On March 24, 2009, the Department of Labor (“DOL”) issued a statement making clear that employers, including Hawaii employers, can expect an increase in DOL audits.  The statement, issued through Secretary of Labor, Hilda Solis, can be found at the DOL’s website, http://www.dol.gov/opa/media/press/esa/esa20090324.htm.

Among other things, Ms. Solis stated that she is “committed to ensuring that every worker is paid at least the minimum wage, that those who work overtime are properly compensated, that child labor laws are strictly enforced and that every worker is provided a safe and healthful environment.”

In addition:

The department’s Wage and Hour Division has already begun the process of adding 150 new investigators to its field offices to refocus the agency on these enforcement responsibilities. In addition, under the American Recovery and Reinvestment Act, the agency will hire 100 investigators to ensure that contractors on stimulus projects are in compliance with the applicable laws. The addition of these 250 new field investigators, a staff increase of more than a third, will reinvigorate the work of this important agency, which has suffered a loss of experienced personnel over the last several years.

Finally, Ms. Solis stated that:  “I am dedicated to ensuring compliance with federal labor laws to both strengthen our economy and protect workers in this country.”

Given the expressed intent of DOL, it is critical that Hawaii employers take the necessary steps, now, to both reduce the risk of potential liability connected to a possible audit AND to prepare for audit itself. 

Thus, Hawaii employers should at a minimum take the following steps prior to and during the audit:

After the audit is completed, it is critical that the Company not repeat any errors in policies or procedures identified by DOL.  Accordingly, any necessary revisions should be made promptly with assistance of counsel.

Roman Amaguin, Esq.; romanamaguin@yahoo.com; www.amaguinlaw.com

Roman Amaguin, Esq. is a Hawaii lawyer specializing in employment law, labor law, and civil litigation.

QUESTION: Dear Mr. Cheng: I used to work in a restaurant and the owner worked us 10 Hours a day straight. I am tired. Recently, I requested a break and was fired. I am still waiting for my paycheck and it has been two months. I was paid $30/Day and owed $390.00 for 13 days of work because I worked six days a week. I worked there for 6 months. Is this legal? Jessica – Rosemead ANSWER: Jessica, not only was this illegal but the violations of the law allow you to receive much more money than what you think is owed to you. Our business law department represents numerous businesses in the San Gabriel Valley, including restaurants. The actions by the owner are classic labor law violations. Minimum Wage: First, no person can contract for less than minimum wage. Currently, minimum wage is $8/Hour in 2008.

Therefore, at a minimum you are owed $80/Day and not $30/Day as stated. Meal Breaks: Each day you work more five hours you are required to get a meal break not less than 30 minutes. Failure to do so allow you to receive a penalty of $8/Day for every meal missed. Furthermore, depending on your specific circumstances you may also need to receive another $8/Day in a second meal break missed. Rest Breaks: You were also required, based on your circumstances, to receive a rest break no less than 10 minutes, twice a day. A violation of this allows you to receive one additional hour of pay. Overtime: Any time you work over 8 hours a day and less than 12 hours you are required to receive 1.5 x your hourly wage. Therefore, each day you worked you were entitled to receive another $48/Day ($12 x 4). Termination: Anytime you are terminated you are required to receive your pay immediately. If you do not you receive your average daily wage as a penalty for up to 30 days. Therefore, being that your average daily wage (including penalties) should have been $128 you are entitled to receive $3840.00 in penalties. Conclusion: The approximate amount you are entitled to receive based upon your facts is $17952.00. This is calculated on the wages and penalties that you are entitled to receive minus the actual amount received. In conclusion to your question, the answer is no, this was absolutely illegal. QUESTION: Dear Attorney Cheng: I am a business owner in a large company in the San Gabriel area. I am worried about Labor Code violations because the employee recently requested time records and I no longer have them. Are there any legal consequences of not keeping employment records? Sam – Rowland Heights ANSWER: Dear Sam, under the Labor Code you are required to keep documentation available for your employees to copy. Failure to do so within 21 days of a written request for them entitles employees to damages that can range up to $4000.00. Furthermore, when there is a labor dispute, there is a presumption that if the employer fails to keep proper documentation, the employees’ statements can be used to support hours worked. This is a very severe consequence because an employee can claim many extreme figures for their employment. However, if the employer cannot substantiate the hours worked, the employee is not penalized for a disorganized employer.