It’s the height of hurricane season again. With reconstruction still going on in Texas post Harvey and in Puerto Rico post Irma and Maria, Hawaii having already been impacted by storm damage, and North Carolina and South Carolina heavily damaged by Hurricane Florence, it’s time to remind the thousands of workers who do the difficult and dangerous work to clean up and rebuild of their legal rights when it comes to overtime pay. History has proven again and again how unscrupulous employers (often staffing agencies) take advantage of these workers who work extremely long hours under difficult conditions – using various pay schemes to attempt to avoid paying the overtime wages they legally owe. In Puerto Rico and the U.S. Virgin Islands alone, over $14 million in back pay has already been recovered for employees.
Here is an overview of what you need to know:
1) There is no hourly rate high enough to exempt you from earning overtime pay
The most common, and blatant, overtime pay violation involving storm recovery workers is paying them a relatively high hourly rate for all hours worked – including their overtime hours. Paying straight time for overtime is usually justified by telling workers they are getting an hourly rate that is high enough to cover their overtime hours and/or something along the lines of “we don’t pay overtime to workers who make over $25 per hour”. This type of “you’re getting paid enough” scenario is almost always a violation of state and/or federal overtime labor laws. Unless you are doing computer programming work, you are almost certainly owed time and a half for every overtime hour you work, no matter what your hourly rate is – even it is $40, $50 or $100+ per hour. There is no exemption to the overtime laws for hourly workers doing blue collar, manual, clerical, and/or administrative work.
2) If you are paid a day-rate, you are still entitled to overtime pay
Paying a day-rate is legal, but does not mean that an employer does not have to pay overtime. This is the second most common scheme we see used to deprive workers of overtime pay. Similar to hourly workers discussed above, many clean-up and remediation companies will offer attractive per-day-worked rates, but no additional pay for all of the mandatory overtime hours they require. While they view the day-rate as full compensation for all hours worked, the wage laws do not allow this. The overtime pay calculation is a bit more complicated for day-rate workers, but time and a half is still legally required to be paid for all overtime hours worked.
3) If you are being treated as a “contractor”, you are likely misclassified – and owed overtime pay
Neck and neck with use of a day-rate to short-change workers on overtime pay is misclassifying them as contractors, independent contractors, temporary, or 1099 employees. Merely slapping a label on workers does not change the overtime laws or other obligations that employers have toward their employees. In addition to avoiding overtime pay, by treating workers as independent contractors, companies shift the cost of payroll taxes onto workers. Unless the specific legal requirements for being an independent contractor are met, workers are employees. If you are being told what to do, when to do it, how to do it, where to do it, can’t “sub” the work out to someone else, and are being provided with most or all of the tools and equipment necessary to do the job – you are almost certainly an employee and not a true independent contractor.
4) You cannot give up your right to overtime pay by signing an agreement
Both state and federal labor laws on overtime do not permit employees to give up or waive their legal rights to receive overtime pay. Even if you have signed an agreement that states you will be paid a set day-rate with no overtime or that you will only receive your regular hourly rate for overtime, or in any other way “agreed” to give up any overtime pay, the law does not recognize this as an enforceable contract. Lawmakers have long realized the leverage employers have over workers when entering into employment agreements and, as a result, have prohibited them from attempting to contract around and avoid the labor laws that are intended to protect workers from wage theft. So, regardless of what you may have signed, you still have the right to recover any unpaid back overtime pay that you may legally be entitled to.
What happens next?
As we have seen after prior natural disasters, storm-related laborers put in many hours of mandatory overtime for months on end — sometime working 7 days a week and 80 to 100 hours per week, racking up substantial amounts of underpaid overtime wages. With the number of hours being worked, it does not take long for the amount of unpaid overtime to reach into the $1,000s or even $10,000s for each individual worker, and $1,000,000s in unpaid wages collectively.
Over $14 million in back pay has already been recovered for thousands of employees doing work in Puerto Rico and the U.S. Virgin Islands. Violations have included non-payment of wages, minimum wage and overtime violations resulting from employees being misclassified as independent contractors, and failure to pay required health and welfare benefits during emergency response operations funded through (FEMA).
Case In Point: A contractor based in San Juan, Puerto Rico, performing roofing repairs as part of hurricane recovery efforts in Puerto Rico, has already paid $500,000 in back wages to settle overtime pay violations. Employees, including blue roof installers, carpenters, drivers, and laborers, worked 12 or more hours per day, six to seven days per week, but were not paid overtime. Instead, they were paid fixed salaries without regard to the number of hours they worked. Additional overtime violations included failing to record and pay for time worked before and after scheduled shifts as well as working through meal breaks.
Once the crush of the initial work is over, some will start to question the way they were compensated – was it fair, was it legal…? Very commonly the answer is NO.
To find out if they were fairly and legally compensated, one or more workers will typically contact an employment law attorney who handles overtime cases (on a contingent fee basis). If successful, workers can recover their unpaid overtime wages and any additional damages that they may be entitled to, such as “liquidated damages” that can double the value of their recovery (i.e. recover $200 for every $100 of unpaid overtime due).
Special Note For those performing work in Puerto Rico: 1) Your rights to collect back overtime and/or make a claim for unpaid wages may be impacted by the recent changes to Puerto Rico labor laws on overtime by the Labor Transformation and Flexibility Act (January 26, 2017). Changes under the new labor law impact a wide range of employment rights, including: employment contracts, independent contractors, contract termination, statute of limitations [1 year from end of employment], and overtime pay and 2) Major violations appear to be wide-spread as evidenced by the $14+ million in back pay that as already been recovered on behalf of employees working in Puerto Rico and the U.S. Virgin Islands.
Because of the strict time limits imposed by the federal, state, and Puerto Rico overtime pay laws, procrastination can be costly. If you have any doubts as to your entitlement to overtime, contact the overtime pay experts at The Lore Law Firm for a free and confidential review.
Call 1-866-559-0400 or submit your information using our convenient Case Evaluation form for a FREE and CONFIDENTIAL review of your circumstances. Because time is money.
We are here to help prevent wage theft by ensuring that employees receive the wages and benefits they have legally earned and that employers play by the rules and follow the labor laws.