LOS ANGELES, CA – The U.S. District Court for the Central District of California has ordered Gary Tetone, owner of Southern California-based company GT Drywall, to comply with U.S. Department of Labor investigators in a long-running Wage and Hour Division (WHD) investigation with which he has refused to cooperate since 2016.

WHD issued a subpoena to GT Drywall in Chino Hills and Tetone in November 2016, as part of its investigation of potential wage violations. Tetone has refused to provide a single document and has delayed the U.S. Department of Labor’s actions to secure his compliance since then. The Department’s Office of the Solicitor obtained a warrant for his arrest, which law enforcement officers carried out in February 2018.

Following Tetone’s arrest and incarceration, federal Judge Jesus Bernal released him and ordered him to furnish the documents requested in the subpoena to WHD within 14 days, and to meet with WHD investigators as many times as necessary in the following 28 days to answer questions.

Judge Bernal admonished Tetone, informing him that failure to abide by these conditions would result in the court issuing another warrant for his arrest. The court deferred to a later date enforcement of the more than $48,000 in contempt penalties and $5,200 in attorney’s fees owed by Tetone.

“The court has put this case on the path to closure,” said Janet Herold, the Department of Labor’s Regional Solicitor. “Tetone has been refusing to produce documents necessary for the Department to complete its investigation. “The U.S. Department of Labor takes all of its investigations seriously, and we expect employers like Tetone to do the same.”

Tetone has ignored numerous orders by the court, as well as multiple letters from the Department. He has also evaded service of process throughout the subpoena enforcement action in federal court. At one point, Tetone lied about his identity to WHD investigators who attempted to serve him with the Secretary of Labor’s enforcement petition, claiming to be a “pool guy” hired to work at his residence. Given his refusal to cooperate with the court’s order enforcing the Department’s subpoena, the court found Tetone and his company in contempt, and imposed a daily fine of $500 until both complied with the subpoena.

Workers and employers with questions about the Fair Labor Standards Act or any of the federal wage laws administered by the Division should call the agency’s toll-free helpline at 866-4US-WAGE (487-9243).

BLUEFIELD, WV - The U.S. District Court for the Southern District of West Virginia has entered a consent judgment requiring Lambert Construction of Bluefield Inc. to pay $116,818 in back wages and liquidated damages to 45 employees. Additionally, the Bluefield, West Virginia, construction company will pay $16,000 in civil penalties to resolve overtime violations of the Fair Labor Standards Act (FLSA) found in a U.S. Department of Labor investigation.

The action comes after the Department’s Wage and Hour Division found Lambert Construction of Bluefield Inc., doing business as Lambert Construction; ELL Real Estate LLC; and owner Alex Lambert failed to pay employees overtime when they worked more than 40 hours in a workweek. To create the appearance that overtime had not been worked, the firm paid employees with two separate checks each week, splitting hours between two payroll accounts within their business so that each check reflected fewer than 40 hours. Citing the willfulness of the violations, the judgment also assessed the civil penalties.

In addition to paying the back wages, damages, and penalties, the consent judgment permanently enjoins the companies and Lambert from violating the FLSA in the future.

“This settlement not only ensures Lambert’s employees will receive all of the wages they rightfully earned, it also levels the playing field for law-abiding employers,” said Catherine Glencoe, Wage and Hour Assistant Director in Charleston.

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 for hours worked beyond 40 per work week.

For more information about the FLSA and other laws enforced by the Division, contact its toll-free helpline at 866-4US-WAGE (487-9243). Information is also available at http://www.dol.gov/whd including a search tool to use if you think you may be owed back wages the Division collects.

LOS ANGELES, CA – Following a U.S. Department of Labor investigation that found overtime and minimum wage violations, prompting the Department to invoke a “hot goods” legal action, the U.S. District Court for the Central District of California has issued a temporary restraining order to prevent a Los Angeles garment manufacturer from shipping clothes to retailer Charlotte Russe.

Division investigators notified garment manufacturer RK Apparel Inc. that they found widespread violations of the Fair Labor Standards Act (FLSA), which rendered the garments manufactured and assembled by those workers hot goods unfit for shipment or sale through interstate commerce. The company advised the Department that it would not ship the hot goods, but then proceeded to ship a batch of the hot goods clothing to Charlotte Ruse.

Division investigators found that RK Apparel’s contractor HDK Ave. Inc. paid its employees well below the federal minimum wage of $7.25 per hour, with some receiving pay as low as $4 per hour. The employer required employees to work up to 58 hours per week but paid them only a piece rate, earning a flat amount per garment produced, and did not pay overtime when they worked more than 40 hours in a work week, as required by federal law.

“Whenever goods are produced in violation of the FLSA’s minimum wage, overtime, or child labor provisions, the U.S. Department of Labor can restrain those goods from being shipped in interstate commerce. This action is commonly referred to as invoking the ‘hot goods’ provision,” said Janet Herold, Regional Solicitor in Los Angeles. “Today’s action demonstrates that we will use all of the tools provided by law to ensure that employees receive the pay they have legally earned and that law-abiding employers are not undercut by unfair competition.”

Employees and employers with questions about the Fair Labor Standards Act or any of the federal wage laws administered by the Division should call the agency’s toll-free helpline at 866-4US-WAGE (487-9243). All calls are confidential.

WESTBURY, NY – After an investigation and litigation by the U.S. Department of Labor, Farmingdale Auto Collision Inc. and its owner and officers have paid $306,000 in back wages and liquidated damages to 21 employees to resolve violations of the overtime and recordkeeping provisions of the Fair Labor Standards Act (FLSA).

The Department’s Wage and Hour Division found that the Farmingdale auto body and paint shop typically paid employees by check for their first 40 hours of work, but paid many of them in cash at rates less than or equal to their regular hourly rates for their overtime hours. The FLSA requires the employer to pay these employees overtime at time-and-one half for any hours they work beyond 40 per workweek. In addition, Farmingdale Auto failed to keep accurate records of hours worked by its auto body shop employees.

“Employers that pay employees less than what they have legally earned shortchange these hard-working people and gain an unfair advantage over competitors that abide by the law,” said Irv Miljoner, Wage and Hour Division District Director in Westbury. “We encourage all employers to use the tools and resources the Wage and Hour Division provides to learn about their legal responsibilities, avoid violations, and operate in compliance with the law.”

“This settlement and the resulting payment of back wages and damages demonstrates the U.S. Department of Labor’s commitment to using all available tools, including litigation, to ensure that employees are properly compensated for their work, and that employers compete on a level playing field,” said Jeffrey S. Rogoff, Regional Solicitor of Labor in New York.

The consent judgment also prohibits the defendants from future FLSA violations and from retaliating against, or soliciting repayment of recovered wages from the employees.

The Division’s Long Island District Office conducted the investigation. Senior Trial Attorney James Wong of the regional solicitor’s office in New York litigated the case.

For more information about the FLSA and other laws enforced by the Division, contact its toll-free helpline at 866-4US-WAGE (487-9243). Information is also available at http://www.dol.gov/whd; the site includes a search tool to learn whether you may be owed back wages collected by WHD.

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Acosta v. Farmingdale Auto Collision, Inc., and Joseph Verdi, Joanne Eisenberg, Bruce Eisenberg, and Richard Verdi.    
Civil Action Number: No. 16-cv-07172 

PHILADELPHIA, PA – The U.S. Department of Labor has established a hotline for 1,471 current and former Houlihan’s employees of 17 of the restaurant chain’s New Jersey and New York locations to assist them in recovering back wages and liquidated damages.

The restaurant chain’s employees in New Jersey in Bayonne, Brick, Bridgewater, Cherry Hill, Eatontown, Fairfield, Hasbrouck Heights, Holmdel, Lawrenceville, Metuchen/Woodbridge, New Brunswick, Paramus, Ramsey, Secaucus, and Weehawken; and in New York in Farmingdale and Westbury may call the Department’s Wage and Hour Division at 908-389-5442 for updates on back wage payments and to submit updated contact information.

On April 2, 2018, the Department filed a consent judgment in the U.S. District Court for the District of New Jersey providing for the recovery of $5 million in back wages and liquidated damages for current and former Houlihan’s employees in New Jersey and New York to resolve the Department’s lawsuit alleging violations of the Fair Labor Standards Act (FLSA). The consent judgment was approved by the court on April 9.

For more information about the FLSA and other laws enforced by the Division, contact its toll-free helpline at 866-4US-WAGE (487-9243). Information is also available at http://www.dol.gov/whd including a search tool to use if you think you may be owed back wages collected by the Division.

WASHINGTON, DC – The U.S. Department of Labor’s Wage and Hour Division (WHD) announced today that it has issued three new opinion letters.

“The Department of Labor has committed to protect employees, enforce the law, and ensure employers have the tools for compliance,” said U.S. Secretary of Labor Alexander Acosta. “American job creators and employees deserve to know how an agency will apply the law to a particular set of facts. By addressing the application of statutes and regulations in the specific circumstances presented by an employer, employee, or other entity, opinion letters provide clarity that helps increase compliance to the benefit of all.”

The opinion letters released today address compliance under the Fair Labor Standards Act (FLSA) and other laws:

• What counts as work time under the FLSA when employees travel for work
• Whether 15-minute rest breaks required every hour by an employee’s serious health condition must be paid or may be uncompensated
• Whether certain lump-sum payments from employers to employees are considered “earnings” for garnishment purposes under Title III of the Consumer Credit Protection Act

An opinion letter is an official document authored by WHD on how a particular law applies in specific circumstances presented by the person or entity requesting the letter. Opinion letters represent official statements of agency policy.

In June 2017, Secretary Acosta announced that the Department was resuming its longstanding practice of issuing opinion letters. The Department had issued opinion letters for more than 70 years before ceasing the practice in 2010.

The public is encouraged to submit requests for opinion letters to WHD and can visit this webpage to learn how to request an opinion letter or determine whether existing agency guidance already addresses their questions.  WHD will exercise discretion in determining whether and how it will respond to each request.

GREEN BAY, WI – In an effort to inform employers and employees about federal wage laws, the U.S. Department of Labor’s Wage and Hour Division (WHD) is engaged in an education and enforcement initiative at Green Bay-area restaurants. WHD is focused on providing compliance assistance information to employers and industry stakeholders through educational outreach events, as well as conducting investigations at individual restaurants.

The initiative includes outreach to a wide variety of organizations in the Green Bay area to identify multiple channels to place information into the hands of employers and to provide them the tools they need to comply with the law. WHD is engaged with employer organizations, community organizations, and other government agencies to ensure a wide distribution of information describing requirements under the Fair Labor Standards Act (FLSA).

“These initiatives raise awareness among employers, employees, community organizations and others regarding federal wage and hour laws,” said David King, Wage and Hour District Director in Minneapolis. “The ultimate goal is to increase industry-wide compliance. We want to make sure everyone knows the rules, and follows the rules.”

The FLSA requires that covered, nonexempt 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 for hours worked beyond 40 per week. An employer of a tipped employee is required to pay no less than $2.13 an hour in direct wages, provided that amount plus the tips received equals at least the federal minimum wage of $7.25 per hour. If an employee’s tips, combined with the employer’s direct wages, do not equal the minimum wage, the employer must make up the difference. Employers also are required to provide employees notice of the FLSA tip credit provisions and to maintain accurate time and payroll records.

In the past five years, violations have resulted in more than $2 million in minimum wage and overtime back wages found for 2,571 restaurant workers in Wisconsin. Common violations include failure to pay employees for work they perform either before or after their scheduled shifts, and failure to pay overtime for working beyond 40 hours per week.

“The Wage and Hour Division is committed to ensuring employees receive all the wages they have rightfully earned,” said Ruben Rosalez, Acting Regional Administrator for the Wage and Hour Division in Chicago. “We are also determined to ensure that employers who fail to comply with the law do not gain an unfair competitive advantage over those who do.  Employers can avoid wage violations by reaching out to us for assistance to ensure they are in compliance with the law.”

For more information about the FLSA and other federal labor laws, call the division’s toll-free helpline at 866-4US-WAGE (487-9243). Information also is available at http://www.dol.gov/whd.

CHATTANOOGA, TN – After an investigation by the U.S. Department of Labor’s Wage and Hour Division, Chattanooga-based Chao’s Mongolian Grill LLC will pay $48,197 in back wages to eight employees for violations of the minimum wage, overtime, and recordkeeping provisions of the Fair Labor Standards Act (FLSA).

Division investigators found the restaurant violated the FLSA’s minimum wage requirements when it illegally required servers to surrender 15 percent of their daily tips to the business. Investigators also found Chao’s failed to pay time-and-one-half for overtime hours worked, and failed to maintain required payroll records.

“The U.S. Department of Labor is committed to ensuring that employees receive the wages they have legally earned for all the hours they have worked,” said Nettie Lewis, Wage and Hour Division District Director in Nashville. “The Department’s work levels the playing field for employers who play by the rules. We encourage all employers to reach out to us for information about how to comply with the law.”

For more information about the FLSA and other laws enforced by the Wage and Hour Division, contact the Division’s toll-free helpline at 866-4US-WAGE (487-9243). Information is also available at http://www.dol.gov/whd including a search tool to use if you think you may be owed back wages collected by the Division.

ALBANY, NY – After a U.S. Department of Labor Wage and Hour Division investigation, Georgia contractor Infinite Services and Solutions and its president, Khary Lewis, who provided transportation services for the U.S. Army in New York and Arizona, have been placed on a list of bidders ineligible for federal contracts for a period of three years as a result of violations of the McNamara-O’Hara Service Contract Act (SCA).

Division investigators determined that the Atlanta-based company and its president withheld 401(k) contributions and union dues from employees’ paychecks, then deliberately failed to remit the payments to the plan and to the union while providing transportation services at the U.S. Military Academy at West Point. They also failed to pay out required vacation pay to employees upon termination of the West Point contract. The company and Lewis have since paid $280,740 in back wages and benefits to 67 employees to resolve these violations.

In a separate investigation, Division investigators found that the company and Lewis failed to pay employees required health, paid time off, and other fringe benefits required by the SCA while providing services at the Yuma Proving Ground in Arizona. The contractor will pay $101,147 in back wages to 36 employees to resolve those violations.

“When employers receive federal funds to provide services to the government, they must comply with all applicable laws to ensure that their employees receive legally required pay and benefits,” said Jay Rosenblum, Wage and Hour Division District Director in Albany.

“The U.S. Department of Labor is committed to protecting workers and to ensuring a level playing field for employers,” said Eric Murray, Wage and Hour Division District Director in Phoenix. “Violations can be avoided, and we encourage employers to reach out to the Wage and Hour Division for guidance.”

“The U.S. Department of Labor will pursue appropriate legal measures to help ensure that employers who violate the law do not gain an unfair advantage over those who obey the rules,” said Jeffrey S. Rogoff, Regional Solicitor of Labor in New York.

The New York investigation was conducted by the Division’s Albany District Office and the Arizona investigation by its Phoenix District Office. Trial Attorney Molly Theobald litigated the case on behalf of the New York Solicitor’s Office.

The SCA requires contractors and subcontractors performing services on prime contracts in excess of $2,500 to pay service employees in various classes no less than the wage rates and fringe benefits found prevailing in the locality, or the rates (including prospective increases) contained in a predecessor contractor's collective bargaining agreement. For prime contracts in excess of $100,000, contractors and subcontractors must also, under the provisions of the Contract Work Hours and Safety Standards Act, pay laborers and mechanics, including guards and watchmen, at least one and one-half times their regular rate of pay for all hours worked over 40 in a workweek.

For more information about the SCA and other laws enforced by the Division, contact its toll-free helpline at 866-4US-WAGE (487-9243). Information is also available at http://www.dol.gov/whd including a search tool to use if you think you may be owed back wages collected by WHD.

GUAYNABO, PR – After an investigation by the U.S. Department of Labor’s Wage and Hour Division (WHD), fuel distributor Macro Companies Inc., engaged in hurricane recovery activities in Puerto Rico, has paid $1,151,291 in back wages to 219 employees for violating the overtime provisions of the Contract Work Hours and Safety Standards Act (CWHSSA), the fringe benefits provisions of the McNamara-O’Hara Service Contract Act (SCA), and the recordkeeping provisions of the Fair Labor Standards Act (FLSA).

WHD investigators found that the Broussard, Louisiana, company paid employees performing hurricane recovery activities a fixed salary per day, without regard to the number of hours that they actually worked.  This practice resulted in overtime violations under CWHSSA when these employees worked beyond 40 hours in a workweek but were not paid an additional overtime premium, as the law requires. The employer also failed to pay employees benefits required by the SCA, and failed to record the number of hours they worked, as required by the FLSA.

Macro Companies Inc. will work with WHD to ensure that their pay practices in other projects and contracts outside of Puerto Rico comply with the law.

“No contractor should gain an economic advantage by paying workers below the wages and fringe benefits required on a contract,” said Jose R. Vazquez, District Director of the Wage and Hour Division’s Caribbean District Office. “Not only does this practice undercut what the workers involved are legally owed, it results in unfair competition for contractors who play by the rules.  Violations can be avoided, and we encourage employers to reach out to the Department of Labor for guidance.”

The SCA requires contractors and subcontractors performing services on prime contracts in excess of $2,500 to pay service employees in various classes no less than the wage rates and fringe benefits found prevailing in the locality, or the rates (including prospective increases) contained in a predecessor contractor’s collective bargaining agreement. CWHSSA requires that contractors on federal service contracts in excess of $100,000 pay workers overtime after 40 hours worked in a workweek. 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 for hours worked beyond 40 per week, and must also keep employee time and pay records.

Employees and employers in Puerto Rico and the U.S. Virgin Islands who have any questions or concerns, or wish to obtain more information about the CWHSSA, the SCA, the FLSA, and other laws enforced by the Division, may contact the Division’s Caribbean District Office at 787-775-1947 or 1-866-4-USWAGE, or by email. Information is also available at http://www.dol.gov/whd; the site includes a search tool to learn whether you may be owed back wages collected by the Division.

Read this news release Spanish.