Wage and Hour Division (WHD)
U.S. Department of Labor
PORTLAND, Ore. -- The U.S. Department of Labor has announced that Fred Lea Distributing Inc. of Salem and former owners Brenda Wright and Keith Wright have agreed to pay 10 employees $8,066 in back wages and $2,016 in liquidated damages for violations of the minimum wage and overtime provisions of the Fair Labor Standards Act.
In a consent judgment filed in the U.S. District Court for the District of Oregon, the employers also agreed to the issuance of an injunction against future violations. Failure to comply with the agreement will result in additional penalties up to and including contempt of court. The judgment resolves a lawsuit filed by the department. Legal action was handled by the department’s Office of the Solicitor in Seattle.
Fred Lea Distributing is a distributor of vending machines and consumer food products in Salem that was sold to new owners on Sept. 17, 2010. An investigation by the Portland District Office of the Labor Department’s Wage and Hour Division found that the company and its former owners failed to pay the required minimum wage and overtime compensation to commissioned route drivers who replenished vending machines with food products at various locations.
“The Labor Department is committed to vigorously enforcing the law. When violations are found, we will not rest until workers are paid every dollar of their rightful wages, regardless of the amount of back wages due,” said Jeffrey Genkos, district director of the Wage and Hour Division in Portland. “Commissioned employees are not automatically exempted from the FLSA’s overtime requirements. As demonstrated in this case, ignorance of the law is not an excuse. Employers are legally obligated to ensure that their employees are properly classified and compensated for all hours of their hard work.”
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. Employers must also maintain accurate time and payroll records.
The FLSA provides an exemption from overtime pay for employees of retail and service establishments who are paid in commission, in whole or in part. The Wage and Hour Division’s Fact Sheet No. 20 provides general information about the requirements and proper application of this exemption under the FLSA, and can be accessed at http://www.dol.gov/whd/regs/compliance/whdfs20.htm.
For more information about the FLSA and other federal wage laws, call the Wage and Hour Division’s toll-free helpline at 866-4US-WAGE (487-9243) or the division’s Portland office at 503-326-3331. Information is also available on the Internet at http://www.dol.gov/whd.
Civil Action File No. 6:11-cv-06078-AA
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