US Labor Department investigation finds more than $55,000 in minimum wage and overtime back wages due to 52 employees of Grand Hyatt Denver, Xclusive Staffing

Civil money penalties assessed total $11,440

1750 Welton Street Investors LLC, doing business as Grand Hyatt Denver, and Xclusive Staffing of Denver, have paid a combined total of $55,691 in minimum wage and overtime back wages to 52 employees following an investigation by the U.S. Department of Labor’s Wage and Hour Division. The agency found violations of the minimum wage, overtime and record-keeping provisions of the Fair Labor Standards Act. 

Xclusive Staffing provided temporary employees to work as room attendants at the Grand Hyatt Denver. In addition to the back wages found due, the department also assessed civil money penalties totaling $7,920 for the Grand Hyatt and $3,520 for Xclusive Staffing.
 
“We see a disturbing violation rate among hotel and motel employers, and we are doing something about it,” said Cynthia Watson, regional administrator for the Wage and Hour Division in the Southwest. “Low-wage, vulnerable employees are often hesitant to speak up when subjected to violations. The department is committed to ensuring that an honest day’s work results in an honest day’s pay, and that an employer who plays by the rules isn’t at a disadvantage over one who chooses to skirt the law.”

Investigators found that the employers failed to pay employees for time spent working prior to and after their scheduled shifts. Housekeeping staff was found to arrive early to prepare their carts and to stay late to finish cleaning a required number of rooms, without the extra time recorded or paid. These unpaid work hours resulted in both minimum wage and overtime violations. The employers also failed to pay employees for working through meal breaks and automatically deducted break time, regardless of whether breaks were taken. Record-keeping violations were also cited for the employers’ failure to keep accurate records of hours worked by employees.

Both companies have agreed to comply with the FLSA in the future. The back wages and penalties have been paid in full.
 
1750 Welton Street Investors LLC is a subsidiary of UBS Realty Investors LLC. Their Grand Hyatt Denver property is managed by Hyatt Corp., headquartered in Chicago, which manages, owns, franchises and develops Hyatt-brand hotels and vacation properties worldwide.

Xclusive Staffing Inc. was also recently found in violation of the FLSA during a Wage and Hour Division investigation of the Gaylord Texan Resort and Convention Center in Grapevine, Texas.

The hotel and motel industry is characterized by a wide variety of employment arrangements, such as subcontracting, franchising, third-party management and other practices that obscure the worker-employer relationship.

The division has found that staffing agencies often provide workers for a variety of jobs in the hotel and motel industry, including housekeeping, food service and janitorial services, and sometimes they misclassify these employees as independent contractors. The division is documenting the structure and complexity of these employment relationships to determine which of these structures is most likely to enable violations, and then target enforcement efforts accordingly.
 
The hotel and motel industry employs many low-wage workers who, due to a lack of knowledge of the law or an unwillingness to exercise their rights, are vulnerable to disparate treatment and labor violations. The division is concerned about the severity of noncompliance in this industry and is concentrating its resources on identifying and remedying violations, informing workers of their rights and providing compliance assistance to employers. Since 2009, the division has conducted more than 4,000 investigations of hotel and motel employers, resulting in more than $12.4 million in back wages recovered for more than 23,000 workers nationwide.

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 rates, including commissions, bonuses and incentive pay, for hours worked beyond 40 per week. Additionally, employers must maintain accurate time and payroll records.

Source: DOL

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

South Carolina’s El Jimador Mexican Restaurants agrees to pay more than $74,000 in back wages following US Department of Labor investigation

Investigations conducted under multiyear initiative in local restaurant industry

Two El Jimador Mexican Restaurants in Clemson and Westminster have agreed to pay 13 employees $74,619 in back wages following an investigation by the U.S. Department of Labor’s Wage and Hour Division. The establishments, owned and operated by several members of the Macias family, were in violation of the Fair Labor Standards Act’s overtime, minimum wage and record-keeping provisions at both locations.

The investigations were conducted under the division’s multiyear enforcement initiative, focused on the restaurant industry in South Carolina, where widespread noncompliance with the FLSA’s minimum wage, overtime and record-keeping provisions has been found. Since fiscal year 2012, the division’s Columbia District Office has concluded more than 130 restaurant investigations, resulting in the recovery of more than $1,580,000 in back wages for more than 1,630 workers.

“We found several low-wage, at-risk employees working off the books at both El Jimador Mexican Restaurants. Many of them worked long hours, often averaging 60 hours a week, but earned far below the minimum wage and no overtime compensation,” said Michelle Garvey, director of the division’s Columbia office.

“These workers deserve every penny of the wages they have rightfully earned. Through the effort of our ongoing enforcement initiative, the Wage and Hour Division continues to combat widespread labor violations among South Carolina restaurants to protect workers and ensure a level playing field for law-abiding employers.”

The FLSA violations found at both restaurants resulted from the employers’ failure to compensate employees properly for all work hours. By reviewing payroll records and conducting employee interviews, investigators determined that tipped employees, such as servers, were made to rely primarily on tips for pay. Their wages amounted to less than the federal minimum wage of $7.25 per hour. Additional minimum wage violations occurred when the employers made illegal deductions from workers’ pay for the cost of their uniforms. The employer failed to pay workers overtime compensation at time and one-half the employees’ regular rates of pay for hours worked beyond 40 in a workweek, as required by the FLSA. The employer also failed to maintain records of employees’ work hours and wages, in violation of FLSA’s record-keeping requirement. 
 
In addition to paying the back wages owed, the restaurants agreed to maintain future compliance with the FLSA by signing a Stipulation of Compliance with the department.

The restaurant industry employs some of the country’s lowest-paid workers who, due to a lack of knowledge of the law or an unwillingness to exercise their rights, are vulnerable to disparate treatment and labor violations. In addition to the initiative in South Carolina, the Wage and Hour Division has other ongoing enforcement initiatives throughout the U.S. to identify and remedy violations that are common in the restaurant industry.

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 rates for hours worked beyond 40 per week. It also requires that employers maintain accurate time and payroll records.

Source: DOL

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

Ontario, Calif., noodle maker ordered to pay $208,864 for labor violations

US Department of Labor helps recover back wages for low-wage workers

The U.S. Department of Labor has obtained a consent judgment in federal court ordering Ontario noodle manufacturer and distributor Rama Food Manufacture Corp., and officers Karen Trang Ving and Jonathan Ving, to pay 36 current and former employees $195,400 in back wages and liquidated damages. The judgment resolves an investigation by the department’s Wage and Hour Division that found the company willfully violated the Fair Labor Standards Act’s overtime and record-keeping provisions.

The division established that employees were paid straight time for all hours worked and did not receive an overtime premium for hours worked beyond 40 per week, as required by the FLSA. In addition, the employer violated the FLSA’s record-keeping provision by failing to create and maintain required time and payroll records.

“When employers fail to pay their workers properly, it can be devastating, especially for low-wage workers who may be struggling to pay their rent, medical bills or child-care costs,” said Eric Williams, assistant director of the Wage and Hour Division’s West Covina District Office. “Liquidated damages will double every dollar the employer failed to pay when those wages were originally due. That provides some justice for these workers and helps to level the playing field for employers who are paying their workers properly.”

In addition to requiring the payment of the back wages and liquidated damages, the consent judgment enjoins the defendants from violating the FLSA in the future and requires them to pay $13,464 in civil money penalties. Penalties and damages were assessed after investigators found the employer had labor standards posters at its facility, showing that they were aware of current labor laws, yet continued to commit willful violations of the FLSA.

Under the consent judgment, Rama Food is also required to provide annual employee training on federal labor laws and must display a notice of the department’s findings in both English and Spanish in areas highly visible to employees.

Rama Food Manufacture Corp. produces and packages fresh rice stick noodles to wholesale distributors, markets and restaurants nationwide.

The FLSA requires that covered employees be paid at least the federal minimum wage of $7.25 per hour, as well as one and one-half times their regular rates 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. The FLSA provides that employers who violate the law are generally liable to employees for their back wages and an equal amount in liquidated damages, which are paid directly to the affected employees.

Source: DOL

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

FAQs on Basic Qualifications

Selected from the OFCCP's website, following are frequently asked questions regarding basic qualifications under the Internet Applicant Recordkeeping Rule:

What is the definition of basic qualifications?

The "basic qualifications" which an applicant must possess means qualifications that the contractor advertised to potential applicants or criteria which the contractor established in advance. In addition, the qualifications must be:

• Noncomparative features of a job seeker (e.g. three years' experience in a particular position, rather than a comparative requirements such as being one of the top five among the candidates in years of experience);
• Objective (e.g., a Bachelor's degree in accounting, but not a technical degree from a good school); and
• Relevant to performance of the particular position.

Are employment tests considered basic qualifications?

No. Employment tests used as employee selection procedures, including on-line tests, are not considered basic qualifications under the Internet Applicant rule. Contractors are required to retain records about the gender, race, and ethnicity of individuals who take a test used to screen them for employment, regardless of whether the test takers are "Internet Applicants."


Can the basic qualifications be modified during the selection process, or do they need to be set prior to the beginning of the process?

All basic qualifications must be established prior to the selection process. Basic qualifications are the qualifications advertised to potential applicants as being required in order to be considered for the position. If the contractor does not advertise for the position but, for example, searches an external resume database, the contractor must make and maintain a record of basic qualifications to be used in the search prior to considering any expression of interest for that particular position.


Can contractors use different basic qualifications for the same job title?

As used in the Internet Applicant rule, the basic qualifications are those qualifications associated with the position filled. Nothing in the final rule would prohibit a contractor from utilizing different basic qualifications for different positions with the same job title, keeping in mind that the basic qualifications must be advertised or established in advance, and must be noncomparative, objective, and relevant to the particular position.

View OFCCP's Internet Applicant Recordkeeping Rule FAQ page.


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