Wage and Hour Division (WHD)
Archived News Release — Caution: Information may be out of date.
Date: Nov. 19, 2013
Contact: Deanne Amaden or Jose A. Carnevali
Phone: 415-625-2630 or 415-625-2631
U.S. Department of Labor
Wage and Hour Division
Release Number: 13-2104-SAN (SF-202)
Days Inn franchisee agrees to pay more than $123,000 in back wages, damages for labor violations after US Labor Department investigation
Federal investigation reveals housekeepers paid less than $5 per hour in San Bernardino, Calif.
SAN BERNARDINO, Calif. -- A Days Inn franchisee in San Bernardino has agreed to pay $123,678 in back wages and liquidated damages to 16 housekeeping employees after an investigation by the U.S. Department of Labor’s Wage and Hour Division found the franchisee violated the minimum wage, overtime and record-keeping provisions of the Fair Labor Standards Act. Investigators determined that the actual hourly wage for these employees averaged less than $5 an hour, well below the current federal minimum wage of $7.25 per hour. The Days Inn brand is part of Wyndham Hotel Group LLC, which is a subsidiary of Wyndham Worldwide Corp.
“Evasive practices like those identified by this investigation deprive vulnerable workers of an honest wage, as guaranteed by the FLSA,” said Daniel Pasquil, director of the Wage and Hour Division’s West Covina District Office. “Failure to pay required minimum wage and overtime have been identified as typical violations in the hotel and motel industry. These employees have worked long hours and now, as a result of our investigation, are being paid the wages they have rightfully earned. We encourage other hotel and motel employers to learn from this case, review their own practices and make diligent efforts to comply in the future with federal employment laws.”
Investigators found franchisee Sahkar Hospitality Corp. also failed to pay the overtime premium required for hours worked beyond 40 per week. Employees typically worked more than eight hours of overtime per week during the hotel’s busiest periods. The employer also violated the record-keeping requirements of the FLSA by not maintaining records of the hours employees worked or recording the portion of their wages paid in cash.
Sahkar Hospitality showed payment of $8 per hour to employees on its payroll, but actually paid $4 per room cleaned, without regard to the number of hours worked. Amounts paid on the payroll were subtracted from the amounts earned on a per-room basis, and the remainder, if any, was unrecorded and paid in cash. Wage and Hour assessed a civil money penalty of $4,928 due to the willful nature of the violations.
In addition to paying back wages, liquidated damages and penalties, Sahkar Hospitality signed a settlement agreement enjoining the company from violating the FLSA in the future. The employer further agreed to hire a third-party human resources firm to direct and monitor its future compliance with labor laws.
The Wage and Hour Division has noticed the noncompliance in this industry and is concentrating its resources on investigating and remedying violations, informing workers of their rights and providing compliance assistance to employers. Since 2009, the division has concluded more than 5,100 cases involving hotel and motel employers, resulting in more than $16.1 million in back wages for more than 30,000 workers nationwide.
The FLSA requires that covered, nonexempt employees be paid at least the federal minimum wage of $7.25 per hour, as well as one and one-half times their regular rates for every hour they work beyond 40 per week. The law also requires employers to maintain accurate records of employees’ wages, hours and other conditions of employment, and prohibits employers from retaliating against employees who exercise their rights under the law. The FLSA provides that employers who violate the law are generally liable to employees for their back wages and an equal amount in liquidated damages, which are paid directly to the affected employees.
For additional information about the FLSA, call the Wage and Hour Division’s toll-free helpline at 866-4US-WAGE (487-9243). Information is also available at http://www.dol.gov/whd.
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