Alabama staffing agency to pay nearly $134K in back wages after denying 218 workers overtime compensation
Employer illegally labeled part of employees' wages as per diem reimbursement
Employer name: NSC Technologies Inc.
Investigation site: 2601 Government St., Mobile, Alabama 36606
Investigation findings: Investigators from the department's Wage and Hour Division's Mobile District Office found that NSC Technologies Inc. violated the overtime provisions of the Fair Labor Standards Act. Specifically, the employer illegally labeled a portion of workers' regular wages as per diem payments in order to exclude these wages when calculating overtime premiums. This improper pay practice also resulted in record-keeping violations because the employer failed to maintain accurate records of employees' wages and actual hours worked, as required by the FLSA. Legitimate per diem payments are compensation for living expenses incurred on behalf of the employer, such as transportation, meals, and lodging.
Resolution: NSC Technologies Inc. has agreed to comply with the FLSA and to pay 218 employees back wages totaling nearly $134,000.
Quote: "Unfortunately, we are seeing too many companies utilizing this evasive pay practice to unlawfully deny their employees their hard-earned overtime. We are concerned that, in this competitive market, labor service providers are looking to each other for new and creative ways to cut labor costs by engaging in illegal practices that short workers," said Frank McGriggs, Wage and Hour Division's deputy regional administrator in Atlanta. "Other employers should take note of this investigation, and any workers who may be seeing similar practices with their pay should not hesitate to reach out to us."
Information: The FLSA requires that covered, non-exempt employees be paid at least the federal minimum wage of $7.25 per hour for all hours worked, plus time and one-half their regular rates, including commissions, bonuses and incentive pay for hours worked beyond 40 per week. Employers also must maintain accurate time and payroll records, and are prohibited from retaliating against workers who exercise their rights under the law.
For more information about federal wage laws administered by the Wage and Hour Division, or to file a complaint, call the agency's toll-free helpline at 866-4US-WAGE (487-9243). All services are free and confidential. Information also is available at http://www.dol.gov/whd/.