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Archived News Release ó Caution: Information may be out of date.

Press Releases

Date:  Sept. 26, 2012

Contact:  Scott Allen or Rhonda Burke

Phone:  (312) 353-6976

U.S. Department of Labor
Wage and Hour Division
Release Number: 12-1886-CHI

US Labor Department finds more than $162,000 in back wages due to 712 workers at 2 hotels in Lansing and Muskegon, Mich.

GRAND RAPIDS, Mich. -- A total of 712 workers will receive $162,147 in back wages after an investigation of two commonly owned Michigan hotels by the U.S. Department of Laborís Wage and Hour Division discovered violations of the Fair Labor Standards Actís overtime, minimum wage and record-keeping provisions. The affected employees at the Best Western Plus Lansing and the Red Roof Inn in Muskegon worked as front desk, office, housekeeping, banquet and renovation staff.

"Wages for housekeeping and clerical staff in these hotels hovered near minimum wage, so any inaccurate tracking of hours worked by this employer could cause a substantial loss of income for these employees. Workers would struggle even more to purchase groceries, pay rent or meet other basic expenses," said Mary O'Rouke, the division's director in Grand Rapids. "The resolution of this case should remind employers that the Labor Department is committed to ensuring that workers receive their rightful pay. Hotel workers are among the most vulnerable employees in this country, and the Labor Department will not tolerate their exploitation."

Investigators determined that the employer violated minimum wage regulations by taking pay deductions for breaks and lunch periods that employees did not receive, failing to count or pay for hours worked at special events and requiring new hires to perform four hours of uncompensated work in the department for which they were being considered for employment. The investigation also disclosed overtime violations due to the payment of a "straight time" rate for hours worked beyond 40 hours per week, rather than the required rate of time-and-one-half employees' regular pay for those hours.

A total of $158,986 was found to be owed to 603 workers at the Best Western Plus Lansing, and $3,161 owed to 109 workers at the Red Roof Inn in Muskegon. As a result of the investigation, the employer has signed a compliance agreement to pay all the back wages in full and to comply with the FLSA in the future. Additionally, the agreement requires the employer to provide information about the FLSA to employees in the companyís employee handbook or directly to each new employee at the time of hire.

The Best Western Plus Lansing is currently operated by LM Management 57 Corp. and CB Lansing 300 LLP. Prior to January 2012, it operated as the Causeway Bay Hotel and Convention Center. The Red Roof Inn of Muskegon is operated by Causeway Bay Muskegon 308 LLP. The Causeway Bay Hotel chain is headquartered in Waterloo, Canada. Both investigated hotels are owned by Pe-Tse Keung of Waterloo, Canada, and have been owned by the Keung Family since 2008.

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 rates, including commissions, bonuses and incentive pay, for hours worked beyond 40 per week. In general, "hours worked" includes all time an employee must be on duty, or on the employer's premises or at any other prescribed place of work, from the beginning of the first principal work activity to the end of the last principal activity of the workday. Additionally, the law requires that accurate records of employees' wages, hours and other conditions of employment be maintained. The law also prohibits employers from discharging or discriminating against an employee for filing a complaint or for cooperating with an investigation.

Accessible and searchable information on enforcement activities by the Department of Labor is available at Publicly available enforcement data are also available through the free mobile application "Eat Shop Sleep," which enables consumers, employees and other members of the public to check if a hotel, restaurant or retail location has been investigated by the Wage and Hour Division, and whether FLSA violations were found. The app is available at

For more information about the FLSA and other federal wage laws, call the Wage and Hour Divisionís toll-free helpline at 866-4US-WAGE (487-9243) or visit


U.S. Department of Labor releases are accessible on the Internet at The information in this news release will be made available in alternate format (large print, Braille, audio tape or disc) from the COAST office upon request. Please specify which news release when placing your request at (202) 693-7828 or TTY (202) 693-7755. The Labor Department is committed to providing Americaís employers and employees with easy access to understandable information on how to comply with its laws and regulations. For more information, please visit