Human Resources News & Insights

DOL hires 250 cops to hunt labor violations

records

The U.S. Department of Labor just announced it’s hiring 250 investigators to look into wage-and-hour violations. Why now? And what are they looking for?

First, the answer to the “why now?” question:

It starts with a recent report titled “Broken Laws, Unprotected Workers: Violations of Employment and Labor Laws in America’s Cities.”

The report was based on face-to-face interviews with about 4,000 workers in New York, Los Angeles and Chicago. It was published by the Center for Urban Economic Development at the University of Illinois at Chicago, the National Employment Law Project and the UCLA Institute for Research on Labor and Employment.

A sample of the study’s findings:

  • 76% who had worked overtime the previous week claimed they were not paid time-and-a-half for it.
  • 26% said they were being paid less than the minimum wage.
  • 75% of those interviewed earned less than $10 an hour.
  • 69% of workers who were entitled to a meal break said they received no break at all, had their break shortened, were interrupted by their employer or worked during the break.
  • 20% said they had made a complaint to their employer or attempted to form a union in the last year; of those, 43% said they’d experienced some form of retaliation — such as getting fired or being threatened with a pay cut.

So the violations that jumped out at DOL involve OT pay, minimum-wage violations, denied breaks mandated by law and illegal retaliation.

The study found that minimum-wage violation rates were most common in apparel and textile manufacturing, personal and repair services, and private households. Violation rates were substantially lower in residential construction, social assistance and education, and home health care.

Women were significantly more likely than men to experience minimum wage violations, and foreign-born workers were nearly twice as likely as U.S.-born workers to suffer a minimum-wage violation, according to the report.

Click here to see the full report in PDF format.

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  • Lynn

    Boy, if this is correct, these employees certainly do not know their rights. Somehow, it just doesn’t seem like the whole story is being told here. ?

  • Ar

    My son works on a production line where the “meal break” is violated on a regular basis. It is also not at all looked upon favorably if anyone complains. Subtle retaliation is more prevalent than reported.

  • Kim

    I agree Lynn. Maybe it’s my naive nature, but I find these numbers extremely hard to swallow. I have no doubt there are some unscrupulous individuals in business out there. However, in most cases, the American worker is just as educated (if not more so) on the law and their individual rights than the employers are. If this type of treatment is going on without being reported to the proper agencies, it would seem as though the “victims” have some other reason that would cause them not to come forward. Such as working “Off-the books” to avoid paying taxes or not being legally entitled to work in the US.

  • Bill

    Where do I apply for one of these positions?

  • AZHR

    Inmportant to note that official DOL tax-payer financed policy is being driven by a survey which, by its own admission, includes 40% of responses from “unauthorized” workers (read: illegal).

    My bet would be, should that population be removed from the workforce, the ability of employers to get away with breaking the law (due to the resulting higher value of the workforce) would decrease significantly, certainly more than the announced DOL method. Make no mistake, “Broken Laws, Unprotected Workers”, from inception to completion, was created to start the justification of amnesty for that population.

    (PS: You’ve got to love the irony of the title of the report, “Broken Laws,…”.)

  • Wilford461

    Ladies/Gentlemen: these numbers are real…get out and talk to friends and neighbors and you will find that you do not have to look very far to find these types of violations. I myself questioned overtime practices at my company and it took almost 9 months to resolve. In those 9 months my employer tried numerous times to discourage me from calling the DOL for answers, filing a grievance, they changed their story several times why I wasn’t eligible for OT….it was a nightmare. I prevailed. The laws are written that it is very difficult sometimes to determine who is eligible, who is not. But even after all was said and done…my company has done nothing to make sure that others are not being denied their right to overtime pay. Nothing at all! Bottom line is that companies are not going to tell you that you are eligible for overtime if they don’t have to, and the employee doesn’t ask questions. It’s economics.

  • Dan

    Kim and Lynn, you should go the the DOL website and the wage and hours division and see all of the companies that have been charged with wage and hours violitions. It is not just companies that hire illegals. You will be suprised at the companies that are on this list. American workers have no real clue what their rights are and how they should be paid. We make an issue out the fact that 50 million americans have no healthcare, but more then that can not read or write. If americans can not read, how can they know their worker rights. I have worked in payroll for a long time and have seen so many wrongs and have fought and loss jobs trying to pay people the amount they are due. Time to come out of the tower and visit the kingdom as it really exists. I agree with Bill, how do I get that Job, it would be fun and rewarding to help the workers get the pay they deserve. Ps I found nothing on the DOL website as to how to apply.

  • Dan is correct; the situation is across all companies and types of employees. I have heard the stories personally from three close acquaintances who either themselves or a co-worker have been paid incorrectly. When I tell them that that situation is a violation of Federal law, they look at me like I have 3 heads. These are college educated, born in the USA, professionals. I don’t know why they don’t call their companies’ payroll department on it. Companies are free to ignore wage and hour laws as long as no one complains.

  • Kathy

    Hi, we are changing our pay date at our company. We paid every other Friday with a lag week (this Friday is payday for the last 2 weeks of Sunday to Saturday work) . We are now going to pay Fridays and pay up to that date. No lag week. Friday is pay day and it includes that day. My problem is the employees that work overtime the pay week. I send the direct deposit on Wednesday but they may work overtime that Wednesday, Thursday and Friday. Is it OK to owe it to them? Give them the overtime for those days the next pay?

  • Michelle

    Lynn and Kim need to look around with out blinders on being “naive” is not an excuse. I may self was denied overtime and given “comp time” in its place for 1 yr at a previous employer. Comp time in Alaska is very illegal. Sometimes it is an innocent mistake by the employer, usually the small business employer only though. The confusion is usually between the state and federal laws and what applies when, but the large Corporate and factory type employers no excuse and shame on them. I know tht sometimes people do not make an issue because they are afraid of losing their jobs and yes you can file against the employer but it takes time to be compensated for wrongful termination. Toke me 2yrs to get my settlement.

  • Kathy

    Dan trying to find that list. Can you give more details on how to find it on the website?

  • Sandy

    Kathy, yes, it is okay to pay them for any OT worked in the previous period PROVIDED you pay them the OT rate regardless of the hours they work in the pay period in which the OT hours appear.

  • Patricia

    Kathy,

    When you are paid current, the overtime that is earned during the pay week is adjusted on the next pay date, just as any unexcused absences are adjusted on the next payroll.

  • Erica

    It can be costly and complicated to keep an organization at 100% compliance. We are only human and I feel certain you would find some type of violation at 99.9% of all companies. The question is how prevalent, and how willful are the violations? I sincerely hope they will catch the “bad guys” out there without hurting those who are making that good faith effort to keep things fair, transparent, equitable and compliant… Something definitely needs to be done about the flagrant violators who game the system and exploit employee ignorance, gaining a competetive edge over honest companies.

  • KR

    AZHR – I agree with you. I noticed their first statement was that they were able to reach “unauthorized immigrants and those paid in cash”. Hmm…If they’re not authorized to work here do you think they are going to complain to anyone about not being treated fairly? How would they know anyway? I think they set themselves up for that one by being here illegally. I agree Dan it is not only the companies hiring illegals who are violating these laws; I’m just saying that stood out as an odd way to begin the report. The sad part is, if they do go after these companies who are taking advantage of these people guess who will lose their jobs and will these new cops really be able to right this wrong? I guess we’ll see.

    Kathy – For many states yes it is. I know for TX, AR, TN, OK, IL, MO, and LA for sure. As long as you pay OT to them as soon as practical…usually that means the next pay period. If you are in California, you should check with someone who is familiar with California state law. I am not familiar with the west coast.

    My company paid that way for years. We paid current and then paid OT for that pay period on the following pay period. The difficulty you will have is keeping your employees straight with what hours are paid on which pay dates. My recommendation is create a color coded payroll calendar to help explain it. You’ll be surprised how many hours of explaining that little visual aid will save you. Also, if your company does not count Holiday hours as actual hours worked that will be another source of confusion.

  • mkh

    Look at where this study interviewed. LA, NYC and Chicago. Were only federal laws addressed or were local and state variances included? Was any effort given to assure responses did not include misconceptions of law? Some workers assume laws where none exists. For example, federal law does not limit total hours worked, nor require all of the breaks some assume it does. I have had workers who mistakenly thought it did.

    “We used an innovative, rigorous methodology that allowed us to reach vulnerable workers who are often missed in standard surveys, such as unauthorized immigrants and those paid in cash.” Amazing they declare their method “innovative” and “rigorous” but share little about the exact method or tactics. Why were unauthorized immigrants sought out? And why is unauthorized workers a prevalent violation? Did anyone turn these employers over to the USCIS?

    Also, consider the screening mechanism required to assure “low-wage” status. Was this based on actual payroll data, or upon a response to an interview question. For example, imagine the question, “Do you consider yourself a low-wage worker”, or “are you paid well for your work?” being used. Happy lower wage workers would have been excluded from numbers by their negative response, but unhappy workers would be included by their positive response. Workers who feel underpaid are much more likely to complain about other issues as well.

    A more effective and meaningful study would have surveyed all workers at various lower wage employers to assess the relevant nature of violations.

    It isn’t alarming to learn that if you target employers who will work unlawful immigrants, they are likely to violate other provisions as well.

  • What about contract companies that do not pay overtime? Is there some form of an “agreement” that a contract worker can sign that says they can only be paid for a maximum of, say, 45 hours a week, even if they work 50 or more? Or, can a contract company say we will only pay you a flat rate no matter how many hours a week you work? I am not quite sure what my contract company is doing and I know full well they can doctor their records to show me whatever they want me to believe. We have an executed contract with them that says they follow all of the required state and federal laws, but I am still concerned with how liable my company will be in the event they are audited by the DOL and are found to be non compliant in one area or another. I am familiar with the co-employer stipulations and wonder just how far the DOL will go in holding the companies who hire other contract companies libel. Wal-Mart, for example, did not pay (to my knowledge…someone correct me if I am wrong) DOL fines, etc.; but, if memory serves me correctly, ended up being questioned by the IRS and OSHA and paid penalties to the IRS.

  • scott

    I wonder if the study verified statements, or just took statements from those interviewed as the truth. I don’t think it is accurate/good reporting when they say people interviewed “claimed” they were not paid overtime. I don’t have a copy of the report and don’t know specifically what their methods were in verify claims or allegations. As with most articles, they are skewed towards one perspective and they will ensure that their outcome is just as how they expected it to be.

    Is hiring 250 federal employees to help run this down issue the answer to the problem? How much more will be spent to increase government scrutiny while actually recovering very little for this group of people, some of which are not even citizens of the U.S., and technically shouldn’t fall under the provisions of protection provided by the law of the U.S.. I don’t believe law breakers should be entitled to protections of US law, when they don’t respect the process to immigrate into this country legally or don’t follow work authoriztion procedures. We are talking a great tax payer expense to help these people recover money that should be going to actual citizens of this country. The government should spend the money trying to draw business to this country vs. spending money to repell the remaining ones we have.

    I am sure some of you may think I am heartless, but that is not the case. I believe in following the payroll laws and we do our best to ensure that we keep up our end of the bargain. But, bigger government oversight is never an answer to a problem.

  • Debi

    Geez – so many complaints. I think anybody who even has a job these days is lucky! Businesses are shutting down left and right, being sued by employees, getting fines for non-compliance, etc. Now we’ve got 205 labor cops running around to threaten even more businesses!

  • Fea

    Debi, it’s thinking the way you do that creates the problem in the first place. No one wants to lose their job, especially in a recession, and some employers might use this to take advantage of their employees. I don’t think anyone should get sue-happy, but if a valid charge is brought against a company, why is that a bad thing? If you run an honest business, you shouldn’t be worrying about unfair suing and fines for non-compliance.

  • D.S.

    There are more violations than you think. I know of companies that are furloughing salaried workers a couple days a month. That is not legal, but they get away with it b/c everyone is afraid to complain.

  • Maria

    I’ve seen both sides of the fence and have been through a DOL investigation for Wage and Hour violations (NYS).

    1) Violations of this law are across companies. I’ve had friends come to me for advice but rarely follow through due to fear of retaliation. My sister’s employer (accounting firm) does not pay OT as it is earned. Instead, they are given it in a lump sum at the end of tax season. She said in some respects she likes this “big check” but knows it’s done in an illegal manner. I’ve educated her, but she feels if she were to say something her job would be gone.

    2) The nursing home where I worked previously was hit with violations for not paying OT on “bonuses” and not allowing an uninterrupted 30-minute meal break for nurses, particularly those on the 3rd shift. The bonus was for working a block of weekends during the calendar quarter. I was ignorant to the fact that I had to pay OT on the bonuses. OK–I deserved that hit. It was tremendous fun going back two years and calculating. BUT During this investigation we were also the victim of lies and retaliation by the 3rd shift nursing staff. Apparently it was a 3rd shift nurse who called in the complaint. They claimed they were denied an uninterrupted 30-minute meal break.

    The history of the situation is: Upon being hired, I conducted a full payroll audit. When I noticed this particular group of nurses were not taking their 30-minute meal break, I questioned why. I was told they preferred to split their meal break into several smoke breaks and they were just far too busy to take the 30-minute break. They were counseled (not disciplined) and told they HAD to take their 30-minute meal break. Apparently they didn’t like the fact that they would no longer get an additional 2.5 hours of pay per week, which was typically all OT hours. They lied to the investigator stating they were denied the meal break. Even though I had documentation to prove we were enforcing the 30-minute meal break, we still had to pay backpay. Sometimes too much knowledge can be dangerous as well!

  • Kim B

    News releases of violations by region – lots of fast food & food processing plants

    http://www.dol.gov/esa/whd/media/press/whdprss.htm

  • Jessica

    A conversation with my boss (Director of Operations) a few years ago reminded me that managers either don’t know the laws, or don’t care. She was talking to another employee about OT and said “I remember a few years ago when OT was based on 80 hours if you had a two-week pay period. Since they changed that to 40 hours a week, it’s harder to manage.” This is from someone who was previously a payroll accountant and also owned a couple of businesses. I would have loved to remind her that OT has been based on a 40-hour week since the inception of FLSA, but she’s not someone who takes kindly to being corrected.

    I worked for a “major pizza restaurant chain” in my early 20’s (in the early 90’s). A big part of my manager’s monthly bonus was contingent on labor, of course, so OT was a HUGE no-no. However, being one of the few employees with unlimited availability for work, I often filled in for others and ended up working over 40 hours. The manager would always try to do one of two things with those extra hours: (1) He’d move them to the next week and try to get me out early on future days or (2) ask me to trade pizza for the OT hours. Not knowing any better, I would usually agree to one or the other.

  • Martin

    Sounds simply like yet another element of the many faceted income redistribution plan and amnesty for illegal alien workers.

    Ohio is already providing drivers licenses to illegals (60,000 so far) in order for them to become de facto citizens and collect health care benefits free…..

    Hey, big deal we all will work for the state and call each other comrade…..it worked well for Russia, no?

    Interesting to note that the argument that “American” workers would not take the jobs the illegals do has been proven to be a big fallacy. Imagine that.

  • Cheryl

    I can understand how the laws apply to bonuses if they are for production such as meeting quotas, etc. but the only bonuses our company pays is for seniority (5 yr, 10 yr, 15 yr…) and for stop smoking where neither should be tied into base pay rate and OT. Profit Sharing is also not a bonus. If I am misinterperting this please correct me…..

  • Bill Rodgers

    When the survey was being taken was there a question about finding a new employer to remedy the objectionable situation of illegal labor actions by the current employer? I am sure many employees would prefer to give up a $25.00 an hour under the table job that does not pay overtime for a minimum wage job (at say a fast food joint) where there is never going to be a labor violation and taxes are meticulously deducted as well. Whatever happened to economic freedom? In the process of protecting us from each other government has enslaved us.

  • Flel

    The story from Maria does not surprise me at all. The lack of appreciation shown by some employees is remarkable. The DOL clearly did not look at the context of the situation and accepted the stories of the nurses as fact. As a benefits and pension manager, all I can add is document, document, document. The DOL and IRS are far more satisfied when something is in writing whether or not you are in the right or not. It’s all about the process.

  • Harold

    I’m not surprised individuals do not know their rights as to most DOL issues. Many employees work extra time or through breaks/lunches to just do a better job for thier company and to be noticed, and are hard to stop even when told to do so. Wage and Hour really won’t care unless you document your counseling and corrective actions. Many managers do not care if the employee does this. I beleive most violations in mid-size business are passive but in small companies/restaurants are blatant violations.

    If you are looking for these investigators jobs go to the DOL website and dig down through their careers section. there are a lot of openings!

  • Cindy

    Furloughing salaried employees a few days/month IS allowed by Federal law and most states are allowing it as well.

  • JAGGER

    I think 2 things are in play here. Both the Amnesty issue, and the desire for Big Government to have every laboror belong to one of their comrade unions. If they can stir up enough trouble and it is costing the tax payer bookoo bucks to police the employers, well………………let’s mandate that everyone belong to a Union and the Union can act as Big Daddy and do the policing. See, everyone wins. Workers (for a few shakles of dues monies) will be protected from the Big Bad Employer, Taxpayers won’t have to pay to police the Big Bad Employers……..see everyone wins. Except the very people that supply the workers with their jobs in the first place. Well…………lets see if we can change that. I know, we will have the Government take over all the businesses……….then we won’t have those Big Bad Employers. All we will have is Chevez, I mean SOMEONE like Chevez (maybe “the one”) to control everything. Sounds good to me!! NOT!!

  • AZGR8

    I was recently fired from filling a lletter of demand against my employer for back wages owed to me for over a period od 4 months, a total of 15 pay checks that were either NSF or account closed. Of course he had other reasons for firing for me. He has written well over $150,000 worth of nsf payrol checks to over 42 employees. we have contacted the DOL…to no evail, nothing has been done to stop this man, we have even went as far as filling charges against him, and still nothing has been done. So, my feelings as to the employees knowing their rights, well, even if you do and you contact the proper authorities, nothing gets done.

  • grogan

    I run a small company (100 employees). What I have learned over the years is that the better you treat your employees, the stronger and more profitable your company becomes. Instead of penny pitching on meal and/or other breaks, one should concentrate on things like profit sharing, learning about the families of all of the workers, and treating each of them with the respect you would hope they give you. Not all employees respond to that, and those are the ones that need to be weeded out. But most do respond and the company becomes stronger and the employees get better pay through bonuses and profit sharing. Employees truly are a company’s most valuable asset.

  • Harold

    1. My company is going through the fulough process – production n/e’s are now on a 38 hour work week (leave 2 hours early Friday’s unpaid); office n/e had the option of a 38 hour work week or take 1 day per month unpaid furlough; exempts had a 5% salary reduction, but maintain their regular work hours.

    My advice on unpaid furough days for exempt is for both parties above to get legal opinions – W&H offices in Kentucky nixed the idea of having unpaid days during a pay period when I called them.

    On the issue of OT vs. lunch/breaks. Docuntation will have to be more than a one time event. In the case of the nurses on 3rd Shift, What ever supervisor was there should have been issuing counseling notices to those violating the policy. You gotta love health care professionals needing all those smoke breaks:)

  • linda

    My son works at an oil change place and is required to clock out when not busy,but must remain on site without pay

  • Rachel

    Wow, so many issues. First, exempt employees can only be deducted for a full day of time off, not an hour here and an hour there. Second, legally the burden of proof is on the employer to prove that the non-exmet employee did NOT work overtime, not on the employee to prove that they did. That is why it is so difficult to defend against such claims.

    AZGR8 – did you report him to the fraud department of your local police department? I’m not sure if you were being sarcastic or truthful when you said “Of course he had other reasons for firing me.” It might not hurt for you to discuss your issue with an employment attorney.

  • AZGR8

    Not only myself have issued charges but so have several other employees. It just seems that employees these days have no rights, even after going through all the legal channels. State DOL, and the US DOL. I’m not being sarcastic about the reasons for being fired, my attorney is going to deal with that once I get the other behind me. His reasons were bogus and had nothing to do with work. My position was in senior management.

  • Sandy

    Rachel, you CAN allow exempt employees to substitute sick or vacation hours for time not worked if you have a bonafide leave program. You don’t HAVE to give “free hours of pay” to exempt employees who do not work them if they have leave time available or if your policies allow for the exempt employee to go into a negative balance situation for the leave. You just can’t “not pay” the exempt employee for the time.

  • Angel

    I also have worked in the HR/Payroll field for many years. The problem I have encountered is where employees don’t want to take their breaks and I must constantly call to make sure that they do infact take their break. Most would rather work straight thru and work and violate the 1 day rest in seven law, which I don’t allow to happen. I wish employees would understand that these laws are their to help them. They need that break and one day off, or they will not be much help for me as they would burn themselves out. Please remember that their are employers out there that work for the rights of their employees.

  • Angel

    In response to grogan – great job! Employees are our greatest asset.

  • Dan

    If you go to the Dept of labor web site and click on complaince assitance and there is a link ofr job opportunities. I looked a couple of weeks ago and there were several posting. however all were listed as temp jobs and spanish was required. If I knew spanish I would apply. I would love making sure companies were compliant, it could be fun.

  • Harold

    All these posts give a lot of information that proves to HR and other management types everyone should restudy the laws and regulations – both federal and your state.

    I have had children in years past that worked at car washes and restaurants that were cheated out of OT and their share of tips. Most of these places use intimidation to keep their staff in line.

    I am glad my company chooses to insist we do it right!

    Good luck to each of you!

  • deborah huchinson

    The company I currently work for in the state of GA, asked that employees in Customer Service to work until the job is done once a month, which could inclulde 1 – 6 hours or more for some. We are salaried representatives who actually worked the extended hours last weekand waited to be told how we would be compensated. To date no answer. Human Resource was asked and stated ” exempt employees do not get overtime”. For the last 5 years a manager of customer service gave comp time but his supervisors mis-managaged the allocation of comp and people complained. Some knew others did not work for as much comp time given, viewed as possible discrimination. Now you are asked to work the extended hours with no question! In America who can afford to work for nothing when asked to once a month. Using sick time or exucse w/ pay has not been offered as a compensation. What rights do EXEMPT (SALARIED) customer service reps have? It Behooves me how they managed to get us exempt anyway. The PROFESSIONAL category under EXEMPT is so vagued I guess that is where we fall under. Regardless, we need to know if the federal law states we should be compesated. Help!

  • Dan

    to Deborah,
    customer services reps is a position title that has a fine line as to if it is exempt or non-exempt. However most cases that I read about on the internet, my guess would be that most customer service jobs are non-exempt. the easiest solution is to contact your local Dept of labor. How ever do not that expect them to act on your complaint. I recently read another article that suggest that the DOL is lacking in their follow up of complaints. Outside of that keep a record of the time you actually work for each day/week. this will help in the future of any investigation by the DOL. You can file a wage claim for the unpaid hours, but I would wait until after you leave. even though protected by law, they will find a reason to help you out the door. Is what is nice with a wage claim is once you make it, it is the employer responsiblity to proof that you did not work the hours or are not owed the amounts. With a title of customer service, they will have a hard time proofing that. Remember depending on the state you live in you could get up to 3 times the amount you owe. Most states are double but I know some are 3 times. another course of action is to contact an employment lawyer and file a law suit and threaten a class action suit. Many times a company will pay the employee instead of going to court as defending themselves is expensive and potential loss of a class action could be even more expensive. Also remember comp time is illegal except in public (govt) jobs.

  • Harold

    Deborah,

    Dan is right – it is a real stretch to put any customer service manager as exempt. Even customer service supervisor positions can be a stretch.

    Suggestion – if you quit your job, and have no place to go you may not qualify for unemployment. If you file your problem with your supervisor and HR (in writing) and then they fire you, you have some way to defend yourself in the UI hearing and also with the DOL/W&H if you file a claim of termination due to making your request.

    If you file with the state, I would recommend you copy to the nearest Federal DOL office also. Even though they will defer to the State, if you do not get any response from the state after a few weeks, send another letter to both. In Kentucky, the state is actually very responsive in my experience to employee complaints.

    After 30 years in HR, it is amazing what some companies will still try to do – they put those of us who try to do it right in a big hurt. Best of luck.

  • Larry Bradley

    What percentage of those interviewed were illegal aliens?

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