Wage and Hour Division (WHD)
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Allston, Mass., employer to pay $250,000 in back wages and damages to 42 workers following US Labor Department investigation
Employees misclassified as independent contractors, not paid required overtime
BOSTON -- Allston real estate and property management company Alpha Management Corp. and its owner, Anwar Faisal, have agreed to pay a total of $250,000 in back wages and liquidated damages to 42 employees following an investigation by the U.S. Department of Labor's Wage and Hour Division.
The Wage and Hour Division's Boston District Office found that the company and Faisal violated the federal Fair Labor Standards Act by misclassifying 42 workers as independent contractors and employing them for more than 40 hours per workweek without paying overtime for the excess hours. The employees worked as painters, maintenance employees, janitors, electricians, plumbers, floor installers and security guards at properties owned by Mr. Faisal and at other locations, such as Northeastern University.
"Employers who either intentionally or negligently misclassify their employees as independent contractors, thus avoiding paying legally required wages, are not just cheating vulnerable workers, they are also undercutting those employers who obey the law and pay their employees properly," said Dieera Fitzgerald, assistant director for the division's Boston office, which conducted the investigation.
Under the agreement, Alpha and Faisal will pay the workers $125,000 in back wages, minus legally required payroll taxes, covering the period of Nov. 16, 2008, through Nov. 13, 2010, plus an equal amount of liquidated damages. Proof of payment must be submitted to the Wage and Hour Division by Jan. 4, 2012. If Alpha and Faisal fail to comply with the terms of the agreement, including future compliance with all applicable provisions of the FLSA, they face possible legal action in U.S. district court.
The FLSA requires that covered employees be paid at least the federal minimum wage of $7.25 per hour as well as time and one-half their regular hourly rates of pay for every hour they work beyond 40 per week. The law also requires employers to maintain accurate records of employees' wages, hours and other conditions of employment, and prohibits employers from retaliating against employees who exercise their rights under the law. The FLSA provides that employers who violate the law are liable to employees for the back wages as well as an equal amount in liquidated damages.
Detailed compliance assistance on the FLSA and other laws enforced by the Wage and Hour Division is available on line at http://www.dol.gov/whd/regs/compliance/ca_main.htm.
The agreement was facilitated by the Labor Department's Regional Solicitor's Office in Boston. Workers and employers in Massachusetts with questions about their FLSA rights and responsibilities may call the Wage and Hour Division's Boston office at 617-624-6700 or its toll-free helpline at 866-4US-WAGE (487-9243).
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