Wage and Hour Division (WHD)
U.S. Department of Labor
MINNEAPOLIS -- The U.S. Department of Labor has recovered $65,526 in back wages for 47 employees of Quality Trusted Commercial Construction and Roofing in Minneapolis, following an investigation by the department’s Wage and Hour Division which found that the employees had been misclassified as independent contactors and denied compensation for all hours worked, in violation of the Fair Labor Standards Act’s overtime provision.
“Employers subject to the Fair Labor Standards Act are responsible for ensuring that their workers are properly classified and compensated for all hours worked. They cannot evade their duty to pay minimum wage and overtime compensation by misclassifying workers as independent contractors,” said Jose Medina, director of the Wage and Hour Division’s Minneapolis District Office. “The Labor Department is committed to ensuring that all workers receive their rightfully earned wages.”
After conducting employee interviews and examining payroll records, investigators determined that the employees had been misclassified as independent contractors, despite the existence of an employment relationship as defined by the FLSA. Additionally, they were made to work 80 hours in a pay period before receiving overtime compensation and paid “straight time” wages for the overtime hours, rather than time and one-half their regular rates of pay for hours worked over 40 in a single week, as required under the FLSA.
In addition to paying all back wages due, the company committed to maintaining future compliance with the FLSA.
The misclassification of employees as independent contractors is an alarming trend, particularly in industries such as construction that often employ low-wage, vulnerable workers and in which the Wage and Hour Division has historically found significant wage violations. The practice is a serious threat both to workers entitled to good and safe jobs, as well as to employers who obey the law. Too often workers are deprived of overtime and minimum wages, forced to pay taxes that their employers are legally obligated to pay and left with no recourse if they are injured or discriminated against in the workplace. Honest employers have a difficult time competing against scofflaws. The Labor Department is committed to ensuring that workers receive the pay and benefits to which they are legally entitled, and to level the playing field for employers that play by the rules.
The FLSA requires that covered employees be paid at least the federal minimum wage of $7.25 for all hours worked, plus time and one-half their regular rates of pay, including commissions, bonuses and incentive pay, for hours worked beyond 40 per week.
For more information about the FLSA and other federal wage laws, call the division’s toll-free helpline at 866-4US-WAGE (487-9243). Information is also available on the Internet at http://www.dol.gov/whd.
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