The Fair Labor Standards Act Strikes Again, and Again, and Again, and Again

Usually, approximately 5-6 times each week, I receive emails from several Labor Attorney firms as well as the U.S. Department of Labor (DOL), the Equal Employment Opportunity Commission (EEOC) and the National Labor Relations Board (NLRB) on some specific actions taken against employers for violations of various labor and employment laws. Below are 9 examples which were received over the last 7 days of recent violations of one particular law known as the Fair Labor Standards Act (FLSA). The fines and penalties range from $46,000 to $2,125,000. It behooves all large and small employers to understand and be in full compliance with this law. Many employers have, for many years, had basic misconceptions about this statute. Unfortunately, these misconceptions can have a huge negative impact on the bottom line of any organization.

PASCAGOULA, MS – A Pascagoula, Mississippi staffing agency for the marine and shipbuilding industries has paid $46,372 in back wages to 45 employees to resolve overtime and recordkeeping violations of the Fair Labor Standards Act found in a U.S. Department of Labor Wage and Hour Division investigation.

Wage and Hour Division investigators found Quality Marine Staffing LLC failed to pay some employees overtime when they worked more than 40 hours in a workweek. Instead, the employer artificially labeled a portion of the employees’ hours as “per diem” payment, at an hourly rate, and paid that hourly payment at straight time for overtime hours. In addition, the division found the employer failed to maintain accurate payroll records as required by the FLSA.

PHILADELPHIA – A recent investigation by the DOL’s Wage and Hour Division has recovered $2,125,429 in back wages for 456 workers employed by Good Family Support Services Inc., which is a non-profit organization in Philadelphia.

The division found that the employer paid family care workers on an hourly basis, but paid straight-time rates for overtime hours. Good Family Support Services also failed to record the number of hours that two employees worked, and failed to record hourly rates, violating the FLSA’s recordkeeping requirements.

PITTSBURGH – A U.S. District Court for the Western District of Pennsylvania in Pittsburgh has issued a consent order requiring the payment of more than $1.6 million in back wages and damages to 546 home health aides. The Pittsburgh home health care agency misclassified the aides as independent contractors and failed to pay required overtime wages in violation of the FLSA. The court also ordered payment of $20,000 in civil money penalties.

Investigators determined that Christian Home Health Care violated the FLSA when the employer:

• Misclassified 546 home health aides as independent contractors instead of employees, and then failed to pay them overtime when they worked over 40 hours per week.
• Continued to pay some aides straight-time rates for overtime hours, even after it began to classify them correctly as employees.
• Failed to keep a record of the number of hours worked by office staff.

BALTIMORE, MD –Following an investigation and summary judgment in the U.S. District Court for the District of Maryland in Baltimore, the DOL has recovered a total of $499,258 in back wages and liquidated damages for 62 workers employed by Mezcal Inc., operator of Mezcal Mexican Restaurant and Bar in Owings Mills and Lutherville, Maryland.

The Department’s Wage and Hour Division conducted an investigation that found numerous violations of the FLSA’s minimum wage and overtime requirements.

CHICAGO –The DOL’s Wage and Hour Division has recovered $697,295 in back wages for 60 employees following an investigation of Tank Noodle Inc. Investigators found the employer owed some workers more than $10,000 each in back wages and identified numerous violations of the FLSA’s minimum wage and overtime requirements. The agency also found the employer failed to keep accurate records of the number of hours employees worked, as the law requires.

MANCHESTER, NH –The division recovered $108,043 in back wages for 17 employees. Investigators found the employer paid cooks and bussers flat salaries, regardless of the number of hours they worked per week. By paying flat salaries, the employer failed to pay overtime when those employees worked more than 40 hours in a workweek, in violation of federal law. The division also found the employer violated FLSA recordkeeping requirements when it failed to record the number of hours employees worked, including time some employees spent transporting other workers to and from employer-provided housing.

SANIBEL, FL –An investigation of Island Cow Inc. by the DOL’s Wage and Hour Division has recovered $222,432 in back wages for 48 workers.

The division’s investigators determined Island Cow violated the FLSA by operating an unlawful tip pool, which required tipped employees to share earnings with non-tipped workers, including dishwashing assistants and kitchen expeditors. The employer also classified cooks, a bookkeeper and a bar manager incorrectly as exempt from overtime requirements, and paid them flat salaries regardless of the number of hours they worked. By doing so, Island Cow violated the FLSA when it failed to pay these workers overtime when they exceeded 40 hours in a workweek. The employer also failed to maintain accurate records of the number of hours employees worked and of the wages paid to workers, violating FLSA recordkeeping requirements.

TAMPA, FL – A Tampa restaurant enterprise has paid $102,894 in back wages to 11 workers after a federal investigation found the employer illegally denied them overtime pay.

Wage and Hour Division investigators determined Sarione Restaurant Inc. – operating as Sarione Korean Restaurant – and Sarione Grill Inc. violated the FLSA by incorrectly classifying cooks and dishwashers as exempt from overtime requirements, and paying them fixed semi-monthly salaries, regardless of the number of hours they worked. By doing so, the employer failed to pay these workers overtime when they worked more than 40 hours in a week. In addition, the employer failed to record the number of hours the employees worked.

Employers must understand that paying workers a fixed salary does not automatically excuse them from paying overtime. Unless a specific exemption applies, even workers paid on a salary basis must be paid overtime when they work more than 40 hours in a week.

ORLANDO, FL – An Orlando landscaping employer will pay $48,978 in back wages to 39 workers after a federal investigation found the employer paid employees illegally for the hours that they worked.

Wage and Hour Division investigators determined Aaction Scape Inc. violated the FLSA by incorrectly classifying workers as exempt from overtime requirements and paying them flat biweekly salaries, regardless of the number of hours they worked. By doing so, the employer failed to pay workers the additional half time required by the FLSA when they worked more than 40 hours in a workweek. In addition, the employer failed to keep a record of the number of hours the employees worked.

A company’s best defense against the potential expense and aggravation related to federal or state law violations is to proactively review and revise as needed all Human Resources policies, handbooks, hiring procedures, compensation, benefits, training programs, communications tools and other functions. The professionals of PHHR are ready to assist your organization with this type of training as well as to maintain compliance with the latest state and federal mandates.

Newsletter Archive

Our newsletter is updated regularly, providing information of interest
to many of our readers. We invite you to check back frequently.

Paul Hilton is a certified Human Resources Consultant, located in Columbia, SC.
If you would like to subscribe to our Newsletter e-mailing list,
please submit our Contact Form.