Employers, take note: The U.S. Department of Labor is watching your adherence to the Fair Labor Standards Act (FLSA), so be cautious — especially if you are on TV.
On April 23, the Department of Labor obtained a settlement agreement with well-known auto restyling center West Coast Customs of Corona, California, and its owner, to pay $157,592 in back wages and liquidated damages to 45 employees following an investigation by the department’s Wage and Hour Division. The investigation found that the company willfully violated the FLSA’s overtime, minimum wage, and record-keeping provisions. In addition to paying back wages and damages, the settlement agreement requires the employer to pay $16,830 in civil penalties.
West Coast Customs was featured on the MTV program Pimp My Ride during the cable TV show’s first few seasons, in programs produced by the Learning Channel and the Discovery Channel, and in the video game L.A. Rush.
Wage and Hour Division investigators found that the auto shop paid a weekly salary to employees regardless of the total number of hours worked. Reportedly, for some employees, this resulted in wages that averaged approximately $6 per hour, violating the FLSA’s minimum wage and overtime provisions. The investigators allegedly also established that, until 2011, West Coast Customs had misclassified employees as independent contractors.
The FLSA requires that covered employees be paid at least the federal minimum wage of $7.25 per hour, as well as one-and-a-half times their regular rates for every hour they work beyond 40 per week. As employers are surely aware, the FLSA also requires employers to maintain accurate records of wages, hours, and other conditions of employment; prohibits employers from retaliating against employees who exercise their rights under the law; and provides that employers who violate the law are generally liable to employees for back wages and an equal amount in liquidated damages.
If you have questions about the FLSA and your business, please contact: