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Secretary of Labor Thomas E. Perez
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News Release

WHD News Release: [03/30/2011]
Contact Name: Jose A. Carnevali
Phone Number: (415) 625-2631
Release Number: 11-0380-SAN

Arizona underground utility contractor agrees to pay $750,000 in overtime back wages following US Labor Department investigation

740 employees in California, Arizona and Nevada to be compensated

HESPERIA, Calif. — Arizona Pipeline Co. has agreed to pay $750,000 in back wages to 740 employees following an investigation by the U.S. Department of Labor's Wage and Hour Division, which found that the company violated the overtime and record keeping provisions of the Fair Labor Standards Act.

The Arizona-incorporated company, which contracts with major utility companies to install underground utilities, has main offices in Hesperia and is licensed in eight states: Arizona, California, Nevada, Utah, New Mexico, Oregon, Washington and Texas. It maintains construction yards in Phoenix and Tucson, Ariz.; Corona and Indio, Calif.; and Las Vegas and Carson City, Nev. The company specializes in gas distribution; long line pipeline; power distribution and transmission; fiber optics placement; engineering and design; and sewer, water and storm drains.

"There is no excuse to deny workers the wages they have worked hard to earn. All businesses have an obligation to pay their employees fairly and must comply with federal labor laws," said Secretary of Labor Hilda L. Solis. "Cheating workers out of time spent on the job — whether performing work-related tasks, traveling or attending a meeting — is unacceptable."

Investigators determined that Arizona Pipeline Co. did not pay employees for pre-shift and post-shift time required for loading and unloading material, cleaning trucks or picking up equipment. Additionally, workers were not compensated for travel time from the company yard to job sites and back, and they were required to attend a one-hour monthly meeting that was unpaid. The company also docked a half-hour lunch time from employees' pay even though they typically had a 15-minute lunch period or worked through their lunch periods.

This investigation was conducted by the Wage and Hour Division's West Covina District Office and covered a two-year period beginning in November 2007. Of the 740 affected employees, 487 are in California, 244 are in Arizona and nine are in Nevada.

The FLSA requires that covered employees be paid for attending required meetings, and for pre-shift and post-shift job duties. Employees also must 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. Additionally, employers must maintain accurate time and payroll records.

For more information about the FLSA, call the Wage and Hour Division's toll-free helpline at 866-4US-WAGE (487-9243). Information is also available on the Internet at http://www.dol.gov/whd.