Failure to Pay Wages Costs Big Money to Companies, Shames Clients

By Linda H. Evans,
Senior Associate.

 

Metroclean Commercial Building Services, a company that provides cleaning services to many prominent businesses in Houston including the Houston Independent School District, has just agreed to pay nearly $275,000 in back wages to 266 janitors after a U.S. Department of Labor (DOL) investigation found minimum wage and overtime pay violations.  Some employees worked an average of 65 hours per week but did not receive overtime, according to the DOL.  The company also failed to maintain accurate records as required by federal labor law.  This case also sends a reminder to companies looking to hire contractors for cleaning, security, landscaping and other services to be aware of the contractor’s labor compliance history before making a selection.  If the contractor ends up owing back wages, the client companies just might find themselves in the spotlight too.  This is part of the “shaming” strategy used by the DOL to target high profile companies that use contract workers rather than focus on the relatively unknown contracting companies themselves.

 

And, for companies working in the Houston area, it should also be noted that as of November 20, 2013, Houston City Council unanimously passed rules giving more teeth to the state’s wage theft regulations, creating a blacklist of companies found guilty of civil or criminal wage theft violations and banning them for five years from city contracts or occupational licenses.  Wage theft can include misclassification, failure to pay overtime or just withholding of wages.  The new regulations also give Houston’s inspector general the ability to investigate wage theft complaints and put companies in the blacklist database for violations once all appeals have been exhausted.

 

So once again, we remind employers to be aware of DOL regulations that govern how wages are paid.

 

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