Wage and Hour Division (WHD)

Printer-Friendly Version

Press Releases

NASHVILLE, Tenn. -- Boulton Enterprises has agreed to pay $146,926 in back wages to 94 employees following an investigation by the U.S. Department of Labor’s Wage and Hour Division.

Investigators determined that persons employed by the Nashville construction company were misclassified as independent contractors and therefore not paid in compliance with the provisions of the Fair Labor Standards Act (FLSA). The employees were paid straight time for all hours worked with no overtime pay for hours worked in excess of 40 hours per week. One nonexempt mechanic was paid a straight salary without additional compensation for hours worked beyond 40 in a workweek.

“This problem is common in the construction industry, where companies hire so-called ‘independent contractors’ who should be considered employees because they do not meet certain tests,” said Sandra Sanders, acting district director of the Wage and Hour Division’s Nashville office.

After the Wage and Hour Division explained the requirements of the law, the company agreed to pay all back wages owed employees and to comply with the federal wage and hour law in the future.

For purposes of the FLSA, there are a number of factors for determining whether an individual is an independent contractor or an employee. In this case, the division found that the company’s workers did not meet the legal factors for independent contractor status.

When it has been determined that an employer-employee relationship does exist, and an employee is engaged in work that is subject to the FLSA, the employee must be paid at least the federal minimum wage, which is now $5.85 per hour, and, in most cases, time and one-half the employee’s regular rate of pay for all hours worked in excess of 40 per week. The minimum wage will increase to $6.55 per hour effective July 24, 2008, and to $7.25 per hour effective July 24, 2009.

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 more information about the FLSA and other laws administered by the Wage and Hour Division, call the Labor Department’s toll-free helpline at 866-4US-WAGE (487-9243), visit the Internet at www.wagehour.dol.gov, or contact the division’s Nashville office at 1321 Murfreesboro Road, Suite 511; telephone: 615-781-5344.

###

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.