Alabama Carrier Fined For Worker Misclassification

Kenan Transport to Pay $27,000 to Settle EEOC Discrimination and Retaliation Suit

The Department of Labor has ordered an Alabama carrier to pay 63 employees $113,000 in back wages and damages.

According to the U.S. Department of Labor, the investigators front he Wage and Hour Division investigated Fitzhugh Contracting LLC and found that the company violated overtime and record-keeping provisions of the Fair Labor Standards Act.

The investigation revealed that Fitzhugh Contracting paid 63 workers “straight time” for all hours worked, however the Fair Labor Standards Act requires employers to pay overtime rates for any hours worked in excess of 40 hours.

In addition, investigators also found that Fitzhugh Contracting misclassified 46 employees as independent contractors, making them ineligible to receive earned wages and benefits.

Fitzhugh Contracting has agreed to pay 63 employees $56,367 in back wages, plus an “equal amount in liquidated damages for a total of $112,735.”

“Employers need to understand and be aware that it is unlawful to underpay employees, misclassify them as independent contractors, or pay straight time for overtime to increase their profit margin,” said Frank McGriggs, the Wage and Hour Division’s deputy regional administrator in Atlanta. “Other employers who may be paying workers in a similar manner should take note of this investigation and change their practices immediately.”