s New Orleans District Office, revealed that Justiss Oil failed to pay workers for time spent attending mandatory safety and orientation meetings that occurred on drilling rigs and platforms at the beginning of each shift. The employer required the rig workers, who typically have a seven-day tour of duty, to come to the meetings 30 minutes before the start of their 12-hour shift. Because the employer failed to consider time spent at mandatory safety meetings as compensable, employees were not paid for all hours worked and did not receive all of the overtime pay to which they were entitled.


“Employers are responsible for ensuring their employees are paid for every compensable work hour,” said Cynthia Watson, regional administrator for the Wage and Hour Division in the Southwest. “We are pleased that, in this case, the employer has agreed to pay all employees and to abide by the law in the future.”


Justiss, established in 1946, is an oil field services company with about 408 employees. It is mainly a land-based drilling, exploration, production and well-servicing company. The company has paid all back wages in full and agreed to comply with all applicable FLSA provisions in the future.


The FLSA requires that covered employees be paid at least the federal minimum wage of $7.25 per hour. Workers who are not employed in agriculture and not otherwise exempt from overtime compensation are entitled to time and one-half their regular rates of pay for every hour they work beyond 40 per week. The law also requires employers to maintain accurate records of employees’ wages, hours and other conditions of employment, and prohibits employers from retaliating against employees who exercise their rights under the law.


Source: DOL

This information is intended to be educational and should not be considered legal advice on any specific matter.

Garcia Forest Service debarred from federal contracts for 3 years following DOL investigation

A U.S. Labor Department investigation has resulted in the debarment of Garcia Forest Service LLC, and its president, Samuel Garcia, from eligibility for further service contracts with any U.S. government agency for three years. The investigation found that the Rockingham, N.C.-based company violated the McNamara-O'Hara Service Contract Act and the Contract Work Hours and Safety Standards Act by failing to pay fringe benefits, minimum wage, overtime and holiday pay to workers hired for a reforestation project in the Superior National Forest in Minnesota. Administrative Law Judge Kenneth A. Krantz issued the debarment order in Newport News, Va. The consent findings were filed by the department's Regional Office of the Solicitor in Chicago.

"Contractors that do business with the federal government have an obligation to abide by the law, pay their employees the required contractual rates and benefits, and keep accurate and complete required records," said Laura A. Fortman, principal deputy administrator of the Wage and Hour Division. "The Service Contract Act requires debarment when violations are found unless the high standard of 'unusual circumstances' is met. Debarring this employer illustrates the department's commitment to vigorous enforcement of government contracting laws and helps level the playing field for law-abiding employers."

Garcia Forest Service entered into a contract in 2007 with the U.S. Forest Service, an agency of the U.S. Department of Agriculture, for reforestation services, such as planting seedlings and clearing brush in the Superior National Forest. The company primarily uses the H-2B Visa Program to recruit and employ foreign guest workers to perform seasonal work under its contracts.

An investigation by the department's Wage and Hour Division's district office in Minneapolis found that the company violated the SCA and the CWHSSA by failing to ensure hours worked were accurately reported resulting in minimum wage violations, not paying required fringe benefits, overtime and holiday pay. The company and its president, Garcia, cooperated fully with the Wage and Hour Division during its investigation and subsequently paid 12 workers $27,489 in back wages.

Garcia Forest Service had previously been investigated by the Wage and Hour Division regarding three contracts during the period of 2005-2006. That investigation found the company had failed to pay holiday pay under these contracts. The company provided back wages to the effected employees as a result of the investigation.

The SCA applies to every contract entered into by the United States or the District of Columbia, the principal purpose of which is to furnish services in the United States through the use of service employees. The SCA requires that contractors and subcontractors performing services on covered federal contracts in excess of $2,500 must pay their service workers no less than the wages and fringe benefits prevailing in the locality.

Source: DOL

This information is intended to be educational and should not be considered legal advice on any specific matter.

DOL sues nursing home for unpaid wages, damages and workplace retaliation

The U.S. Department of Labor has filed a complaint in federal District Court against Oxnard Manor nursing home in Oxnard and its administrator, Steven Rieder, after an investigation by the department’s Wage and Hour Division. The investigation determined that the employer violated the overtime, record-keeping and anti-retaliation provisions of the Fair Labor Standards Act.

“Retaliation against employees for reporting wage violations to federal authorities is unacceptable and illegal,” said Kimchi Bui, the division’s district director in Los Angeles. “Employers can face legal action and significant monetary penalties for discharging or otherwise harassing employees who file a complaint or participate in an investigation.”

The lawsuit alleges that the employer required employees to work off-the-clock, deducted hours worked from their timecards, and paid only straight time instead of time and one-half the employee’s regular rate for hours worked beyond 40 in a workweek. The employer also wrongly classified some employees as exempt from overtime pay.

In addition to paying unpaid overtime wages and an equal amount in liquidated damages, the department’s lawsuit filed in the U.S. District Court for the Central District of California seeks lost wages and the reinstatement of an employee who was terminated because the employer believed she had spoken to investigators about the wage violations.

The FLSA requires that covered, nonexempt employees be paid at least the federal minimum wage of $7.25 per hour for all hours worked, plus time and one-half their regular hourly rates for hours worked beyond 40 per week. The FLSA provides that employers who violate the law are, as a general rule, liable to employees for their back wages and an equal amount in liquidated damages. Liquidated damages are paid directly to the affected employees. Additionally, the law requires employers to maintain accurate time and payroll records, and prohibits retaliation against employees who exercise their rights under the law.

It is a violation of the FLSA for any person to discharge, or in any other manner discriminate against any employee, because the employee has filed any complaint or instituted or caused to be instituted any proceeding under or related to the FLSA, or has testified or is about to testify in any such proceeding, or has served or is about to serve on an industry committee.

Source: DOL

This information is intended to be educational and should not be considered legal advice on any specific matter.

Janitorial service subcontractor misclassified workers as independent contractors

Empire Janitorial Sales and Services Inc. has paid $277,565 in overtime back wages to 233 current and former janitorial service workers employed by Acadian Payroll Services LLC after an investigation by the U.S. Department of Labor’s Wage and Hour Division found violations of the Fair Labor Standards Act’s overtime and record-keeping provisions.

The investigation, conducted by the division’s New Orleans District Office, found that employees were wrongfully classified as independent contractors and paid an hourly wage with no overtime wages of time and one-half their regular rate of pay for hours worked over 40 in a workweek. Additionally, Acadian Payroll Services did not establish a seven-day workweek and failed to maintain proper records of weekly hours worked by its employees. Empire Janitorial Sales and Services and Acadian Payroll Services shared joint employer responsibilities. Both companies agreed to future compliance with the FLSA; however, full payment of back wages was made by Metairie-based Empire Janitorial Sales and Services, which cooperated with the investigation.

“We are pleased that the employer agreed to reclassify janitorial staff as employees, establish a seven-day workweek and to compensate workers properly when they work overtime,” said Cynthia Watson, the Wage and Hour Division’s regional administrator for the Southwest. “Misclassified workers are often denied access to basic benefits and protections under the FLSA, such as the Family and Medical Leave Act, overtime, minimum wage and unemployment insurance, to which they are entitled.”

The department and the Internal Revenue Service, through an interagency memorandum of understanding, are working together and sharing general information to reduce the incidence of misclassification of employees, reduce the tax gap and improving compliance with federal labor laws.

Source: DOL

This information is intended to be educational and should not be considered legal advice on any specific matter.

DOL investigating wage violations at McAllen TX produce distributor

The U.S. Department of Labor has filed an action in the U.S. District Court in McAllen seeking a temporary restraining order and preliminary injunction to protect workers from retaliation and threats of retaliation from some ISPE Produce Inc. officials.
 
The department’s Wage and Hour Division is currently investigating ISPE Produce under the minimum wage, overtime, record-keeping and anti-retaliation provisions of the Fair Labor Standards Act.

“Employee intimidation and coercion will not be tolerated. Employers are prohibited from retaliating against any employee who files a complaint or cooperates in a Wage and Hour investigation,” said Cynthia Watson, regional administrator for the Wage and Hour Division in the Southwest. “We will leverage any resources necessary to ensure that a fair investigation is conducted and workers are protected.”

During the investigation, the employer required workers to leave the job site when Wage and Hour investigators arrived to conduct interviews. Company officials threatened workers with termination of employment and deportation for cooperating with the department. The temporary restraining order asks the court to enjoin the owner and two company officials from continuing threatening and retaliatory conduct aimed at employees who cooperate in the Wage and Hour investigation.

The department also seeks an order requiring the owner or a department employee to read aloud a statement to all employees informing them of their right to speak with Wage and Hour investigators without fear of retaliation; to post a copy of the statement at all ISPE Produce work sites; and to prohibit the owner and named officials from speaking directly to employees about the Wage and Hour investigation.

Source: DOL

This information is intended to be educational and should not be considered legal advice on any specific matter.

 

Colorado nursery agrees to pay more than $127,000 in unpaid overtime wages

Harmony Gardens Inc. erroneously claimed agricultural employer exemption

Harmony Gardens Inc. has agreed to pay 72 employees $127,301 in back wages after an investigation by the U.S. Department of Labor’s Wage and Hour Division found violations of the Fair Labor Standards Act’s overtime and record-keeping provisions. The firm incorrectly claimed an exemption from the overtime provisions of the FLSA. The investigation, conducted by the division’s Denver District Office, found that Harmony Gardens violated the FLSA when it paid its workers straight time for all hours worked and did not pay the additional overtime premium for hours worked over 40 in a workweek. Additionally, the company failed to maintain accurate time and payroll records.

“Employers are responsible for learning about the laws that apply to their businesses. Not paying legally required overtime hurts workers, their families and their communities,” said Cynthia Watson, regional administrator for the Wage and Hour Division in the Southwest. “Nursery employees who handle only products grown at the nursery are generally exempt from FLSA overtime requirements. However, nursery employees who handle agricultural products grown elsewhere are generally entitled to overtime compensation at time and one-half their regular rates for hours worked beyond 40 in a workweek.”

Harmony Gardens works with suppliers nationwide to bring in a wide range of plant material for customers, which they do not grow themselves; therefore, the exemption from the overtime requirements does not apply. The employer has agreed to comply with all applicable FLSA provisions in the future. The payment of back wages is ongoing. For more information about agricultural employers under the FLSA, visit http://www.dol.gov/whd/regs/compliance/whdfs12.pdf.

The FLSA requires that covered employees be paid at least the federal minimum wage of $7.25 per hour. Workers who are not employed in agriculture and not otherwise exempt from overtime compensation are entitled to time and one-half their regular rates of pay for every hour they work beyond 40 per week. The law also requires employers to maintain accurate records of employees’ wages, hours and other conditions of employment, and prohibits employers from retaliating against employees who exercise their rights under the law.

Source: DOL

This information is intended to be educational and should not be considered legal advice on any specific matter.