The US Department of Labor announced on May 31, 2023, that it had obtained a consent judgment in federal court requiring the operator of a Minnesota home healthcare provider franchise to pay $121,000 in back overtime wages and liquidated damages to 25 certified nursing and patient care assistants after a federal investigation found the provider denied them overtime pay. The provider and its owner agreed to pay the monies owed to the affected employees. The order also forbids the provider from future violations of the Fair Labor Standards Act (FLSA).
The court’s action followed a review of the provider’s employment practices by the Department’s Wage and Hour Division from Oct. 9, 2019, to Oct. 6, 2021. Investigators found that the provider violated federal law by paying a flat daily rate to workers who provided live-in assistance with self-care and daily living activities. By doing so, the provider failed to pay overtime as required when the employees worked more than 40 hours in a workweek.
The Division also alleged that the provider’s pay records gave the appearance that overtime had been paid when it had not been paid. The Division further asserted that the provider misapplied rules exempting employees from eligibility for overtime pay and failed to pay overtime wages owed to an office worker. These actions violated the FLSA’s overtime and recordkeeping provisions.
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. 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. Misclassification of an employee’s status can lead to violations of the FLSA which can result in fines and other penalties.
Discussion Points
- Review your policies and procedures on fair wages, overtime pay eligibility, and recordkeeping. Update if needed.
- Train all staff with responsibility for determining fair wages, overtime pay eligibility, and recordkeeping so that they are knowledgeable about your policies and procedures to ensure they comply with federal and state requirements. Document that these trainings occurred, and file each signed document in the employee’s education file.
- Periodically audit to ensure compliance with minimum wage laws, and that overtime pay eligibility and recordkeeping are accurate and being reported correctly.
*This news alert has been prepared by Med-Net Concepts, LLC for informational purposes only and is not intended to provide legal advice.*
