Wage And Hour Recovers $560,000 in Back Wages
This month, the USDOL Wage and Hour Division announced that it had recovered $560,000 in back wages owed to workers of Stone and Webster Construction Company in Pueblo, Colorado. That number may seem large, but Wage and Hour has announced similar and larger amounts this year, highlighted by April’s announcement of a 1.7 million dollar back payment owed to 1,751 employees in 17 states from a company based in Houston.
There is little doubt that the Wage and Hour division of the USDOL will remain active during this downturn. Every day, employers consider payroll deductions, leave ideas and other measures which are evaluated as cost-savings devices but may unintentionally trigger violations of the Fair Labor Standards Act – – the law enforced by Wage and Hour and private attorneys for affected employees.
One reason why the recoveries are so large is that adjustments to payroll rarely affect isolated employees. Instead, an error can quickly become compounded and enlarged with each payroll cycle. Similarly, employees who are mistakenly classified as “independent contractors” can also trigger violations of minimum wage and overtime, not to mention tax laws. What’s the theme here? Be careful when using compensation or classification for cost-saving.