US Labor Department Secures $1 Million in Overtime Back Wages for 154 Hurricane Katrina Recovery Workers

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

HOUSTON — The U.S. Department of Labor's Wage and Hour Division has resolved a lawsuit against a Houston-based project management corporation, and  an Irving, Texas-based engineering and construction company for failing to pay $1 million to 154 workers in overtime compensation in the wake of Hurricane Katrina as required by the Fair Labor Standards Act (FLSA).

"Workers who help rebuild our communities and secure the safety of local residents following natural disasters should be fairly and legally compensated for the work they perform," said Secretary of Labor Hilda L. Solis. "This department is committed to securing their wages and overtime."

The department filed a consent judgment against the Texas-based company, and obtained a default judgment against the Houston-based company in the U.S. District Court for the Southern District of Texas, Houston Division, following an investigation by the Wage and Hour Division in Houston which found that the companies paid straight time only for all hours worked. The settlement agreement has resulted in payment of $1 million for these hurricane workers. Payment of back wages is ongoing.

The Texas-based company, primarily engaged in engineering, procurement and construction, entered into a contract with the Federal Emergency Management Agency following Hurricane Katrina. As general contractor, the company subcontracted with the project to inspect temporary housing trailers for displaced residents who lost their homes in the aftermath of the hurricane. The company has denied the company had any liability.

"Some employees involved in the inspection of trailers during the hurricane recovery worked up to 84 hours in a week without the required overtime compensation for hours worked over 40 in a workweek," added Cynthia Watson, regional administrator for the Wage and Hour Division's Southwest Region.

The FLSA requires covered employees be paid at least the federal minimum wage of $7.25 for all hours worked, plus time and one-half their regular rates of pay, including commissions, bonuses and incentive pay, for hours worked beyond 40 per week. Employers must also maintain accurate time and payroll records.

For more information about the FLSA and other federal wage laws, call the Wage and Hour Division's toll-free helpline at 866-4US-WAGE (487-9243) or the Wage and Hour Division's district office in Houston at 713-339-5500. Information is also available on the Internet at http://www.dol.gov/whd.

For information on FLSA and other fair pay laws and regulations, or to protect your company against potential liability, please contact Berkshire Associates at 800.882.8904 or email bai@berkshireassociates.com.