Two United States healthcare staffing companies have been instructed to repay employees $2.4 million in back wages.
The companies are based in Massachusetts and Pennsylvania and specialize in recruiting workers for the healthcare sector.
The court action was entered in the U.S. District Court for the District of Massachusetts against Gate Solution Systems Inc. of Malden, Massachusetts, and Healthcare Services Group Inc. of Bensalem, Pennsylvania.
“Misclassification of employees as independent contractors remains a serious concern for the Department of Labor,” said Wage and Hour Administrator Jessica Looman.
$2.4 million backwage bill for healthcare recruiters
The $2.4 million repayment of liquidated damages and wages results from an investigation by the Department of Labor’s Wage and Hours division.
“This case’s outcome should remind employers that the U.S. Department of Labor will take appropriate action, including legal action, to protect workers whose employers deny them proper pay under the Fair Labor Standards Act,” said Solicitor of Labor Seema Nanda. “The Department of Labor will always strive to protect the rights of workers.”
The government labor watchdog found that Gate Solution Systems Inc. incorrectly classified housekeepers, laundry, and dietary workers as independent contractors.
In this case, the employees provided services at Maine, Massachusetts, New Hampshire, and Vermont healthcare facilities. The report found that employees who worked over 40 hours in a workweek were not paid the “required overtime rate.”
Gate Solution Systems and its officers and managers will now comply with the regulations in the judgment to avoid further breaches of the Fair Labor Standards Act and improve their employment records and filing process.
“Preventing and combating misclassification is a priority for the Wage and Hour Division as it deprives workers of their rights to full wages, health and safety protections, unemployment insurance, workers’ compensation, and tax protections,” concluded Looman.
Image: Pexels.
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