Human Resources News & Insights

This has got to be a record: 4 investigations, a judgment of $2.1M for OT violations

Occasionally, employers try some sneaky tactics to avoid paying employees the overtime they’re entitled to. This is the most egregious case of this kind of skullduggery we’ve ever come across.  

El Tequila is a restaurant with four locations (Harvard, Broken Arrow, Owasso, and Memorial) in Tulsa, OK. After an employee from the Harvard location complained to the Department of Labor’s Wage and Hour Division about unpaid overtime, the DOL conducted an investigation and examined payroll documents. The DOL also interviewed employees and El Tequila’s owner, Carlos Aguirre, and concluded that, aside from some recordkeeping violations, the operation was on the up and up.

But the DOL kept getting complaints. In a second investigation, the DOL turned up bogus records and timesheets that had been tampered with. Employees told the investigator they’d been instructed to lie during the first investigation — they’d actually been working up to 70 hours a week, and were forced to sign the bogus timesheets. Aguirre finally agreed to pay $261,760 to 58 employees at the Harvard location.

A month later, the DOL investigated El Tequila’s Memorial, Owasso, and Broken Arrow locations because Aguirre admitted the same impermissible payment practices were occurring there. Total owed to employees for violations at the three locations: $386,887.

Man with a mission

You’d think those numbers would have given Aguirre incentive to change his ways, but no.

He started to have employees clock their hours through the company’s computer system, but then manually overrode the system to indicate that employees only worked 40 hours. Eventually, more complaints brought a fourth investigation, and it was determined the company owed employees an additional $636,000 in overtime.

The final total, after the company lost both the original court case and an appeal: $2,137,627 (back pay and damages).

To read all the gory details, check out the court decision: Perez v. El Tequila.

 

 

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