Wage and Hour Division (WHD)

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ATLANTA -- T.L. Wallace Construction Inc. has agreed to pay $168,220 in back wages to 27 employees after the U.S. Department of Labor’s Wage and Hour Division determined that the company was not in compliance with the provisions of the McNamara O’Hara Service Contract Act (SCA) and the Contract Work Hours and Safety Standards Act (CWHSSA).

“The Labor Department is committed to protecting employees’ rights by assuring that they receive at least the locally prevailing wage rate and fringe benefits when they work under a federal contract,” said Oliver Peebles III, deputy regional administrator of the Wage and Hour Division in the Southeast.

T.L. Wallace Construction was a subcontractor to Heritage Inc., which held the contract with the Federal Emergency Management Agency (FEMA) for the inspection and repair of trailers provided to people affected by Hurricane Katrina. The investigation was conducted as part of the Wage and Hour Division’s Hurricane Katrina Initiative.

Wage and Hour Division investigators found that the company’s employees were being paid a piece rate for each trailer that was inspected or repaired but at times did not receive the required federal prevailing wage rate. In addition, some employees did not receive fringe benefits payments for holidays and vacation as required under the SCA. Finally, the company failed to make overtime payments when employees worked more than 40 hours in a workweek.

The SCA applies to federal service contracts entered into by the United States or the District of Columbia that are in excess of $2,500. The CWHSSA, which also applies to federal contracts, requires payment of one and one-half times an employee’s basic rate of pay for every hour worked over 40 in a workweek.

The Labor Department’s Wage and Hour Division concluded 30,467 compliance actions and recovered a record $220 million in back wages for more than 341,000 employees in fiscal year 2007. Back-wage collections in fiscal year 2007 represent a 67 percent increase over back wages collected in fiscal 2001. The number of workers receiving back wages has increased by 58 percent since fiscal year 2001.

For further information about SCA and CWHSSA requirements, call the Labor Department’s toll-free helpline at 866-4US-WAGE (866-487-9243), visit the Wage and Hour Division Web site at www.wagehour.dol.gov or contact the division’s office in Birmingham, Ala., at 955 22nd St. N., Suite 656; telephone 205-731-1305.

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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.