The agency’s Wage and Hour Division found the franchisee paid 33 nonexempt employees working as cooks straight time for all hours worked, including hours over 40 in a single workweek. This amounts to a violation of the Fair Labor Standards Act’s overtime provision, the DOL said.
The investigation also determined the employer violated recordkeeping provisions of the FLSA by falsely listing wage payments as bonuses.
Paying straight time beyond 40 hours and labeling wages as bonuses both affect the regular rate used to calculate overtime. When required earnings are excluded or misclassified, overtime is underpaid even if total pay appears correct.
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“Wage violations like these are all too common in the restaurant industry,” said Michael Gannet, Wage and Hour Division Acting District Director in Columbia, SC. He added that employers should review their pay practices and use Wage and Hour Division resources, such as its industry-specific compliance toolkits, to avoid similar violations.
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