A construction staffing agency and its owner must pay $278,073 in back wages and liquidated damages to 208 construction workers for intentionally misclassifying workers as independent workers, the U.S. Labor Department said Thursday.
The DOL said the U.S. District Court in Norfolk, Virginia entered a consent judgment on Sept. 15 ordering Suffolk, Virginia-based Resto Contracting LLC and its owner, Bethany B. Resto, to pay $139,036 in back wages and an equal amount in liquidated damages to the affected workers.
The DOL said the consent order followed a finding by the department’s Wage and Hour Division that the company and its owners hired workers as finishers, loaders, operators and carpenters, then illegally misclassified them as independent contractors.
The department said the workers were paid directly for all hours, including those that totaled more than 40 in a workweek, denying them required overtime pay, in violation of the Fair Labor Standards Act.
The statement said the department̵7;s Office of the Solicitor successfully argued in federal court that bankruptcy could not stop enforcement and litigation after the employer filed for bankruptcy in an attempt to stop the case.
It said months of contentious litigation ended when the employer agreed to the consent judgment and FLSA compliance.
The department said that in addition to recovering back wages and damages, the consent judgment permanently enjoins the employer and its owners from future FLSA violations and prohibits them from firing or retaliating against employees who exercise their FLSA rights.
An attorney for the staffing agency and the owner had no comment.