BALTIMORE – A North Carolina company that rounds up live chickens for poultry processors has paid nearly $600,000 in back wages and an equal amount in liquidated damages to 838 workers as part of a settlement agreement with the U.S. Department of Labor.

The Marshville company, Unicon Inc., paid the back wages to employees who worked as chicken catchers and van drivers. Investigators with the department’s Wage and Hour Division found violations of the Fair Labor Standard Act’s overtime and recordkeeping provisions at the company’s worksites throughout the northeast and southeast.

The violations resulted from the company’s failure to pay for all the hours employees had worked.  Specifically, Unicon made automatic deductions from payroll for lunch and other breaks that crew leaders and catch crew members did not actually take. The firm also failed to pay workers for time they spent on work activities prior to the start of the actual catching process, and failed to pay crew leaders for time spent picking up catch crew members and cleaning company vans. The division also cited the employer for not maintaining time and payroll records.

 “This agreement goes a long way to ensure that Unicon’s workers are made whole by providing the wages they earned. It also levels the playing field for other employers in this industry,” said Mark Watson, administrator of the division’s Northeast Region.

The division is committed to providing companies with the tools they need to understand and comply with  labor laws. 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/.

Date of Action: May 8, 2017

Type of Action: U.S. District Court decision

Name of Defendants: Foreclosure Connection, Inc.
Jason Williams, owner

Findings: U.S. District Court Judge Dale A. Kimball for the District of Utah, Central Division, has ruled that workers of Foreclosure Connection, Inc. – a Salt Lake City company that acquires, remodels, rents and re-sells foreclosure properties – are employees, and not independent contractors as the defendants alleged. The court also found the company and its owner, Jason Williams, violated the Fair Labor Standards Act when they willfully retaliated against employees and interfered with the U.S. Department of Labor’s Wage and Hour Division investigation. The division found the employer threatened workers and instructed them to withhold information and records from its investigator.

The court has ordered the defendants to pay $161,985 in back wages and damages to the affected employees.

During its investigation, the division determined the defendants had terminated two workers who asked the division about unpaid overtime. The employer also refused to provide the division with records it requested, and was generally uncooperative with investigators; claiming that all of its workers were independent contractors not subject to the FLSA. The investigation uncovered voice recordings in which the employer threatened workers and instructed them to withhold information and records.

Quote: “Workers should not have to fear their employer’s retaliation when they exercise their rights under the law,” said Betty Campbell, Southwest regional Wage and Hour Division administrator. “The court’s decision reaffirms the department’s conclusion – the individuals are, in fact, employees with rights that protect them from workplace retaliation.  This case is an example of our commitment to protecting workers and to leveling the playing field for law-abiding employers.”

Additional Information: For more information about compliance with the FLSA, visit www.dol.gov/whd/, or call 866-4US-WAGE.

Civil Action Number: 2:15-cv-00653-DAK

NEW YORK – The U.S. Department of Labor has obtained a consent judgment in federal court requiring a New York City design and construction company and its owners to pay $726,989 in back wages and liquidated damages to 184 employees and take other corrective actions to resolve past overtime and recordkeeping violations of the federal Fair Labor Standards Act.

Design Development NYC, Inc., had misclassified almost all of its employees as independent contractors, an investigation by the department’s Wage and Hour Division found.

The misclassified employees worked in numerous jobs, including carpenters, draftspersons, drivers, electricians, laborers, painters, and plumbers and tilers. The company also wrongfully considered three employees as exempt from the FLSA’s overtime compensation requirements, paying them a fixed weekly salary without regard to hours worked.

As a result, misclassified employees and non-exempt employees – some of whom worked 70 hours per week or more – did not receive proper overtime pay when they worked more than 40 hours in a workweek. The FLSA requires that employees receive one-and-one-half their regular rates of pay when they work more than 40 hours in a workweek and that employers maintain adequate and accurate records of employees’ wages and work hours.

“This resolution commits this company to positive and effective steps to prevent future violations,” said Mark Watson Jr., the Wage and Hour Division’s northeast regional administrator.

“Our goal is to ensure that employees receive the hard-earned wages due them and that law-abiding businesses can compete fairly in the marketplace,” said Jeffrey S. Rogoff, the regional solicitor.

The company and owners, Michael Daddio and Earl Brian, neither admit nor deny the allegations; they have agreed to a consent judgment, entered in the U.S. District Court for the Eastern District of New York, which requires them to comply with the FLSA by determining employees’ overtime exemption status properly and recording employees’ work hours accurately, among other requirements. They will also submit complete samples of time and payroll records for all employees to the division for its review, and supply current and new employees with written notification of their rights under the FLSA in languages the workers understand.

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. 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.

The division’s New York City District Office conducted the FLSA investigation. Trial Attorney Frances Y. Ma of the department’s New York Regional Solicitor’s Office handled the case for the division.

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.

OKLAHOMA CITY – The U.S. Department of Labor’s Wage and Hour Division is conducting a survey of residential construction projects in metropolitan Oklahoma counties to help establish prevailing wage rates as required under the Davis-Bacon and Related Acts.

The division is collecting data on wages paid to workers on all residential construction projects statewide from Oct. 1, 2015, to Jan. 31, 2017. The survey is not limited to federally funded projects.

“Participation in the survey is crucial to the process, and should reflect the wages and fringe benefits paid to construction workers in the county where they work. We need the full participation of Oklahoma’s construction industry community,” said Betty Campbell, the Wage and Hour Division’s Southwest regional administrator.

Without a high level of survey participation, the state’s wage rates will not reflect actual wages and will prevent proper and accurate wage determinations from being created, leading to an increase in requests for additional classifications. Wage data should be submitted for all projects meeting the criteria, regardless of how they are funded.

The 18 counties covered in the survey are: Canadian, Cleveland, Comanche, Cotton, Creek, Grady, Le Flore, Lincoln, Logan, McClain, Oklahoma, Okmulgee, Osage, Pawnee, Rogers, Sequoyah, Tulsa and Wagoner.

The division urges industry employers to participate to ensure Davis Bacon wage rates and fringe benefits represent a truly prevailing wage. Your participation makes a difference. 

The division is sending notification letters and “WD-10” data collection forms to interested parties and contractors of which it is aware. Data must be postmarked by Nov. 3, 2017, to be included in the survey. Participants may also complete the survey online at http://www.dol.gov/whd/programs/dbra/wd10/index.htm.

Contractors do not need to receive a letter to participate in the survey. To participate or ask questions regarding the survey process and forms, contact Craig L. Jackson at (214) 749-2021.

PHILADELPHIA – The U.S. Department of Labor’s Wage and Hour Division is conducting a construction survey in Vermont 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 building construction, heavy construction and highway construction projects in the state that occurred between Feb. 1, 2016, and Jan. 31, 2017. It is not limited to federally funded construction projects.

“Davis-Bacon prevailing wage rates should reflect the actual wages and fringe benefits paid to construction workers in the locations where the work takes place. This can only happen with full participation by the construction industry community in the state of Vermont,” 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 Oct. 31, 2017, to be included. To complete the survey electronically, visit www.dol.gov/whd/programs/dbra/wd10/index.htm

Contractors do not need to receive a letter to answer the survey. To  participate or ask questions regarding the survey process or completing the WD-10 form, contact William E. Schweizer at 267-687-4031.

SAN DIEGO – The CEO of a leading U.S. staffing company will pay a former live-in domestic service worker $135,000 in back wages and damages under the terms of a consent judgment entered into the U.S. District Court for the Central District of California.

The judgment, entered on April 11, 2017, resolves a complaint filed by the U.S. Department of Labor on Aug. 22, 2016. An investigation by the department’s Wage and Hour Division found that Himanshu Bhatia willfully and repeatedly violated the Fair Labor Standards Act’s minimum wage and record keeping provisions from July 2012 to December 2014, as well as the act’s anti-retaliation provision.

The complaint alleged that Bhatia paid her domestic service worker a fixed monthly salary of $400 plus food and housing at Bhatia’s home in San Juan Capistrano and other residences in Miami, Las Vegas and Long Beach. Investigators found that the employee suffered callous abuse and retaliation, including being forced to sleep on a piece of carpet in the garage when ill, while Bhatia’s dogs slept on a mattress nearby. The complaint also alleged that Bhatia confiscated her employee’s passport.

Bhatia terminated the worker in December 2014 after she found her employee researching “labor laws” online, and after the worker refused to sign a document stating she was being paid an adequate salary and had no employment dispute with Bhatia.

“This consent judgment underlines the department’s commitment to protecting workers from exploitation,” said Janet Herold, solicitor for the department’s Western Region. “The department will take strong and immediate action to ensure that workers are protected against retaliation.”

The consent judgment orders the defendant to pay $135,000 in damages, including back wages, liquidated damages, and other damages.

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/.

Read this news release in Spanish.

BOSTON – The U.S. Department of Labor has secured a consent judgment in federal court ordering two Gloucester-based fish processors – Zeus Packing Inc. and Cape Ann Seafood Exchange Inc. – and the companies’ owner Kristian Kristensen to pay over $200,000 in liquidated damages to more than 100 employees to resolve violations of the Fair Labor Standards Act.

An investigation by the department’s Wage and Hour Division found the defendants violated the FLSA’s overtime and recordkeeping requirements from October 2011 through September 2014, and owed 132 employees $203,998 in back wages plus an equal amount in liquidated damages.

The companies and Kristensen paid the back wages in December 2015, but refused to pay the damages and civil money penalties assessed for the violations. As a result, the department filed suit in the U.S. District Court for the District of Massachusetts in March 2016 to recover those amounts.  After almost a year of litigation and negotiation, the defendants agreed to settle the matter by consent judgment.

In addition to requiring payment of $203,998 in liquidated damages covering the investigative period, the judgment also orders the defendants to pay $7,215 in back wages plus an equal amount in liquidated damages to the employees, on account of violations committed after the close of the investigation, and $29,500 in civil money penalties to the department. The judgment also restrains the defendants from future violations of the FLSA’s overtime and recordkeeping requirements.

“Employers are best served by recognizing that, as a general rule, if they fail to pay workers the proper minimum wage and overtime pay, they will be liable to pay double,” said Michael Felsen, regional solicitor for New England.  “As this case demonstrates, the department takes that employer responsibility under the law seriously.”

“The Wage and Hour Division is committed to providing companies with the tools they need to understand and comply with a variety of labor laws,” said Mark Watson, the division’s northeast regional director.

The division 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. Information is available in a variety of languages. In addition, the division’s Community Outreach and Resource Planning Specialists conduct ongoing outreach activities to educate businesses, professional associations, labor groups and others  with  easy-to-understand information about rights and responsibilities.

The division’s Boston District Office conducted the original investigation. Attorneys James Glickman and Sheila Gholkar litigated the case for the department.

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

# # #

Hugler v. Zeus Packing Inc., Cape Ann Seafood Exchange Inc. and Kristian Kristensen
Civil Action Number:  16-10442-DPW

PHILADELPHIA – The U.S. Department of Labor and a Philadelphia commercial printer have entered into a consent judgment that requires the company to pay $273,892 in back wages and liquidated damages to a group of temporary employees to resolve past violations of the federal Fair Labor Standards Act.

Under the agreement, back wages will be paid to 136 temporary employees who worked as machine operators and general laborers at Bartash Printing, Inc. An investigation by the department’s Wage and Hour Division found violations of the FLSA’s minimum wage, overtime, and recordkeeping provisions.

Bartash used a temporary help agency, VQ Management, Inc. – doing business as Managed Staffing and/or Best Staff – to acquire the workers, but failed to ensure they were paid the legally required wages. The workers were paid $6.25/per hour in cash, below the required federal minimum wage of $7.25 per hour. Bartash also failed to ensure the workers received the required overtime payments when they worked beyond 40 hours in a workweek. Bartash also failed to maintain the required payroll records for these workers.

“Although Bartash acquired workers through a temporary agency, it still had a legal responsibility as a joint employer to ensure that the workers received proper wages as the law requires,” said James Cain, director of the Wage and Hour Division’s Philadelphia District Office. “The resolution of this case should inform other employers who may acquire employees through a temporary help agency – it illustrates their responsibility to ensure that these temporary workers are being paid in compliance with the law.”

Bartash Printing specializes in newspaper and magazine publishing, including press, bindery and mail operations. In addition to the back wages and liquidated damages, the company has agreed to pay a civil monetary penalty of $31,350.

The Wage and Hour 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/.

# # #

Editor’s Note: A change was made in the third paragraph to clarify the responsibility for wages.

CUYAHOGA FALLS, Ohio – A federal judge has ordered Cathedral Buffet and its owner to pay $388,507 in back wages and damages to 235 “volunteers” who worked at the Cuyahoga Falls restaurant. An investigation by the U.S. Department of Labor’s Wage and Hour Division found violations of the Fair Labor Standards Act’s minimum wage, overtime, recordkeeping and other provisions.

U.S. District Judge for the Northern District of Ohio Benita Pearson wrote that testimony at a trial in late 2016 supported the department’s findings that the owner of Cathedral Buffet, televangelist Ernest Angley, and managers encouraged members of Angley’s church – Grace Cathedral – to work at the restaurant without pay. The for-profit restaurant used volunteers to save money, and the volunteers felt pressured to provide free labor, meaning they should have been paid for their work, Pearson wrote in her findings entered on March 29, 2017.

George Victory, district director for the Wage and Hour Division in Columbus, said that “the buffet’s constant solicitation of volunteer labor, the company’s admission that the use of volunteer labor was intended to save money, and the volunteers’ feelings of pressure to work at the restaurant shows they were actually employees. That is unacceptable under the law. There are many instances, however, in which the use of volunteers is acceptable. Organizations with questions about compliance should contact us.”

The investigation found FLSA violations that included:

• Improperly treating certain workers as volunteers and paying them no wages. These unpaid volunteers cooked, cleaned, waited tables, stocked and maintained the buffet line, and served as cashiers.
• Classifying 235 employees as unpaid volunteers, denying them the $7.25 hourly minimum wage.
• Paying four managers weekly salaries that failed to meet the $7.25 per hour federal minimum wage, and failing to pay overtime after 40 hours. The employer incorrectly categorized these managers as exempt from the FLSA’s overtime requirement.

The overtime and other FLSA violations were resolved in a partial consent judgment entered by the court on Oct. 26, 2016.

Cathedral Buffet and Angley have 60 days to appeal the court’s decision.

In 1999, the division investigated the buffet restaurant and it later paid more than $37,000 in back wages to employees improperly classified as volunteers. In 2012, Angley decided to again use volunteer labor, the Wage and Hour Division found.

Workers and employers can get more information about federal wage laws administered by the division by calling the agency’s toll-free helpline at 866-4US-WAGE (487-9243). Workers can also file complaints confidentially. More information is available online at http://www.dol.gov/whd/.

Who: U.S. Department of Labor’s Wage and Hour Division
U.S. Department of Labor’s Employee Benefits Security Administration
National Labor Relations Board
U.S. Equal Employment Opportunity Commission
U.S. Department of Labor’s Office of Federal Contract Compliance Programs
U.S. Department of Labor’s Occupational Safety and Health Administration
U.S. Department of Labor’s Veterans’ Employment and Training Service
U.S. Small Business Administration
Louisiana Workforce Commission’s Office of Unemployment Insurance Administration

What: Prevailing wage seminar in New Orleans

When: April 11-13, 2017

Where: Sheraton New Orleans Hotel
500 Canal St.
New Orleans, LA 70130

Background: The Wage and Hour Division’s Prevailing Wage Seminar is a free, three-day compliance training event designed for regional stakeholders (private contractors, state agencies, unions, federal agencies and workers). At these seminars, conference participants will learn about:

• Davis-Bacon and Related Acts.
• McNamara O’Hara Service Contract Act.
• Executive Order 13495 “Nondisplacement of Qualified Workers.”
• Executive Order 13658 “Establishing a Minimum Wage for Contractors.”
• The process of obtaining wage determinations and adding classifications.
• Compliance assistance and enforcement processes.
• The process for appealing wage rates, coverage, and compliance determinations.

Stakeholders and employers who wish to attend this event need to register here.

For any questions please send email to: WHD-PWS@dol.gov.