CWS 3.0: August 21, 2013

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Feds Make Hospitality CW Buyers Pay

Two contingent workforce buyers in the hotel industry and a staffing firm have been ordered to pay tens of thousands in settlements, according to announcements by the U.S. Department of Labor.

In one case, 1750 Welton Street Investors LLC, which does business as Grand Hyatt Denver, and Xclusive Staffing of Denver agreed to pay $55,691 in back wages to 52 workers, the Department of Labor reported.

The Grand Hyatt must also pay $7,920 in civil penalties and Xclusive must pay $3,520 in civil penalties as well.

The staffing agency provided room attendants at the Grand Hyatt. The Department of Labor reported workers were not paid for time spent working before and after their scheduled shifts. Employees also did not receive pay for meal breaks.

Xclusive was also found in violation of the Fair Labor Standards Act at a recent investigation of the Gaylord Texan Resort and Convention Center in Grapevine, Texas, the department reported.

In another case, Midwest Lodging, a Cincinnati-based hotel operator, agreed to pay $47,654 in back wages to 67 workers from staffing firms that were misclassified as independent contractors, the department announced.

Midwest Lodging used Luxor Services Inc., Bahor Inc. and BA Cobalt Cleaning Inc., according to the department. And the affected workers were jointly employed by Midwest Lodging and the temporary staffing agencies.

In addition, the Department of Labor reported Midwest failed to pay overtime to workers directly employed by the company.

“Temporary employment agencies serve valuable and legitimate business needs in today’s economy, but employers may not use such services to escape their responsibility to pay their workers the minimum wage and overtime pay they are entitled to under the law,” said George Victory, district director in Columbus, Ohio, for the department’s Wage and Hour Division.

Midwest signed an enhanced compliance agreement which includes paying back wages to the employees of the staffing agencies that have ceased operation, creating an employee handbook which details wage-specific information, maintaining accurate payroll records, issuing payroll checks with detailed wage statements and ensuring that any workers supplied by a contracting agency are paid in accordance with the Fair Labor Standards Act.

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