Employers may make deductions for uniforms under the Fair Labor Standards Act but such deductions cannot take their wage rates under the minimum. Life Time Fitness just learned this truism. The gym chain has agreed to pay in excess of $976,000 in back wages and damages to almost 16,000 employees whose wages fell below the minimum after these deductions were made.
The Wage Hour Administrator stated that “the U.S. Department of Labor takes its responsibility to ensure workers receive the wages they have earned very seriously. This agreement will put thousands of dollars where they belong — in the pockets of hardworking people and their families.”
The agreement applies to workers at locations in 26 states. The Company will pay back $11,899 to 363 workers across three locations in Minnesota and $476,329 to 15,546 employees at locations in 26 states for a total of $488,228 in back wages. The Company will also pay a sum equal to the wages in liquidated damages and was also assessed Civil Money Penalties of almost $100,000 for these FLSA violations.
The Company has self-corrected. More than a year ago, the Company voluntarily ceased compelling employees buy their own uniforms. A Company spokesperson stated that “we are pleased to have since reached a resolution with the Department of Labor that was acceptable to all parties.”
The minimum wage is inviolate. Deductions can never reduce an employee’s wage rate below that basement level. Moreover, each State has their own rules, often times stricter than the FLSA, concerning “illegal” deductions. Thus, the takeaway here is to learn the wage payment laws of each State where business is conducted and to “honor” the sacredness of the minimum wage.