Wage and Hour Division (WHD)
Archived News Release — Caution: Information may be out of date.
Date: Feb. 21, 2013
Contact: Scott Allen or Rhonda Burke
Phone: (312) 353-6976
U.S. Department of Labor
Wage and Hour Division
Release Number: 13-114-KAN
Cecil Whittaker’s Pizzeria agrees to pay more than $100,000 in back wages to 58 workers following US Department of Labor investigation
ST. ALBANS, Mo. -- Cecil Whittaker’s Pizzeria has agreed to pay 58 delivery drivers and servers at three pizzeria locations a total of $100,569 following an investigation by the U.S. Department of Labor’s Wage and Hour Division, which found violations of the Fair Labor Standards Act’s minimum wage, overtime and record-keeping provisions.
The investigation found that the employer misclassified delivery drivers as independent contractors rather than employees. Drivers were paid $3 per delivery, without regard to how many hours they worked, and were not reimbursed for vehicle mileage. When drivers did not make enough deliveries to earn at least the federal minimum wage of $7.25 per hour, violations resulted. Additionally, the employer failed to pay delivery drivers an overtime premium for hours worked beyond 40 in a week, failed to calculate overtime compensation properly for servers, and failed to maintain records of all hours worked, tips earned, and miles driven, as required by the FLSA.
“Far too often, employers misclassify their employees as independent contractors to avoid paying them in compliance with the FLSA, as well as other federal, state and local laws,” said Norma Cervi, the Wage and Hour Division’s district director in St. Louis. “The Wage and Hour Division is vigorously pursuing corrective action in those situations when workers are employees, to ensure that they are paid required wages. In keeping with our partnership with the Missouri Department of Labor and Industrial Relations, this case has also been referred to them for consideration.”
The pizzerias located in St. Charles, Valley Park and Ellisville, are owned by Donna and Donald Glenn. As a result of the investigation, the employer agreed not only to comply in the future and to pay all back wages found due, but also to train all current and future employees regarding FLSA compliance, to conduct quarterly payroll reviews to ensure compliance and to provide training to its nine franchisees locations, which are separately owned and operated in the St. Louis area. The training, which has been conducted, included providing those franchisees with DOL compliance materials.
The misclassification of employees as independent contractors presents a serious problem for affected employees, employers and the entire economy. Misclassified employees often are denied access to critical benefits and protections—such as family and medical leave, overtime, minimum wage and Unemployment Insurance—to which they are entitled. Employee misclassification generates substantial losses to the U.S. Treasury and the Social Security and Medicare funds, as well as to state Unemployment Insurance and workers’ compensation funds. Misclassification also creates a competitive disadvantage for employers who comply with the law.
Under the FLSA, employers must distinguish employees from bona fide independent contractors. An employee, as distinguished from a person who is engaged in a business of his or her own, is one who, as a matter of economic reality, follows the usual path of an employee and is dependent on the business that he serves. For more information, visit http://www.dol.gov/whd.
The FLSA requires that covered 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 in a week. Additionally, the law requires that accurate records of employees’ wages, hours and other conditions of employment be maintained. 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 visit http://www.dol.gov/whd.
U.S. Department of Labor releases are accessible on the Internet at www.dol.gov. 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 America’s employers and employees with easy access to understandable information on how to comply with its laws and regulations. For more information, please visit www.dol.gov/compliance.