Senate Cafeteria Workers to Collect $1M in Unpaid Wages

     WASHINGTON (CN) – Cafeteria workers on Capitol Hill will recoup over $1 million in back pay after an investigation by the Labor Department found private contractors were misclassifying employees to pay them less than they should have.
     Joanna Hawkins, a regional director for the department, said a six-year investigation revealed that private contractor Restaurant Associates and a subcontractor, Personnel Plus, illegally underpaid the workers by using a series of misclassifications on employee records, for example, demoting someone on paper from a chef to a food server.
     The department said that in addition, the companies also made “employees work prior to their scheduled starting times without compensation.”
     The mislabeling also permitted the contractors to pay “below the required rates [which] also caused the companies to fail to pay the workers overtime at the proper rates,” the government said.
     The investigation uncovered unpaid health and welfare benefits and evidence and found that record keeping by Restaurant Associates was routinely incomplete in violation of the Fair Labor Standards Act.
     The Labor Department said 604 employees were adversely affected by these practices, and that as a group, they are owed more than $1 million.
     The FLSA ensures that “nonexempt workers be paid at least the federal minimum wage of $7.25 per hour for all hours worked plus one and one-half times their regular rates of pay for hours worked beyond 40 per week.” Cafeteria worker’s wages are protected under “prevailing wage laws” since they are funded by the American taxpayer. These laws guarantee minimum pay but also deter contractors from undercutting the labor force.
     David Weil, head of the Wage and Hour Division, the agency that lead the investigation, said in a statement the workers “shouldn’t have to deal with the paychecks that don’t accurately reflect their hard work and the wages to which they are legally entitled.”
     The violation may also force the Wage Hour Division to nix the contractor’s access to future federal contracts but that has yet to be determined.
     According to the department’s labor standards for federal service contracts, ineligibility for future contracts is determined when “unusual circumstances” are found, but those circumstances are not defined in the act. “The the determination must be made on a case-by-case basis in accordance with the particular facts present,” the code states.
     When first reached for comment this afternoon, Personnel Plus president Bob Guiney said he was unaware of the Labor Department’s allegations.
     “All we know is we had people working down there, and we had a contract with Restaurant Associates. We were told what to do, what to pay the people and everything,” he said. “But then I guess we were told the wrong thing. They have all the records. All I know is Restaurant Associates is paying back wages to employees. We’re not really involved.”
     Guiney said he was unable to reach lead investigator Bill Shodd, but emphasized that Personnel Plus was not associated with “any federal contracts at all.”
     “Restaurant Associates didn’t know there was such a backlog and didn’t communicate that to us. The Department of Labor gave [Personnel Plus] a clean bill of health. We personally had to pay nothing in back wages. Zero,” Guiney said.
     Guiney also expressed concern that the announcement of the investigation “implicated we did something wrong,” he said. “[DOL] makes it sound like we aren’t for paying wages.”
     Hawkins said despite these assertions, Personnel Plus, as a subcontractor also failed to pay all of its workers for all hours worked which resulted in additional back wages.
     “It is a prime contractor’s responsibility to formally advise subcontractors of the requirements of the SCA and their obligation to adhere to those requirements,” she said. “In this case, Restaurant Associates failed to do so, and took responsibility for that and agreed to pay the back wages owed to the employees of Personnel Plus. The Wage and Hour Division examined compliance for Personnel Plus only with regard to the employer’s performance on the specific contract in question. “
     Restaurant Associates senior vice president Sam Souccar was also unable to be reached for comment by phone Tuesday afternoon.
     Hawkins said the workers should be receiving their long overdue payment by August 3.

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