Wage and Hour Division (WHD)
U.S. Department of Labor
MINNEAPOLIS -- The U.S. Department of Labor has determined that a total of $203,539 in back wages is owed to 159 current and former employees of Satellite Link Corp. and Digital Media Group. Both companies contract to install satellite television dishes in Minnesota, and Satellite Link also performs installations in South Dakota. An investigation by the department’s Wage and Hour Division found that both companies failed to pay their technicians the minimum wage and overtime pay, and failed to keep accurate records, in violation of the Fair Labor Standards Act.
Violations stemmed from the employers’ practice of paying technicians on a “piece-rate” basis without regard to actual hours worked. When work was slow, the piece-rate pay did not always yield the required federal minimum wage of $7.25 per hour. Additionally, when employees’ workweeks exceeded 40 hours, the employers only paid piece-rate wages and did not pay the required premium for overtime hours.
“Employers are responsible for correctly recording and paying for all hours worked to ensure that the minimum wage and overtime are properly paid,” said Theresa Walls, district director of the Wage and Hour Division in Minneapolis. “Other employers who may be paying employees on a piece-rate basis should take note of this investigation and ensure that they are in compliance with federal labor law. Additionally, large corporations should be aware when their subcontractors are not in compliance with the FLSA so that they can make informed decisions about who they want to do business with in the future.”
Digital Media Group is a subcontractor of DirectSat USA, which is a subcontractor to Direct TV. Investigators determined that 126 employees were owed a total of $132,664 in minimum and overtime back wages. Additional violations include failing to maintain accurate records of employees’ hours worked, and to compensate employees for work-related travel and time spent working on installations that were not completed. The company has agreed to pay the back wages, implemented new methods to record work start/stop times for technicians, and developed an online mileage and time-tracking systems for employees’ work travel.
Satellite Link Corp., which has offices in Vadnais Heights, Minn., and Blackhawk and Colton, S.D., is a subcontractor of Dish Network. Investigators determined that 33 employees were owed $70,875 in minimum and overtime back wages. Additional violations include failing to maintain accurate records of hours worked and compensate employees for work-related travel time. The company has paid the back wages, and has agreed to fully comply with the FLSA in the future and to record all daily starting and stopping times for its remote technicians. In addition to providing installation services, the company also operates three warehouse facilities in Minnesota and South Dakota.
The Wage and Hour Division enforces the FLSA, which 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, including commissions, bonuses and incentive pay, for hours worked beyond 40 per week. Earnings may be determined on a piece-rate, salary, commission or some other basis, but in all such cases the overtime pay due must be computed using the employee’s average hourly rate. Employers are also required to maintain accurate time and payroll records.
To learn more about the FLSA’s requirements, call the division’s toll-free helpline at 866-4US-WAGE (487-9243). Information also can be found at http://www.dol.gov/whd.
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