A federal judge ordered four interrelated Maryland providers of assisted living, adult day care, and transportation services to pay a total of $364,604 to 132 employees due to numerous pay practice infractions. Half of the amount is what they owed to the employees in back wages and the other half is for liquidated damages.
A US Department of Labor Wage and Hour Division investigation found that the providers violated the Fair Labor Standards Act (FLSA) by doing the following:
- Failing to combine hours and pay appropriate overtime premiums to workers who clocked in and out of the different businesses while performing similar duties.
- Not paying workers for all hours worked.
- Manually adjusting timecards to omit hours, and rounding down employees’ worked hours.
- Making improper payroll deductions, which dropped workers’ pay rates below the minimum wage.
- Paying workers for overtime hours at straight time, instead of time and one-half their required pay rates.
The companies and their owners must also pay $34,430 in civil money penalties due to the willful nature of their violations. The judgment also permanently enjoins the companies and their owners from future FLSA minimum wage, overtime, and recordkeeping violations and prohibits them from discharging or taking retaliatory action against employees exercising their FLSA rights.
Violations of the FLSA’s minimum wage, overtime, and recordkeeping requirements were resolved by the court’s action.
Philadelphia Regional Solicitor Oscar L. Hampton III stated, “The employer’s theft of wages earned by 132 of its workers is a reminder of the harsh realities faced by some of the most vulnerable workers in our communities. The recovery of unpaid wages and an equal amount in liquidated damages for these workers reflects the US Department of Labor’s commitment to investigate such violations and obtain appropriate compensation for workers.”
Issue:
The FLSA requires that most employees in the US be paid at least the federal minimum wage for all hours worked and overtime pay at not less than time and one-half the required rate of pay for all hours worked over 40 in a workweek. Staff who are responsible for determining rates of pay, recordkeeping of wages, and other areas that affect employee’s wages should be knowledgeable and adhere to the FLSA at all times. Violations can result in fines and other penalties.
Discussion Points:
- Review your policies and procedures on fair wages, overtime pay eligibility, and recordkeeping. Update if needed.
- Train all staff with responsibility for determining fair wages, overtime pay eligibility, and recordkeeping so that they are knowledgeable about your policies and procedures to ensure they comply with federal and state requirements. Document that these trainings occurred, and file each signed document in the employee’s education file.
- Periodically audit to ensure compliance with minimum wage laws, and that overtime pay eligibility and recordkeeping are accurate and being reported correctly.
