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​Department of Labor Targets Employers Cutting Corners with Disadvantaged Workers​​

By Ashley Kaplan, Esq. on 8/28/2014
DOL targets employers cutting corners

Better funded and committed to more aggressive enforcement, the Wage and Hour Division (WHD) of the Department of Labor is taking a critical view of time and pay issues affecting vulnerable workers. As part of its oversight of the minimum wage, overtime, recordkeeping and youth employment provisions under the Fair Labor Standards Act (FLSA), the WHD is focusing on these “disadvantaged populations”:

Young workers who don’t have the knowledge or confidence to defend themselves from inappropriate treatment
Low-wage workers who don’t have access to assistance
Non-English-speaking workers

It’s not uncommon for the DOL to target certain industries in its strategic planning, especially businesses employing low-wage or immigrant workers. This is because violations are more prevalent with these employers, and the affected employees are less likely to take steps to file a complaint with the agency.

Industries that fall under this scrutiny may include:

Transportation and warehousing
Health care
Child care
Restaurant and/or catering
Guard services
Meat and poultry processing
Personnel services (including temporary help and staffing firms)

    Within these industries, the DOL is particularly interested in “fissured industries” where alternative business arrangement may exist, making the nature of the work relationship less definable and, in turn, susceptible to exploitation. A fissured industry relying on subcontracting, third-party management, franchising and other contractual relationships, for example, may cut corners with FLSA compliance in the absence of a direct employer-employee relationship.

    Cracking down on FLSA violations

    The FLSA abuses that can occur in these industries and among these vulnerable workers are plentiful, including minimum wage violations, not paying adequate overtime wages, employing under-age children, poor recordkeeping that doesn’t meet FLSA requirements and improper classification of employees as independent contractors. As part of its outreach, the DOL wants to ensure that workers receive the wages and overtime they’ve legally earned. These workers are also entitled to a work environment free of exploitation, where they understand their rights and are allowed to exercise those rights.

    As many employers are already aware, the DOL’s enforcement efforts have strengthened under the Obama administration. If the 2015 budget is approved, the enforcement arm will get even stronger, with the DOL’s Wage and Hour Division receiving a $41 million revenue bump that would support the hiring of an additional 300 investigators. The added resources would not only allow the agency to respond more effectively to wage complaints, but also to conduct directed investigations on industries where violations are high, but vulnerable workers are less likely to file a complaint. ​

    Labor Law
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