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United Plastics and Citigroup Technology Inc. to Pay Over $3.3 Million in Back Wages

Aug 9, 2016

Investigations conducted by the United States Department of Labor discovered that United Plastics and Citigroup Technology Inc. failed to properly compensate workers for overtime labor, as well as other violations of the Fair Labor Standards Act (FLSA).

The Department of Labor discovered through the course of their investigation of United Plastics manufacturing plants located in Leominster, MA and Sardis, MS that, along with ASI Staffing Group Corp., who provided the company with contract labor, employees were systematically underpaid over a three year period by denying overtime pay. The U.S. District Court for the District of Massachusetts ordered the companies to:

  • Pay the 566 affected employees $716,809 in back wages and $716,809 in liquidated damages – $1,433,618 in total – by the end of 2016.
  • Pay the United States Labor Department $100,000 for repeated and willful violations.
  • Hire consultants to provide the Wage and Hour Division with quarterly progress reports, and to create recordkeeping and pay systems to ensure the companies’ practices comply with the FLSA.

According to the Department of Labor, Staffing group created alternate false companies that, when an employee worked over 40 hours, the extra hours would be listed under one of those other company names, and they would only receive payment for regular hours worked. The employees affected by this scheme often worked close to 50 hours per week, and were employed as color mixers, molding technicians, machine operators, quality control workers, and maintenance workers.

United Plastics was apparently aware that their workers were not receiving overtime pay, and also failed to maintain legally required records of what rates employees were paid at or how many hours they worked. Wage and Hour Division regional administrator Mark Watson, Jr. said that,

“Employers who use staffing agencies as a cover for short-changing workers of their hard-earned wages are breaking the law, plain and simple. Violations like this not only deprive workers of money they need to meet their living expenses, they also undercut law-abiding employers who pay their workers legally and play by the rules. The resolution of this case should send a strong message that employers can’t hide behind staffing agencies to avoid their responsibilities to their workers.”

A separate investigation by the Department of Labor into Citigroup Technology Inc. (CTI) based out of Tampa, FL found that 882 employees were denied overtime compensation after they were incorrectly classified as analysts and administratively exempt from the overtime requirements set forth in the FLSA. CTI was required to pay the employees in question $1,870,009, and were fined $97,680 for repeated violations. Along with paying the back wages and fine, CTI signed an agreement with the Department of Labor requiring them to review all remaining employees classified as analysts to ensure compliance with the FLSA, and will notify the Wage and Hour Division of any employees due back wages in writing.

If your employer has failed to pay you overtime wages, contact the lawyers at Bailey Peavy Bailey Cowan Heckaman today. Out legal team has over 100 years of collective experience, and has the resources and skills needed to ensure that your case is handled in a way that maximizes your potential compensation. Call us at (888) 367-7160 to set up a meeting with one of our attorneys, or send us your information through our online form to request a free consultation.

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