By Kim Slowey
July 28, 2016
Dive Brief:
- The U.S. Department of Labor has ruled that Arizona homebuilder DCO Custom Builders must pay $48,000 in back wages and penalties for misclassifying workers as independent contractors and not paying employees at overtime rates when required – in violation of the Fair Labor Standards Act, according to the Arizona Republic.
- The DOL investigated DCO for two years and ordered the contractor to pay 31 employees $24,255 in unpaid overtime, additional penalty wages and restitution in the amount of $4,604.
- Despite DCO’s actions, a DOL spokesman said the company is now in compliance with fair labor standards, and DCO managing owner Daniel Osete said the company was unaware it was violating a law and has taken internal measures to make sure the same situation doesn’t happen again.
Dive Insight:
Eric Murray, director of the DOL’s Phoenix Wage and Hour Division office, said misclassifying workers as independent contractors “cheats” employees and taxpayers alike. Murray told the Arizona Republic, “As this outcome shows, we are committed to protecting the rights of construction workers and will use every tool available to hold employers accountable.”