$657,069 in Back Wages to be Paid by Produce Broker for Minimum Wage, Overtime and Record Keeping Violations

Thursday, September 6, 2012

Wholesale produce broker Frank Donio Inc. has agreed to pay $657,069 in back wages and liquidated damages to 519 workers at the company’s Hammonton packing facility. The back wages owed result from violations of the Fair Labor Standards Act discovered during an investigation by the U.S. Department of Labor’s Wage and Hour Division.

Through employee interviews and reviews of time and payroll records, investigators determined that the employees were paid $6.50 per hour, which is below the required minimum wage. The employees also were not paid time and one-half their regular rates for hours worked in excess of 40 per week, in violation of the FLSA’s overtime requirements. Finally, the company violated the FLSA’s record-keeping provisions by not maintaining proper records of hours worked or adequate records identifying employees.

Investigators also learned that FDI used Heng Heng Agency Inc., a temporary employment agency in Philadelphia, to provide the workers. The Wage and Hour Division analyzed the employment relationship between the companies and determined that the affected workers, who hand-packed fruits and vegetables at FDI’s facility under the supervision of its managers, were jointly employed by FDI and Heng Heng Agency. As a result, both companies are responsible for the FLSA violations.

FDI cooperated in the investigation and agreed to correct the violations immediately upon being notified of them by the division. In addition to paying the back wages and liquidated damages to the employees, FDI has agreed to ensure that all workers, including those who may be hired or supplied by temporary help or employment service companies, are treated in accordance with the requirements of the FLSA. FDI will advise its business partners of FDI’s commitment to comply with the FLSA and its expectation that they, too, comply with the FLSA and all applicable laws. The company also will take steps to raise awareness among other produce growers, brokers and shippers about the importance of compliance with federal labor laws.

This investigation was conducted under a multiyear enforcement initiative focused on remedying FLSA violations and strengthening compliance in temporary employment industry throughout Southern New Jersey. Across the nation, the division has conducted 900 investigations of temporary employment agencies since 2009, resulting in $10,870,947 in back wages recovered for more than 19,900 employees.

Investigations conducted under this initiative will continue to focus on identifying and remedying common FLSA violations among temporary employment agencies and the employers using their services. Additionally, the division will continue providing compliance assistance to employers and conducting outreach to workers, community organizations and other stakeholders to encourage their participation in promoting industrywide compliance.

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, including commissions, bonuses and incentive pay, for hours worked beyond 40 per week. Employers also are required to maintain accurate time and payroll records. 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.

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