The U.S. Department of Labor (“DOL”) has recovered $613,037 in back wages for 46 workers after the DOL found that a Minnesota-based restaurant chain, NY Gyro, violated federal wage laws by paying employees straight-time wages for all hours worked, including overtime hours. The investigation also found that the restaurant failed to maintain accurate records of employees’ hours and paid at least one worker less than the $7.25 federal minimum wage.
Straight-time pay refers to an employee’s regular hourly wage for all hours worked. Under the Fair Labor Standards Act (FLSA), most non-exempt employees who work more than 40 hours in a workweek must be paid overtime at one and one-half times their regular rate of pay for hours in excess of forty per workweek. Employers cannot satisfy this requirement by paying an employee’s regular hourly rate for every hour worked.
According to the DOL, investigators found that four NY Gyro entities operating restaurants in Minnesota paid employees straight-time wages for all hours worked, even when employees exceeded 40 hours in a workweek. As a result, workers were denied the overtime compensation required by federal law. Investigators also found that the employer failed to keep accurate records of hours worked, making it more difficult to ensure employees received all wages they had earned.
Paying straight time wages instead of overtime is a common form of wage theft. Employees who regularly work long shifts or extended workweeks may not realize they are legally entitled to premium overtime pay. Workers should carefully review their pay stubs and hours worked to ensure they are being properly compensated. If you consistently work more than 40 hours in a workweek but receive only your regular hourly rates for those additional hours, you may be entitled to recover unpaid overtime wages. Only managers and other categories of “exempt” workers can be paid a salary and are not entitled to receive overtime pay at “time and one half” after forty hours.
The NY Gyro investigation is only one example of straight time wage theft. In another recent DOL enforcement action, the owner of four Leo's Coney Island restaurants in Michigan was ordered to pay more than $500,000 in back wages and damages. Investigators found that the company maintained two sets of timecards; one tracking regular hours and another tracking overtime hours, to avoid paying employees the overtime wages required by law. Employers who fail to properly compensate employees for overtime or manipulate payroll records may face significant financial penalties
If you believe your employer has failed to pay you proper overtime compensation or have questions about your rights under federal or state wage laws, contact the wage and hour attorneys of Pechman Law Group at 212-583-9500.
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