A recent series of investigations by the US Department of Labor (DOL) found an increase in wage violations among care sector employers in California. These violations, involving the underpayment of workers, resulted in the recovery of $735,762 in back wages and damages from five employers, affecting 173 workers entitled to fair pay under the Fair Labor Standards Act (FLSA).
The specific cases investigated include:
- A home care employer that failed to pay overtime for hours worked beyond 40 per week. The division recovered $252,578 in back wages and damages for 103 employees and assessed $32,343 in penalties.
- An operator of five adult residential care facilities in Bakersfield that did not pay overtime wages. The division recovered $245,285 in back wages and damages for 39 workers and imposed $19,159 in civil money penalties.
- A company that failed to pay overtime wages to workers at four adult care facilities in Fresno. The investigation recovered $113,507 in back wages and damages for 20 employees and assessed $9,163 in penalties.
- A residential care facility in Auburn for individuals with disabilities that did not pay overtime wages. The division recovered $63,974 in back wages and damages for two employees and imposed $686 in penalties.
- A residential care employer operating four facilities that did not combine the total hours worked by employees across locations, resulting in overtime violations. The division recovered $60,418 in back wages and damages for nine employees and assessed $6,174 in penalties.
These investigations were conducted by the DOL’s Wage and Hour Division in California as part of a broader effort to enforce wage compliance and raise awareness of legal obligations. To support employers, the division offers many compliance resources to help ensure adherence to labor laws.
In fiscal year 2024, the Wage and Hour Division conducted over 2,300 investigations nationwide in the broader healthcare sector, recovering more than $37.8 million in back wages for nearly 30,000 workers. The division also assessed more than $2.8 million in penalties for violations of federal labor regulations.
Compliance Perspective
Issue
The FLSA sets minimum wage, overtime pay, recordkeeping, and youth employment standards for employment subject to its provisions. Unless exempt, covered employees must be paid at least the minimum wage and not less than one and one-half times their regular rates of pay for overtime hours worked. Hours worked ordinarily include all the time during which an employee is required to be on the employer’s premises, on duty, or at a prescribed workplace. Every covered employer must keep certain records for each non-exempt worker. The Act requires no particular form for the records, but does require that the records include certain identifying information about the employee and data about the hours worked and the wages earned. The law requires this information to be accurate.
Discussion Points
- Regularly review and update your policies and procedures on fair wages, overtime pay eligibility, and recordkeeping to ensure they align with both federal and state regulations. Some states have stricter standards than federal law, so make sure your policies are comprehensive. Include clear guidelines on how overtime is calculated, how to handle multi-location work, and how bonuses and shift differentials are factored into pay calculations. Ensure these policies are well-documented, easily accessible to staff, and clearly communicated.
- Provide training for staff responsible for determining fair wages, overtime pay eligibility, and recordkeeping. Training should cover accurate time tracking, overtime calculations, and the requirements for maintaining proper records. Conduct training regularly (e.g., annually) or whenever there are significant changes in the law or company policies. Document all training sessions and keep signed documents in each employee’s education file to verify that training has taken place.
- Conduct periodic audits to ensure compliance with minimum wage laws, verify that overtime pay eligibility is properly applied, and confirm that recordkeeping practices are accurate and up to date. Keep thorough documentation of the audit results, including any corrective actions taken to address issues identified during the audit.
*This news alert has been prepared by Med-Net Concepts, Inc. for informational purposes only and is not intended to provide legal advice.*
