LONG ISLAND, N.Y. – An investigation by the U.S. Department of Labor’s Wage and Hour Division’s Long Island District Office has resulted in the recovery of more than $178,000 in back wages and damages for 95 nail salon workers underpaid between 2012 and 2015 at six Nassau and Suffolk County nail salons. In addition, the salons will pay $24,640 in civil monetary penalties as part of their settlement.

The latest investigation is part of the division’s ongoing strategic enforcement initiative to eliminate wage violations and help educate vulnerable workers in the low-wage, nail salon industry about their employment rights. The investigations revealed overtime and record-keeping violations of the Fair Labor Standards Act.

“Nail salon workers cannot afford to be underpaid,” said Irv Miljoner, director of the Wage and Hour Division’s Long Island District Office. “The industry employs vulnerable workers less likely to complain about unfair labor practices because of language barriers and fear of losing their jobs.”

Many nail salon workers are not paid overtime. Typically, they are paid a flat rate – in cash – for each day they work, in an attempt to avoid both paying overtime and keeping accurate time records. The Bureau of Labor Statistics reports annual average earnings for a manicurist in Nassau and Suffolk counties is $20,670 with an hourly wage of $9.94.

The settlements include the following salons:

• Nails & Relaxation Spa 1 in Copiague will pay 19 employees $31,365 in back wages and an equal amount in liquidated damages. The salon will also pay $5,544 in civil monetary penalties.
• M B Relaxation Spa in Massapequa will pay 13 employees $17,986 in back wages. The salon will also pay an additional $4,004 in civil monetary penalties.
• Nails & Relaxation Spa III in Bellmore will pay 27 employees $14,912 in back wages and an equal amount in liquidated damages. The salon will also pay an additional $8,316 in civil monetary penalties.
• Nails & Relaxation IV in Ronkonkoma will pay 13 employees $21,532.
• Nails & Relaxation V in Farmingville will pay six employees $9,045 in back wages and an equal amount in liquidated damages. The salon will also pay $1,848 in civil monetary penalties.
• Aegean Spa & Nails in West Babylon will pay 17 employees $14,384 in back wages and an equal amount in liquidated damages. The salon will also pay $4,928 in civil monetary penalties.

The Wage and Hour Division offers publications describing workers’ rights translated into many different languages, including Spanish, Vietnamese, Korean, Chinese, Thai, Haitian, Russian, Hmong, Tagalog, Polish, Brazilian Portuguese, Urdu, Hindi, Bahasa Indonesian, Somali, Samoan and Punjabi.

For more information about the FLSA, contact the division’s toll-free helpline at 866-4US-WAGE (487-9243) or its Long Island District Office at 516-338-1890. Information also is available at http://www.dol.gov/whd/.  

WASHINGTON – To ensure that federal contractors better comply with laws that protect their workers’ safety, wages and civil rights, the U.S. Department of Labor and the Federal Acquisition Regulatory Council today announced final regulations and guidance implementing the Fair Pay and Safe Workplaces Executive Order.

Signed by President Obama in July 2014, the order requires prospective federal contractors to disclose labor law violations and gives agencies more guidance on how to consider labor violations when awarding federal contracts. It directs the department and the council to issue regulations and guidance to implement the new requirements.

The regulations and guidance announced today are designed to increase efficiency and cost savings by ensuring that federal contractors are responsible and provide basic workplace protections. The guidance also creates a process for agencies and the department to help contractors come into compliance with labor laws. In crafting the final regulations and guidance, department and council received and considered thousands of comments from members of the public, including many in the contracting community.

“Federal contracts should deliver value for taxpayers in a way that is consistent with our nation’s values,” said U.S. Secretary of Labor Thomas E. Perez. “Contractors that illegally cut corners at the expense of their workers should not benefit from taxpayer-funded federal contracts. At the same time, employers who meet their legal responsibilities should not have to compete with those who do not. The regulations and guidance we are announcing today seek to ensure a level playing field for contractors and workers alike.”

Contractors are already required to disclose findings of fault and liability made in administrative or civil proceedings; however, current disclosures do not give a full picture of the contractor’s labor compliance track record and leave agencies vulnerable to making awards to contractors that cheat their workers, competitors and the taxpayers.

With the new rule phased in fully, prospective contractors will be required to disclose violations of 14 basic workplace protections from the previous three years – including those addressing wage and hour, safety and health, collective bargaining, family and medical leave, and civil rights protections. The final rule will make sure that federal agencies have the information they need to determine which contractors are meeting their responsibilities to workers.

In addition to setting up a process to effectively consider labor law violations, the order requires that contractors' employees are given the necessary information each pay period to verify the accuracy of their paycheck. It also ensures that workers who may have been sexually assaulted or had their civil rights violated get their day in court, putting an end to mandatory pre-dispute arbitration agreements covering these claims at large federal contractors.

To help contractors come into compliance with labor laws, the regulations and guidance build on the existing procurement system. Most federal contractors will only have to attest that they comply with laws providing basic workplace protections. Designated Agency Labor Compliance Advisors will be available to help contractors who do report violations and coordinate with the relevant enforcement agency experts to help them come into compliance.

The final regulations will be effective on Oct. 25, 2016, and be implemented in phases to give contractors time to understand their responsibilities.

• The final guidance is available at: https://www.federalregister.gov/articles/2016/08/25/2016-19678/guidance-fair-pay-and-safe-workplaces.
• The final regulations are available at: https://www.federalregister.gov/articles/2016/08/25/2016-19676/federal-acquisition-regulation-fair-pay-and-safe-workplaces  

The week of Sept. 12, 2016, the department will begin a pre-assessment process for contractors that anticipate competing for future federal contracts. The department will be available to discuss existing labor law violations and whether additional compliance measures are warranted. For information about the pre-assessment process, please visit: https://www.dol.gov/asp/fairpayandsafeworkplaces/PreAssessment.htm.

Further information on the final guidance and regulations as well as implementation and compliance can be found at: https://www.dol.gov/asp/fairpayandsafeworkplaces/.

Employer: Dinh Construction Corporation

Location: 2313 Hall Ave., Riverside, California

Investigation findings: An investigation by the U.S. Department of Labor’s Wage and Hour Division found that Dinh Construction violated the overtime provisions of the Fair Labor Standards Act when it failed to pay employees overtime at time-and-a-half for hours they worked beyond 40 per week. Instead, the employer paid overtime hours at straight time rates, with separate checks. In addition, the construction contractor failed to keep accurate records of the hours and wages paid, in violation of FLSA’s recordkeeping provisions.

Resolution: Dinh Construction has paid $65,087 in overtime back wages and an additional, equal amount of $65,087 in damages to 52 workers. The employer has also been assessed a $4,004 civil penalty because of the willful nature of the violations found.    

Quote: “Workers required to put extra hours must receive the overtime pay they rightfully deserve,” said Daniel Pasquil, district director of the Wage and Hour Division in West Covina. “Extra work equals extra pay. We are committed to leveling the playing field so that employers do not take shortcuts at the expense of their workers and other businesses don’t get placed at a competitive disadvantage in the marketplace.”

Information: Dinh Construction is an industrial and commercial construction contractor specializing in the transportation, installation, remodeling, and demolition of modular structures.

The FLSA requires that covered, nonexempt workers be paid at least the federal minimum wage of $7.25 per hour for all hours worked, plus overtime at one and one-half times their regular wages for hours worked beyond 40 per week. Employers also must maintain accurate time and payroll records. Employers are prohibited from retaliating against workers who exercise their rights under the law.

For more information about federal wage laws administered by the Wage and Hour Division, or to file a complaint, call the agency’s toll-free helpline at 866-4US-WAGE (487-9243). All services are free and confidential. Information also is available at http://www.dol.gov/whd/.

Read this news brief in Spanish.

COLUMBUS, Neb. – While some in charge at Daniels Produce LLC kept workers away from U.S. Department of Labor Wage and Hour Division investigators, others gathered the farm laborers and instructed them to tell federal authorities the company never paid them less than legally required wages. If the workers did not lie during their interviews, their employer threatened to send them home to Mexico and Guatemala and not invite them back to work in future growing seasons.

Despite their attempt to intimidate the workers and impede an investigation, the company will pay 89 Mexican and Guatemalan guest workers $250,000 in back wages for work at the Columbus produce farm. Daniels Produce will also pay $20,000 in civil penalties for violating provisions of the H-2A temporary worker visa program, which allows employers to bring nonimmigrant foreign workers to the U.S. for agricultural labor.

“Daniels Produce clearly intimidated these workers and violated the provisions of the visa program. Employers that attempt to circumvent the law gain an unfair advantage over their competitors,” said Karen Chaikin, regional administrator of the Wage and Hour Division in Chicago. “We are glad that these workers are getting the wages they worked so hard to earn, and that our enforcement tools can protect not only workers’ rights, but also level the playing field for growers who play by the rules.”

Investigators found Daniels Produce violated the H-2A visa provisions by:

• Falsifying records to indicate they paid the legally required minimum wage for workers under the visa program.
• Giving preferential treatment to H-2A workers,  paying them more than others, including U.S. citizens, employed in similar jobs.
• ­Failing to reimburse H-2A workers for the cost of their inbound/outbound transportation and subsistence expenses.
• Failing to provide complete earning records to employees.
• Failing to properly insure vehicles used to transport workers.

The company employed the workers during the 2012 and 2013 seasons to pick and pack produce grown in its 500-acre fields near Columbus.

Before the U.S. Citizenship and Immigration Services can approve an employer’s petition for H-2A visa workers, an employer must file an application with the department stating that there are not sufficient workers who are able, willing, qualified and available, and that the employment of nonimmigrant, temporary workers will not adversely affect the wages and working conditions of similarly employed U.S. workers. The law provides for numerous worker protections and employer requirements with respect to wages and working conditions that do not apply to nonagricultural programs.

For fiscal year 2015, the department has processed more than 6,700 H-2A applications.

Visit http://www.dol.gov/whd or call the division’s toll-free helpline at 866-4US-WAGE (487-9243) for more information.

ALBUQUERQUE, N.M. – The U.S. Department of Labor’s Wage and Hour Division is conducting survey of building and heavy construction projects in seven New Mexico 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 active building and heavy construction projects statewide from March 1, 2015, to Feb. 29, 2016. The survey is not limited to federally funded projects.

“Survey participation is crucial to the process, and should reflect the wages and fringe benefits paid to construction workers in the county where they work. To ensure workers are paid fairly and legally, we need the full participation of New Mexico’s construction industry community,” said Betty Campbell, the Wage and Hour Division’s regional administrator in the Southwest.

Without a high level of survey participation, the state’s wage rates will not reflect actual wages and will prevent proper wage determinations, 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 seven counties affected by the survey are: Dona Ana, Bernalillo, Sandoval, Torrance, Valencia, San Juan and Santa Fe.

The division urges industry employers to participate to:

• Ensure Davis Bacon wage rates and fringe benefits represent a truly prevailing wage.
• Level the playing field for all contractors bidding on federally funded construction

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 Dec. 2, 2016, to be included in the survey. Participants may also complete the survey online at http://www.dol.gov/whd/programs/dbra/wd10/index.htm.

You do not need a letter to answer the survey. If you would like to participate, or have questions regarding the survey process and forms, contact Craig L. Jackson at (214) 749-2021.

Employer: Unique Custom Exteriors

Site: 9326 South Hawley Park Road #A, West Jordan, Utah 84088

Investigation Findings: A U.S. Department of Labor Wage and Hour Division investigation found Unique Custom Exteriors violated the overtime provisions of the Fair Labor Standards Act. The investigation by the division’s Salt Lake City District Office revealed the employer failed to pay for all of the overtime hours employees worked.  Specifically, the employer reduced the total number of overtime hours worked by one-third on the payroll.

Resolution: The construction contractor paid $31,833 in back wages for unpaid overtime and an equal amount in liquidated damages, for a total of $63,666 to 27 employees. The company agreed also to comply with all provisions of the FLSA in the future. 

Quote: “Construction workers have some of the toughest jobs in the country,” said Betty Campbell, regional administrator for the Wage and Hour Division in the Southwest. “Often doing hard work in harsh conditions, these employees deserve to be paid for all the time they spend working, including overtime.  Reducing the number of overtime hours worked by one third essentially eliminates the time-and-one half premium for those hours that the law requires.  The resolution of this case demonstrates that the division will root out and remedy these violations, protecting the workers and leveling the playing field for contractors who play by the rules.”

Background:  Unique Custom Exteriors specializes in stucco and other exterior surfaces on residential and commercial properties.   

Information: For more information about federal wage laws, call the Wage and Hour Division’s toll-free helpline at 866-4US-WAGE (487-9243) or its Salt Lake City District Office at 801 524-5706. Information is also available at http://www.dol.gov/whd/.

DENVER – Officials from the U.S. Department of Labor and the U.S. Department of Housing and Urban Development signed a Memorandum of Understanding to help stop the misclassification of workers in Colorado, Montana, North Dakota, South Dakota, Utah and Wyoming.

The first MOU of its kind represents a new effort on the part of the agencies to work together to protect employee rights and level the playing field for responsible employers by reducing the practice of misclassification.

In Fiscal Year 2015, the department’s Wage and Hour Division recovered more than $74 million in back wages for more than 102,000 workers in industries, such as janitorial, food, construction, daycare, hospitality and garment. The division regularly finds low-wage workers are victims of misclassification.

“The Wage and Hour Division stands together with the U.S. Department of Housing and Urban Development to protect workers and responsible employers and ensure everyone has the opportunity to succeed,” said Dr. David Weil, administrator of the Wage and Hour Division. “Misclassification deprives workers of rightfully earned wages and undercuts law-abiding businesses.”

The agreement will help both agencies communicate and cooperate more effectively and efficiently in areas of common interest, including cross training staff and providing employers and employees with information about the law. By doing so, the two agencies seek to protect the wages, safety, and health of America’s workforce by sharing information.

“In recent years, our division has worked with partners like HUD to address the problem of employee misclassification in the construction industry,” said Betty Campbell, the Wage and Hour Division’s regional administrator for the Southwest. “The MOU we announce today allows us to work more closely to educate workers and employers and improve compliance in the industry.”

“Region 8 is proud to strengthen our partnership and collaboration with the U.S. Department of Labor,” said HUD Regional Administrator Rick M. Garcia. “With all the complexities of labor laws and labor standards impacting new residential construction today, working closely with the department provides our customers and our staff with more efficient and effective means for success.”

While legitimate independent contractors are an important part of the national economy, misclassification of employees is a serious problem. Workers misclassified as independent contractors are often denied access to critical benefits and protections, such as family and medical leave, overtime compensation, minimum wage pay and unemployment insurance, to which they are entitled. In addition, misclassification cheats law-abiding business owners, who often find it difficult to compete with those who are skirting the law. More information is available on the Department of Labor’s misclassification website at http://www.dol.gov/misclassification/.

To learn more about the FLSA’s requirements, call the Wage and Hour Division’s toll-free hotline at 866-4US-WAGE (487-9243) or visit its website at http://www.dol.gov/whd/.

Employer name: Makin’ Choices Inc.

Investigation site: 2000 Chapel Hill Road, #23, Durham, North Carolina 27707

Investigation findings: Investigators from the U.S. Department of Labor’s Wage and Hour Division found that Makin’ Choices and its owner, Rachelle Brooks-Blue and manager Lamont Adams, violated the anti-retaliation provision of the Fair Labor Standards Act.

Specifically, the department alleges that the employer demanded two workers return back wage payments they received from an earlier division investigation. As a result of the earlier investigation, the employer entered into a settlement and compliance agreement to pay over $100,000 for overtime and minimum wage violations. Employed as habilitation specialists, the workers refused to return the back wage payments and the employer reduced their pay to recover the money. The demand to return the back wages and reduction in pay violate the anti-retaliation provisions of the FLSA.

Resolution: On Aug. 17, 2016, the department filed a complaint in the U.S. District Court for the Middle District of North Carolina, Durham Division, against Makin’ Choices Inc., its owner and its manager. The agency is seeking to compel the employers to pay the two employees, who were retaliated against, back wages and an additional equal amount in liquidated damages. When conducting the investigation regarding retaliation, the agency discovered that the employers continued to violate of FLSA overtime regulations. These new violations resulted in four employees, including the two employees retaliated against, being due overtime back wages and liquidated damages.

The division’s Raleigh District Office conducted the investigation and the department’s Atlanta Regional Office of the Solicitor is litigating the case.

Quote: “We look forward to helping these workers find justice and will continue to protect the rights of all workers to speak up,” said Wayne Kotowski, regional administrator for the Wage and Hour Division in Atlanta. “Employers must understand they cannot retaliate against an employee who has been wronged. We will continue to use every tool we have to make that clear. Shorting workers once is bad enough, but we simply will not tolerate attempts to retaliate after we’ve stepped in to recover the wages they’ve worked so hard to earn.”  

Based in Fayetteville, Makin’ Choices provides mental health and therapeutic support services. The employer also operates a facility in Durham.

The FLSA states that it is a violation for any person to discharge or in any other manner discriminate against any employee because such employee has filed any complaint or instituted or caused to be instituted any proceeding under or related to this Act, or has testified or is about to testify in any such proceeding, or has served or is about to serve on an industry committee.

Court: U.S. District Court for the Middle District of North Carolina, Durham Division

Case Number: 1:16-cv-01065

ST. LOUIS – Significant minimum wage and overtime violations found at three hotels owned by SASAK Corporation, led the company to sign a settlement agreement with the U.S. Department of Labor’s Wage and Hour Division. The agreement requires the St. Louis-area property manager, developer and investor to pay $200,000 in back wages and damages to 51 housekeepers, front desk clerks and laundry service employees. SASAK will also make significant changes in its business practices to ensure compliance with the Fair Labor Standards Act.

Investigators found violations at two St. Louis hotels, the Super 8 on Charles Rock Road and the Robinson Motel on Page Avenue; and at the Howard Johnson hotel on East Diamond Drive in Salina, Kansas – all of which are owned and controlled by SASAK.  

The investigations found SASAK violated minimum wage, overtime and recordkeeping requirements of the FLSA at the three properties when it labeled housekeepers and front-desk employees as managers, and then payed them flat salaries without regard to the number of hours they worked. Minimum wage violations resulted when those salaries, divided by the number hours employees actually worked, failed to cover all of their hours at the federal minimum wage of $7.25 per hour. Overtime violations occurred when the employees worked more than 40 hours in a week yet the employer failed to pay an overtime premium. Many of these workers resided on the premises and were expected to be available around-the-clock. Other housekeepers were paid on an hourly or piece rate (per room) basis, and were denied minimum wage and overtime when the employer failed to record or pay for all of the hours that they worked, as required by law.  

“The resolution of this investigation is a win for workers and for law-abiding employers,” said Karen Chaikin, regional administrator for the Wage and Hour Division in Chicago. “The violations found in this case are all-too-common in the hotel industry, where we often find some of the most vulnerable workers we see. Simply paying workers a salary does not mean they are not entitled to minimum wage and overtime. This case sends a clear message that the Wage and Hour Division is committed to using every enforcement tool we have to ensure workers receive every penny they have rightfully earned, and that employers compete on a level playing field.”

The agreement requires the employer to implement enhanced FLSA compliance measures as part of its employment practices, including:

• Adding a notation to the required FLSA poster that informs employees of the name and telephone number of the local Wage and Hour office to call if they have questions regarding their rights under the FLSA.
• Training employees on the employer's record-keeping requirements.
• Providing Wage and Hour Division publications to employees to keep them informed of their rights.

Based in St. Louis, SASAK Corporation specializes in the acquisition, design, development, and management of more than 60 properties in its portfolio which includes shopping centers, office buildings, motels, vacant land, fast food restaurants, mini-storage facilities, gas stations and condominiums.

The FLSA provides an exemption from both minimum wage and overtime pay requirements for individuals employed in bona fide executive, administrative, professional and outside sales positions, as well as certain computer employees. To qualify for exemption, employees generally must meet certain tests regarding their job duties and be paid on a salary basis at not less than $455 per week. Job titles do not determine exempt status. In order for an exemption to apply, an employee's specific job duties and salary must meet all the requirements of the department's regulations.

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 hourly rates for hours worked beyond 40 per week. The FLSA provides that employers who violate the law are, as a general rule, liable to employees for their back wages and an equal amount in liquidated damages. Liquidated damages are paid directly to the affected employees. Additionally, the law requires employers to maintain accurate time and payroll records and prohibits retaliation against employees who exercise their rights under the law.

For more information about the FLSA, visit https://www.dol.gov/whd or call the division’s toll-free helpline at 866-4US-WAGE (487-9243).

Type of Action: Fair Labor Standards Act lawsuit filing 

Name of Defendants: Austin Electric Services LLC
Toby Thomas

Complaint: The U.S. Department of Labor has filed a lawsuit against Austin Electric Services, and its president Toby Thomas, after the department’s Wage and Hour Division investigators found the Phoenix-area residential electrical contractor violated the Fair Labor Standards Act’s provisions on overtime and recordkeeping. The latest investigation marks the third time in the past five years the department has found this employer in violation of federal labor laws.

Filed in the U.S. District Court for the District of Arizona, the complaint alleges the defendants willfully and repeatedly violated – and continue to violate – the FLSA’s overtime and recordkeeping provisions by failing to pay some electricians overtime. Instead, the firm pays workers a piece rate, without regard to how many hours they work.  The complaint also alleges that Austin Electric and Thomas knowingly provided the department with falsified records of hours worked. The department also alleges managers instructed electricians who worked between 45 and 70 hours per week to record only 40 hours or less of work on their timesheets.

Resolution: The complaint seeks the payment of overtime back wages and an equal amount in liquidated damages for 200 employees, and also asks the court to enjoin the company and its owners from violating the FLSA in the future.  

Quote: “We will not tolerate an employer that continues to violate the law and deprive workers of their hard-earned overtime wages,” said Eric Murray, director of the Wage and Hour Division’s district office in Phoenix. “The fact that we have found Austin Electric in violation multiple times in the last five years makes their actions all the more egregious. This lawsuit demonstrates that we will use every enforcement tool available to us, and that we will follow through to hold employers accountable and to ensure that workers are paid every penny they have rightfully earned.”  

Background: The division investigated Austin Electric in 2012 and found the employer misclassified field electricians and other workers as independent contractors. A 2013 follow-up investigation resulted in $23,885 in back wages due to 72 employees misclassified again as independent contractors. Most of the back wages due were the result of overtime violations. In 2013, Austin Electric also paid $9,424 in penalties for the willful nature of the violations found.

Information: 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, including commissions, bonuses and incentive pay for hours worked beyond 40 per week. Employers also must maintain accurate time and payroll records, and are prohibited from retaliating against workers who exercise their rights under the law.

For more information about federal wage laws administered by the Wage and Hour Division, or to file a complaint, call the agency’s toll-free helpline at 866-4US-WAGE (487-9243). All services are free and confidential.  Information also is available at http://www.dol.gov/whd/.

Read this news brief in Spanish.