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DOL roundup: IC misclassifications, work visa violations

The US Department of Labor announced fines and settlements totaling more than $700,000 in cases involving independent contractor misclassification as well as H-1B and other work visa violations.

Visa Violations

$74,290 — Silvis Group Inc., a Mount Pleasant, Pennsylvania, landscaping company, has entered consent findings with the DOL requiring payment of $74,290 in back wages and penalties for violating the labor provisions of the H-2B temporary visa program, including denying employment to two qualified US applicants; failing in some weeks to pay overtime at the correct rate; taking impermissible deductions for uniforms and housing in poor condition; failing to cooperate with and actively working to hinder the Wage and Hour Division investigation; misrepresenting dates of temporary need and the number of employees needed on its Petition for a Nonimmigrant Worker and Foreign Labor Certification forms; and failing to meet the requirement to contractually forbid third parties from seeking payment from employees.

$14,350 plus debarment — Farmers Branch, Texas-based Joon Beauty Line Corp. paid $13,851 in back wages, $500 in civil money penalties, and agreed to a one-year debarment from the H-1B foreign labor certification program to resolve a DOL lawsuit. The charges against Joon Beauty Company Line include failing to pay wages as required, failing to maintain a public access file and substantially failing to provide notice of the filing of the Labor Contract Agreement at each place of employment where any H-1B worker will be employed.

$124,999 The NASWA Motor Inn Inc., doing business as The NASWA Resort in Laconia, New Hampshire, has paid $64,449 in back wages to 64 employees and $60,550 in civil money penalties to resolve violations of the H-2B visa program. Among violations found by WHD investigators: The resort failed to offer the same terms and working conditions to US job applicants that it provided to H-2B employees during 2016 and 2017; placed H-2B employees in job classifications outside of those included on the employer’s approved applications, and paid those workers less than the required wages; required the foreign employees to pay their own visa fees; failed to provide the required job information to all foreign employees when required; failed to reimburse employees the required amount for travel to the resort and back to their home countries; and overcharged foreign employees for housing.

$24,625 — Two agricultural employers in Idaho have paid a combined $24,625 in back wages to 19 employees for multiple violations found under the H-2A temporary agricultural worker visa program. The employers have also paid a total of $26,946 in civil money penalties.

Alan Brown – a commercial beekeeper and honey producer in Soda Springs, Idaho – gave preferential treatment to H-2A workers by paying a US worker less for doing the same work, the WHD said. The employer also failed to meet housing safety and health requirements; pay transportation and other expenses to H-2A workers traveling to and from Peru; and meet the frequency of pay requirements.

Investigators also found that Brown retained the H-2A workers’ passports and visas, failed to provide the employees with pay statements, failed to pay the required rates, and made impermissible pay deductions from workers’ earnings.

In a separate investigation, WHD found Forrest Arthur — a sheepherder and agricultural grower and harvester in Paul, Idaho — in violation of several H-2A visa program requirements. Investigators determined Arthur failed to reimburse H-2A workers from Peru and Mexico for transportation expenses to and from their home countries, failed to pay the required rates of pay to some workers, and failed to meet required housing and transportation safety requirements.

IC Misclassification

$118,425 — Michigan-based New Image Landscaping LLC and owner Jeremy Cizauskas will pay 32 former employees $118,425 in back wages and damages, after a DOL Wage and Hour Division investigation.

WHD investigators determined the employees did not meet the criteria for classification as independent contractors because Cizauskas exercised control over the work they accomplished, including scheduling and providing equipment, training, and uniforms. The employer controlled pay rates and the hiring of employees working in his landscaping, lawn mowing, and snow removal business.

The court agreed the workers were not independent contractors, but rather employees, and were therefore entitled to overtime and ordered the employer to pay $59,212 in overtime back wages and an additional, equal amount in liquidated damages. WHD investigators found many of Cizauskas’ employees routinely worked in excess of 50 hours per week at a set hourly rate, and that the employer often failed to pay them for time that they worked when they missed their meal breaks.

$199,010 — C&W Trucking Inc., an Orange, California based contractor for the US Postal Service, will pay $199,010 in wages and unpaid benefits to 56 employees who were found to have been misclassified as independent contractors

$133,070 — San Marcos, Texas-based U.S. Security Service PLLC has paid $133,070 to resolve minimum wage and overtime violations of the Fair Labor Standards Act. WHD investigators found that the security services provider made deductions from employees’ wages to pay for uniforms, which lowered their hourly wages below the federally required $7.25 per hour. The company also incorrectly classified security guards as independent contractors and subsequently failed to pay them overtime when they worked more than 40 hours per week.

$33,034 — Avalon Hunter Jumpers LLC, a San Francisco Bay Area horse training facility, will pay $33,034 to seven employees who were misclassified as independent contractors and, as a result, not paid overtime when they worked more than 40 hours in a workweek.

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