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WHD News Release: [07/14/2011]
Contact Name: Juan Rodriguez or Elizabeth Todd
Phone Number: (972) 850-4709 or x4710
Release Number: 11-0769-DAL
US Department of Labor recovers nearly $105,000 in overtime back wages for 57 Hurricane Ike cleanup workers in Anahuac, Texas
ANAHUAC, Texas The U.S. Department of Labor has recovered $104,837 in overtime back wages for 57 workers who had been misclassified as independent contractors and thereby denied overtime compensation for all hours of their work in violation of the Fair Labor Standards Act, following an investigation by the department's Wage and Hour Division. The workers were employed by Cecil Parker Jr., the owner of a debris cleanup company in Anahuac.
Parker was awarded a contract by Chambers County to perform local debris removal and cleanup services in areas impacted by Hurricane Ike. At the time of the investigation, Parker did not own an incorporated business entity and did not have a standing contract with the Federal Emergency Management Agency to perform these services. Following the resolution of this case, Parker acquired three business entities in Dallas: PDQ Construction LLC, PDQ Environmental LLC and Chambers Leasing LLC.
"Cecil Parker, a former councilman and local contractor, was awarded a $1.4 million public contract to serve Chambers County residents and assist them in recovering from the devastation of Hurricane Ike. Parker had a moral and legal obligation to use these funds properly and abide by all labor regulations in the performance of his taxpayer-funded contract," said Cynthia Watson, regional administrator of the Wage and Hour Division in the Southwest. "Parker's employees worked 10-hour days, operating heavy equipment and performing strenuous labor, to remove millions of yards of storm debris. We are pleased that these employees, whom Parker had misclassified as independent contractors and denied fair wages, now will be properly compensated for all hours of their hard work."
Despite the existence of an FLSA-covered employment relationship, investigators found that Parker had misclassified debris cleanup workers as independent contractors and paid them "straight time" wages instead of time and one-half their regular rate of pay for hours worked over 40 in a week, as required under the FLSA.
Investigators conducted employee interviews and reviewed payroll documents to determine the amount of back wages due. Parker has paid the back wages and committed to ensuring that all of his employees are properly classified and compensated for their full work periods in accordance with the FLSA.
The investigation was part of a Wage and Hour Division ongoing enforcement initiative in Southeast Texas. As communities in this region recover from Hurricane Ike's devastation, the division seeks to increase public awareness of federal wage and hour laws, encourage workers to understand and exercise their rights, and strengthen compliance among employers engaged in recovery and rebuilding efforts.
The misclassification of employees as independent contractors is an alarming trend, particularly in industries such as construction that often employ low-wage, vulnerable workers, and in which the division historically has found significant wage violations. The practice is a serious threat both to employees entitled to good and safe jobs, as well as to employers who obey the law. Too often misclassified employees are deprived of overtime and minimum wages, and forced to pay taxes that their employers are legally obligated to pay. Honest employers have a difficult time competing against scofflaws. The Labor Department is committed to ensuring that employees receive the pay and benefits to which they are legally entitled and to level the playing field for employers that play by the rules.
The FLSA requires that covered employees 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. Employers also are required to maintain accurate time and payroll records.
For more information about the FLSA and other federal wage laws, call the Wage and Hour Division's toll-free helpline at 866-4US-WAGE (487-9243) or its Houston District Office at 713-339-5500. Information is also available on the Internet at http://www.dol.gov/whd/.
- Read this news release en Espaņol.