WASHINGTON – The U.S. Department of Labor will reinstate the issuance of opinion letters, U.S. Secretary of Labor Alexander Acosta announced today. The action allows the department’s Wage and Hour Division to use opinion letters as one of its methods for providing guidance to covered employers and employees.

An opinion letter is an official, written opinion by the Wage and Hour Division of how a particular law applies in specific circumstances presented by an employer, employee or other entity requesting the opinion. The letters were a division practice for more than 70 years until being stopped and replaced by general guidance in 2010.

“Reinstating opinion letters will benefit employees and employers as they provide a means by which both can develop a clearer understanding of the Fair Labor Standards Act and other statutes,” said Secretary Acosta. “The U.S. Department of Labor is committed to helping employers and employees clearly understand their labor responsibilities so employers can concentrate on doing what they do best: growing their businesses and creating jobs.”

The division has established a webpage where the public can see if existing agency guidance already addresses their questions or submit a request for an opinion letter. The webpage explains what to include in the request, where to submit the request, and where to review existing guidance. The division will exercise discretion in determining which requests for opinion letters will be responded to, and the appropriate form of guidance to be issued. 

Employers: Forge Building Company, LLC

Site: 2619 West Lampert Drive, Boise, Idaho

Investigation findings: U.S. Department of Labor Wage and Hour Division investigators found that Forge Building Company violated the Fair Labor Standards Act’s minimum wage and overtime provisions. The company – a provider of customized manufactured galvanized steel structures and storage facilities – failed to pay workers overtime at time-and-one-half for hours worked beyond 40 in a work week. In addition, the employer made illegal deductions from workers’ paychecks to recoup the cost of tools it required them to purchase. These deductions had the effect of lowering the workers’ pay below the federal minimum wage of $7.25 per hour.

Resolution: In an agreement with the department, Forge will pay minimum wages to eight employees and overtime premium to 97 employees, with total back wages calculated at $358,601. The company also agreed to pay an equal sum of $358,601 in damages, totaling $717,202 for the workers.

Quote: “Our investigation has discovered violations resulting in wages that these workers had rightfully earned,” said Wage and Hour Division District Director Thomas Silva. “This case allows us to level the playing field for all of the employers who play by the rules. We are dedicated to protect both workers and employers.”

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

Employer: Freshore Hospitality, LLC doing business as Willows Inn on Lummi Island

Site: 2579 West Shore Drive, Lummi Island, Washington

Investigation findings: U.S. Department of Labor Wage and Hour Division investigators found that Willows Inn violated the Fair Labor Standards Act by failing to pay overtime and minimum wage to its employees. The restaurant required entry-level kitchen staff known in the industry as “stages” to work one month as a free try-out period before they were considered for paid employment. Once on the payroll, the kitchen workers were paid daily rates from $50 per day for up to 14 hours per day with no consideration of weekly overtime premium.

Resolution: Willows Inn reached a settlement with the department in which the company agreed to pay $74,812 in unpaid overtime to 19 kitchen workers and an equal amount in damages, totaling $149,624 for the employees. The company also canceled its “stage program” and agreed to comply with federal wage laws in the future.

Quote: “We hope this case can educate others in the high-end restaurant world that “staging,” while common, is unfair to workers, and it is illegal,” said Jeanette Aranda, director of the Wage and Hour Division’s office in Seattle. “This case allows us to level the playing field for employers who play by the rules by complying with the law. We are dedicated to educating and protecting both workers and employers.”

Background: Recognized recently as one of the world’s best luxury farm stays, the Willows Inn on Lummi Island specializes in serving meals created from local Pacific Northwest ingredients. Like many restaurants, Willows Inn relied on “stages” (originates from the French word “stagiaire,” meaning trainee, apprentice or intern) to supply unpaid labor. The stages were asked to perform kitchen work including cleaning dishes, polishing silverware, collecting herbs, prepping vegetables and assembling dishes. The stages also devoted hours to cleaning facilities and painting the exterior of Willow Inn buildings.

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

NEW YORK – A company that operates 138 parking garages in New York City and surrounding areas has paid $296,836 in back wages for 1,164 employees and amended its payroll practices to align with the federal Fair Labor Standards Act as part of an agreement with the U.S. Department of Labor.

An investigation by the department’s Wage and Hour Division found that Quik Park NYC LLC; RL Holdings 2 LLC; and Quik Park NYC (Fee) LLC, which does business as “Quik Park,” did not comply with the FLSA’s overtime and recordkeeping requirements between Oct. 1, 2014, and July 31, 2016. The division found the company’s practice of rounding hours resulted in employees not receiving correct overtime when they worked more than 40 hours in a workweek. Also, it erroneously programmed its timekeeping system to automatically record employees’ scheduled work hours instead of the actual hours they worked. This resulted in employees not getting paid for hours they worked beyond those scheduled.

“This agreement recovers back wages for thousands of workers in an industry that employs some of the most vulnerable workers. Quik Park’s prompt payment and commitment to current and future compliance ensures that its employees will receive all the wages they are due now and in the future,” said David An, director of the division’s New York City District Office. “Overtime and recordkeeping are not uncommon wage and hour issues. We encourage employers and workers to familiarize themselves with the FLSA’s requirements and to contact us with any questions they may have.”

The division has received the back wages and is in the process of distributing them to the employees. In the agreement, Quik Park neither admits nor denies the findings of the division’s investigation.

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. Some states have established minimum wage rates that differ from the federal minimum wage. Where federal and state law have different minimum wage rates, the higher standard applies. Employers also must maintain accurate time and payroll records.

The division is committed to providing employers with the tools they need to understand and comply with the variety of labor laws the division enforces, including resources in a variety of languages. It offers useful resources ranging from an interactive E-laws advisor to a complete library of free, downloadable workplace posters. In addition, the division’s Community Outreach and Resource Planning Specialists conduct ongoing outreach activities to educate stakeholders, including employers, employees, business and labor groups and professional associations, among others, with accessible, easy-to-understand information about their rights and responsibilities.

For more information about the FLSA, contact the division’s toll-free helpline at 866-4US-WAGE (487-9243) or its New York City District Office at 212- 264-8185. Information also is available at http://www.dol.gov/whd.

Employer: Zenefits FTW Insurance Services

Site: 303 2^nd St. San Francisco, California
Two closed offices in Tempe and Scottsdale, Arizona

Investigation findings: U.S. Department of Labor Wage and Hour Division investigators found that Zenefits violated the Fair Labor Standards Act by misclassifying 743 account executives and sales development representatives in San Francisco, and in Tempe and Scottsdale, Arizona, as exempt from minimum wage and overtime. The company incorrectly paid the workers a flat salary for all hours worked, regardless of overtime or training time.

Resolution: Zenefits will pay $3.4 million in unpaid overtime to 743 account executives and sales representatives in California and Arizona. The software company has also entered into an enhanced compliance agreement that includes monitoring by the department to prevent future wage and hour violations.

Quote: “We have put money back in workers’ wallets while also working with Zenefits to ensure future compliance with federal labor law,” said Ruben Rosalez, the Wage and Hour Division’s regional administrator in San Francisco. “This case allows us to level the playing field for all of the employers who play by the rules. We are dedicated to protecting both workers and employers.”

Background: Zenefits provides products and services, including software for payroll, timekeeping, hiring and employee benefits. The company also serves as an insurance broker.

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

PHILADELPHIA – The owners of two establishments – a produce market and a restaurant – at Reading Terminal Market have entered into a stipulation agreement with the U.S. Department of Labor that requires the payment of $660,117 in back wages and liquidated damages to 140 present and past workers to resolve violations of the federal Fair Labor Standards Act.

The department’s Wage and Hour Division investigators found that Iovine Bros Inc. – doing business as Iovine Brothers Produce – and Iovine Brothers Bar and Grill Inc. – doing business as Molly Malloy – violated the overtime and recordkeeping provisions of the FLSA. Both businesses are owned by James and Vincent Iovine.

Investigators found that the employer failed  to pay overtime at time-and-a-half when employees at the produce market and restaurant worked more than 40 hours in a workweek.  Instead, the employer paid for the overtime hours at straight time rates, in cash.  The failure affected regular hourly employees, and tipped employees, such as servers and bartenders. The employer also failed to maintain some of the payroll records required by  law. A civil money penalty of $62,007 was assessed due to the willful nature  of the violations.

“For workers in the restaurant and service sectors, money earned through overtime can make a big difference to their livelihood,” said James Cain, director of the division’s Philadelphia District Office. “For employers in this competitive industry, maintaining a level playing field is critical.  Our top priorities are to ensure that workers are aware of their rights, and to help companies come into compliance with the law.”

In the agreement, the owners agreed to change their business practices to ensure compliance with the law.

The division is committed to providing companies with the tools they need to understand and comply with the variety of labor laws the division enforces. It offers useful resources ranging from an interactive Employment Laws Assistance for Workers and Small Businesses advisor to a complete library of free, downloadable workplace posters. In addition, the division’s Community Outreach and Resource Planning Specialists conduct ongoing outreach activities to educate stakeholders, including employers, employees, business and labor groups and professional associations, among others, with accessible, easy-to-understand information about their rights and responsibilities.

The FLSA requires that covered, nonexempt employees be paid at least the 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.

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

WHITE BEAR LAKE, Minn. – Ten workers at a Minnesota title company will receive $107,893 in back wages and unpaid fringe benefits after the title insurance company that employed them was found in violation of the Service Contract Act during an investigation by the U.S. Department of Labor’s Wage and Hour Division. The employees worked on real estate closings on a contract with the U.S. Department of Housing and Urban Development.

The Labor Department’s Office of Administrative Law Judges issued a decision and order effectively resolving a lawsuit filed by the department in July 2014 against Northwest Title Agency Inc., Chief Executive Officer Wayne Holstad and Chief Operating Officer Joel Holstad. As a result, the company has been debarred from bidding on federal contracts for three years.

“Contractors that do business with the federal government have an obligation to pay their employees the required contractual rates and benefits,” said David King, the Wage and Hour Division’s district director in Minneapolis. “When employers fail to do so, they undercut employers who play by the rules, in addition to shorting their workers. The department will not hesitate to pursue legal action, including debarment, to ensure employees working on federally funded projects are properly paid and to level the playing field for contractors.”

An investigation by the department’s Wage and Hour Division determined that the White Bear Lake-based company failed, among other things, to:

• Pay legally required prevailing wage rates and fringe benefits to the workers on this contract.
• Maintain required records of hours worked and to segregate hours for contract work from non-contract work.
• Notify the employees that work performed on the HUD contract was subject to SCA requirements.

The decision and order found Northwest Title and Wayne Holstad jointly liable for $67,893 of underpayments and barred each from bidding on federal contracts for a period of three years.

Joel Holstad and the department filed a separate settlement agreement in July 2016 in which he agreed to pay $40,000 in back wages.

The company held the HUD contract from April 2010 through April 2011, with an additional option year through April 2012.

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 prevailing wage rates and fringe benefits found in the locality, or the rates, including prospective increases, contained in a predecessor contractor’s collective bargaining agreement. The department issues wage determinations on a contract-by-contract basis in response to specific requests from contracting agencies. These determinations are incorporated into the contract. Additional information on labor provisions and enforcement of government contracts is available at http://www.dol.gov/whd/govcontracts/.

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

PHILADELPHIA – The U.S. Department of Labor’s Wage and Hour Division is conducting a residential construction survey in 25 eastern Pennsylvania counties to collect data on wages paid to workers to help establish prevailing wage rates, as required under the Davis-Bacon and Related Acts.

The survey includes wages paid on all residential construction projects that occurred between April 1, 2016, and March 31, 2017, in the following counties: Adams, Berks, Bucks, Carbon, Chester, Columbia, Cumberland, Delaware, Dauphin, Franklin, Lackawanna, Lehigh, Luzerne, Lycoming, Monroe, Montgomery, Montour, Northampton, Perry, Philadelphia, Pike, Lancaster, Lebanon, Wyoming and York. It is not limited to federally funded construction projects.

“Davis-Bacon prevailing wage rates should reflect the actual wages and fringe benefits paid to residential construction workers in the locations where the work takes place. This can only happen with full participation by the residential construction community in these eastern Pennsylvania counties,” said Mark Watson, the division’s regional administrator for the Northeast. “Participation by contractors and interested parties is crucial. Low response can lead to wage rates that do not reflect wages and incomplete wage determinations, which leads to an increase in requests for additional classifications.”

Notification letters and data collection forms, known as WD-10s, are being sent to interested parties and contractors known to the division. Data must be postmarked by Nov. 30, 2017, to be included. To complete the survey electronically, visit www.dol.gov/whd/programs/dbra/wd10/index.htm

You do not need to receive a letter to answer the survey. If you would like to participate, or have questions regarding the survey process or completing the WD-10 form, contact William E. Schweizer at 267-687-4031.

DAWSON, Pa. – A Southwestern Pennsylvania farm and landscaping company has paid nearly $22,000 in back wages and penalties after the U.S. Department of Labor found the operator failed to recruit and hire U.S. workers before hiring workers under the H-2A visa program, in violation of section 218 of the Immigration and Nationality Act.

Investigators with the department’s Wage and Hour Division found Dawson-based Christner Farms LLC illegally denied one qualified U.S. worker the opportunity to work on the farm, resulting in the back wages due.

“The H-2A visa program provides protections against employers hiring foreign workers over qualified U.S. workers,” said John DuMont, director of the division’s district office in Pittsburgh. “We will continue to make every effort to ensure that U.S. workers are not unfairly denied jobs.”

The division also found that Christner failed to cooperate with the state’s workforce agency by not accepting referrals of all eligible U.S. workers who applied for the job opportunity. The company also failed to provide housing for agricultural workers that met required housing safety and health standards, and post required information about the temporary agricultural employment of foreign workers.

Christner has paid $11,275 in back wages and $10,463 in civil money penalties to resolve the matter.

The division is committed to providing companies with the tools they need to understand and comply with the variety of labor laws the division enforces. It offers useful resources ranging from an interactive Employment Laws Assistance for Workers and Small Businesses advisor to a complete library of free, downloadable workplace posters. In addition, Community Outreach and Resource Planning specialists conduct ongoing activities to educate stakeholders, including employers, employees, business and labor groups and professional associations with accessible, easy-to-understand information about their rights and responsibilities.

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

ANDOVER, N.J. – The U.S. Department of Labor’s Office of Administrative Law Judges approved a consent finding and order to resolve a complaint filed against a New Jersey-based mail delivery contractor and others for failing to pay legally required wages and benefits to employees. Under the order, the company agreed to pay $245,000 in back wages. The department is now distributing the wages to the affected workers.

Dennis K. Walker Trucking Co. Inc. – doing business as Walker Trucking Co. – agreed to pay 23 drivers back wages for violating prevailing wage, fringe benefits and record-keeping provisions of the McNamara-O’Hara Service Contract Act. The Andover company was also debarred from eligibility to bid on future government contracts for three years. Walker Trucking had been contracted by the U.S. Postal Service to haul mail.

The department filed a complaint against the company; its officer Mary B. Walker; manager Dennis K. Walker Jr., and D&M Leasing Corp., after an investigation by the Wage and Hour Division found that – from June 27, 2013, to June 26, 2015 – Walker Trucking Co. and Mary Walker failed to pay the prevailing wage to 10 drivers, full health and welfare fringe benefits to 23 drivers, and full vacation fringe benefits to eight drivers, as required by the SCA. The division also found that the firm failed to keep a record of the hours worked by employees.

“The resolution of this case ensures that workers at this company were paid the wages we found they rightfully earned, ensuring a level playing field for other mail-haul contractors,” said John Warner, director of the division’s Northern New Jersey District Office.

“Our goal is to ensure that companies that follow the rules – and their workers – are not placed at a disadvantage by those companies that do not,” said Jeffrey S. Rogoff, the department’s regional solicitor in New York.

The SCA applies to federal and District of Columbia contracts worth more than $2,500 that provide services in the U.S. using service employees. Contractors and subcontractors performing on covered service contracts must pay their service workers no less than the wages and fringe benefits prevailing in the locality, or rates contained in a predecessor contractor’s collective bargaining agreement.

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