A home care sector enforcement effort by the US Department of Labor’s (DOL) Wage and Hour Division found that four Texas and Louisiana providers’ pay practices violated the Fair Labor Standards Act. Violations included the following:
- A company in Pharr, Texas, adjusted the employees’ rate of pay to make it appear they paid the overtime premium for hours over 40 in a workweek when, in fact, the employer paid straight time for the overtime hours worked. The division calculated that 400 employees were owed $841,244 in overtime back wages.
- An Alexandria, Louisiana, company misclassified workers as independent contractors and paid straight-time wages for all hours worked. The division calculated the employer owed 129 affected workers a total of $160,477 in overtime back wages.
- A San Juan, Texas, company did not pay the additional overtime premium to 47 hourly employees for hours over 40 in a workweek, and owed them $122,944 in overtime back wages.
- A company in Laredo, Texas, paid employees for up to 40 hours a week and rarely paid overtime for hours over 40. Investigators found that, if employees stayed on the clock beyond 40 hours, the employer would adjust its records to indicate no more than 40 hours of work. In addition, employees would clock out and resume working because they were expected to complete the assigned work and knew their time would be adjusted because their employer would not approve overtime. The division determined the Laredo company owed 23 employees a total of $82,497 in overtime back wages.
In all, the division’s investigations recovered $1,207,162 in back wages for the affected workers.
The DOL also announced that its ongoing nationwide effort focused on improving compliance by residential care, nursing facilities, home health services, and other care-focused sector employers has made significant progress in protecting workers’ rights and protections.
Since its 2021 launch, the Wage and Hour Division’s initiative has completed more than 1,600 investigations and identified violations in 80 percent of its reviews. These investigations recovered more than $28.6 million in back wages and damages for nearly 25,000 workers, and led to assessments of nearly $1.3 million in civil monetary penalties for employers who willfully violated federal law.
Its reviews of residential care facilities, nursing facilities, and home health providers found the most common violations discovered by investigators related to failures to pay overtime or federal minimum wages or the misclassification of employees as independent contractors.
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. Determine if your policies clearly state the differences between an independent contractor and an employee, and that they clearly address non-retaliation for reporting of concerns. Update your policies as needed.
- Provide training for staff who have responsibility for ensuring accuracy of overtime pay and recordkeeping, and ensure they demonstrate competence with the requirements of your policy and procedures and the FLSA, including the difference between an employee and an independent contractor. Document that these trainings occurred, and file each signed document in the employee’s education file.
- Periodically audit to ensure that overtime pay eligibility and recordkeeping are accurate and being reported and paid correctly. Audit employees for understanding in how they can report any concerns to their supervisor or through the hotline, including anonymously.
*This news alert has been prepared by Med-Net Concepts, LLC for informational purposes only and is not intended to provide legal advice.*
