Employer: Molina Healthcare of New Mexico Inc.

Site: 400 Tijeras SE, Suite 200, Albuquerque, New Mexico

Investigation Findings: A U.S. Department of Labor Wage and Hour Division investigation found Molina Healthcare of New Mexico Inc. violated the overtime provisions of the Fair Labor Standards Act. The employer incorrectly applied an exemption from the FLSA’s overtime requirements, meant for salaried executive, administrative and professional employees, to case managers. To meet the criteria for exemption, employees must be paid a minimum guaranteed salary, and must perform job duties specific to that exemption. While case managers working for Molina Healthcare met the salary requirement, their job duties did not support the employer’s determination that these employees were exempt from overtime.

Resolution: Molina Healthcare of New Mexico will pay $701,855 in back wages to 409 employees, and will provide training to their managers on this issue.

Quote: “Denying workers their hard-earned overtime pay not only hurts them and their families, it also places law-abiding employers at a competitive disadvantage,” said Betty Campbell, regional administrator for the Wage and Hour Division in the Southwest. “This case should encourage other employers in this industry to take a close look at their own pay practices to ensure they are not paying workers in violation of the law. We will continue to educate employers and to conduct investigations to ensure workers receive a fair day’s pay for a fair day’s work.”

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

Employer: Federico’s Mexican Food Restaurant

Sites: 4014 North 43 Avenue, Phoenix, Arizona
3730 West Happy Valley Road, Suite 109, Glendale, Arizona
20429 North Lake Pleasant, Suite 101, Peoria, Arizona
7410 South 35 Avenue, Laveen, Arizona

Investigation findings: An investigation by the U.S. Department of Labor’s Wage and Hour Division found that four locations of the Federico’s Mexican Food restaurant chain failed to pay the additional half-time for each hour worked beyond 40 in a work week, as required by the Fair Labor Standards Act. The employer paid hourly employees overtime hours at straight time, in cash, and off the record. The company also failed to pay overtime for the combined hours worked at multiple locations during the same week. Some of the employees worked an average of 48 hours per week for $8 per hour with no overtime. In addition, Federico’s failed to keep accurate records of the hours and wages paid, also in violation of FLSA’s recordkeeping provisions.

Resolution: Federico’s Mexican Food admitted to willfully violating the FLSA’s overtime and recordkeeping provisions. In a consent judgment filed in the U.S. District Court for the District of Arizona on May 20, a judge ordered the restaurant chain to pay $101,175 in overtime back wages and an equal, additional amount in damages to 48 employees. The judgment requires the restaurants to improve their system to record hours worked, to provide employees with pay stubs that clearly show the number of hours worked and wages paid per period, and to distribute employee handbooks that include fact sheets from U.S. Labor Department and contact information for the Wage and Hour Division.    

Quote: “Wage violations, especially with overtime, are far too common in the restaurant industry,” said Eric Murray, district director for the Wage and Hour Division in Phoenix. “We will continue to ensure that workers get paid all the wages they rightfully earn, even if some employers use tactics such as paying cash and off-the-books to avoid what is required by law.”

The department’s regional office of the solicitor litigated the case.

Federico’s Mexican Food has 21 locations in Arizona and three in New Mexico.

Information: 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/.

SEATTLE – The next time you enjoy an apple, a pear, a cherry or some other fruit, think for a moment about the people whose labor brought it to your table. From sun-up to sundown, these men and women exchange low wages earned in fields and packing houses for hard work and sore bodies.

The U.S. Department of Labor’s Wage and Hour Division ensures workers like these receive the wages, protections and benefits to which they are entitled by law. Since 2014, the division has engaged in an ongoing enforcement initiative focused on ensuring that agricultural employers in the Northwest comply with federal labor laws.

In Washington State, results of those efforts to date include the recovery of $318,000 in unpaid wages and damages for thousands of farmworkers. In dozens of agricultural facilities statewide, investigators have found growers and fruit packing facilities violating federal pay and recordkeeping requirements. The division has recouped back wages and damages from some of Washington’s largest fruit processing facilities, including Wenatchee’s Stemilt Growers, Yakima’s Borton Fruit and Cowiche’s Strand Apples. In these cases, the division has also collected $25,000 in penalties.

“Employers need to pay these hardworking men and women, who help put food on the tables of millions of American households, what they have rightfully earned,” said Jeanette Aranda, district director for the Wage and Hour Division in Seattle. “When these workers are shorted, it not only hurts them and their families, it also creates a competitive disadvantage for growers who pay their employees properly and play by the rules. We remain committed to protecting the rights of these often vulnerable workers, and to ensuring a level playing field.”

At peak harvest, packers and sorters work six to seven days per week readying cherries, apples, pears and other produce to ship to market. Federal investigators found many employers failed to pay workers for time spent prepping boxes or waiting for machines to be repaired. They also found employers denying pay to farmworkers for time spent traveling to and from the orchards during the workday, and for time spent in required training.

In addition to wage violations, investigators have found many growers failed to notify workers of federal worksite rights and to provide migrant farmworkers with written terms and conditions of employment when they recruited them.

The division administers many laws that extend various protections to different types of agricultural workers. They include:

• The Fair Labor Standards Act contains federal minimum wage, overtime, recordkeeping and child labor requirements for covered employers.
• The Migrant and Seasonal Agricultural Worker Protection Act protects agricultural workers by establishing employment standards related to wages, housing, transportation, disclosures and recordkeeping. The act also requires farm labor contractors and their employees to register with the U.S. Department of Labor and to obtain special authorization before housing, transporting or driving covered workers.
• The H-2A visa program establishes standards related to recruitment, wages, housing, transportation and recordkeeping for employers of temporary non-immigrant agricultural workers admitted to the country under the Immigration and Nationality Act.

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/.

Read this news release en españól.

NEW YORK – The U.S. Department of Labor has recovered $189,000 in unpaid wages and overtime for 28  carpenters and laborers who worked on the federally funded West 131st St. Cluster Project in Harlem between April 2009 and April 2010. This was the result of a joint enforcement effort with the office of New York Attorney General Eric Schneiderman in which the two agencies shared information and worked collaboratively on behalf of workers in New York. The attorney general’s investigation continues.

“Contractors on federally funded construction projects commit to paying their workers the required wages and fringe benefits when they bid these contracts. When, as in this case, they cheat their workers, they are also cheating the taxpayers who ultimately fund these jobs,” said Wage and Hour Division Regional Administrator Mark Watson, Jr. “As the resolution of this case demonstrates, we will not tolerate such illegal behavior.”

“We thank Attorney General Schneiderman and his staff for working jointly with us during the prosecution of this case. We have the mutual goals of ensuring that employees in our jurisdictions are paid and treated properly and employers who underpay their workers do not secure an unfair advantage over law-abiding employers,” said Jeffrey S. Rogoff, the department’s regional solicitor in New York.

An investigation by the department’s Wage and Hour Division found that SJ Insulation Corp., a second-tier subcontractor hired to perform all carpentry work on the gut rehabilitation of a five-story apartment building, failed to pay its workers the prevailing wages, overtime, and fringe benefits required by law. In addition, SJ Insulation submitted falsified certified payroll records to the government and failed to maintain accurate and complete payroll records.

Specifically, the division found that SJ Insulation submitted numerous certified payrolls to the government falsely claiming that it employed only two unskilled laborers and a single carpenter at the five-story building, and that these workers were paid the legally required prevailing wages of $33.59 per hour and $40.25 per hour, respectively, plus fringe benefits. In fact, SJ Insulation employed at least 28 workers over the course of the project. The division determined that SJ typically paid these workers only about $10 per hour, and failed to pay any fringe benefits. In addition, the employer paid 13 of these employees straight time for overtime hours worked. It also determined that SJ Insulation and its owner committed these acts willfully. After SJ failed to defend itself in court, an administrative law judge ordered that the company be debarred from working on federally financed projects for a period of three years. 

The division also found that the project’s general contractor, A. Aleem Construction Inc., and its prime contractor, West 131^st Street Development Corp., were responsible for the payment of back wages. West 131 did not contest these findings. Under the Davis-Bacon and Related Acts, prime contractors are responsible for ensuring that their subcontractors comply with the acts’ requirements.

The department has secured a consent findings and order with its Office of Administrative Law Judges under which Aleem Construction agrees to release $189,000 in withheld funds to the Wage and Hour Division, which will distribute the monies to the 28 affected workers. The order became final on March 1, 2016.

The Davis-Bacon and Related Acts and the Contract Work Hours and Safety Standards Act require that employees on federally funded construction projects receive the locally prevailing wages and fringe benefits for the jobs they perform and that they also receive overtime when they work more than 40 hours per workweek.

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/.

Read this news release en españól.

Employer names: MV Petro LCC, doing business as, End of the Road Chevron
JJB Petro LCC, doing business as, Country Freeze Food Mart

Investigation sites: 3565 Laurendine Road, Theodore, Alabama 36582
3860 Turnbull Court, Mobile, Alabama 36619

Investigation findings: Investigators from the U.S. Department of Labor’s Wage and Hour Division, Birmingham District Office, found violations of the overtime and recordkeeping provisions of the Fair Labor Standards Act. Both locations are owned and operated by the same owner under different corporate names.

The employer paid workers at straight time, in cash off the books, for hours worked beyond 40 in a workweek, instead of overtime at time-and-one- half their hourly rates as the law requires.  This practice violated not only the overtime provisions, but also the recordkeeping provisions of the FLSA, because the employer failed to maintain payroll records reflecting all hours worked, or the cash payments.

Resolution: The employer has agreed to comply with the FLSA. End of Road Chevron will pay four employees $13,928 plus an equal amount in liquated damages; totaling $27,856. Country Freeze Food Mart will pay three employees $22,037 plus an equal amount in liquidated damages; totaling $44,074.

Quote: “Our data shows us that violations like these are all too common in the convenience store industry. We are focusing our resources to ensure these vulnerable workers receive every penny they rightfully earn,” said Kenneth Stripling, the Wage and Hour Division’s district director in Birmingham.  “Other employers who may be paying in a similar manner should take note of this case, and other workers who are being shorted are encouraged to give us a call.”

Information: 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 of pay for hours worked beyond 40 per week. Employers are prohibited from retaliating against workers who exercise their rights under the law.

For more information about the FLSA and wage laws or to file a complaint, call the Wage and Hour Division’s toll-free helpline at 866-4US-WAGE (487-9243); the Birmingham District Office at 205-536-8570 or visit http://www.dol.gov/whd/. 

Employer name: Perfect Service Excellent Benefits Services Inc.

Investigation site: 7475 West Irlo Bronson Memorial Highway, Kissimmee, Florida 34747

Investigation findings: Investigators from the U.S. Department of Labor’s Wage and Hour Division, Jacksonville District Office, found that Perfect Service Excellent Benefits Services, a staffing agency that provides workers to the Knights Inn Maingate in Kissimmee, violated the overtime and recordkeeping provisions of the Fair Labor Standards Act.

The employer misclassified employees working as housekeepers, laundry, maintenance and front desk personnel as independent contractors, instead of employees. Some housekeepers working up to 48 hours a week were paid a piece rate, earning a set amount for each room they cleaned without regard to the number of hours that they worked, resulting in overtime violations when they worked more than 40 hours in a week. Hourly paid employees were paid straight time for their overtime hours. The employer also failed to maintain required time and payroll records.     

Resolution: The employer will comply with the FLSA, will pay $12,442 in unpaid overtime wages to 15 employees, and will also pay the workers an equal, additional amount in liquidated damages, totaling $24,884. The division also assessed the employer $7,012 in civil money penalties for the willful and repeat nature of the violations. The division found similar violations of the company in prior investigations.

Quote: “Misclassification of employees as independent contractors is all too common in the hotel industry. It denies employees their rights to critical benefits and protections, such as overtime compensation, family and medical leave, unemployment insurance and safe workplaces protections,” said Daniel White, district director for the Wage and Hour Division in Jacksonville. “The agency is committed to improving compliance in this industry by conducting thorough investigations that ensure workers receive the wages they’ve earned and stop employers who undercut competitors that play by the rules. This investigation is typical of those we refer to our partner agencies for investigation under their laws as well, to fully address these types of violations.”

Information: The division has agreements with 29 states, including Florida, to combat misclassification of employees as independent contractors to ensure workers’ get the wages, benefits and protections to which they are entitled.

More information regarding the Department of Labor’s initiative to combat the misclassification of employees as independent contractors can be found at http://www.dol.gov/whd/workers/Misclassification/index.htm. The FLSA requires that covered, nonexempt employees be paid for all hours worked, plus time and one-half their regular rates of pay for hours worked beyond 40 per week. Employers are prohibited from retaliating against workers who exercise their rights under the law.

For more information about the FLSA and wage laws or to file a complaint, call the Wage and Hour Division’s toll-free helpline at 866-4US-WAGE (487-9243); the Jacksonville District Office at 904-359-9292 or visit http://www.dol.gov/whd/. 

Who: U.S. Department of Labor’s Wage and Hour Division

What: Seminar on prevailing wage requirements in federal contracts and service agreements

When: Tuesday, June 14, 2016: Check-in at 8 a.m., presentation from 9 a.m. to 4:30 p.m.
Wednesday, June 15, 2016: 9 a.m. to 4:30 p.m.
Thursday, June 16, 2016: 9 a.m. to 4:30 p.m.
(All times are MDT.)

Where: Hotel Cascada
2500 Carlisle Blvd. NE
Albuquerque, NM 87110

Background: The U.S. Department of Labor’s Wage and Hour Division will offer a comprehensive compliance seminar for federal contractors, unions and employees to provide information on the rules governing prevailing wage requirements under:

• The Davis-Bacon and Related Acts.
• The McNamara-O’Hara Service Contract Act.
• Executive Order 13495 wage rules for Nondisplacement of Qualified Workers.
• Executive Order 13658 to establish a Minimum Wage for Contractors.

This three-day event is free and open to the public. Preregistration is required. To register, visit  https://www.eventbrite.com/e/prevailing-wage-seminar-tickets-24570202136 and complete a registration form.

For more information on DBRA, SCA and other federal wage laws related to government contracts administered by the Wage and Hour Division, call the department’s toll-free helpline at 866-4US-WAGE (487-9243) or visit the agency’s website at http://www.dol.gov/whd/.

Type of Action: Fair Labor Standards Act consent judgment

Defendant(s): Expertize Masonry Inc., Pawel Walaszek

Investigation Findings: An investigation conducted by the department’s Wage and Hour Division found that Elmwood Park, Illinois-based Expertize Masonry Inc., and Walaszek violated the Fair Labor Standards Act’s minimum wage, overtime and recordkeeping provisions when they misclassified employees working as laborers, masonry workers, crew leaders and foreman on masonry jobs in the Chicago area as independent contractors.

Investigators found the misclassification resulted in workers receiving less than the legally required federal minimum wage, and led to the employer’s failure to pay the workers overtime when they worked more than 40 hours in a workweek. Additionally, the employer failed to maintain accurate time records as required by the FLSA.

Resolution: The U.S. Department of Labor has obtained a consent judgment in federal court ordering Expertize Masonry Inc. and its owner, Pawel Walaszek to pay 20 workers a total of $104,115, which includes $52,057 in back wages for minimum wage and overtime violations, plus an equal amount in liquidated damages.

The defendants have also agreed to classify their workers as employees, to abide by the requirements of the FLSA in the future and to:

• Employ an accounting firm to audit its pay practices for two years;
• Provide each current and future employee information on the FLSA in Polish and English, and to provide them with the local telephone number of the Wage and Hour Division; and
• Provide detailed wage statements each pay period, allowing workers to verify their hours worked, earnings, and pay.

Quote:  “Misclassification is a serious issue that we see far too often,” said Thomas Gauza, district director for the Wage and Hour Division in Chicago. “These employees worked long hours without receiving minimum wage or overtime. This is illegal and unacceptable. Misclassification deprives workers of rightfully earned wages and undercuts law-abiding businesses. This judgment sends a clear message to employers that you cannot simply label employees as independent contractors to avoid paying overtime and other required benefits to your employees.”

Court: U.S. District Court for the Northern District of Illinois, Eastern Division

Docket Number: 1:15-cv-1745

Employers: Harold E. Nutter & Son Inc., an electrical federal contractor

Sites: Napa Valley Wine Train Relocation Project, Napa, California
Beale Air Force Base, Child Development Center, Beale AFB, California
Folsom Dam Project, Folsom, California
Beale Air Force Dock 4 Repair, Beale AFB, California
Beale Air Force Base Dock 1, Beale AFB, California
Ft. Irwin Barracks Complex, Ft. Irwin, California
U.S. Armed Forces Reserve Center, Vancouver, Washington

Investigation findings: An investigation by the U.S. Department of Labor’s Wage and Hour Division found that Harold E. Nutter & Son Inc. failed to pay the prevailing wages required by the Davis-Bacon Act to 58 employees working on seven federally funded construction projects, six in California and one in Washington. The electrical contractor also failed to meet the terms and conditions of the apprenticeship training plan, which required Nutter & Son to enroll apprentices in a health insurance plan. Additionally, the firm improperly charged training program costs to the journeymen working on the projects.

Resolution: Nutter & Son will pay $385,000 to 58 workers to remedy the violations. The contractor also has agreed to comply with all applicable labor standards in any future contract.

Quote: “In this competitive contracting environment, no contractor should gain an economic advantage by paying workers below the required wages and fringe benefits on a prevailing wage projects,” said Rick Newton, district director for the Wage and Hour Division in Sacramento. “Government contracts specify in detailed language how pay and benefits are to be determined, and employers are required to follow these rules so workers are paid correctly.  Contractors are well aware of these obligations when they bid, and when the contracts are awarded. Enforcement of the prevailing wage laws levels the playing field for all contractors.”

Information: The Davis-Bacon Act requires all contractors and subcontractors performing work on federal and certain federally funded projects to pay their laborers and mechanics the proper prevailing wage rates and fringe benefits as determined by the secretary of labor. On a Davis-Bacon Act project, the prime contractor is responsible for the compliance of subcontractors and lower-tier subcontractors. 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/.

Employers: Sanchez Recycling, Inc.

Sites: 2018 East Orangeview, Placentia, California (Main office/yard)
1459 South Anaheim Blvd., Anaheim, California
1130 West 6^th St., Corona, California
2560 North Perris Blvd., Perris, California

Investigation findings: Investigators with the U.S. Department of Labor’s Wage and Hour Division found that Sanchez Recycling, Inc. violated the Fair Labor Standards Act’s overtime and recordkeeping provisions.  Specifically, the employer paid some employees flat salaries, in cash, regardless of how many hours they worked. This created overtime violations when they worked more than 40 hours in a week without the proper payment. The employer also failed to pay other workers for some overtime hours at all, and paid for others at straight time rates. Sanchez also failed to keep accurate records of the hours its employees worked.

Resolution: The company will pay $56,953 in back overtime wages and an equal, additional amount in damages to seven employees.  

Quote: “Sanchez Recycling showed complete disregard for the most basic worker protections,” said Rodolfo Cortez, director of the Wage and Hour Division’s San Diego District Office. “These employees worked long hours and this employer routinely shorted their pay, hurting not only the workers themselves but also their families and their communities. The resolution of this case should send a clear message to others in this industry who may be paying workers in a similar manner – the Wage and Hour Division will use every tool available to ensure that workers are paid every penny they’re owed.”  

Background:  The department issued a press release in 2015 chronicling the high rates of wage and hour violations in Southern California’s recycling industry.

Information: 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/.