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Department of Labor hits Alabama company for $110,000

The U.S. Department of Labor Wage and Hour Division (WHD) recently investigated JPO Contractors, Inc. and determined it owed $90,904 in back wages and liquidated damages to 43 employees. The company was found guilty of improperly categorizing its laborers as independent contractors instead of employees, thus creating a violation of overtime and record keeping laws. There was also a penalty of $19,737 for willful and repeated violation.

The Alabama-based framing and drywall company paid the employees straight time for overtime hours worked, which is legal for those who are contractors. The company was also found to not keep the required records, nor to display the most recent Fair Labor Standards Act posters.

According to a press release on the Department of Labor’s website, the violation occurred when the company performing drywall and framing work on the Methodist University Hospital in Memphis, Tennessee.

The official statement

According to Nettie Lewis of Wage and Hour Division District in Nashville: “When employers fail to pay employees the wages they have legally earned, they harm employees and gain an unfair advantage over their law-abiding competitors. The Department of Labor will use all the tools at its disposal when employers repeatedly violate the law. We encourage employers to contact us with any questions they may have, and to use the wide variety of tools we offer to help them understand their obligations and to comply with the law.”

Legal guidance helps companies and employees

Government documents can be confusing, however. So a knowledgeable business and corporate law attorney can be a tremendous help if a company is unsure of how to classify certain employees. A lawyer can help companies avoid lapses in compliance, thus avoiding penalties and fines.

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