Employer allegedly sought arbitration to force employees to cover future profits
NEW YORK – The U.S. Department of Labor has filed suit asking a federal court to stop a Brooklyn, New York, healthcare staffing provider from allegedly making employees sign contracts that would force them to work for the company for three years or repay rightfully earned wages.
Filed today in the U.S. District Court for the Eastern District of New York by the department’s Office of the Solicitor, the complaint against Advanced Care Staffing LLC and its CEO, Sam Klein alleges that the contracts led some employees to earn less than the federal minimum wage, a violation of the Fair Labor Standards Act.
“Federal law forbids employers from clawing back wages earned by employees, for employers’ own benefit,” said Solicitor of Labor Seema Nanda. “Employers cannot use workers as insurance policies to unconditionally guarantee future profit streams. Nor can employers use arbitration agreements to shield unlawful practices. The Department of Labor will do everything in its power to make sure employees are being paid their hard-earned wages, and to safeguard them from these types of exploitative practices.”
The department’s complaint seeks an injunction forbidding ACS and Klein from reducing employees’ wages below federal minimums, whether by demanding employees enter into contracts requiring them to cover ACS’ future profits, attorneys’ fees or costs associated with arbitration, or by enforcing such...
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