Judge Susan Richard Nelson of the U.S. District Court for the District of Minnesota is requiring that Hawkins Tree and Landscaping Inc., a Shakopee, Minn., company, and its owners, Michael Hawkins and Dawn Hawkins, pay back wages as well as liquidated damages totaling to $478,000 to 57 current and former laborers, drivers, crew leaders and foremen of the company after violating the Fair Labor Standards Act.
Hawkins Tree and Landscaping and its owners are also set to pay $22,000 in civil money penalties.
"The misclassification of employees as independent contractors is a serious threat to both workers, who are entitled to good and safe job, and to employers who obey the law and are undercut when others use illegal practices," says Nancy J. Leppink, deputy administrator for the Wage and Hour Division. "The Department of Labor is committed to remedying employee misclassification and ensuring compliance to protect and enhance the welfare of the nation's work force."
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This judgment settles a lawsuit filed by the U.S. Department of Labor in 2010 following an investigation that suggested Hawkins Tree and Landscaping did not pay workers time and one-half their regular rates of pay for hours worked over 40 hours in a week. According to the investigation, Hawkins Tree and Landscaping also did not provide adequate records of hours worked and misclassified workers as independent contractors. Hawkins Tree and Landscaping and its owners have agreed to all violations. Under the consent judgment, the court determined that the workers were employees of Hawkins, not independent contractors.
The consent agreement terms state that Hawkins Tree and Landscaping must retain a certified public accounting firm to perform bi-annual audits of its pay practices to ensure compliance under FLSA and provide all employees information on the FLSA in English or Spanish. FLSA mandates that an employment relationship must be classified from a purely contractual one. An employee, which is separate from a person engaged in a business of his or her own, follows the usual path of an employee and is dependent on the business that he or she serves.
Based on FLSA requirements, employees be paid at least the federal minimum wage of $7.25 for every hour worked as well as time and one-half their regular rates, including commissions, bonuses and incentive pay, for hours worked beyond 40 per week. Employers must also retain accurate time and payroll records.
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