CORRECTED: U.S. Department of Labor Investigation Results in Federal Contractor Paying $354,978 in Back Wages to 14 Employees
ATLANTA, GA – After a U.S. Department of Labor Wage and Hour Division investigation, Insight Global LLC will pay $354,978 in back wages to 14 employees for violating provisions of the Fair Labor Standards Act (FLSA) and the McNamara-O’Hara Service Contract Act (SCA). The Atlanta-based staffing and consulting company committed the violations during performance as a subcontractor to Hewlett Packard on an information technology contract with the U.S. Department of the Navy.
Wage and Hour Division investigators determined that Insight Global violated the SCA after failing to pay employees the prevailing wage rates required for the work they performed. The company erroneously categorized and paid the employees as computer operators when they actually performed the work of personal computer support technicians, which require the payment of higher rates. Insight Global also failed to pay employees fringe benefits required by the SCA. These incorrect wage rates resulted in overtime violations under the FLSA when the company based their time-and-one-half calculations for hours employees worked beyond 40 per week on the rates that were erroneously low.
“When employers receive federal funds to provide services to the government, they must comply with all applicable laws to ensure that their employees receive legally required pay and benefits,” said Jeffrey Genkos, Wage and Hour Division Acting District Director in Atlanta. “Violations can be avoided, and we encourage employers to reach out to us for guidance.”
Insight Global LLC provides services as a government contractor working for the U.S. Navy in California, Florida, Virginia, Louisiana, Massachusetts, North Carolina, Minnesota, New Jersey, and Washington, D.C.
The SCA requires contractors and subcontractors performing services on prime contracts in excess of $2,500 to pay service employees in various classes no less than the wage rates and fringe benefits found prevailing in the locality, or the rates, including prospective increases, contained in a predecessor contractor’s collective bargaining agreement.
For more information about the FLSA, SCA, and other laws enforced by the Division, contact the Division’s toll-free helpline at 866-4US-WAGE (487-9243) or visit the Division’s web site. The Division also offers a search tool that allows users to determine if they the Division has collected back wages owed to them.
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Editor’s Note: This news release was changed to correct the list of states where contracting services were provided.