W2 Issues/Concerns

  • This field is for validation purposes and should be left unchanged.

Blog

Check out our weekly blog posts and see the latest news and discussions happening in the HR world of business.

The rules for minimum wage violations when making pay deductions

The US Department of Labor recently ordered a regional restaurant group to pay $700,000 in back wages and damages to 129 employees that the DOL says were not fairly paid for their work.

In the case, the DOL claims that Wisconsin-based El Azteca restaurant group failed to pay its employees for all hours worked and paid kitchen staff a salary, regardless of the number of hours they worked, in violation of the Fair Labor Standards Act (FLSA). The restaurant also committed minimum wage violations when it made deductions from workers’ pay for uniform shirts, name tags and aprons, according to the labor department.

According to the DOLs Fact Sheet #16, if an employer requires its workers to pay for uniforms, it must ensure that the employees’ compensation for that week does not fall below the required minimum wage and minimum overtime due. However, if an employee receives more than the relevant minimum wage, the employer is allowed to prorate deductions for uniforms over multiple days.

To resolve the DOL’s claims, El Azteca will pay its workers $350,000 in back wages and $350,000 in liquidated damages; it will also pay $25,000 in civil penalties. In addition, the company must conduct FLSA training and perform quarterly reviews of time and payroll records at each location.

Commenting on the case, Thomas E. Perez, secretary of labor, said that restaurant owners should view this consent judgment as a “wake-up call,” adding that the DOL “takes these violations very seriously and will continue to use every tool at our disposal to ensure workers get the money they have earned.”

 

Featured BLOGS

  • Is It THAT Bad To Let Your Employees’ Rebel?

    As the leader of your business, you’re the one that gets to make the rules and the expectation is that, of course, your employees will follow said rules. However, a groundbreaking book from a Harvard University professor suggests that it is the employees that bend – or even break – the rules are actually the ones that will boost your business. In the book, appropriately titled Rebel Talent, author Francesca Gino argues that rebels reject the idea that there are limits on what they can achieve and thus will do what they can to “break, transform, and create.” So how

  • Are Your Payroll and Payroll Taxes Being Done Legally?

    When we think about payroll, we typically just think about the act of issuing paychecks to employees. However, if you’ve ever tried to run payroll on your own, you know that there is FAR more to it than simply cutting a check.  An error in the process, can land you in a lot of hot water with your employees and even more trouble with the authorities. Below, we outline just SOME of the legal considerations associated with staying compliant with payroll for your business. Get set up: Before you can ever even hire a single employee, you have to first

Archives