Wage/hour seems pretty basic (pay workers for time worked), but the people who find it easy tend to be the people who pay out million-dollar suits. In yesterday’s CED, we featured three million-dollar wage and hour lawsuits. Today, two more suits and an introduction to a unique source of wage/hour information that might just help you avoid a million-dollar suit.
Oriental Forest Will Pay $2 Million to ‘Most Vulnerable Workers’
The Suit: Li Jin Yang and Dong Lin, a wife and husband operating Oriental Forest restaurants in western Michigan, will pay $2,030,430 in minimum wage and overtime pay and damages to 129 workers.
The payment resolves a lawsuit filed by the U.S. Department of Labor (DOL) that alleged the business owners paid its employees less than time and one-half workers’ regular rates for hours over 40 in a single workweek, paid them less than the federal minimum wage, and failed to keep adequate and accurate pay records.
The court found that $1,015,215 in back wages is owed and ordered that an equal amount be paid to the 129 workers as liquidated damages. (Payments to individual workers range from several hundred dollars to as much as $96,000.) The court also ordered the business owners not to violate minimum wage and overtime pay laws in the future.
“For those employers who take advantage of the most vulnerable workers in this country, the Department will not hesitate to enforce federal law to the fullest extent possible,” said Secretary of Labor Hilda L. Solis—a former California legislator.
CED Comment: You might think poor records would not be such a big deal, but they are. First of all, poor records insult and annoy inspectors. And courts are likely to assume the worst in the absence of good records. If employees say they worked 80 hours, and you have no records, the court might agree to the 80 hours—even if you know they only worked 60 hours.
Notice that in this case the owners are implicated as well as the company itself.
Check out ERI’s wage/hour HR Management & Compliance Report, exclusively for California employers, and find out how to avoid getting burned in a complicated—and costly—wage/hour suit. Read more.
Failure to Aggregate Costs $2.7 Million in Overtime
The Suit: Partners HealthCare Systems, Inc., and its affiliated hospitals and healthcare companies will pay 700 employees more than $2.7 million in overtime back wages to resolve a lawsuit filed by DOL.
Interestingly, Partners’ management contacted DOL’s Wage and Hour Division after realizing that its companies might be in violation of the Fair Labor Standards Act.
The problem, DOL said, was that employees were working for more than one Partners-affiliated facility during a single workweek, but their hours worked during those workweeks were not being combined to determine if overtime was due.
DOL and Partners agreed that the best way to resolve the matter was through the filing of a complaint and consent judgment in federal court.
CED Comment: This case is about any employer with multiple facilities and where an employee might work at more than one company facility.
However, it’s also a general warning for all employers to sort things through immediately whenever you suspect that there might be wage and hour issues—otherwise the ultimate lump-sum payment could be staggering.
Don’t become the next wage/hour headline. Try out our exclusive report, How to Comply with California Wage & Hour Law, and get your compliance questions answered with confidence.
Study Up Now—Before a Costly Lawsuit
Your best line of defense against a devastating wage/hour lawsuit is a good offense—in this case, our HR Management & Compliance Report, How To Comply with California Wage & Hour Law.
This information-packed 155-page guide, written by an experienced California employment lawyer, features in-depth coverage of all the topics you need to know about in an easy-read, quick-reference style:
- The California Labor Code vs. the federal Fair Labor Standards Act (FLSA)
- Who the California wage/hour laws apply to
- The Wage Orders that cover your organization
- Hours of work—including travel time, make-up time, meal and rest periods, and the definition of “hours worked”
- The rules for hourly, salary, and piece-rate pay
- Bonuses, profit-sharing plans, and tips
- Overtime and double-time wages
- Alternative workweeks
- Tools and equipment, uniforms, and work-related expenses and losses
- Paid time off—vacation, PTO, holidays, and sick leave
- Unpaid time off
- When and how employees must be paid
- Payment of final wages upon termination
- Deductions from pay
- Recordkeeping requirements
- Pay-related discrimination
- And much more!
Order your copy now and try it out risk-free for 30 days. If you’re dissatisfied in any way, just return it within 30 days for a full refund.
Don’t become the next statistic—get your copy of How To Comply with California Wage & Hour Law today.