New York City Area Car Washes Agree to Pay Employees $3.4 Million in Back Wages and Damages to Resolve U.S. Labor Department Lawsuit

Source: U.S. Department of Labor (DOL)

NEW YORK — Nine car wash companies throughout New York have agreed to pay 1,187 current and former employees a total of $3.4 million in back wages and liquidated damages to resolve their part of a lawsuit filed by the U.S. Department of Labor alleging violations of the federal Fair Labor Standards Act (FLSA).

The agreement, in the form of a final partial consent judgment, brings to a conclusion the suit filed by the secretary of labor in the U.S. District Court for the Southern District of New York, which named as defendants a number of related car wash and auto lube businesses and the individuals who operated them. Three partial consent judgments filed earlier in this case resulted in the recovery of $1,348,489 in back wages, liquidated damages, and post-judgment interest for more than 200 employees of the defendants' various other corporations. The suit has resulted in a total recovery of more than $4.7 million in back wages, liquidated damages and post-judgment interest to more than 1,300 employees. It followed an investigation by the Labor Department's Wage and Hour Division that disclosed violations of the FLSA's minimum wage, overtime, and recordkeeping requirements.

"This case should be a loud wake up call to other employers of vulnerable workers that the U.S. Department of Labor will not hesitate to pursue them in federal court in order to compel them to pay employees properly for all hours worked," said Secretary of Labor Hilda L. Solis. "Employers must be aware of their obligation to comply with all federal labor laws, and we are here to make sure that they do."

The FLSA requires employees be paid at least the federal minimum wage and time and one-half their regular rates of pay for hours worked over 40 per week. Employers also are required to maintain accurate records of employees' names, addresses, wages, hours, and other conditions of employment.

The consent judgment prohibits the defendants from future violations of the FLSA's minimum wage, overtime, and recordkeeping requirements, and orders them to pay employees back wages, liquidated damages and post-judgment interest. If the defendants fail to make the payments, the court will appoint a receiver with power to seize and liquidate their assets to satisfy the order. Finally, the defendants must post in their facilities, where all employees may view them, official Department of Labor posters informing employees of their rights under the FLSA.

The Wage and Hour Division's district office in New York City is attempting to locate several workers who are no longer employed by the establishments to pay them the back wages to which they are legally entitled. Individuals who believe they are due back wages as part of this settlement should contact the New York District Office of the division at 212-264-8185. Over the past two years, that office has recovered more than $5.4 million for workers in the New York City car wash industry. For more information about the requirements of the FLSA, contact the Wage and Hour Division office in Manhattan at 212-264-8185 or call the Department of Labor's toll-free helpline at 866-US-WAGE (487-9243). Information is also available on the Internet at http://www.wagehour.dol.gov.

For further information on FLSA or fair pay laws and regulations, please contact Berkshire Associates at 800.882.8904 or email bai@berkshireassociates.com.