BASEBALL TEAM PAYS BACK WAGES AND DAMAGES FOR VIOLATIONS OF THE FAIR LABOR STANDARDS ACT

FROM:   U.S. JUSTICE DEPARTMENT 

San Francisco Giants pay employees $545,000 in back wages, damages
US Labor Department finds clubhouse and administrative workers not paid properly

SAN FRANCISCO — The San Francisco Giants baseball team paid $544,715 in back wages and liquidated damages to 74 employees after a U.S. Department of Labor investigation determined that the Major League Baseball club failed to properly pay the workers over a three-year period. As a result of the investigation, MLB and the department are now working to ensure that all teams are aware of and adhere to the requirements of the Fair Labor Standards Act.

Investigators with the department's Wage and Hour Division found violations of the Fair Labor Standards Act's minimum wage, overtime pay and record-keeping provisions. The violations affected a range of employees in the organization at the major and minor league levels, including clubhouse assistants and managers. San Francisco Baseball Associates LLC, the club's ownership group, has entered into an agreement with the department to ensure continued and future compliance with the FLSA.

"We are pleased that the Giants addressed this matter, and it is our hope that other Major League Baseball teams will take a close look at their pay practices to ensure they are in compliance with the law," said Laura Fortman, principal deputy administrator of the Wage and Hour Division. "MLB has agreed to work collaboratively with the department to ensure all MLB teams are in compliance with the FLSA."

Susana Blanco, director of the San Francisco District Office of the Wage and Hour Division, said the case underscores the importance of wage protections: "I am encouraged that the Giants acted to resolve this issue, but it was disappointing to learn that clubhouse workers providing services to high-paid sports stars weren't making enough to meet the basic requirements of minimum-wage law."
During the investigation, the department determined that clubhouse employees were working more hours than were recorded, under an employment agreement required by the club that established a flat rate of pay of $55 for working 5.5 hours per day. However, investigators found that the employees actually worked an average of 12 to 15 hours daily, and the workers received less than the hourly federal minimum wage of $7.25 and were also not paid overtime for hours exceeding 40 in a workweek.

Investigators found the club had improperly classified a number of employees as exempt from overtime pay, including clubhouse managers at the major and minor league levels and video operators at the team's major and minor league affiliates. The non-exempt employees were paid a straight salary and no overtime premium, as required based on their job duties. Additionally, the investigation determined that the club failed to pay overtime or incorrectly calculated overtime pay for administrative staff participating in the Giants' bonus program, in violation of the FLSA.

The FLSA requires that covered employees be paid at least the federal minimum wage of $7.25 per hour, as well as time and one-half their regular rates for hours worked over 40 per week. The law also requires employers to maintain accurate records of employees' wages, hours and other conditions of employment, and it prohibits employers from retaliating against employees who exercise their rights under the law. The FLSA provides that employers who violate the law are, as a general rule, liable to employees for back wages and an equal amount in liquidated damages. Liquidated damages are paid directly to the affected employees.

U.S. LABOR DEPARTMENT SUES FRUIT AND VEGITABLE GROWERS FOR NOT PAYING FEDERAL MINIMUM WAGE

Photo Credit:   Wikimedia Commons.

FROM: U.S. DEPARTMENT OF LABOR

US Labor Department sues Sabana Grande fruit and vegetable growers for not paying workers minimum wage

Suit seeks back wages, liquidated damages from Bananera Fabre, Finca La Platas

SAN JUAN, Puerto Rico — The U.S. Department of Labor has filed a lawsuit against agricultural employers Jose V. Fabre Laboy, doing business as Bananera Fabre, and his son, Jose V. Fabre Santiago, doing business as Finca La Plata, for failing to pay their workers the minimum wage as required by the Fair Labor Standards Act. The defendants cultivate and package bananas, tomatoes, and other fruits and vegetables for wholesale at contiguous locations on Rte. 117 in Sabana Grande.

An investigation by the department's Wage and Hour Division found that the defendants willfully and repeatedly violated the law. The federal minimum wage is $7.25 per hour, but the defendants paid many employees only $6.25 or $6.50 per hour. The division estimates that a total of $191,402 is owed to 174 employees between the two employers.

"These agricultural employers willfully and repeatedly violated the law, and they continue to withhold payments of unpaid wages due to their employees," said Jose R. Vazquez, the director of the division's district office in Guaynabo, which conducted the investigation. "We will not tolerate these actions and, as demonstrated by the filing of this lawsuit, the Labor Department will use all enforcement tools available to recover workers' wages and hold accountable employers who demonstrate a clear disregard for the law."

The department's Regional Office of the Solicitor filed the suit in the U.S. District Court for the District of Puerto Rico in San Juan. The suit asks the court to order the defendants to pay the full amount of back wages due plus an equal amount in liquidated damages to the affected workers. The suit also seeks to permanently prohibit the defendants from future violations of the FLSA.

Fabre Laboy has been the subject of several Wage and Hour Division investigations in the past. As a result of the most recent prior inspection, Fabre Laboy paid $38,098 in back wages as well as $6,381 in civil money penalties.

The FLSA requires that covered, nonexempt employees be paid at least the federal minimum wage of $7.25 per hour as well as time and one-half 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.

U.S. LABOR DEPARTMENT SUES DALLAS-BASED COMPANY FOR BACK MINIMUM AND OVERTIME WAGES

FROM: U.S. DEPARTMENT OF LABOR

US Labor Department sues Dallas-based The Christmas Light Co. to secure more than $240,000 in minimum and overtime back wages

DALLAS — The U.S. Department of Labor has filed a lawsuit against The Christmas Light Co. Inc. and owner William F. Rathburn to recover approximately $240,881 in wages and an additional amount in liquidated damages on behalf of 233 employers who installed and removed lights for the company. An investigation in Dallas by the department's Wage and Hour Division found that the company violated the Fair Labor Standards Act by failing to pay 233 installers and removers the minimum and overtime wages required by law.

"The Labor Department holds employers accountable when they do not properly pay their workers," said Cynthia Watson, regional administrator for the Wage and Hour Division in the Southwest. "Failing to pay minimum and overtime wages is unacceptable. Such behavior robs workers of their rightful wages and undercuts those hardworking and conscientious employers who obey the law. This lawsuit demonstrates that the department will use all enforcement tools available, including litigation, to recover workers' wages and ensure a level playing field for law-abiding employers."

The complaint was filed in the Northern District of Texas, Dallas Division seeking back wages, liquidated damages and an injunction against future violations of the FLSA, which provides that employers who violate the law are, as a general rule, liable to employees for their back wages and an equal amount in liquidated damages. Liquidated damages are paid directly to the affected employees.

The investigation determined that the company paid employees a flat rate for installing and removing Christmas lights without regard to the number of hours the employees had worked. Investigators also found that in most cases employees were paid "straight time" rather than overtime at time and one-half their regular rates for hours worked over 40 in a week, as required. Additionally, records required by the FLSA were not maintained.

The FLSA requires that covered, nonexempt employees be paid at least the federal minimum wage of $7.25 per hour for all hours worked. An overtime premium rate takes into account commissions, bonuses and incentive pay. Additionally, employers must maintain accurate time and payroll records.

HOMEWORKERS AND THE FAIR LABOR STANDARDS ACT

Photo:  Howe Sewing Machine.  Credit:  Wikimedia
FROM: U.S. DEPARTMENT OF LABOR

Fact Sheet: Homeworkers Under the Fair Labor Standards Act (FLSA)

This fact sheet provides general information concerning the application of the FLSA to homeworkers.

Characteristics

Under the FLSA, industrial homework means the production by any person in or about a home, apartment, tenement, or room in a residential establishment, of goods for an employer who suffers or permits such production, regardless of the source (whether obtained from an employer or elsewhere) of the materials used by the homeworker in such production.

Coverage

The FLSA applies to homeworkers who are covered on an "individual" basis or whose employer is covered on an "enterprise" basis. The enterprise coverage test requires a specified annual dollar volume of business. However, in most instances, a homeworker is covered under the FLSA on the basis of individual coverage (i.e. production of goods for out of state shipment and/or receipt of out of state materials or goods used in the production process).

Requirements

Homework requires certification in only seven specific industries: women's apparel, jewelry manufacturing, knitted outerwear, gloves and mittens, button and buckle manufacturing, handkerchief manufacturing and embroideries. Certification occurs when the employer obtains an employer certificate, or homeworkers obtain individual certification, from the Department's Wage and Hour Division, authorizing such work. Certified employers of homeworkers in these industries will be required to renew their certificate every two years. Employer certification is not available for women's apparel and certain hazardous jewelry manufacturing operations; only individual certification is permitted. Homework under the FLSA is not restricted in any industry other than those listed above. However, all individually covered homework is subject to the FLSA's minimum wage, overtime and recordkeeping requirements.

Homeworker employees must be paid the Federal minimum wage. This rate must be met regardless of whether the worker is paid by time, piece, job, incentive, or any other basis. The cost of tools, tool repair, or other similar requirements, may not be borne by the worker where such cost would reduce the wages paid below the required minimum wageor in any way reduce wages due for overtime hours. Overtime must be paid at one and one-half times the employee's regular rate of pay for each hour worked in excess of 40 hours in any workweek. The regular rate includes all remuneration for employment, such as piece rate earnings and commissions paid. Time and one-half of the average piece rate of pay is to be paid for hours worked over 40 per week, if the average is greater than the employee's regular rate of pay (never less than the required minimum wage).

Records which must be kept for all employees include: name, social security number, home address and telephone number, date of birth (if under 19 years of age), hours worked each day (including time spent transporting), total hours worked each workweek, basis of pay computations, regular pay, overtime premium pay, total gross pay, deductions (specifying the nature and amount of each), and net pay. All employees who have been hired since November of 1986 must also fill out the I-9 form, required by INS.

When employing homeworkers, a separate homeworker handbook is required. These handbooks are available through Wage and Hour offices. Employers are responsible for insuring that handbooks are completed as required. The handbooks require homeworkers to also list business related expenses, such as equipment and supplies.

In the case of clerical workers who may perform duties at home on only an occasional or sporadic basis, employers are not required to follow homework regulations. However, all hours, including the time worked at home, must be recorded and compensated as required by the FLSA for every employee.

Typical Problems

(1) Employer improperly treats homeworkers as "independent contractors".

(2) Employer fails to maintain required record of hours, production, etc., or fails to instruct the employee to record the required data in the DOL homeworker handbook.

(3) Employer fails to assure that homeworker paid on piece rate basis has earned the minimum wage.

(4) The employer must bear the cost of tools purchased as well as tool maintenance and repair to the extent that these costs cut into theminimum wage or overtime wages required.

(5) Employer fails to count as hours worked preparatory and concluding activities, time spent at the shop, travel time and training time.

(6) Employer fails to ensure proper certification for the restricted industries.

　

This publication is for general information and is not to be considered in the same light as official statements of position contained in the regulations.