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/.

Type of Action: Fair Labor Standards Act consent judgment

Name of Defendants: H&H Lawn Service and Snowplowing LLC, Muskegon, Michigan
Darrell Hinken

Investigation Findings: An investigation by the U.S. Department of Labor’s Wage and Hour Division found the company and its owner Darrell Hinken violated the FLSA’s overtime and record keeping provisions. 

Specifically, the employer:

• Misclassified some employees as independent contractors instead of employees, and subsequently failed to pay them overtime when they worked more than 40 hours in a week.
• Paid some employees a flat salary, without regard to the number of hours they worked; this led to overtime violations when they worked more than 40 hours per week.
• Banked overtime hours for some employees, to be paid out in future workweeks at straight time, rather than paying overtime in the pay period during which the hours were worked.
• Failed to keep required payroll records.

Resolution: Under terms of a consent judgment entered into U.S. District Court for the Western District of Michigan, Southern Division, H&H Lawn Service and Snowplowing will pay a total of $38,000 in back wages and liquidated damages to 11 employees.

The company has agreed to abide by the FLSA in the future and specifically to:

• Notify employees in writing if they are claiming an overtime exemption for them, and why.
• Provide Wage and Hour Division facts sheets to all employees, describing the definition of an employee versus an independent contractor, among other topics.
• Retain a certified public accounting firm to conduct an annual audit of the firm’s payroll practices to determine compliance with the FLSA.

Quote: “Banking of overtime and misclassifying employees as independent contractors occurs all too often in seasonal businesses such as lawn care and snowplowing,” said Mary O’Rourke, district director for the Wage and Hour Division in Grand Rapids. “These pay practices hurt workers, and give the employer an unfair advantage over businesses that play by the rules. This case demonstrates our commitment to using every tool available to us, including litigation, to ensure that these hard-working employees receive every cent they have earned.”

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.

Court: U.S. District Court for the Western District of Michigan, Southern Division

Docket Number: Perez v. H & H Lawn Service and Snowplowing LLC, et al.
1:15-cv-00197-PM

During an education and enforcement initiative, in addition to conducting investigations, the division conducts outreach events for employers and industry stakeholders to provide compliance assistance and information on legal rights and responsibilities. The initiatives also raise awareness among workers, community organizations and others regarding federal wage and hour laws and protections.

In 2014, the division began an education and enforcement initiative in the hospitality industry in Midwest college towns and resorts. Currently, the division is investigating restaurants and hotels in Madison, Wisconsin and Iowa City, Iowa. In the coming months, the effort will expand to other cities, and other states.  

Nationwide, the Wage and Hour Division recovered more than $38 million for 46,902 workers in the restaurant industry in fiscal year 2015.

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

Accessible and searchable information on enforcement activities by the department is available at http://ogesdw.dol.gov/homePage.php. For more information about the FLSA and other federal labor laws, call the division’s toll-free helpline at 866-4US-WAGE (487-9243) or its Kansas City Office at 913-551-5721. Information also is available at http://www.dol.gov/whd/.

Employer name: Street’s Seafood Restaurant

Investigation site: 251 Highway 31, Bay Minette, Alabama 36507

Investigation findings: Investigators from the U.S. Department of Labor’s Wage and Hour Division, Birmingham District Office, found that Street’s Seafood Restaurant violated child labor, minimum wage, overtime and recordkeeping provisions of the Fair Labor Standards Act. The restaurant employed four minors ages 15 to 17 to work regularly in occupations prohibited for any workers less than 18-years-old. Specifically, investigators found the employer:

• Required minors to operate, dismantle, clean and reassemble a meat slicer and a dough mixer.
• Required a 17-year-old to operate a motor vehicle to transport food to catering events.
• Required a 15-year-old to work more hours than allowed by law.
• Paid some workers only $6 per hour, below the required federal minimum wage of $7.25 per hour.
• Paid employees straight time for overtime when they worked more than 40 hours in a week, instead of paying them time-and-one-half, as the law requires.
• Failed to maintain proof of age of minors.
• Failed to maintain required time and payroll records.

Resolution: Street’s Seafood Restaurant will pay $14,288 in minimum wage and overtime back wages and an equal amount in liquidated damages totaling $28,577 to eight employees. Additionally, the employer was also assessed a civil money penalty of $14,125 for child labor violations.

Quote: “Employing young people provides valuable experience, but that experience must never come at the expense of their safety,” said Kenneth Stripling, director of the division’s Birmingham District Office. “Additionally, employers have an obligation to pay employees what they have legally earned. All workers deserve a fair day’s pay for a fair day’s work. Unfortunately, Street’s Seafood violated not only child labor laws, but has also shorted workers’ pay. The resolution of this case sends a strong message that we will not tolerate either of those behaviors.”

The FLSA establishes a minimum age of 18 for workers in those nonagricultural occupations that the secretary of labor declares to be particularly hazardous for 16- and 17-year-old workers or detrimental to their health or well-being. Youth ages 14 and 15 may be employed outside of school hours in a variety of nonmanufacturing, non-mining and non-hazardous jobs for limited periods of time and under specified conditions. These rules must be followed unless a specific exemption applies. A list of hazardous occupations prohibited for minors is available on the division’s website at http://www.dol.gov/elaws/esa/flsa/docs/haznonag.asp . More information on child labor rules can be found at http://youthrules.dol.gov/ or call the division’s toll-free helpline at 866-4US-WAGE (487-9243) for more information.

ARLINGTON, Va. – A suburban Washington, D.C.-area restaurant and its owners have entered into an agreement ensuring that they would not intimidate or retaliate against employees who cooperate with a U.S. Department of Labor wage and hour investigation and subsequent ongoing litigation. The owners also agreed to stop soliciting “waivers” from employees to relinquish their rights under the Fair Labor Standards Act.

The department obtained a consent order in the U.S. District Court for the Eastern District of Virginia prohibiting Aroma Indian Cuisine in Arlington from terminating employment; retaliating or discriminating against employees they believe have spoken with or will speak to federal Wage and Hour Division investigators; and asking employees to sign “waivers” of their FLSA rights.

The order also requires the defendants to allow a department representative to provide employees with an oral and written statement about their right to speak with investigators and participate in the litigation without fear of retaliation. The owners signed the statement and posted it at the restaurant.

“Our investigation concluded, and our suit alleges, that the owners failed to pay employees the wages they were owed. We also believe the owners attempted to use intimidation tactics to pressure employees to cease cooperating with our investigation,” said Mark Lara director of the Wage and Hour Division’s Baltimore District Office. “This case should send a strong message to employers: hindering an investigation by intimidating employees will not be tolerated, and will not prevent federal labor laws from being upheld.”

The division began an investigation of Aroma Indian Cuisine in August 2013 to confirm its compliance with FLSA provisions. After the investigation disclosed violations, and the department filed suit to enforce regulations, the restaurant’s employees reported to investigators that the business’ owner asked employees to sign waivers purportedly waiving their right to recover back wages under the FLSA and their right to participate in the investigation and ongoing litigation. Employees also reported feeling threatened for their potential involvement in the department’s case. 

Aroma Indian Cuisine is a full-service Indian food restaurant and catering service. The division’s area office in Arlington conducted the investigation. The department’s Regional Office of the Solicitor in Arlington is litigating the case.

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, including commissions, bonuses and incentive pay, for hours worked beyond 40 per week. These requirements may not be “waived” by employees. Employers are required to maintain accurate time and payroll records. Employers are prohibited from discharging or discriminating against an employee in any way because such employee has filed a complaint with the Wage and Hour Division or cooperated in an investigation.

For more information about the FLSA and other federal wage laws, call the Wage and Hour Division’s toll-free helpline at 866-4US-WAGE (487-9243) or its Arlington Area Office at (703) 235-1182. Information also is available at http://www.dol.gov/whd/.  

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Perez v. Aroma Indian Cuisine.
Civil Action Number:  1:15-cv-01259