FROM: U.S. DEPARTMENT OF LABOR
US Labor Department sues Boston Hides & Furs Ltd., seeking at least $1 million in back wages and damages for underpaid, wrongfully fired workers
Chelsea, Mass., business also assessed $100,000 penalty for willful labor violations
BOSTON — Citing "knowing, deliberate and intentional" violations of federal wage and hour law, the U.S. Department of Labor has filed a lawsuit against Boston Hides & Furs Ltd. and company officials seeking at least $500,000 in back wages and an equal amount in liquidated damages for underpaid employees of the Chelsea wholesale animal hide business.
The department filed the lawsuit in federal court following an investigation by its Wage and Hour Division that found the employer committed willful and repeated violations of the minimum wage, overtime and record-keeping provisions of the federal Fair Labor Standards Act, including offering for shipment or sale "hot goods" produced in violation of the law during a period spanning at least three years. The suit also asserts that the company unlawfully retaliated against several workers by firing them after they cooperated with the federal investigation.
"The violations uncovered by this investigation reveal a disturbing disregard for the law," said Secretary of Labor Hilda L. Solis. "Such unacceptable behavior not only harms the workers involved, it also undercuts employers who obey the law."
The investigation found that 14 Boston Hides & Furs employees worked approximately 10 hours per day, six days per week processing hides and furs for shipping to tanneries. These workers were paid a daily cash wage of $50 to $70, which amounted to an hourly pay rate far below the federal minimum wage of $7.25 per hour. The employees also were not paid time and one-half the required state minimum wage of $8 applicable for those hours worked above 40 in a week. Additionally, the defendants failed to keep adequate records of the workers' employment, work hours and pay rates, and a representative of the defendants falsely told investigators that the company's payroll records included all employees.
Further, the defendants ordered employees to hide in a nearby house when Wage and Hour Division investigators first arrived at Boston Hides & Furs so they could not be interviewed. Investigators subsequently interviewed the workers. Two days later, the defendants fired the workers. During their employment, the workers were threatened and subjected to verbally abusive treatment on an ongoing basis, particularly when they asked about their pay rates.
"If you work, you are entitled to be paid the wages you earn — at a rate no less than the applicable minimum wage, with proper overtime pay — and to seek those wages without fear of retaliation or termination. It's that simple and it's the law," said Michael Felsen, the Labor Department's regional solicitor for New England. "If you're an employer, understand that if you cheat your workers on their pay, the U.S. Department of Labor will seek not only the withheld wages but an equal amount in liquidated damages for those workers. And if you fire your workers or otherwise retaliate against them because they cooperated with a Labor Department investigation, we will seek appropriate redress for that violation too."
In addition to back wages and liquidated damages, the department's suit seeks to permanently prohibit the defendants from future FLSA violations — including a prohibition against shipping any goods handled by workers who were paid in violation of the law — and compensatory and punitive damages for the workers on account of their unlawful firing. The Wage and Hour Division also has assessed $100,000 in civil money penalties against Boston Hides & Furs Ltd. for willful violations of the FLSA.
The suit has been filed in the U.S. District Court for the District of Massachusetts by the Labor Department's Regional Office of the Solicitor in Boston. The original investigation was conducted by the Wage and Hour Division's Boston District Office.
The FLSA requires that covered employees be paid at least the federal minimum wage of $7.25 per hour as well as time and one-half their regular rates for every hour they work beyond 40 per week. When the state minimum wage is higher than the federally mandated wage, and employees work more than 40 hours in a week, employees paid at the minimum permissible level are entitled to overtime compensation based on the higher state minimum wage.
The law also requires employers to maintain accurate records of employees' wages, hours and other conditions of employment, and prohibits employers from retaliating against employees who exercise their rights under the law. The FLSA provides that employers who violate the law are, as a general rule, liable to employees for back wages and an equal amount in liquidated damages.
