Department of Labor recovers $127K in back wages, damages from San Diego cafe owner who denied overtime pay to 18 employees

News Release

Department of Labor recovers $127K in back wages, damages from San Diego cafe owner who denied overtime pay to 18 employees

Employer:     
Jimmy Carter’s Mexican Café LLC

3172 Fifth Ave.
San Diego, CA 92103 

Investigation findings: U.S. Department of Labor Wage and Hour Division investigators found Jimmy Carter’s Mexican Café and owner James Brennan Carter failed to pay employees, including waiters and cooks, the required overtime pay rates for hours over 40 in a workweek, a Fair Labor Standards Act violation. Investigators learned some of the employees worked up to 67 hours per week.

Back Wages Recovered:       $63,674 in unpaid wages and an equal amount in damages for 18 employees

                                                $7,263 in penalties for the reckless disregard of the law

Quote: “Restaurant employers such as Jimmy Carter’s Mexican Café cheat workers and commit wage theft when they refuse to pay employees’ earned overtime wages,” said Wage and Hour District Director Min Park-Chung in San Diego. “Cooks and servers often work long hours and, like all workers, must be paid in compliance with federal labor laws. Employers who undercut their workers’ wages will be held accountable.”

Background: Investigators learned about this employer’s illegal practices through the Employment Education and Outreach alliance, known as EMPLEO, that operates a multistate toll-free hotline to assist Spanish-speaking workers with workplace issues: 1-877-552-9832.

 Learn more about the Wage and Hour Division, including a search tool to use if you think you may be owed back wages collected by the division. Workers can call the Wage and Hour Division confidentially with questions – regardless of their immigration status – and the department can speak with callers in more than 200 languages.

Help ensure hours worked and pay are accurate by downloading the department’s Android and iOS Timesheet App for free, also available in Spanish.

Agency
Wage and Hour Division
Date
July 25, 2023
Release Number
23-1651-SAN
Media Contact: Michael Petersen
Media Contact: Jose Carnevali
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Workers underserved: Court requires six Connecticut restaurants, owners to pay $858K to 105 workers after Department of Labor investigation, litigation

News Release

Workers underserved: Court requires six Connecticut restaurants, owners to pay $858K to 105 workers after Department of Labor investigation, litigation

Employers withheld tips, wages, overtime from restaurant employees at six locations

HARTFORD, CT – A federal court has entered a consent judgment and order requiring six Connecticut restaurants and their owners to pay a total of $858,191 in back wages and liquidated damages to 105 employees after an investigation and litigation by the U.S. Department of Labor.

The restaurants are located in Darien, Fairfield, Greenwich, New Canaan, New Haven and Westport.

In November 2022, the U.S. District Court for the District of Connecticut granted the U.S. Secretary of Labor’s motion for partial summary judgment in its entirety, concluding that the employers violated the Fair Labor Standards Act’s overtime and recordkeeping provisions. The court awarded a total of $251,129 in back wages for overtime violations and held the employers liable for liquidated damages and forbid them from violating the FLSA’s overtime and recordkeeping provisions. 

After obtaining a favorable order on partial summary judgment, the department and the employers entered into a consent judgment. The judgment — entered by the court in February 2023 — requires the employers to pay additional back wages, withheld tips and liquidated damages owed for all remaining claims, including those for minimum wage, tip pool and other overtime violations. It also forbids the employers from violating the FLSA and provides for a consent writ of execution should the employers fail to comply with the consent judgment’s monetary terms. The judgment also incorporates the court’s summary judgment decision and requires the restaurants and their owners to pay a total of $858,191 in back wages, withheld tips and liquidated damages.

“These employers’ pay practices deprived workers of the full, hard-earned wages and tips on which they depend to help them support themselves and their families,” said Wage and Hour Division District Director Donald Epifano in Hartford, Connecticut. “While these types of violations are common in the restaurant industry unfortunately, they can be prevented with knowledge and compliance with the law.”

The case includes the following restaurants:

1077 LLC, operating as Scena Wine Bar and Restaurant, Darien

SL Restaurant Group LLC, operating as 55 Wine Bar, Fairfield

Greenwich Avenue Restaurant LLC, operating as Sundown, Greenwich

Siguenza LLC, operating as Cava Wine Bar and Restaurant, New Canaan

1104 Chapel Street LLC, operating as Harvest Wine Bar and Restaurant, New Haven

36 Railroad Place LLC, operating as Harvest Wine Bar and Restaurant Westport, Westport

“This case reflects the U.S. Department of Labor’s commitment to litigate aggressively, and secure back wages, tips and liquidated damages owed to workers,” said Regional Solicitor Maia Fisher in Boston.

“We encourage employers with questions and concerns about their responsibilities, and employees with questions about their rights under federal wage laws, to contact the Wage and Hour Division,” added Epifano.

The Fair Labor Standards Act establishes minimum wage, overtime pay, recordkeeping and youth employment standards affecting employees in the private sector and in federal, state and local governments. Covered nonexempt workers are entitled to a minimum wage of not less than $7.25 per hour. Overtime pay at a rate not less than one and one-half times the regular rate of pay is required for hours over 40 in a workweek. Learn about specific FLSA rules for the restaurant industry and tipped employees.

Learn more about the Wage and Hour Division, including a search tool to use if you think you may be owed back wages collected by the division. Employers and workers can call the division confidentially with questions, regardless of immigration status. The department can speak with callers in more than 200 languages through the agency’s toll-free helpline at 866-4US-WAGE (487-9243). Download the agency’s new Timesheet App for iOS and Android devices to ensure hours and pay are accurate, available in English and Spanish.

Secretary of Labor v. Siguenza LLC d/b/a Cava Wine Bar and Restaurant; 1077 LLC d/b/a Scena Wine Bar and Restaurant; 1104 Chapel Street LLC d/b/a Harvest Wine Bar and Restaurant; Greenwich Avenue Restaurant LLC d/b/a Sundown; 36 Railroad Place LLC d/b/a Harvest Wine Bar and Restaurant Westport; SL Restaurant Group LLC d/b/a 55 Wine Bar; Vicente Siguenza; Wilson Siguenza; Nube Siguenza; and Kleber Siguenza.

Civil Action No. 3:20-cv-01762-VLB

Agency
Wage and Hour Division
Date
July 25, 2023
Release Number
23-455-BOS
Media Contact: Ted Fitzgerald
Media Contact: James C. Lally
Phone Number
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Labor Department obtains judgment to recover $162K in back wages, damages from Reading assisted living facility for 20 employees denied full wages

News Brief

Labor Department obtains judgment to recover $162K in back wages, damages from Reading assisted living facility for 20 employees denied full wages

Employer name: Morris-Pace Assisted Living Inc., operating as Morris-Pace Personal Care Home, and located at 416 Reading Ave., Reading, Pennsylvania 19611

Court action: Consent judgment obtained on July 3, 2023, in the U.S. District Court for the Eastern District of Pennsylvania by the Department of Labor.

Investigation findings: The department’s Wage and Hour Division found the operator of a senior assisted living facility paid a semi-monthly salary to five workers employed as personal care assistants.

The affected employees received a lower salary due to the employer’s invalid reduction for monthly rent while residing in apartments connected to the facility. The employer failed to maintain records of the reasonable cost for furnishing the employees with lodging. By doing so, the facility violated federal law by allowing employees’ hourly wage to fall below the federal $7.25 per hour minimum wage. The division determined Morris-Pace owed these workers $21,931 in back wages.

Investigators also learned the employer paid 20 workers straight-time for all hours worked, including hours over 40 in a workweek, in violation of federal overtime requirements, and determined Morris-Pace owed these employees $59,194 in back wages.

Back wages and liquidated damages: $81,125 in back wages and $81,125 in liquidated damages

Workers affected: 20  

Civil money penalties: The department assessed $16,140 in penalties for the willful nature of the employer’s Fair Labor Standards Act violations, which Morris-Pace Assisted Living Inc. has paid.

Quotes:  “Morris-Pace Assisted Living’s failure to pay some workers minimum wage and their denial to pay others overtime pay for their hard work, made it more difficult for those care workers to care for their needs and those of their families,” said Wage and Hour Division District Director Alfonso Gristina in Wilkes-Barre, Pennsylvania. “The outcome of this investigation shows that employers who violate workers’ rights to be paid fully, often face costly consequences.

“Employers who disregard Fair Labor Standards Act provisions deliberately will discover that the U.S. Department of Labor does not tolerate wage theft and will use legal actions needed to uphold the law,” explained Deputy Regional Solicitor Samantha Thomas in Philadelphia.

Background: Started as a family business in 1968, Morris-Pace Personal Care Home provides room and board along with medical and personal care and daily living support.

For more information about the FLSA and other laws the division enforces, contact its toll-free helpline at 866-4US-WAGE (487-9243). Learn more about the Wage and Hour Division, including a search tool to use if you think you may be owed back wages collected by the division. Workers can call the Wage and Hour Division confidentially with questions or concerns – regardless of where they are from – and the department can speak with callers in more than 200 languages. Help ensure hours worked and pay are accurate by downloading the department’s Android and iOS Timesheet App for free.

 

Agency
Wage and Hour Division
Date
July 25, 2023
Release Number
23-1612-PHI
Media Contact: Joanna Hawkins
Media Contact: Leni Fortson
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US Department of Labor recovers $373K in back wages, damages from California staffing agency that denied overtime pay to 23 caregivers

News Release

US Department of Labor recovers $373K in back wages, damages from California staffing agency that denied overtime pay to 23 caregivers

Creative Living Solutions also assessed $17K in penalties for willful violations

SAN FRANCISCO – The U.S. Department of Labor has recovered $373,471 in back wages and damages for 23 caregivers after an investigation found a Bay Area staffing agency denied overtime wages to workers, some of whom worked 12 to 16 hours a day.

Investigators with the department’s Wage and Hour Division found that Creative Living Solutions Inc. in Union City paid employees straight-time rates for all hours worked, including overtime hours. By doing so, the employer, whose home care workers serve older adults and people with disabilities, failed to pay the required time-and-a-half overtime rates for hours over 40 in a workweek, a Fair Labor Standards Act violation.

The company and owner Nafisa Mohseni accepted the division’s findings, agreed to pay the back wages owed and changed their pay practices to avoid future FLSA violations.

“The U.S. Department of Labor is determined to recover full wages for workers when their employer fails to pay them as required,” said Wage and Hour Division District Director Susana Blanco in San Jose, California. “Care workers often work around-the-clock to meet the needs of people who depend on them, and they deserve to be paid properly for the long hours they spend on the job.”

In addition to recovering $186,735 in back wages and an equal amount in liquidated damages, the department assessed the employer $17,227 in civil money penalties for the willful nature of their violations.

Learn more about worker protections for care workers and the responsibility of employers to comply with federal minimum wage and overtime law.

Learn more about the Wage and Hour Division, including a search tool to use if you think you may be owed back wages collected by the division. Employers and workers can call the division confidentially with questions, regardless of where they are from. The department can speak with callers in more than 200 languages through the agency’s toll-free helpline at 866-4US-WAGE (487-9243). Download the agency’s new Timesheet App for iOS and Android devices – free and now available in Spanish – to track hours and pay.

Agency
Wage and Hour Division
Date
July 24, 2023
Release Number
23-1635-SAN
Media Contact: Michael Petersen
Media Contact: Jose Carnevali
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Department of Labor recovers over $66K in back wages for 20 workers after finding overtime, minimum wage violations at six Napa Auto Parts locations

News Brief

Department of Labor recovers over $66K in back wages for 20 workers after finding overtime, minimum wage violations at six Napa Auto Parts locations

Employer: Bellinger Parts Group Inc., operating as NAPA Auto Parts

Corporate location:  NAPA Auto Parts, 160 Bentree Lane, Florence, SC 29501                                

Sites investigated: NAPA Auto Parts, 612 Pearl St. Darlington, SC 29532

NAPA Auto Parts, 913 Highway 301 N. Dillon, SC 29536

NAPA Auto Parts, 116 3rd Loop Road Effingham, SC 29505

NAPA Auto Parts, 160 Bentree Lane Florence SC 29501

NAPA Auto Parts, 1016 S 5th St. Hartsville, SC 29550

NAPA Auto Parts, 1806 E. Highway 76, Marion, SC 29571

Investigation findings: U.S. Department of Labor Wage and Hour Division investigators found that Bellinger Parts Group Inc. — who operates the businesses as NAPA Auto Parts stores — made illegal deductions from employees’ pay at six South Carolina locations for store damage, cash register shortages and uniforms. These deductions caused some workers’ pay to fall below the $7.25 per hour federal minimum wage for all hours worked, a Fair Labor Standards Act violation.

Bellinger Parts Group also failed to pay non-exempt salary counter salespeople and delivery drivers overtime for hours over 40 in a workweek. Investigators also learned the employer did not include non-discretionary sales bonuses in some employees’ regular rate when calculating correct overtime rates, causing Bellinger Parts Group to pay overtime premiums at rates lower than required by law.

Back wages recovered: The division recovered $66,322 in back wages for 20 workers.                                               

Quote: “Employers who deny workers their full earnings make it harder for employees to provide for themselves and their families and give these employers an unfair advantage over law-abiding competitors,” said Wage and Hour Division District Director Jamie Benefiel in Columbia, South Carolina. “Other employers should use the outcome of this investigation as a reminder to review their pay practices to make certain they avoid violations that have costly consequences.”

Background: Employers can contact the Wage and Hour Division at its toll-free number, 1-866-4-US-WAGE. Learn more about the Wage and Hour Division, including its search tool to learn if you are owed back wages collected by the division and industry-specific toolkits, like the auto repair and maintenance compliance toolkit.

Keep track of hours and wages with the Wage and Hour’s new Timesheet App for Apple and android devices, available in English and Spanish.

Agency
Wage and Hour Division
Date
July 20, 2023
Release Number
23-1541-ATL
Media Contact: Erika Ruthman
Media Contact: Eric R. Lucero
Phone Number
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Department of Labor files suit after investigation found Grand Rapids restaurant owner withheld employees’ tips

News Brief

Department of Labor files suit after investigation found Grand Rapids restaurant owner withheld employees’ tips

26 employees owed more than $150K in minimum wage, overtime, liquidated damages

Employer:      The Saucy Crab Grand Rapids LLC operating as The Saucy Crab

                        5039 28th St. SE

                        Grand Rapids, MI

Investigation findings: On July 14, 2023, the Department of Labor filed suit against The Saucy Crab Grand Rapids LLC and owner, Jixi Qui, in the U.S. District Court for the Western District of Michigan seeking back wages and liquidated damages for 26 workers. An investigation by the department’s Wage and Hour Division found the restaurant used a tip pool illegally and denied employees correct minimum and overtime wages.

The department alleges the company owes $75,402 in back wages to the 26 workers after investigators found the company violated provisions of the Fair Labor Standards Act when they did the following:

  • Included the owner who served as manager, along with cooks and dishwashers in a tip pool customarily used for servers and bartenders.
  • Made illegal deductions from servers’ pay for uniforms, aprons, name tags, and lost items such as crab crackers, scissors and oyster forks, resulting in employees failing to earn minimum wage.
  • Failed to pay servers time and one-half their cash wage in periods when the employer claimed a tip credit. The employer should have paid time and one-half the employees’ regular hourly rate.
  • Paid cooks a flat rate, denying them overtime for hours over 40 in a workweek.
  • Failed to maintain any payroll records for at least two cooks.
  • Failed to pay one cook any wages.
  • Did not maintain accurate time records for employees from at least August 2020 until October 2022.

The suit also seeks an equal amount in liquated damages for employees and an injunction barring Qui from violating the FLSA in the future.                                               

Quote: “Our investigation found the owner of the Saucy Crab restaurant abused the rights of their employees by illegally taking tips from customers intended for servers and bartenders and by denying servers, cooks and dishwashers their fully earned wages,” said Wage and Hour Division District Director Mary O’Rourke in Grand Rapids, Michigan. “The Department of Labor will fight to protect the rights of restaurant industry workers who, in addition to being among the nation’s lowest paid people, may be vulnerable to wage theft because they might not know their rights and protections or be reluctant to exercise them.”

Background: The department’s Quick Service Restaurants Compliance Assistance Toolkit explains wage laws for the industry. Learn more about the Wage and Hour Division.

Agency
Office of the Solicitor
Date
July 20, 2023
Release Number
23-1633-CHI
Media Contact: Scott Allen
Phone Number
Media Contact: Rhonda Burke
Phone Number
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Court requires Virginia home care provider, owners to pay about $1.6M in back wages, liquidated damages to 202 employees willfully denied overtime

News Release

Court requires Virginia home care provider, owners to pay about $1.6M in back wages, liquidated damages to 202 employees willfully denied overtime

1st Adult & Pediatrics Healthcare Services must also pay $48K in penalties for violations

FAIRFAX, VA – A federal court has directed a Fairfax home care agency and its owners to pay more than $1.6 million in back wages and liquidated damages to 202 home health aides in a consent judgment obtained by the U.S. Department of Labor.

The action by the U.S. District Court for the Eastern District of Virginia follows an investigation of 1st Adult & Pediatrics Healthcare Services Inc. by the department’s Wage and Hour Division that found the company and its owners, Carolyn Bryant-Taylor and Kafomdi Josephine Okocha, willfully denied the affected workers overtime wages by paying them straight-time rates of pay for all hours worked, including hours over 40 in a workweek.

Investigators also learned the employers did not keep required payroll records, a violation of the Fair Labor Standards Act.

Despite the division’s findings, 1st Adult & Pediatrics Healthcare Services, Bryant-Taylor and Okocha refused to pay the back wages and damages owed to the workers. In September 2022, the department’s Office of the Regional Solicitor filed suit to recover the monies owed.

The court’s judgment required the employers to pay $834,782 in back wages and an equal amount in liquidated damages to the affected workers. They must also pay $48,675 in civil money penalties to the department for their intentional violations and must not violate the FLSA in the future.

“Hard-working home care aides provide essential services to people in need and deserve to be paid all their legally earned wages,” said Wage and Hour Division District Director Nicholas Fiorello in Baltimore. “Our investigation found the employers willfully disregarded the law and used pay practices that harmed their own employees.”

The division’s Baltimore District Office conducted the investigation. Senior Trial Attorney Alejandro Herrera in Region III’s Philadelphia office and Wage and Hour Counsel Angela France in the Arlington, Virginia, office litigated the case and secured the judgment.

“The U.S. Department of Labor will hold employers who fail to comply willfully with the Fair Labor Standards Act legally accountable,” said Deputy Regional Solicitor Samantha Thomas in Philadelphia. “The outcome of this investigation and litigation should send a clear signal to other home healthcare industry employers that we will not tolerate employees being shortchanged by illegal pay practices.”

Based in Fairfax, 1st Adult & Pediatrics Healthcare Services Inc. provides skilled nursing and pediatric care services in residential settings in Virginia.

Learn more about worker protections for care workers and the responsibility of employers to comply with federal minimum wage and overtime law.

For more information about the FLSA and other laws the division enforces, contact its toll-free helpline at 866-4US-WAGE (487-9243). Learn more about the Wage and Hour Division, including a search tool to use if you think you may be owed back wages collected by the division. Workers can call the division confidentially with questions or concerns – regardless of where they are from – and the department can speak with callers in more than 200 languages. Help ensure hours worked and pay are accurate by downloading the department’s Android and iOS Timesheet App for free in English or Spanish.

Civil Action No. 1:22-cv-01032

Agency
Wage and Hour Division
Date
July 18, 2023
Release Number
23-1510-NAT
Media Contact: Leni Fortson
Media Contact: Joanna Hawkins
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Court orders Philadelphia home healthcare staffing agency to pay $212K in back wages, damages, penalties after federal litigation, investigation

News Release

Court orders Philadelphia home healthcare staffing agency to pay $212K in back wages, damages, penalties after federal litigation, investigation

Department of Labor found Empire Homecare Agency LLC failed to pay proper overtime

PHILADELPHIA A federal court in Pennsylvania has ordered a Philadelphia home healthcare staffing agency to pay $197,236 in back wages and liquidated damages to 31 employees after federal investigators found that their employer failed to pay proper overtime.

On July 10, the U.S. District Court for the Eastern District of Pennsylvania in Philadelphia entered a consent judgment requiring Empire Homecare Agency LLC to pay back wages, damages and penalties resulting from litigation prompted by a U.S. Department of Labor investigation.

The department’s Wage and Hour Division determined the staffing agency failed to pay an overtime premium to employees for hours over 40 in a workweek while living in their clients’ homes. Investigators also learned of eight instances when Empire Homecare did not pay overtime to three employees who did not live with their clients. They also learned the employer failed to combine the hours that an employee spent caring for two clients when calculating overtime. These actions violated the Fair Labor Standards Act.

“Home care workers deliver vital services to people in our communities in need. Their hard work allows many people who need regular care to live in their homes,” said Wage and Hour District Director James Cain in Philadelphia. “Empire Homecare Agency’s failure to comply with federal wage regulations denied more than 30 employees thousands in wages on which they depend to care for themselves and their families.

The judgment also requires the payment of $15,010 in civil money penalties for the intentional nature of the employers’ violations, and forbids the employer from future FLSA violations.

“Home healthcare staffing employers must ensure they comply with federal wage laws. Third-party employers like Empire Homecare Agency cannot claim an overtime exemption for live-in homecare workers,” said Deputy Regional Solicitor Samantha Thomas. “This enforcement action goes a long way in ensuring that home care employees working for this employer receive all of their hard-earned wages, including overtime pay.”

Empire Homecare Agency LLC is a non-medical home care agency servicing the greater Philadelphia area.

Learn more about minimum wage and overtime requirements for direct care workers.

For more information about the FLSA and other laws the division enforces, contact its toll-free helpline at 866-4US-WAGE (487-9243). Learn more about the Wage and Hour Division, including a search tool to use if you think you may be owed back wages collected by the division. Workers can call the Wage and Hour Division confidentially with questions or concerns – regardless of where you are from – and the department can speak with callers in more than 200 languages. Help ensure hours worked and pay are accurate by downloading the department’s Android and iOS Timesheet App for free.

Agency
Wage and Hour Division
Date
July 11, 2023
Release Number
23-1131-PHI
Media Contact: Leni Fortson
Media Contact: Joanna Hawkins
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US Department of Labor recovers $469K in back wages, damages from California restaurants operator that denied overtime pay to 114 workers

News Release

US Department of Labor recovers $469K in back wages, damages from California restaurants operator that denied overtime pay to 114 workers

Also finds Suleiman Fakhouri & Sons violated child labor laws at Crepevine locations

BURLINGAME, CA – A federal investigation has recovered more than $469,000 in back wages and damages after a Northern California restaurant chain’s pay practices denied 114 workers of their fully earned wages at five Bay-area locations.

The U.S. Department of Labor’s Wage and Hour Division found Suleiman Fakhouri & Sons, the operator of Crepevine, did not pay employees overtime properly at its locations in Berkeley, Burlingame, Oakland, Palo Alto and San Jose. The division also learned the employer assigned minors to work later and longer than federal child labor laws permit.

In addition to the recovery of $234,636 in back wages and an equal amount in liquidated damages, the department assessed $82,706 in civil money penalties for the willful nature of the employer’s violations.

Investigators determined Suleiman Fakhouri & Sons violated overtime and child labor provisions in the Fair Labor Standards Act. Specifically, the division cited Crepevine for the following violations:

  • Failing to combine hours employees worked at more than one location.
  • Paying overtime hours worked in cash at straight-time rates, when time and one-half is required.
  • Failing to keep records of cash payments for overtime in its payroll records.
  • Allowing 14- and 15-year-old employees to work past 7 p.m., more than 3 hours on school nights and more than 18 hours on school weeks.
  • Not keeping records for several employees and not registering their hours worked and wages due.

“Employers such as Crepevine who employ workers at more than one location must combine the total hours worked an all locations to pay workers accurately to avoid overtime violations and, in this case, costly consequences,” said Wage and Hour Division District Director Susana Blanco in San Jose, California. “The onus is on employers to ensure their employees are paid fully and that workers receive all of the protections they are due.”

Since its incorporation in 1992, Suleiman Fakhouri & Sons has operated Crepevine restaurants in the Bay Area. The enterprise now has nine Bay Area locations. In addition to the Berkeley, Burlingame, Oakland, Palo Alto and San Jose locations in this investigation, the employers operates Crepevine restaurants in Mountain View, San Francisco, San Rafael and Santa Rosa.

Learn more about federal regulations governing the restaurant industry.

Learn more about the Wage and Hour Division, including a search tool to use if you think you may be owed back wages collected by the division. Employers and workers can call the division confidentially with questions, regardless of where they are from. The department can speak with callers confidentially in more than 200 languages through the agency’s toll-free helpline at 866-4US-WAGE (487-9243). Download the agency’s new Timesheet App for iOS and Android devices – free and now available in Spanish – to track hours and pay.

Agency
Wage and Hour Division
Date
July 11, 2023
Release Number
23-1512-SAN
Media Contact: Michael Petersen
Media Contact: Jose Carnevali
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Labor Department seeking over 1,300 current, former workers at Arizona auto parts distributor, delivery company to repay over $5.6M in back wages, damages

News Release

Labor Department seeking over 1,300 current, former workers at Arizona auto parts distributor, delivery company to repay over $5.6M in back wages, damages

Parts Authority, Diligent Delivery Systems misclassified employees as independent contractors

PHOENIX – The U.S. Department of Labor is seeking people now or once employed by a national auto parts distributor and its delivery company who may be owed their share of more than $5.6 million in back wages and damages recovered on behalf of more than 1,300 drivers.

The division encourages people who worked while classified as independent contractors for Parts Authority and Diligent Delivery Systems in Arizona from April 2012 through March 2020 and who believe the employer may have denied them full wages to call 877-465-4898 from Monday through Friday from 8 a.m. to 6 p.m. CDT. Workers are strongly encouraged to act quickly.

In November 2022, the department obtained a consent judgment in the U.S. District Court for the District of Arizona that requires Parts Authority Arizona LLC and Arizona Logistics Inc. – operating as Diligent Delivery Systems – to pay the monies to the drivers who the employer misclassified as independent contractors.

An investigation by the department’s Wage and Hour Division determined the misclassification caused the employer to incur violations of the Fair Labor Standards Act for the following:

  • Failing to meet minimum wage requirements.
  • Paying straight-time rates for all hours worked.
  • Not paying the time and one-half overtime rate for hours over 40 in a workweek.
  • Failing to keep required timekeeping records.

Investigators also found the company required employees to use their personal vehicles for deliveries and did not pay them when they did, another FLSA violation.

“We want to make sure that Parts Authority Arizona and Arizona Logistics workers receive all the wages and damages owed to them,” said Wage and Hour Division District Director Eric Murray in Phoenix. “Workers may be difficult to locate when they change addresses or phone numbers, and they may not be aware they are owed back pay. The Department of Labor’s Wage and Hour Division and its Office of the Solicitor is working diligently to ensure the more than 1,300 underpaid employees of Parts Authority and Arizona Logistics get their shares of the $5.6 million that the agency recovered for them.”

Founded in 1973, Parts Authority is a leading national distributor of automotive replacement parts, tools, equipment and transmissions. Headquartered in Lake Success, New York, the company has more than 200 U.S. locations. Diligent Delivery Systems has national headquarters in Houston and 46 U.S. locations serving industries, including automotive, healthcare, retail and e-commerce, oil and gas, and agriculture.

Learn more about the Wage and Hour Division, including a search tool to use if you think you may be owed back wages collected by the division. Employers and workers can call the division confidentially with questions, regardless of where they are from. The department can speak with callers confidentially in more than 200 languages through the agency’s toll-free helpline at 866-4US-WAGE (487-9243). Download the agency’s new Timesheet App for iOS and Android devices – free and now available in Spanish – to track hours and pay.

This news release is also available in Spanish.

Agency
Wage and Hour Division
Date
July 11, 2023
Release Number
23-1486-SAN
Media Contact: Michael Petersen
Media Contact: Jose Carnevali
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