$544,715 in Back Wages and Liquidated Damages Paid by San Francisco Giants for Violations of FLSA

Thursday, September 5, 2013

The San Francisco Giants baseball team paid $544,715 in back wages and liquidated damages to 74 employees after a U.S. Department of Labor investigation determined that the Major League Baseball club failed to properly pay the workers over a three-year period. As a result of the investigation, MLB and the department are now working to ensure that all teams are aware of and adhere to the requirements of the Fair Labor Standards Act.

Investigators with the department's Wage and Hour Division found violations of the Fair Labor Standards Act's minimum wage, overtime pay and record-keeping provisions. The violations affected a range of employees in the organization at the major and minor league levels, including clubhouse assistants and managers. San Francisco Baseball Associates LLC, the club's ownership group, has entered into an agreement with the department to ensure continued and future compliance with the FLSA.

During the investigation, the department determined that clubhouse employees were working more hours than were recorded, under an employment agreement required by the club that established a flat rate of pay of $55 for working 5.5 hours per day. However, investigators found that the employees actually worked an average of 12 to 15 hours daily, and the workers received less than the hourly federal minimum wage of $7.25 and were also not paid overtime for hours exceeding 40 in a workweek.

Investigators found the club had improperly classified a number of employees as exempt from overtime pay, including clubhouse managers at the major and minor league levels and video operators at the team's major and minor league affiliates. The non-exempt employees were paid a straight salary and no overtime premium, as required based on their job duties. Additionally, the investigation determined that the club failed to pay overtime or incorrectly calculated overtime pay for administrative staff participating in the Giants' bonus program, in violation of the FLSA.

The FLSA requires that covered employees be paid at least the federal minimum wage of $7.25 per hour, as well as time and one-half their regular rates for hours worked over 40 per week. The law also requires employers to maintain accurate records of employees' wages, hours and other conditions of employment, and it prohibits employers from retaliating against employees who exercise their rights under the law. The FLSA provides that employers who violate the law are, as a general rule, liable to employees for back wages and an equal amount in liquidated damages. Liquidated damages are paid directly to the affected employees.

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