Violating the Wage & Hour laws can be expensive

by Michael Haberman on April 30, 2015 · 0 comments


Wage and hour violations cost employers a great deal of money. How much? A recent review of fines published at the USDOL website produced a list that totaled up to a great deal of money. It included:

  • Shell Oil Co. and Motiva Enterprises LLC, which markets Shell gasoline and other products, have agreed to pay $4,470,764 in overtime back wages to 2,677 current and former chemical and refinery employees as a result of investigations by the U.S. Department of Labor that found violations of the Fair Labor Standards Act.
  • Miranda and Zamudio willfully violated the Fair Labor Standards Act by taking cash-register shortages from workers’ paychecks and misrepresenting deductions made to pay as insurance or garnishments. These illegal, repeated and willful deductions forced the employees’ pay below the minimum wage of $7.25 per hour. As a result of the investigation, the companies must pay 111 employees more than $15,000 in minimum wage back wages and $61,050 in civil penalties for the FLSA violations.
  • The judgment orders payment of back wages and liquidated damages in the amount of $478,000 to 57 current and former laborers, drivers, crew leaders and foremen of the company for violations of the Fair Labor Standards Act. Hawkins Tree and Landscaping and its owners also have agreed to pay $22,000 in civil money penalties.
  • Fat Law’s Farm Inc. has been ordered by a court to pay $428,800 in back wages and liquidated damages to workers after an investigation by the U.S. Department of Labor’s Wage and Hour Division found the Oahu-based employer in violation of the Fair Labor Standards Act’s minimum wage, overtime and record-keeping provisions. The company has also agreed to pay $31,200 in civil money penalties because of deplorable housing, safety and health conditions for workers, in violation of the Migrant and Seasonal Agricultural Worker Protection Act.

Just this small sample adds up to over $5,000,000. My friend Ben Eubank sent me an infographic that showed the total amounts employers paid in 2014. Here are some of the figures from that infographic:

  • There were 22,280 violations that resulted in back pay.
  • 8,086 cases went to litigation
  • $172,971,406 was paid in back wages to 282,549 employees.
  • 1,188,531 hours were spent investigating
  • $136,000,000 was paid for overtime violations
  • $360,000 was paid for minimum wage violations

These figures don’t include the lawyers’ fees that were paid nor the amount of time companies had to put in collecting information and preparing for investigations.

It pays to know the law

Knowing and understanding the Fair Labor Standards Act can have a direct impact on the bottomline. Not abiding by the law, either intentionally or unintentionally, can be costly. These figures show just how costly.

My blog posts can provide you with ample guidance, just put FLSA in the search box and you will be referred to numerous articles. Or you can contact me as well.


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