Tag Archives: Wage and Hour Law

Low-wage Workers Suffer High Rate Of Workplace Abuse and Wage Theft, UCLA Survey Shows

UCLA Today, a periodical covering faculty and staff news at UCLA has released a story summarizing the findings of a recent study conducted by 3 UCLA researchers, that examined the frequency of labor and wage abuses against low-wage workers in the Los Angeles area.  According to the story, “[a]n alarmingly high number of Los Angeles County workers at the bottom of the labor market are the victims of “wage theft” and other workplace violations by employers, who on average deprive workers of 12.5 percent of their weekly paycheck, according to a study released today, Jan. 6, by three researchers with the Institute for Research on Labor and Employment at UCLA.
Approximately 88 percent of those surveyed reported at least one instance of being paid less than the minimum wage, working overtime and not being paid for it, working off-the-clock for free, or other pay-based violation during the previous work week.
The results of a 2008 survey of 1,815 workers in the county holding such low-wage jobs as nannies, bank tellers, retail workers, garment workers, janitors and gardeners show that most of these violations are more prevalent in Los Angeles than in New York or Chicago, where similar surveys were done. Detailed, hour-long interviews were conducted with the workers who were asked to describe their previous work week.
“This is a wake-up call to the community,” said Professor Ruth Milkman, lead author and a professor of sociology at UCLA and the City University of New York Graduate Center. Ana Luz Gonzalez, a doctoral candidate in urban planning, and Victor Narro, project director at the UCLA Downtown Labor Center and a lecturer in Chicano studies, are co-authors on the study.
Most egregious, said researchers, was that 30 percent of those surveyed in L.A. County were being paid less than the legal minimum wage for California, which is $8 an hour.”
                                                                                                                                                                                        To read the entire report click here.  To read the UCLA Today news story  click here.   

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Filed under Minimum Wage, Wage and Hour News, Wage Theft

Tyson Foods Found In Violation Of Fair Labor Standards Act In Donning And Doffing Suit, Reuters Reports

Reuters is reporting that “Tyson Foods Inc., one of the nation’s largest poultry producers, has been found in violation of the Fair Labor Standards Act (FLSA) at its Blountsville, Ala., facility.  The jury’s verdict in federal court in Birmingham resulted from a lawsuit filed by the U.S. Department of Labor against the company…

The Department of Labor’s lawsuit was filed in the U.S. District Court for the Northern District of Alabama.  The federal department alleged that Tyson Foods did not keep accurate records and failed to pay production line employees for the time they spend donning and doffing safety and sanitary gear, and performing other related work activities.  The violations cover the period from the year 2000 to the present and affect approximately 3,000 current and former workers at the plant.

The initial investigation began in April 2000 as part of the department’s Wage and Hour Division’s poultry enforcement initiative.  The Labor Department filed the district court complaint in May 2002 following the company’s failure to comply with the law and to pay back wages.  The first jury trial, which began in February 2009, ended in a mistrial.  The Labor Department chose to pursue a second trial in August 2009 to secure a ruling that Tyson was failing to compensate its employees lawfully.”

To read the full story go to Reuters’ website.

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Filed under Donning and Doffing, Wage and Hour News, Work Time

6 Construction Companies Accused Of Using Race-based Pay Scale: Whites At Top, Latinos Rock Bottom, Daily News Reports

The Daily News is reporting that, “[s]ix construction companies are accused in a new state lawsuit of paying their employees according to their race – with whites at the top and Latinos at the bottom.

The suit filed by [New York] state Attorney General Andrew Cuomo on Thursday says the companies cheated lower-paid minority workers out of $4 million in wages and overtime.

All six firms are controlled by Michael Mahoney, a contractor exposed by the Daily News last year after workers said his companies provided them with black market federal safety certificates.

Mahoney’s companies paid white workers an average hourly rate of $25, while paying African-Americans $18 and Latinos and Brazilians only $15 an hour for the same work, the suit charges.

Since 2002, the companies short-changed dozens of employes at at least 10 construction sites, Cuomo charged.

Some workers were cheated of as much as $600 a month, according to Cuomo.”

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Filed under Wage and Hour News, Wage Theft

$7.6 Million Judgment For Louisville Firefighters Upheld On Appeal, Courier-Journal Reports

Friday’s Courier-Journal reports that Louisville “[f]irefighters came another step closer in their quest to get back pay from Louisville Metro Government for 15 years in which they claim their overtime was miscalculated.

On Friday, the Kentucky Court of Appeals upheld a Jefferson Circuit Court ruling that says Louisville violated the firefighters’ contract by not including incentive and longevity pay in calculations for overtime pay. The ruling entitles more than 800 firefighters to pay going back 15 years from when the claim was filed in 2000.

The ruling could cost the city $7.6 million plus interest.”

To read the entire article go to the Courier-Journal website.

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New Jersey Labor Department Investigator Admits To Taking $1.8 Million In Bribes From Owners Of Temporary Labor Firms He Was Hired To Investigate

As reported in The Star-Ledger on March 31, 2009:

“A New Jersey Labor Department investigator from Camden County admitted on Monday to taking some $1.8 million in bribes from owners of temporary labor firms he was hired to investigate.

A second investigator, who lives in Salem, was also charged in the scheme that allegedly involved these men looking the other way when these agencies broke the law.

Joseph Rivera, 53, of Winslow, a senior investigator for the state, pleaded guilty to soliciting and accepting a bribe, and tax evasion.

Also charged in this scandal was 71-year-old James Peyton, a field investigator with the Department of Labor. Police believe the Salem man began accepting cash bribes in 2005 and took as much as $8,000 in cash each quarter.

“The conduct described by two of these defendants … was driven by pure greed,” said Acting U.S. Attorney Ralph Marra. “Mr. Rivera’s corrupt actions lined his own pockets, and provided temporary labor firms with an unwarranted advantage against those employers who operate lawfully.”

The owner of one of these temp businesses also pleaded guilty Monday, and two others were charged for their alleged involvement.

As a senior investigator, Rivera was responsible for inspecting temporary labor firms with workers in southern New Jersey to verify their compliance with state wage and hour laws.

Federal prosecutors said in a court document that Rivera charged temporary employment agencies 25 cents per hour their employees worked not to notice irregularities with their tax withholdings and other payroll violations. He also would recommend these temp agencies to companies looking for workers.

Between 2002 and 2008, Rivera said he raked in $1.86 million from 20 firms.

He also admitted to trying to cover up this scheme by filing false tax returns.

For tax year 2007, Rivera claimed on a tax return that he had $89,696 in taxable income, when, in fact, his total taxable income was nearly $500,000.

These companies provide workers to other firms for a flat hourly rate with the agreement they are responsible for making sure the workers are documented, withholding payroll taxes, and covered with worker’s compensation insurance.

By getting these investigators to look the other way on some of these responsibilities, these companies make bigger profits.

At least one of the alleged bribe payments was made at the Deptford Mall, authorities said, adding the conversation was caught on tape. On Feb. 13, Peyton allegedly met with one of these temp agency owners at the mall, received $800 in cash, and said he would help the firm “stay out of trouble,” court documents indicate.

Another time, he also reportedly told the firm’s manager that the temp agency would only have to report 70 percent of the hours worked by these employees. For his services, Peyton allegedly received $700.

Although he has not pleaded guilty, Peyton Ð who was charged on Monday with bribery Ð has reportedly spoken with an IRS agent and admitted to receiving such payments.

Peyton was responsible for auditing employer records, reviewing quarterly tax filings and other duties related to making sure companies complied with tax laws.

The three managers of these temporary labor firms all live in Philadelphia and were charged with paying bribes.

They are: Yohan Wongso, 27; Channavel “Danny” Kong, 37; and Thuan Nguyen, 37.

Wongso pleaded guilty Monday and faces 18 to 24 months in prison.

As part of his plea agreement, Rivera will forfeit two homes, a 2008 Lexus, $120,000 in cash and a collection of valuable coins. He also will turn over five gold plates and four silver bars.

Rivera faces up to 15 years in prison when he is sentenced on July 6. Although the judge has final say, the two sides agreed on Monday to not object to Rivera receiving a sentence of between eight and 10 years.”

To read the full original article go to http://www.nj.com/sunbeam/index.ssf?/base/news-4/1238476203173240.xml&coll=9

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Filed under Department of Labor

N.D.Cal.: Former DOL Wage and Hour Investigator Struck As Expert Because Cannot Testify As A “Legal Expert”

Valladon v. City of Oakland

Defendant sought to use a former DOL Wage and Hour Investigator as their expert to defend this FLSA claim. While working at the Department of Labor (“DOL”), Ms. Kramer gained expertise on Department of Labor regulations and federal case law interpreting FLSA.

She applied this expertise in her report and arrives at the following conclusion:

‘[I]t is my opinion that the City’s compensation practices with regard to donning and doffing of uniforms and equipment and the maintenance of uniforms and equipment, as well as its practices with regard to the use of compensatory time of, fully comply with the FLSA.’  Ms. Kramer also opined that if the Court nonetheless found that the Defendant’s practices violate FLSA, (1) those violations are not willful, so a two-year statute of limitations applies and (2) that the City is not liable for liquidated damages because it acted in good faith with a reasonable belief that its practices were lawful. Ms. Kramer reached these conclusions by analyzing DOL regulations and federal cases interpreting FLSA and determining whether the policies at issue here violate those laws. That is, she applied the facts of this case to the law. For example, after interpreting the text of FLSA, the DOL’s regulation concerning the “continuous workday rule,” two Supreme Court cases, a DOL advisory opinion, and the DOL’s “Wage and Hour Division’s Field Operations Handbook,” Ms. Kramer 2 concluded, ‘Thus, applying DOL’s interpretation of the FLSA and the agency’s own regulations, the time [p]laintiffs spent donning and doffing uniforms and equipment is not compensable because the City permits donning and doffing at home.’

Ms. Kramer used a similar method to reach her opinions about the statute of limitations and the reasonableness of the Defendant’s policies. She even opines that a particular district court reached the “incorrect” legal conclusion about whether a city must compensate its employees for the time spent donning and doffing uniforms.

Finding that, “Ms. Kramer’s “expert report” reads like a legal brief,” the Court found that because “[r]esolving doubtful questions of law is the distinct and exclusive province of the trial judge,” Nationwide, 523 F.3d at 1058 (citation omitted), Ms. Kramer’s report must be stricken. The Court reasoned that “her area of expertise is the law. She therefore purports not to “assist the trier of fact to understand the evidence or to determine a fact in issue,” but to help the jury understand the law itself. This is not permissible.

The Court further clarified its holding saying, “[h]ad Ms. Kramer offered opinions moored to the facts of this case, such opinions would not have been inadmissible merely because they included reference to legal terms or regulations. See, e.g., Hangarter v. Provident Life and Acc. Ins. Co., 373 F.3d 998, 1017 (9th Cir.2004) (citation omitted) (“[A] witness may properly be called upon to aid the jury in understanding the facts in evidence even though reference to those facts is couched in legal terms.”). However, Ms. Kramer’s report as drafted, and hence her anticipated testimony, was effectively a surrogate for legal instructions to the jury. This is not allowable.

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5th Cir.: FLSA Does Not Require Employers to Reimburse H-2B Visa’d Guest Worker Expenses

Castellanos-Contreras v. Decatur Hotels, LLC

In the aftermath of Hurricane Katrina, Defendant, a hotelier in New Orleans, sought the services of foreign national H-2B guest workers to staff its hotel in a variety of positions.  Each worker hired a recruitment company to locate H-2B job opportunities on his or her behalf, to guide him or her through the H-2B visa application process, and to arrange transportation to the United States.  Each recruitment company charged between $1,700 and $2,000 for its services.  In addition to this fee, each recruitment company required workers to pay their own visa-application fees as well as all transportation expenses necessary to relocate to the United States.  Altogether, each guest worker paid between approximately $3,000 and approximately $5,000 in recruitment, transportation, and visa expenses before relocating to the United States.

When the guest workers arrived in New Orleans, Defendant conducted a week-long orientation session, for which it paid the workers; and the guest workers began to work. Defendant paid the guest workers whom it hired through one company, $6.09 per hour, the guest workers whom it hired through a second recruiting company, $6.02 per hour, and the guest workers whom it hired through a third recruiting company $7.79 per hour.  Defendant did not reimburse the guest workers for their recruitment, transportation, or visa expenses, all of which they incurred before relocating to the United States.

The Court held, relying in part on a 2008 DOL Interpretative Letter, that, under the FLSA, an employer is not required to reimburse guest workers for (1) recruitment expenses, (2) transportation expenses, or (3) visa expenses, which the guest workers incurred before relocating to the employer’s location.  In reaching their decision the Court recognized its disagreement with another Court, which had previously found such expenses to be reimbursable, due to the fact that they were employer business expenses, and not for the benefit of the guest workers.  See Rivera v. Brickman Group, 2008 U.S. Dist. LEXIS 1167, at *47-*50 (E.D.Pa. Jan. 7, 2008).

Further, the Court, likely recognizing the injustice that would result from its ruling, discussed the fact that its ruling will likely have little future impact, because, effective January 18, 2009, the Department of Labor requires an employer seeking H-2B labor certification to attest that “[t]he employer has contractually forbidden any foreign labor contractor or recruiter whom the employer engages in international recruitment of H-2B workers to seek or receive payments from prospective employees, except as provided for in DHS regulations at 8 CFR 214.2(h)(5)(xi)(A).” 20 C.F.R. § 655.22(g)(2). Also effective January 18, 2009, the Department of Homeland Security forbids an employer, employer’s agent, recruiter, or similar employment service from collecting any “job placement fee or other compensation (either direct or indirect)” from a foreign worker as a condition of an H-2B job offer or as a condition of H-2B employment. 8 C.F.R. § 214.2(h)(6)(i)(B).

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