Wage and Hour Division (WHD)

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CHICAGO --

The Grand Hotel, a hotel and resort complex on Mackinac Island, Mich., has paid $75,593 in back overtime wages to 70 salaried employees following an investigation by the U.S. Department of Labor.

“The Labor Department is committed to vigorously enforcing the law to ensure that employees are paid all wages they are owed,” said James Smith, district director of the department’s Wage and Hour Division in Detroit. “Workers must be paid overtime pay after 40 hours in a week unless they meet specific salary and job duty tests established for white-collar executive, administrative, or professional employees.”

The department’s Wage and Hour Division in Detroit investigated the Grand Hotel under the Fair Labor Standards Act (FLSA), the federal minimum wage and overtime law. The investigation disclosed that 70 salaried employees were misclassified as exempt from overtime pay. They worked as secretaries, receptionists, retail sales workers, cooks, food service workers, assistant managers, assistant foremen and performed job duties that required the payment of overtime pay even if the employees were paid on a salaried basis. The hotel also failed to keep a record of their hours worked. The investigation covered the period May 2002 through November 2003.

The Grand Hotel cooperated fully during the investigation. After the Wage and Hour Division explained the overtime requirements of the FLSA for salaried workers, the Grand Hotel immediately changed its payroll policies to comply with the law prior to the 2004 summer season. The department’s investigation found that most workers were paid by the hour and received proper overtime pay after they worked 40 hours in a week.

The Fair Labor Standards Act requires employees to be paid the federal minimum wage of $5.15 for all hours worked and time and one-half the regular rate of pay for hours worked over 40 in a week unless the employee is exempt from overtime pay. Employers must also maintain accurate time and payroll records.

The Wage and Hour Division recovered nearly $200 million in back wages in fiscal year (FY) 2004 for more than 288,000 workers. Average days to resolve a complaint decreased in FY 2004 from 108 days to 92 days.

For more information, call the Department of Labor’s toll-free help line at 1-866-4USWAGE (1-866-487-9243). Information is also available on the Internet at www.wagehour.dol.gov. Information about the current exemption for while-collar executive, administrative, and professional employees can be found on the Internet at www.dol.gov/fairpay.

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U.S. Department of Labor releases are accessible on the Internet at www.dol.gov. The information in this news release will be made available in alternate format (large print, Braille, audio tape or disc) from the COAST office upon request. Please specify which news release when placing your request at (202) 693-7828 or TTY (202) 693-7755. The Labor Department is committed to providing America’s employers and employees with easy access to understandable information on how to comply with its laws and regulations. For more information, please visit www.dol.gov/compliance.