HOUSTON – The U.S. Department of Labor has asked a federal court in Houston to stop the owner and operator of 17 single-family residential group homes and a day habilitation center for adults with disabilities from violating several federal employment regulations and to pay dozens of current and former employees back wages they’re owed as well as damages.

The department filing in the U.S. District Court for the Southern District of Texas alleges TEAM Abilities LLC and its founder and CEO Rachel Jelks willfully failed to pay overtime to the majority of her employees who regularly worked more than 40 hours in a workweek in violation of the Fair Labor Standards Act.                                                           

The action follows an investigation by the department’s Wage and Hour Division that found the company, operating as T.E.A.M. Abilities, required direct care staff working in residential facilities to work 16 – 24 hour shifts and did not provide adequate sleeping accommodations or rest periods. Direct care staff slept in recliners or on couches and were frequently interrupted, sometimes as often as every half hour, to provide resident care throughout the night. Jelks and T.E.A.M. Abilities chose to pay many of these direct care staff members straight time for all hours worked.

The division also learned Jelks willfully withheld some direct care employees’ overtime pay because they asked to be treated as independent contractors for tax purposes, which is not allowed under federal law. Recent regulations address how the department determines if a worker is an employee or an independent contractor.

When the investigation concluded, the division calculated $115,077 in overtime wages and $115,077 in liquidated damages owed to 56 current and former workers. As T.E.A.M. Abilities continues to violate the law, those amounts continue to increase.

“Employers must pay time  one-half an employee’s regular rate of pay for all hours worked over 40 in a workweek when an employee is not exempt under the Fair Labor Standards Act,” said Southwest Regional Wage and Hour Division Administrator Betty Campbell. “Our investigation found T.E.A.M. Abilities violated the law willfully and continues to ignore the law while its employees are suffering financially for its defiance.”

In its filing, the department seeks back wages owed for a period of three years due to the willful nature of the violations, an equal amount in liquidated damages, and an injunction requiring future FLSA compliance. In addition, the action asks the court to assess the employers with the department’s costs for its litigation and an order granting other further relief as necessary and appropriate. 

“The Department of Labor is committed to protecting workers’ rights to be paid all of their hard-earned wages and will use all legal means necessary to recover their money,” said Regional Solicitor of Labor John Rainwater in Dallas. “T.E.A.M. Abilities and CEO Rachel Jelks will ultimately learn there are costly consequences for employers who mistakenly believe they can refuse to comply with federal labor regulations.”

Based in Spring Texas, TEAM Abilities LLC provides assisted living services in the Houston area for adults with disabilities. Its services include assistance with adaptive equipment and aids, providing temporary relief for caregivers, supporting individuals in community living settings, offering mental health services, ensuring oral health, making living quarters safer and more accessible, and assisting with job placement and support.

For more information about the Fair Labor Standards Act and other laws enforced by the division, contact the agency’s toll-free helpline confidentially at 866-4US-WAGE (487-9243). The division can speak with callers in more than 200 languages, regardless of where a caller is from.

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. Download the agency’s new Timesheet App for iOS and Android devices – available in English and Spanish – to ensure hours and pay are accurate.

Employer:      Investier LLC, operating as Round Table Pizza

                            5016 NE Thurston Way

                            Vancouver, WA 98684

Investigation findings: A U.S. Department of Labor Wage and Hour Division investigation found the owner of a Round Table Pizza restaurant unlawfully kept a portion of the tips earned by workers by allowing managers to participate in the restaurant’s tip pool, a violation of the Fair Labor Standards Act. Federal law forbids employers or managers from keeping employees’ tips for any purpose.

Back Wages Recovered:       $64,681 in unpaid tips for 52 employees

                                                          $64,681 in liquidated damages for 52 employees

                                                          $28,548 in civil money penalties for the willful nature of the violations

Quote: “Many restaurant employers continue to shortchange vulnerable workers by using the tips they receive to supplement managers’ and supervisors’ salaries,” said Wage and Hour Division District Director Katherine Walum in Portland, Oregon. “We are determined to stop these unlawful schemes. As Round Table Pizza has learned, wage theft in any form has costly consequences for employers.” 

Background: In fiscal year 2023, the division successfully recovered more than $29.6 million in back wages for nearly 26,000 food service workers nationwide and assessed $6.1 million in civil money penalties in the food services industry.

Investier LLC owns and operates 14 Round Table Pizza franchise locations in Portland, Oregon, and Vancouver, Washington. 

Workers can use the division’s Workers Owed Wages search tool to see if they are owed back wages collected by the division. Employers and workers can contact the Wage and Hour Division for assistance at its toll-free number, 1-866-4-US-WAGE. Learn more about the Wage and Hour Division, including the agency’s restaurants compliance assistance toolkit and an overview about the FLSA protections for restaurant workers. Workers and employers alike can help ensure hours worked and pay are accurate by downloading the department’s Android and iOS Timesheet App for free in English or Spanish. 

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LAS VEGAS – The U.S. Department of Labor has recovered $475,385 in back wages and liquidated damages from the owner of three Juan’s Flaming Fajitas & Cantina restaurants in Las Vegas and Henderson who did not combine hours worked by 32 employees at more than one location and improperly withheld overtime wages earned by employees.

The department’s Wage and Hour Division determined that the restaurant’s owner, Juan Vazquez, failed to pay the affected workers overtime for hours over 40 in a workweek and wrongly exempted two others from overtime eligibility, both violations of the Fair Labor Standards Act. After the investigation, the employer agreed to correct its recordkeeping practices, including total hours worked at multiple locations to ensure proper calculation of overtime.

In addition to the division’s recovery of $237,692 in back wages and an equal amount in liquidated damages for the workers, the department assessed $12,050 in civil money penalties for the willful nature of the violations.

“Our investigators found Juan’s Flaming Fajitas & Cantina deliberately withheld overtime pay earned by dozens of hard-working employees,” explained Wage and Hour Division District Director Gene Ramos in Las Vegas. “This case’s outcome highlights the importance of protecting workers’ rights, including their right to be paid fairly and fully, and reflects the types of violations we find far too often in food service industry investigations.”

Juan’s Flaming Fajitas & Cantina operates two Las Vegas locations and one in Henderson.

In fiscal year 2023, the division recovered more than $29.6 million in back wages for nearly 26,000 workers in the food service industry.

For more information about the Fair Labor Standards Act and other laws enforced by the division, contact the agency’s toll-free helpline at 866-4US-WAGE (487-9243). Workers and employers can call the division confidentially with questions, regardless of where they are from, and the division can speak with callers in more than 200 languages.  

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. Download the agency’s Timesheet App for iOS and Android devices – free and available in English and Spanish – to track hours and pay.

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Employers:    Axis Home PCA Agency Inc. 

Cubtan Nur, owner                    

Action:           Consent judgment and order 

Court:             U.S. District Court for the District of Minnesota 

Court action: The Department of Labor has recovered $135,000, representing $67,500 in back wages and an equal amount in liquidated damages, for 57 employees of Axis Home PCA Agency  Inc. after an investigation by the department’s Wage and Hour Division found the Minneapolis employer violated the Fair Labor Standard Act’s overtime and recordkeeping provisions. 

A consent judgment and order entered by District Court Judge John R. Tunheim on July 16, 2024, requires the agency and owner Cubtan Nur to make the back wage payments, maintain an electronic timekeeping systems and abide by the FLSA in the future.

The department filed a complaint on Aug.15, 2022, after investigators found Axis typically paid their employees straight-time pay for all hours worked - failing to pay employees one and half times their regular rates for hours over 40 in a workweek - from at least May 16, 2019, to May 15, 2021. Its employees provide in-home personal care services to children and adults.

Quote: “These caregivers provide their clients with critical in-home care to maintain their dignity and support their ongoing care needs. They deserve the wages they have rightfully earned for their hard work and dedication,” said Wage and Hour District Director Kristin Tout in Minneapolis. “Employers are legally responsible for knowing and complying with federal wage laws.”

“The injunctive relief provided by this consent judgment - including requiring the payment of overtime whenever an employee works more than 40 hours, regardless of whether they are working for different clients or doing different tasks - will protect Axis’s employees,” added Regional Solicitor of Labor Christine Z. Heri in Chicago. “The department will continue to allocate its resources to protect caregivers, who are disproportionally women of color and among the nation’s lowest paid workers.” 

Background: In fiscal year 2023, the Wage and Hour Division recovered more than $31.8 million in back wages for workers in the healthcare industry nationwide and $528,886 for workers in Minnesota. The Wage and Hour Division offers resources for health care workers on its website. 

Learn more about the Wage and Hour Division, a search tool to use if you think you may be owed back wages collected by the division and how to file an online complaint. For confidential compliance assistance, employees and employers can call the agency’s toll-free helpline at 866-4US-WAGE (487-9243), regardless of where they are from.

Download the agency’s new Timesheet App for iOS and Android devices – also available in Spanish –to ensure hours and pay are accurate.

United States Department of Labor v. Axis Home PCA Agency, Cubtan Nur, owner

Civil Action No. 22-2002

GOOSE CREEK, SC – The U.S. Department of Labor has recovered $1,091,515 in back wages for 43 employees of a Goose Creek federal contractor that paid them rates lower than required by federal law.

The department’s Wage and Hour Division learned that – after acquiring Honeywell Technology Solutions Inc. – KBRwyle Technology Solutions LLC changed the title of quality control inspectors used by the original contract holder from supply technicians to technical instructors. While the employees still performed the same work as quality control inspectors, the employer paid them rates lower than the required prevailing wage rate, violating the McNamara-O’Hara Service Contract Act. The practice also resulted in the company paying overtime at a lower rate than required, a violation of the Contract Work Hours and Safety Standards Act. 

“Contractors must follow requirements specified for work performed under federal contracts to make certain they pay employees the correct wages for the type of work they do,” explained Wage and Hour Division District Director Jamie Benefiel in Columbia, South Carolina. “Workers on federal contracts perform critical work for our country. We enforce prevailing wage laws to ensure that the workers who help our country run receive their full, hard-earned wages.” 

KBRwyle Technology Solutions LLC assumed the federal contract awarded to Honeywell Technology Solutions for logistical support by the U.S. Army. The company is a subsidiary of KBR, the Houston-based science, technology and engineering company, which employs about 35,000 people worldwide in more than 80 countries with operations in over 30 countries. 

Employers can contact the Wage and Hour Division at its toll-free number, 1-866-4-US-WAGE. Learn more about the Wage and Hour Division, including numerous online resources for employers, such as a website for frequently asked questions about the McNamara-O'Hara Service Contract Act and the Contract Work Hours and Safety Standards Act. 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. Workers and employers can help ensure hours worked and pay are accurate by downloading the department’s Android or iPhone Timesheet App for free in English and Spanish. 

DALLAS – In one of the largest recoveries of its kind, the U.S. Department of Labor has recouped more than $1.5 million in unpaid overtime wages and damages from a heating, ventilation and air conditioning company that deprived 430 technicians of their rights, protections and benefits under law by misclassifying them as independent contractors.

The recovery follows an investigation by the department’s Wage and Hour Division that found C&G HVAC LLC in Dallas owed the affected technicians $756,158 in unpaid overtime wages and an equal amount in liquidated damages. 

“C&G HVAC denied these technicians their full wages, hurt taxpayers by not paying related payroll taxes and gained an unfair advantage over their law-abiding competition,” explained Wage and Hour Division’s Southwest Regional Administrator Betty Campbell in Dallas. “These employees, who do essential work installing, maintaining and repairing cooling systems in North Texas, stand to collect thousands of dollars in back wages and damages owed to them for their hard work.”

Preventing employee misclassification has been a Wage and Hour Division priority as the improper employment practice deprives workers of their rights to minimum wage, overtime pay and other protections. 

In fiscal year 2023, the division recovered over $24.5 million in back wages for about 20,000 misclassified workers nationwide. In Texas, the division recovered $2.2 million for 5,100 misclassified workers. 

“The Wage and Hour Division will take decisive action when employees are misclassified as independent contractors. C&G HVAC has learned there are significant consequences for violating the rights of their employees and failing to comply with federal law,” Campbell added. “We encourage other employers to take note of this case’s outcome and to ensure that they are affording their employees the minimum wage and overtime pay they are entitled to under the law.” 

Whether a worker is an employee or an independent contractor under the Fair Labor Standards Act requires an analysis of the economic realities of the worker’s relationship with the employer. 

Established in 2017, C&G HVAC LLC in Dallas provides heating, ventilation and air conditioning repair services in North Texas.

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 and employers can call the division’s toll-free helpline at 866-4US-WAGE (487-9243), regardless of where they are from. Calls are confidential and the division can speak with callers in more than 200 languages. 

Download the agency’s new Timesheet App for iOS and Android devices, now available in English and Spanish, to ensure hours and pay are accurate. 

HOUSTON – The U.S. Department of Labor has filed suit asking a federal court to require the owner and operator of three popular north Houston-area restaurants in Tomball and Spring - that allegedly used a portion of employees’ tips for business expenses, including condiments and takeout packaging - to pay back wages and damages to the affected workers.

The allegations stem from investigations by the department’s Wage and Hour Division that found Tejas Chocolate LLC and Tejas Dragon Companies LLC collected the employees’ tips to distribute among them; however, the employer diverted some of the tips for business purposes in violation of the Fair Labor Standards Act. By law, tips are the property of those who earn them, and cannot be used to pay business expenses. 

Filed by the department’s Office of the Solicitor, the suit seeks back wages and an equal amount in liquidated damages for current and former employees of two locations of Tejas Chocolate & Barbecue, operated by Tejas Chocolate LLC, and Tejas Burger Joint, operated by Tejas Dragon Companies LLC, from May 2021 to May 2023 and beyond if the division finds the employer continued to use employees’ tips improperly.

“When it comes to workers’ tips, the law is crystal clear: tips are the property of the workers who earn them,” explained Regional Wage and Hour Administrator Betty Campbell in Dallas. “The owner and operator of Tejas Chocolate & Barbecue and Tejas Burger Joint willfully deprived employees of all their hard-earned tips and used their money to illegally benefit their businesses.”

The department filed its lawsuit on July 19, 2024, in the U.S. District Court for the Southern District of Texas, Houston Division.

“The Department of Labor is determined to protect the rights of all workers when their employers shortchange them for any reason and will use all legal means necessary,” said Regional Solicitor of Labor John Rainwater in Dallas. “The operator of these businesses directly violated the law, denying employees all the tips left by their customers to recognize their good service.”

Tejas Chocolate LLC was founded in 2011 and services the north Houston area. The same employer also founded Tejas Dragon Companies LLC in Tomball in 2019. 

For more information about the Fair Labor Standards Act and other laws enforced by the division, contact the agency’s toll-free helpline at 866-4US-WAGE (487-9243). Workers and employers can call the division confidentially with questions, regardless of where they are from, and the division can speak with callers in more than 200 languages.  

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. Download the agency’s new Timesheet App for iOS and Android devices – free and available in English and Spanish – to track hours and pay.

Court: U.S. District Court for the Southern District of Texas, Houston Division

Docket Number: 4:24-cv-02695

Employer:                              Tito’s Taqueria LLC,  898 Putney Road, Brattleboro, VT 05301

Type of action:                      Administrative settlement

Investigation sites:                Greenfield, Massachusetts

                                                          Keene, New Hampshire

                                                         Brattleboro, Vermont 

Investigation findings:          The U.S. Department of Labor’s Wage and Hour Division’s Northern New England District Office found Tito’s Taqueria, a counter service restaurant, illegally required employees at three locations to share a portion of their tips with managers and failed to pay workers time and one-half their regular rates of pay for hours over 40 in a workweek.

The Fair Labor Standards Act forbids owners and managers from keeping any portion of an employee’s tips for any purpose, 

Resolution:                             In an administrative settlement with the division, Tito’s Taqueria paid $62,452 in back wages and withheld tips as well as an equal amount in liquidated damages to 126 affected employees across three locations. The employer also paid the department $12,214 in civil money penalties to resolve its violations. 

Quote:                                    “The violations by Tito’s Taqueria to shortchange workers by misusing their tips to pay managers is a problem we commonly find in the restaurant industry,” said Wage and Hour Division District Director Steven McKinney in Manchester, New Hampshire. “The Fair Labor Standards Act forbids employers from keeping employees’ tips for any purpose, whether directly from customers or through a tip pool.”

In fiscal year 2023, the Wage and Hour Division successfully recovered more than $29.6 million in back wages for nearly 26,000 food service workers nationwide and assessed $6.1 million in civil money penalties in the food services industry.

Workers and employers can contact the division confidentially at its toll-free number, 1-866-4-US-WAGE (487-9243). Learn more about the Wage and Hour Division, including the agency’s restaurant compliance assistance toolkit, an overview of FLSA protections for restaurant workers and Workers Owed Wages, a search tool to use if you think you may be owed back wages collected by the division. Workers and employers alike can help track their hours worked and pay by downloading the department’s Android and iOS Timesheet App for free in English or Spanish.  

Employer name:             LaLobe Inc.

Investigation site:           11661 Preston Road, Suite 140

                                                   Dallas, TX 75230

Investigation findings: The U.S. Department of Labor’s Wage and Hour Division found LaLobe Inc., a family owned piercing salon that services adults, kept three employees’ tips illegally. Under the Fair Labor Standards Act,  tips are the property of employees who receive them and employers cannot keep their tips or allow managers and supervisors to keep any portion of employees’ tips. In addition, the piercing salon also failed to keep records of hours employees worked and the amount of tips owed to workers, as required by federal law.

Back wages recovered:  $64,656 in owed back wages                                

Quote: “Federal law forbids employers from keeping any portion of employees’ tips or allowing them to be shared with managers or supervisors,” explained Wage and Hour Division District Director Jesus A. Valdez in Dallas. “The errors by LaLobe Inc. in this case should serve to remind other employers not to make the same mistakes and to make certain their pay practices comply with federal law.”

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 and how to file an online complaint. For confidential compliance assistance, employees and employers can call the agency’s toll-free helpline at 866-4US-WAGE (487-9243), regardless of where they are from.

Download the agency’s new Timesheet App for iOS and Android devices – also available in Spanish – to ensure hours and pay are accurate.

ATLANTIC BEACH, FL – The U.S. Department of Labor has recovered $288,979 in back wages and liquidated damages for 92 employees after its investigation found an Atlantic Beach property management group’s improper pay practices denied them overtime wages they earned.

The department’s Wage and Hour Division found American Management Group of North Florida LLC, operating as American Management Group, claimed an overtime exemption illegally and shaved hours off some workers’ time sheets to avoid paying overtime for hours over 40 in a workweek. Investigators also determined the employer paid some of the affected workers a flat salary and failed to include bonuses and commissions in their regular rate to calculate the overtime rate. The company’s actions violated provisions of the Fair Labor Standards Act. 

In addition to paying back wages and damages, American Management Group was assessed a $15,000 civil money penalty to address their violations’ willful nature. 

“Some employers believe paying employees a salary releases them from their legal obligation to pay them their full earned wages for hours over 40 in a workweek. The illegal misuse of the overtime exemptions is a widespread and pervasive problem that denies workers their full, hard-earned wages,” explained Wage and Hour Division District Director Vilma Bell in Orlando, Florida. “In this case, American Management Group has learned shortchanging employees comes with costly consequences.”

Headquartered in Atlantic Beach, American Management Group of North Florida LLC, a real estate management firm operating primarily in the Southeast, is a Jeff Klotz company. Jeff Klotz is the founder and CEO of The Klotz Group of Companies which serves as a parent company for operating subsidiaries and investment partnerships, including investments in more than 125,000 apartment units, 43 ground-up developments and other e-commerce, healthcare, printing, manufacturing and marketing projects. The company employs over 450 employees in Alabama, Florida, Georgia, North Carolina, South Carolina and Tennessee. 

Workers and employers can call the Wage and Hour Division confidentially with questions, and the division can speak with callers in more than 200 languages. For more information about the FLSA and other laws enforced by the agency, contact the division’s toll-free helpline at 866-4US-WAGE (487-9243). The division also offers online resources for employers, such as a fact sheet on Fair Labor Standards Act overtime requirements.

Workers and employers can help ensure hours worked and pay are accurate by downloading the department’s Android or iPhone Timesheet App for free in English and Spanish. 

Ed. Note: The original version of this release stated The Klotz Group of Companies LLC operated as American Management Group, and illegally claimed the overtime exemption. In fact, the American Management Group of North Florida LLC is incorporated separately and entered into the settlement agreement to resolve its violations.