An investigation conducted by the Wage and Hour Division (WHD), a branch of the US Department of Labor, found that Ziegler had violated provisions set out in the Fair Labor Standards Act (FLSA).
The organisation paid some of its employees a piece rate, which did not take into account the number of hours employees worked. This therefore failed to cover all employees’ working hours at the federal minimum wage of $7.25 (£5.58) an hour. This practice further violated overtime regulations, when employees worked for more than 40 hours a week but were not paid for additional hours.
The investigation also found that Ziegler incorrectly classified some of its employees as independent contractors. This meant that they were paid without regard to the number of hours they had worked, which did not comply with overtime standards. The organisation also paid some staff flat salaries without consideration of hours worked, while other employees were paid straight time rates for overtime hours.
Rodolfo Cortez, San Diego district director at the Wage and Hour Division, said: “We encourage employers to contact the Wage and Hour Division for assistance, and to make use of the many tools we provide to help them understand the law and avoid violations.
“This investigation demonstrates the Department of Labor’s commitment to ensuring that [employees] receive the wages they have legally earned, and that employers compete on a fair and level playing field.”