US Department of Labor recovers more than $1 million in overtime wages for employees of US Army contractor in Southern California

WEST COVINA, Calif. — The U.S. Department of Labor's Wage and Hour Division has resolved an investigation against contractor CALNET Inc. and two subcontractors providing language, intelligence and information technology services to the U.S. Army at Ft. Irwin, Calif. The three companies had paid employees improperly for on-call time.

"Contractors and subcontractors hired to perform services for the U.S. military have a clear obligation to comply thoroughly and consistently with federal law," said Secretary of Labor Hilda L. Solis. "As we do with all other employers, we will hold these businesses accountable for paying their workers for all hours, including any overtime, spent on the job."

Investigations conducted by the Wage and Hour Division determined that prime contractor CALNET Inc. of Reston, Va., and subcontractors Acclaim Technical Services Inc. of Huntington Beach, Calif., and McNeil Technologies of Springfield, Va., violated the Fair Labor Standards Act by not properly compensating workers for all on-call time, resulting in overtime violations. The employers also were found to be in violation of FLSA recordkeeping requirements for failing to maintain proper records of the number of hours worked by employees and the compensation they were paid.

The three companies have paid their employees a total of $1,060,554 in back wages owed for the period between October 2008 and October 2010. CALNET paid $676,698 to 597 employees. Acclaim Technical Services paid $234,311 to 177 employees. McNeil Technologies paid $149,545 to 91 employees.

The FLSA requires that covered employees be paid at least the federal minimum wage of $7.25 per hour for all hours worked, plus time and one-half their regular rates of pay, including commissions, bonuses and incentive pay, for hours worked beyond 40 per week. Employees must also maintain accurate time and payroll records.

On-call time becomes compensable under the FLSA when the on-call conditions are so restrictive or the calls to duty so frequent that the employee cannot effectively use on-call time for personal purposes.

These investigations were conducted by the Wage and Hour Division's West Covina District Office. For more information about the FLSA, call that office at 626-966-0478 or the division's toll-free helpline at 866-4US-WAGE (487-9243). Information is also available at http://www.dol.gov/whd/.