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Florida employer settles labor investigation for nearly $2 million for improperly classifying workers as exempt from overtime

The U.S. Department of Labor (DOL) investigated the pay practices of a Florida subsidiary of a national employer. The probe revealed the employer misclassified hundreds of employees as exempt from receiving overtime compensation and also failed to maintain time records, both violations of the Fair Labor Standards Act (FLSA). Oliveira et al. vs. Citicorp North America, Inc., et al. Case 8:12-cv-00251-RAL-TGW.

As a result of the DOL’s Wage and Hour Division investigation, the employer has paid 882 employees a total of $1,870,009 in back wages and a civil penalty of $97,680 for repeat violations. The DOL’s investigation focused on the employer’s practice of classifying analysts improperly as administratively exempt from the FLSA’s overtime requirement. By misapplying an exemption to these workers, the employer was required to pay overtime compensation when they worked more than 40 hours in a work week. Because the DOL determined the workers were not exempt from overtime, the employer’s failure to maintain time records for these employees was also another violation.

The Administrator for the DOL’s Wage and Hour Division, Dr. David Weil, warned employers as follows:

“Employers must understand that simply paying an employee a salary does not necessarily mean the employee is not eligible for overtime;” and “The back wages and penalties paid in this case should cause other employers to take note, and to examine their pay practices. The Wage and Hour division will continue its vigorous enforcement of the …overtime regulations….”

 The employer in question has paid the back wages and has signed an agreement with the DOL which requires it to review compliance for all of their remaining analyst positions and advise the DOL if any back wages are due. It should be noted that in this case, the wages and penalty only cover violations committed during a two year period.  Because the law permits recovery for a three year period if willful, this nearly $2 million settlement could have been much higher if the case was litigated and the DOL proved that the violations were “willful.”The FLSA provides an exemption from both minimum wage and overtime pay requirements for individuals employed in bona fide executive, administrative, professional and outside sales positions, as well as certain computer employees. To qualify for exemption, employees generally must meet certain tests regarding their job duties and be paid on a salary basis at not less than $455 per week . Job titles do not determine exempt status. For an exemption to apply, an employee’s specific job duties and salary must meet all the requirements of the department’s regulations.  Employers should conduct audits prior to December to ensure that their pay practices are in compliance with the White Collar exemptions, especially if they are classifying workers as “exempt” from overtime.


If you would like to speak with a Florida employment lawyer experienced representing Florida employers when claims are made alleging FLSA misclassification of workers, you can email our Law Office of David Miklas, P.A. or you can call us at 1-772-465-5111.


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