Wage and Hour Division (WHD)
U.S. Department of Labor
US Labor Department sues Subway franchisee to recover back wages, damages for 68 employees of 5 Ohio eateries
Hray Enterprises also may face penalties for child labor, repeat violations
COLUMBUS, Ohio -- The U.S. Department of Labor has sued Subway franchisee Hray Enterprises and owners Joseph Hray and Tammy Hray for alleged violations of the federal Fair Labor Standards Act's minimum wage, overtime and child labor provisions. The lawsuit resulted from an investigation by the department's Wage and Hour Division, and seeks to recover back wages for 68 current and former workers of five Subway eateries operated by Hray Enterprises in Warren, Cortland and Brookfield.
The suit also seeks liquidated damages for employees equal to the amount of back wages due, and additional civil money penalties for the repeated nature of the violations. The suit further seeks penalties for allowing minors to perform hazardous tasks specifically prohibited by child labor regulations.
"Businesses large and small are obligated to pay their workers fairly and protect them from safety hazards," said George Victory, director of the Wage and Hour Division's Columbus District Office. "This case was particularly troubling since this employer has been found in violation of federal law in the past. Our lawsuit sends a clear message to all employers that we will not hesitate to take action to protect the rights and pay of vulnerable workers, as well as the safety of young workers. The Labor Department will use all available enforcement tools to ensure a level playing field for law-abiding employers, including the assessment of liquidated damages and civil money penalties, and bringing litigation against companies and their officers to recover workers' wages and to enjoin them from future violations."
The investigation, which covered the period of July 21, 2009, through July 12, 2011, found that Hray Enterprises failed to pay employees for hours worked after the eateries closed to finish nightly closing procedures, resulting in both minimum wage and overtime violations. Additionally, deductions made from some employees' wages for cash register shortages caused their pay to fall below the required minimum wage of $7.25 per hour.
The company also violated the FLSA's Hazardous Occupations Order No. 12, which prohibits workers under age 18 from loading, operating or unloading paper balers or trash compactors. Five minors employed by Hray Enterprises were required to load and operate two paper balers and one trash compactor on a regular basis.
An investigation of Hray Enterprises in 2005 found violations of the FLSA's minimum wage, overtime, record-keeping and child labor provisions. At that time, the company was fined $4,620 in penalties for child labor violations and ordered to pay $1,463 in back wages due 10 employees.
The FLSA requires that covered employees be paid at least the federal minimum wage of $7.25 for all hours worked, plus time and one-half their regular hourly rates for hours worked beyond 40 per week. Employers may make wage deductions for cash register shortages, certain uniforms and food; however, the deductions cannot result in an employee earning less than the minimum wage for all hours worked in every workweek. Additionally, the law requires that accurate records of employees' wages, hours and other conditions of employment be maintained. Finally, employers who violate the law are liable to employees for their back wages and an equal amount in liquidated damages. Liquidated damages are paid directly to the affected employees.
A listing of hazardous occupations prohibited for minors is available on the Wage and Hour Division's website at http://www.dol.gov/elaws/esa/flsa/docs/haznonag.asp. Additional information on child labor rules can be found at http://www.youthrules.dol.gov/index.htm.
For more information about the FLSA and other federal wage laws, call the Wage and Hour Division's Columbus office at 614-469-5678 or call the division's toll-free helpline at 866-4US-WAGE (487-9243). Information is also available on the Internet at http://www.dol.gov/whd.
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