News Release

U.S. Department of Labor Obtains Consent Judgment Ordering Arizona Company to Pay $3,000,000 in Back Wages and Damages

PHOENIX, AZ – The U.S. Department of Labor secured a $3,000,000 consent judgment against Stratis Construction Inc. – a residential drywall company based in Phoenix, Arizona – for violating overtime and recordkeeping requirements of the Fair Labor Standards Act (FLSA).

The judgment follows an investigation by the Department’s Wage and Hour Division (WHD) that determined the employer paid piece rate employees the same rate per piece regardless of the number of hours they worked. This practice resulted in overtime violations when employees worked more than 40 hours in a workweek but the employer failed to pay them overtime. The employer also violated FLSA recordkeeping requirements when it failed to keep a record of the number of hours worked by the piece-rate employees. 

The U.S. District Court of Arizona judgment ordered Stratis Construction Inc. and its owner, Stratis Matheos to pay $1,500,000 in back wages and an equal amount in liquidated damages to 1,039 current and former employees. The court also ordered payment of $200,000 in civil money penalties due to willful nature of the violations.     

 “Employers must understand their responsibilities and ensure they pay workers all the wages they have legally earned. Failure to pay employees as the law requires short-changes them and puts law-abiding employers at a competitive disadvantage,” said District Director Eric Murray. “We encourage other employers to use this case as an opportunity to evaluate their own pay practices and ensure they comply. They can avoid violations like those found in this case.”

 “A federal court agreed with the basic tenet that all workers are entitled to minimum wage and overtime,” said Wage and Hour Division Administrator Cheryl M. Stanton. “It’s unacceptable for an employer to deny workers wages they have legally earned. The outcome of this case demonstrates our commitment to using all the tools we have available, including the courts, to ensure that employers are held accountable and that workers take home their hard-earned pay.”

View the complaint and consent judgment. 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 also is available at http://www.dol.gov.whd.

WHD’s mission is to promote and achieve compliance with labor standards to protect and enhance the welfare of the nation’s workforce. WHD enforces federal minimum wage, overtime pay, recordkeeping and child labor requirements of the Fair Labor Standards Act. WHD also enforces the paid sick leave and expanded family and medical leave provisions of the Families First Coronavirus Response Act, the Migrant and Seasonal Agricultural Worker Protection Act, the Employee Polygraph Protection Act, the Family and Medical Leave Act, wage garnishment provisions of the Consumer Credit Protection Act, and a number of employment standards and worker protections as provided in several immigration related statutes. Additionally, WHD administers and enforces the prevailing wage requirements of the Davis-Bacon Act and the Service Contract Act and other statutes applicable to federal contracts for construction and for the provision of goods and services.

The mission of the Department of Labor is to foster, promote and develop the welfare of the wage earners, job seekers and retirees of the United States; improve working conditions; advance opportunities for profitable employment; and assure work-related benefits and rights.

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Agency
Wage and Hour Division
Date
August 3, 2020
Release Number
20-1449-SAN
Contact: Leo Kay
Phone Number
Contact: Jose Carnevali
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