Federal court orders border warehouse to pay $235K in back wages, penalties after US Department of Labor investigation
SAN DIEGO – A federal court has approved a consent judgment ordering a San Diego customs warehouse company to pay $235,000 in back wages and penalties after a U.S. Department of Labor investigation found the employer illegally paid warehouse workers as little as $3.38 per hour and paid no overtime when the workers averaged 45 to 51 hours a week.
Investigators with the department’s Wage and Hour Division found Premar Global Warehouse Logistics employed 16 Mexican nationals to work as merchandise checkers in San Diego, paying them the equivalent of between $3.38 and $5.61 per hour in pesos. The investigation found Premar – which operates with Export Dynamics de Mexico in Tijuana – paid the workers at a flat rate or salary for all the hours they worked. Workers were paid in pesos despite the fact that all work was performed in San Diego.
Premar also failed to pay overtime wages to the employees when they worked over 40 hours in a workweek. The employer’s action led to violations of the minimum wage, overtime and record keeping requirements of the Fair Labor Standards Act.
In a consent judgment, the U.S. District Court for the Southern District in San Diego ordered that Premar, Export Dynamics and Premar’s owner Tomas Martinez Leal must pay $154,100 in overtime back wages and $75,900 in minimum wage back wages to the 16 workers. The court also affirmed the $5,000 civil monetary penalty against Premar Logistics that the division assessed for the employer’s reckless disregard of FLSA requirements.
Attorneys with the department’s Office of the Solicitor negotiated a resolution of the investigation and the terms of the consent judgment. The investigation is part of a Wage and Hour Division and the Regional Solicitor’s Office compliance initiative to review similar operations along the U.S.-Mexico border. Outreach events, administrative depositions of operators and interviews with employees held in 2020 and 2021 revealed that wage violations, including paying stateside workers a flat rate in pesos, appear to be widespread in the industry.
“This case is a wake-up call to the customs warehouse industry. Paying a workforce as little as $3 an hour will not be tolerated,” said Wage and Hour Regional Administrator Ruben Rosalez, in San Francisco. “The U.S. Department of Labor will use every legal vehicle in our authority to ensure people working on U.S. soil are paid fairly and that employers who underpay workers do not gain an unfair competitive advantage over employers who comply with the law.”
For more information about the FLSA and other laws enforced by the division, contact its toll-free helpline at 866-4US-WAGE (487-9243). Learn more about the Wage and Hour Division, including a search tool to use if you think you may be owed back wages collected by the division.
Workers can call the Wage and Hour Division confidentially with questions – regardless of their immigration status – and the department can speak with callers in more than 200 languages.