Resort Misclassifies Employees as Independent Contractors and Must Pay $55,586 in Back Wages

Tuesday, January 19, 2016

Investigators from the U.S. Department of Labor’s Wage and Hour Division, Knoxville Area Office, found that Elk Springs Resort Cabin Rentals LLC violated the minimum wage, overtime and recordkeeping provisions of the Fair Labor Standards Act. The employer misclassified employees working as cabin cleaners, customer service representatives, cabin inspectors, laundry workers, maintenance workers and an operations manager as independent contractors, and failed to pay at least the federal minimum wage of $7.25 per hour and overtime compensation at time-and-one-half employees’ regular rates for hours worked beyond 40 in a work week.

Elk Springs has agreed to comply with the FLSA, and will pay back wages of $55,586 to 33 employees.  The FLSA requires that covered, nonexempt employees be paid at least the federal minimum wage of $7.25 for all hours worked, plus time and one-half their regular rates of pay for hours worked beyond 40 per week. Employers are prohibited from retaliating against workers who exercise their rights under the law.

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