After an employer make settlements with employees, especially if done through a DOL investigation, and those employees are still employed, there exists perhaps a natural “urge” to take some of that money back or perhaps, to get some pay back. That’s a No-No. To prove the point, the US Department of Labor has now sued an employer who cut the wages of two workers when they refused to return back wages paid to them as part of a settlement in a prior DOL investigation. The case is entitled Perez v. Makin’ Choices Inc. and was filed in federal court in North Carolina.
The company agreed in August 2014 to pay sums exceeding $100,000 to resolve a DOL investigation centering on allegations of unpaid overtime/minimum wage. Then, allegedly, the company began repeatedly asking two of the employees to return what they were paid out under the DOL audit. Their refusal triggered (allegedly) the wage cuts. The government’s complaint charges the company the owner, personally, with violating the anti-retaliation protections of the FLSA. As the Complaint aptly states, “shorting workers once is bad enough, but we simply will not tolerate attempts to retaliate after we’ve stepped in to recover the wages they’ve worked so hard to earn.”
The audit started in July 2012 and culminated in an August 2014 settlement. The simple fact is that the workers worked between 77-112 hours per week, making about $12 per hour, so these people were working a huge amount of overtime hours. Then, after many times being asked to give back the “hard-earned” settlement dollars, the company decided to try an alternative method to recoup the money.
While DOL investigators were looking into the alleged retaliation, they also uncovered other violations by the company of FLSA overtime laws. The agency is seeking back pay and damages for the alleged retaliatory action and, adding insult to injury, seeking overtime wages for the two employees at issue as well as two other technicians.
Sometimes it is better to leave well enough alone. The most important thing for me, when I am advising and representing a client in a DOL audit, is to come out of the audit or inspection, fix what was broken and then move on. The company here seemingly did not do that.
So the company will perhaps learn another, harder, more expensive lesson.