MINNEAPOLIS – An administrative law judge has dismissed a Minnesota company’s notice of contest and affirmed the U.S. Department of Labor finding that the employer violated a federal program that allows foreign, non-agricultural workers with H-2B visas to temporarily work in the U.S.

Issued on May 26, 2022, the judge’s order comes after Solem Concessions Inc. – a Rochester-based operator of concession stands that travel to state and county fairs, music festivals and other public events in eight states – failed to provide documentation to support its challenge and engaged in a pattern of persistent disregard over the courts’ orders and discovery requests by the Department of Labor. The 30-day period for appeal expired without response from the employer.

Investigators with the department’s Wage and Hour Division identified several violations of the temporary H-2B worker visa program by the employer, and found Solem Concessions owed $148,631 in back wages to 35 non-immigrant H-2B workers hired by the company to staff its stands. The H-2B violations also led the division to assess $54,905 in civil money penalties.

“Federal labor law provides worker protections for nonimmigrant workers employed under the H-2B program and Solem Concessions Inc. violated those requirements, said Wage and Hour District Director Kristin Tout in Minneapolis. “The Department of Labor protects non-immigrant workers’ rights and is diligent in its efforts to ensure they receive the wages they earn. Employers who chose to participate in the H-2B program must ensure they are aware of their obligations and abide by the law.”

Specifically, the division’s investigators determined the employer violated the H-2B program when it:

• Did not pay the required hourly rate. Specifically, paid employees flat salaries that did not compensate them for all hours they worked.
• Failed to accurately report their temporary need by staggering employee arrival and departure dates throughout the work season.
• Failed to maintain accurate payroll and time records, including hours worked per day.
• Did not provide timesheets and earning statements to workers that included the employer’s address and identification number, the employees’ hourly rate of pay, hours worked, the pay period’s beginning and end dates, and the employee’s last and first name.
• Reimbursed visa fees to the workers at the end of the season, rather than during the first workweek.

The federal H-2B visa program permits employers to temporarily hire nonimmigrants to perform nonagricultural labor or services in the U.S. The employment must be temporary in nature and be for a limited period of time, such as a one-time occurrence, seasonal need, peak load or intermittent need.

For more information about the FLSA and other laws enforced by the Wage and Hour Division, contact the division’s 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. Download the agency’s new Timesheet App for Android devices to ensure hours and pay are accurate.

United States Department of Labor, Office of Administrative Law Judges, Boston, Massachusetts

Case: 2021-TNE-00017

HAVELOCK, NC – The U.S. Department of Labor has recovered $268,014 in back wages for 63 workers of a Reston, Virginia, technical and engineering contractor who denied them a portion of their wages and benefits while they worked on a Department of Defense project in Havelock.

A review of company pay records by investigators with the department’s Wage and Hour Division found Adams Communications and Engineering Technology Inc. paid some workers a rate lower than the prevailing wage rate – the average wage paid to similarly employed workers in a specific job – and failed to pay nearly all employees who worked on the contract enough wages to cover the health benefits. The employer also failed to pay full overtime wages due to two workers by paying the wrong rate of pay to one hourly employee and by failing to pay another worker time-and-a-half their required rate for hours over 40 in a workweek.

The employer’s action violated several requirements of the McNamara-O’Hara Service Contract Act, which governs pay practices of contractors and subcontractors working on federally funded contracts.

In addition, Adams Communications did not provide employees working on the contract paid sick leave as the Service Contract Act requires, and required them to take leave without pay or use vacation hours when they were sick. The employer’s records also failed to list fringe benefit payments, correct rates of pay and classifications for workers, a recordkeeping violation of the Fair Labor Standards Act.

“Employers awarded federal projects must pay workers all of the wages and benefits they are due, consistent with the terms of the government contract,” said Wage and Hour Division District Director Richard Blaylock in Raleigh, North Carolina. “Failure to pay the correct prevailing wage rate for the work performed can be a costly error and lead to additional violations if overtime is required. Other federal contractors should use the outcome of this investigation as an opportunity to review their own pay practices and ensure they comply with the law.”

The Department of Defense contracted Adams Communications, Engineering Technology Inc. to fabricate updated wiring harness and installation service for the MH-60 helicopter at Marine Corps Air Station Cherry Point. The company operates branches in six locations, including Aberdeen Proving Ground and California, Maryland; Havelock, North Carolina; Coronado, California; and Norfolk, Virginia.

Workers who feel they are not getting the wages they earned may contact a Wage and Hour Division representative in their state through a list and interactive online map on the agency’s website or use the online search tool if you think you may be owed back wages collected by the division. The division also offers numerous online resources for employers, including a website for frequently asked questions about the McNamara-O'Hara Service Contract Act. Employers and workers can get their questions answered by contacting the Wage and Hour Division at its toll-free number, 1-866-4-US-WAGE. Download the agency’s new Timesheet App, now available for android devices, to ensure hours and pay are accurate.

GULF BREEZE, FL – A federal investigation by the U.S. Department of Labor at a Gulf Breeze restaurant found several pay practice and child labor violations, including the failure to pay sushi chefs overtime wages due and the employment of 15-year-old workers for more hours per week than the law allows.

The department’s Wage and Hour Division determined Fred Flounder Inc. – operating as Flounder’s Chowder House – violated the Fair Labor Standards Act’s child labor, overtime and recordkeeping provisions by doing the following:

• Permitting seven, 15-year-olds to work beyond legally allowed hours, including working more than eight hours on a non-school day.
• Paying sushi chefs a flat salary with no overtime pay, when they worked more than 40 hours in a workweek. Though some of the chefs had some supervisory tasks, they did not have sufficient management duties to be considered managers and were entitled to overtime pay.
• Not keeping an accurate record of hours sushi chefs worked.
• Failing to provide workers information about their FLSA rights either through the employee handbook or an FLSA poster.

The division investigation led to the recovery of $26,776 in back wages for the 10 chefs, and an assessment of $5,138 in civil money penalties to Flounder’s Chowder House to address the child labor violations.

“Employers must ensure that federal labor law is correctly applied and that workers are not shortchanged as the result of a misapplication of the law. Any employer who employs minors absolutely must take the time to review the requirements and restrictions regarding youth employment or face the possibility of costly penalties,” said Wage and Hour Division District Director Wildalí De Jesús in Orlando, Florida. “The violations found in this investigation and the penalties they carry could have been avoided. We encourage employers and workers to contact the Wage and Hour Division with their questions about federal employment laws.”

In fiscal years 2020 and 2021, the Wage and Hour Division’s Southeast region found child labor violations in more than 190 food service employers investigated, resulting in more than $1 million in penalties assessed to employers.

For more information about the FLSA and other laws enforced by the division, contact the agency’s 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. Help ensure hours worked and pay are accurate by downloading the department’s Android Timesheet App for free.

ATLANTA – The U.S. Department of Labor’s Wage and Hour Division is asking the highway construction industry of Georgia to participate in a survey to help the agency establish prevailing wage rates, as required under the Davis-Bacon and Related Acts.

The DBRA directs the department to set the prevailing wage rates that reflect the actual wages and fringe benefits paid to construction workers in the county where the work takes place.

The survey includes active highway construction projects in all counties in Georgia between May 1, 2021, and April 30, 2022 and is not limited to federally funded construction projects. The data collection period will begin Aug. 26, 2022 and will conclude on Nov. 25, 2022. The department encourages all stakeholders to participate in the survey.

Full participation by contractors and interested parties is key to setting accurate prevailing wages and to developing complete wage determinations. Accurate wages and complete determinations also reduce the need for contractors to request additional labor classifications.

The best way to participate in the survey is online. The division will send notification letters and WD-10 data collection forms to interested parties and contractors known to the agency. To be included, please postmark all data submissions by Nov. 25, 2022. Contractors and other interested parties do not need to have a letter to participate in the survey. The survey can be completed online. Learn more about the surveys.

If you would like to participate, or have questions regarding the survey process and forms, contact Barbara Allen at (770) 738-6451 or Rose Huynh at (415) 241-3539.

People interested in getting more information, may also attend one of three free, online briefings that will outline the survey process and offer instructions for completing WD-10 forms on July 26, July 28, and July 29, 2022.

Register to attend an upcoming briefing. 

MAUI – A federal investigation has recovered $290,314 in rightfully earned wages and damages owed to 95 workers after the pay practices of their employer – the operator of five Maui food truck-restaurants – willfully denied them their full wages.

The U.S. Department of Labor’s Wage and Hour Division found violations by a single enterprise consisting of five corporations – Da Nani Pirates LLC, Da Nani Pirates Lahaina LLC, Maui Poke LLC, Maui Burgers LLC and Aloha Thai Fusion LLC – that operate the food truck/restaurant establishments, and which are managed by Joshua Marten, their managing member and owner.

The division determined the enterprise’s violations included requiring workers to give a portion of their tips to management, paying them straight-time rates for hours over 40 in a workweek and failing to combine all hours they worked at multiple locations. These actions violated the Fair Labor Standards Act.

The investigation led to the recovery of $290,314 for the affected workers – $145,157 in unpaid wages and an equal amount in liquidated damages. In addition, the department assessed a $20,000 civil money penalty due to the reckless nature of the employer’s violations.

“Wages earned should be wages paid, and when an employee works overtime, they should be paid overtime, as required,” said Wage and Hour Division District Director Terence Trotter in Honolulu. “This case demonstrates that violating federal labor laws has consequences. When employers fail to abide by the rules, they are held legally accountable.”

The Bureau of Labor Statistics reports that Honolulu saw its unemployment rate drop from 5.3 to 3.2 percent from March 2021 to March 2022, making it more difficult for employers to recruit and retain workers who can make choices about the employers for whom they work.

“Employers who shortchange their workers will find it more difficult to retain and recruit the people to do the work needed to operate their businesses,” Trotter explained. “Those who treat their employees with dignity and respect for their hard work will have the competitive advantage.”

Employers and workers can call the division confidentially with questions regardless of their 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). Learn more about the Wage and Hour Division, and its search tool if you think you may be owed back wages collected by the division. Help ensure hours worked and pay are accurate by downloading the newly available department’s Android Timesheet App for free.

LAS VEGAS – The U.S. Department of Labor’s Wage and Hour Division is asking Nevada’s highway construction industry to participate in a survey to help the agency establish prevailing wage rates, as required under the Davis-Bacon and Related Acts.

Not limited to federally funded construction projects, the survey includes active highway construction projects in all counties in Nevada between Aug. 1, 2020 and July 31, 2021.

The DBRA directs the department to set the prevailing wage rates that reflect the actual wages and fringe benefits paid to construction workers in the county where the work takes place.

Full participation by contractors and interested parties allows the department to establish accurate prevailing wages and create complete wage determinations. Additionally, accurate wages and complete determinations reduce the need for contractors to request additional labor classifications.

The division encourages employers to complete the survey online. It will send notification letters and WD-10 data collection forms to interested parties and contractors of which the agency knows. Contractors and other interested parties may participate even if they have not received a survey participation letter.

If you would like to participate, or have questions regarding the survey process and forms, please contact Rose Huynh at huynh.rose@dol.gov. To be included, all data submissions must be postmarked by Sept. 30, 2022.

Learn more about the surveys.

NEW BERN, NC – A U.S. Department of Labor investigation has recovered $56,900 for 31 assistant general managers employed by the operator of six Taco Bell franchise locations in North Carolina who shortchanged them by incorrectly denying them overtime wages.

The Fair Labor Standards Act allows overtime pay requirements to be waived for salaried managers who meet minimum salary and other management requirements. The law states that employers may claim only up to 10 percent of bonuses, commissions or incentive pay toward the minimum salary requirement of $684 per week. The manager’s minimum salary requirement must be made up of a full 90 percent salary and no more than 10 percent bonuses and incentives received.

The department’s Wage and Hour Division determined that Taco Bell franchisee Hagan and Hagan Inc. paid the affected managers a combination of salary and nondiscretionary bonuses, incentives and commissions in violation of FLSA requirements. More than 10 percent of the manager’s salary came from bonuses, incentives and commissions. As a result, the waiver of the overtime requirement did not apply and the employer was required to make overtime payments to these managers for hours over 40 in a workweek.

In addition, investigators learned Hagan and Hagan allowed five 15-year-old employees to work outside of the hours legally allowed, in violation of federal child labor laws. The employer paid a $3,670 civil money penalty to address the child labor violations. 

“Employers who claim a minimum wage and overtime exemption must ensure that all requirements are met under the law,” said Wage and Hour Division District Office Director Richard Blaylock in Raleigh, North Carolina. “To exclude managers from federal minimum wage and overtime requirements, employers must meet the proper salary level, as well as salary basis and duties requirements for their managers. Failure to meet all these requirements could result in overtime or minimum wage violations.”

The division began its investigation at the employer’s Taco Bell location in New Bern and, after finding systemic violations of overtime regulations related to managers, expanded its review to include five other North Carolina locations in Beaufort, Havelock, James City, Morehead City and Washington.

As historic shifts in the nation’s workforce continue, employers are finding it more difficult to retain and recruit the people they need to do the jobs they offer. In December 2021, the Bureau of Labor Statistics projects that 958,000 food and accommodation services workers left their positions, and that there will be about 41,400 openings for food service managers each year, on average, from 2020 to 2030. Many of those openings are expected to result from the need to replace workers who transfer to different occupations or exit the labor force.

“As more workers choose to leave food service industry jobs, employers who demonstrate an ability to pay workers’ rightful wages have the edge when it comes to attracting and retaining workers. Those who put workers at-risk or shortchange their wages will likely find themselves without the people they need to remain successful,” Blaylock added.

In fiscal years 2020 and 2021, the Wage and Hour Division’s Southeast region found child labor violations in more than 190 food service employers investigated, resulting in more than $1 million in penalties assessed to employers.

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. The Wage and Hour Division offers confidential compliance assistance to anyone with questions about how to comply with the law, by calling the agency’s toll-free helpline at 866-4US-WAGE (487-9243). Calls can be answered in more than 200 languages.  Help ensure hours worked and pay are accurate by downloading the department’s Android Timesheet App for free.

Read this news release En Español.

SANFORD, NC – A U.S. Department of Labor investigation has recovered $97,209 in back wages for 41 emergency service workers after finding a Sanford healthcare center denied them federally required overtime.

Investigators with the department’s Wage and Hour Division found that LifePoint-Central Carolina Hospital used timekeeping software that automatically deducted meal periods from employee workhours in its emergency department – the Central Carolina Hospital EMS – after an employee worked a specific number of hours. The employer failed to relieve many of the emergency service workers of all work duties during periods designated as “meals”.  When this time – added to the employee’s other work hours – exceeded 40 hours in a workweek, the employees were entitled to overtime compensation. As a result, LifePoint failed to pay additional overtime owed to these employees.

The investigation led to the recovery of $97,209 in back wages for 41 workers denied their overtime wages.

“Workers have a right to receive all the wages they earn,” said Wage and Hour Division District Director Richard Blaylock in Raleigh, North Carolina. “Employers need to ensure all recordkeeping tools that make automatic deductions for meals are accurate and that they can override the system and input accurate information when meal periods are missed. Otherwise, those companies could face consequences, including costly repayment of wages and difficulty in retaining or recruiting workers who choose employment with organizations that are vigilant about workers’ rights.”

In fiscal year 2021, the division recovered more than $230 million in back wages for more than 190,000 workers, which includes nearly $126 million for workers in low-wage industries including food services, agriculture, healthcare, construction and retail. 

Based in Brentwood, Tennessee, LifePoint Healthcare has operations in 29 states, providing health, emergency medical services and transportation.

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 – regardless of 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 Timesheet App for free.

Read this news release En Español.

Employer:                              Pest Eliminators Inc.

Investigation site:                  3314 Harbor Blvd., Unit B

Port Charlotte, FL 33952

Investigation findings: U.S. Department of Labor Wage and Hour Division investigators found the employer failed to pay an overtime rate to non-exempt workers for hours over 40 in a workweek, a violation of the Fair Labor Standards Act. The division also found Pest Eliminators deducted time from workers’ hours for lunch breaks, even though some employees did not take the break. In addition, the employer failed to include commissions in the regular rate when factoring an overtime rate, resulting in Pest Eliminators paying overtime at rates lower than required by law.

Back Wages Recovered and Liquidated Damages: $175,587 in back wages and liquidated damages for 59 workers.                                          

Quote: “Many employers are under the misconception that salaried employees are not entitled to overtime pay. When companies like Pest Eliminators get it wrong, the outcome could become costly,” said Wage and Hour Division District Director Nicolas Ratmiroff in Tampa, Florida. “Employers who fail to comply and continue to pay workers less than they have earned can quickly find themselves struggling to maintain the workforce needed to stay in business.”

Background: Employers can contact the Wage and Hour Division at its toll-free number, 1-866-4-US-WAGE. The division also offers numerous online resources for employers, such as a fact sheet on Fair Labor Standards Act wage laws overtime requirements. Workers who feel they may not be getting the wages they earned may contact a Wage and Hour Division representative in their state through a list and interactive online map on the agency’s website. Workers and employers alike can help ensure hours worked and pay are accurate by downloading the department’s Android Timesheet App for free.

Learn more about Wage and Hour Division.

WASHINGTON – The U.S. Department of Labor will publish a Notice of Proposed Rulemaking on July 15, 2022, to implement the requirements of Executive Order 14055, “Nondisplacement of Qualified Workers Under Service Contracts.” The proposal would benefit workers who perform work on service contracts by generally requiring that they receive an offer of employment from a successor contractor to a position for which they are qualified.

EO 14055 requires that contractors and subcontractors performing work on covered federal service contracts (i.e., most SCA-covered contracts over $250,000), must, in good faith, offer service employees employed under the predecessor contract a right of first refusal of employment on the successor contract. By doing so, the order seeks to prevent displacement of skilled workers in the federal services workforce. The proposed rule would establish standards and procedures for implementing and enforcing the nondisplacement protections under the order.

The department anticipates the proposed rule would if finalized provide economic benefits and enhanced efficiency in covered contracts by promoting the retention of experienced workers, thereby reducing the disruption in the delivery of services during the transfer of covered federal service contracts, maintaining physical and information security, and providing the federal government with an experienced and well-trained work force familiar with government personnel, facilities and requirements.

Specifically, the NPRM proposes to do the following:

• Establish standards and procedures for implementing and enforcing Executive Order 14055.
• Specify contracting agency and contractor obligations, respectively, under the Executive Order.
• Establish an investigation process that protects workers from displacement and is familiar to federal contractors.
• Identify sanctions and remedies that may be imposed by the department under the Executive Order.

“Executive Order 14055 and these proposed implementing regulations ensure efficient and effective continuity of services and enhanced security of personnel, facilities and information on federal service contracts,” said Acting Wage and Hour Division Administrator Jessica Looman. “The order also safeguards the rights and benefits afforded to workers employed under these federal service contracts and provides peace of mind and a measure of economic security to these workers and their families.”

Executive Order 14055 builds upon Executive Order 13495, originally signed by President Obama in 2009 but rescinded in 2019, which previously established a nondisplacement requirement for federal service contractors. The proposed rule implementing this Executive Order 14055 would establish a right of first refusal for service workers on an estimated 119,700 federal contracts, increasing job security and improving overall well-being for these workers.

Learn more about the NPRM announced today.

The Wage and Hour Division solicits comments on the proposed rule from interested parties and encourages all stakeholders to participate in the process. The comment period is July 15, 2022, through Aug. 15, 2022,  and comments may be submitted online or commenters may address written submissions to: Division of Regulations, Legislation, and Interpretation, Wage and Hour Division, U.S. Department of Labor, Room S-3502, 200 Constitution Avenue NW, Washington, DC 20210.

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 – regardless of their immigration status – and the department can speak with callers in more than 200 languages.