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Labor: State and federal agencies turn up heat on restaurants and contractors for wage and hour violations

Businesses that do not pay minimum wage or overtime could face stiff fines

The restaurant business is notoriously difficult. According to one study, about 60 percent of new restaurants fail within three years of opening. Restaurant owners work long hours in a highly competitive industry, with high turnover and extensive regulations. The persistent economic slowdown has added more pressure, with many cutting leisure expenses like dining out. Now comes another hurdle in the form of Big Brother, who is watching closely to make sure restaurant owners are complying with wage and hour laws. 

Restaurateurs and contractors beware

The scrutiny isn't just on restaurant owners—contractors also are under the microscope.  In Massachusetts, on March 8, Attorney General Martha Coakley announced that three companies that perform drywall installation, sewer cleaning and waste disposal work had agreed to pay a total of $2.8 million in restitution and fines for, among other things, misclassifying employees as independent contractors. On March 20, the DOL sued a Kentucky cable installation business to recover overtime pay for 165 installers allegedly classified as independent contractors in violation of the FLSA. 

The emphasis is on lower-paid workers

Contributing Author

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Richard Glovsky

Richard D. Glovsky is a partner and nationally recognized trial lawyer and employment law attorney with Edwards Wildman Palmer LLP. He can be reached at...

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