Wage and Hour Division (WHD)

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NEW YORK -- JieYu Fashion Inc. and company owner Ava Wu have agreed to pay 23 employees a total of $25,000 in minimum wage and overtime back wages to resolve a lawsuit filed by the U.S. Department of Labor alleging violations of the federal Fair Labor Standards Act (FLSA). The defendants will also pay a $2,500 civil money penalty.

An investigation by the department’s Wage and Hour Division district office in New York City revealed that low-wage employees were required to work more than 40 hours during many workweeks without being properly compensated for overtime, and that some were not even being paid the federal minimum wage. Additionally, the investigation found that the company did not keep proper records of the number of hours employees worked, their regular rates of pay and other required information.

The FLSA requires that covered employees be paid at least the federal minimum wage as well as one and one-half times their regular rates of pay for hours worked over 40 per week. The law also requires that accurate records of employees’ wages, hours and other conditions of employment be maintained.

The suit was filed by the Labor Department’s Regional Solicitor’s Office in New York City with the U.S. District Court for the Southern District of New York. A consent judgment resulted in which the defendants neither admitted nor denied violations of the FLSA. However, they are prohibited from future violations of the law’s minimum wage, overtime and recordkeeping provisions. The court order, signed by Judge Naomi R. Buchwald, also prohibits the defendants from taking retaliatory action against any employees who exercise their rights under the law.

Finally, the defendants must advise employees, in English and the employees’ native language, of their rights under the FLSA, the terms of the judgment and their right to engage in protected activities without fear of retaliation. Official posters must be placed where all employees may view them.

“We felt compelled to take this employer to court,” said Philip Jacobson, director of the Wage and Hour Division’s district office in New York City, “because they had been found in violation of the FLSA in the past and were continuing those violations. We hope, now that they are subject to an order of the court, JieYu Fashion and Ava Wu will come into full compliance with the law and pay their employees properly from now on.”

The back wage payments cover the period between June 9, 2004, and August 6, 2006. If the defendants fail to make any payments, the court will appoint a receiver with power to seize and liquidate their assets to satisfy the order.

For more information about the FLSA, call the U.S. Department of Labor’s toll-free helpline at (866) 4US-WAGE (487-9243). Information is also available on the Internet at www.wagehour.dol.govand through an interactive “e-laws advisor” at www.dol.gov/elaws/flsa.htm..

Chao v. JIEYU FASHION INC. et al; Civil Action Number: 07-CV-04844-NRB

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