Labor Department Recovered Over $2.3 Million For Wage, Overtime, and Record-Keeping Violations of Long Island Restaurants

Thursday, December 8, 2011

An ongoing enforcement initiative conducted by the U.S. Department of Labor's Wage and Hour Division has found widespread noncompliance with the minimum wage, overtime and record-keeping provisions of the Fair Labor Standards Act among full-service restaurants on Long Island. Under the initiative, the division has completed 46 investigations of pizza and pasta establishments and recovered $2,341,507 in back wages for 578 employees. In addition, the division has assessed $202,315 in civil money penalties against employers for willful and repeated FLSA violations.

"This initiative reflects the Labor Department's commitment to protecting our nation's vulnerable workers by ensuring that employers meet their responsibilities under federal law," said Secretary of Labor Hilda L. Solis. "The Wage and Hour Division will continue to monitor full-service restaurants and other industries in which unlawful pay practices are widespread in order to level the playing field for the many employers who abide by the law and properly pay their employees."

The Wage and Hour Division is concerned about the prevalence of unlawful pay practices in the full-service restaurant industry, such as employers paying cash wages "off the books," rather than maintaining legally required employment records; paying employees a fixed salary for all hours worked, without regard for the FLSA's minimum wage and overtime requirements; and falsifying employees' time and payroll records.

Investigators from the division's Long Island District Office are inspecting restaurants throughout the jurisdiction to identify patterns of minimum wage, overtime and record-keeping violations, and to remind workers of their rights under the FLSA. These inspections include thorough reviews of payroll records as well as interviews with employees to assess employer compliance with all applicable labor standards. Other strategies include surveillance of employers who may be committing violations, using penalty assessments to increase the cost of noncompliance, and coordination with local agencies and criminal enforcement authorities to combat willful violations, such as falsification of records and tax filings.

Additionally, the division is actively engaging major industry representatives — such as accountants, attorneys and associations — to solicit their input on enforcement strategies and enlist their cooperation in ensuring compliance among their clients. The division also is reaching out to employers, workers, community organizations and other stakeholders to inform them of the ongoing initiative and encourage participation in promoting industrywide compliance.

When violations are found, the division is using all enforcement tools available — including litigation, administrative subpoenas, civil money penalty assessments and liquidated damages — to ensure accountability and deter future violations. Based on the findings of its investigations, the division has pursued litigation against 26 local establishments, recovering more than $1,914,000 in back wages and liquidated damages for more than 300 local restaurant employees. These defendants also have been assessed more than $127,000 civil money penalties for willful and/or repeat violations of the FLSA. The FLSA provides that employers who violate the law are liable to employees for the back wages as well as an equal amount in liquidated damages.

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