US Labor Department moves to protect workers with disabilities in crackdown on Rhode Island employer

Wage and Hour Division refers case to US Justice Department

PROVIDENCE, R.I. — As the result of a new strategic enforcement effort to remedy labor violations and protect workers with disabilities, the U.S. Department of Labor's Wage and Hour Division has revoked authorization allowing Training Thru Placement, Inc., based in North Providence, to pay less than the current federal minimum wage to its workers after an investigation of the nonprofit educational and vocational training center found willful violations of the Fair Labor Standards Act.

Specifically, the agency found that TTP failed to determine the appropriate sub-minimum wage to be paid to each worker as allowed under Section 14(c) of the FLSA, properly record and pay employees for all hours worked, and determine the prevailing wage rates for workers performing similar work in the area. The company also falsified documents in order to mislead investigators. In an effort to comprehensively redress violations under all applicable laws, the agency referred the matter to the U.S. Department of Justice's Civil Rights Division, which today announced an interim settlement agreement with the state of Rhode Island and the city of Providence that will resolve violations of the Americans with Disabilities Act for approximately 200 Rhode Islanders with intellectual and developmental disabilities.

The FLSA, in general, requires that covered employees be paid at least the federal minimum wage of $7.25 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. However, since its enactment in 1938, the FLSA has contained provisions designed to promote employment opportunities for individuals with disabilities. Section 14(c) of the act allows employers, after receiving a certificate of authorization from the Wage and Hour Division, to pay wages less than the federal minimum wage to workers with disabilities when their disabilities impair their productive capacities for the work being performed.

"The intent of the law is clear — that workers with disabilities deserve an opportunity to be given meaningful work and receive an income, and employers that provide those opportunities may pay such workers below the current federal minimum wage, but only when key conditions are met," said Mary Beth Maxwell, acting deputy administrator of the Wage and Hour Division. "However, not all employers are vigilant in maintaining a well-run program that honors that intention and is in full compliance with the letter of the law. Being in compliance matters, and we will use all enforcement tools available, including revocation of certificates, to prevent employers from exploiting workers."

Based on the severity and willful nature of the violations, the division issued a retroactive revocation of TTP's authorization to pay sub-minimum wages between June 1, 2010, and January 31, 2013, during which time the company was operating in violation of the law. As a result, all FLSA-covered employees performing work for TTP during that time period are owed no less than the federal minimum wage of $7.25 per hour for all hours worked. TTP is allowed under the law to file a timely appeal within 60 days.

Upon notification that its authorization to pay workers sub-minimum wage rates would be revoked, TTP took immediate corrective action to come into compliance with the law. The nonprofit has implemented significant changes including replacing its board of directors in its entirety, and removing or replacing the management and administrative staff who were in charge during the time period in which the violations occurred. Further, TTP has contracted with a new provider of services, Fedcap Rehabilitation Services, to assume day-to-day management of operations, hire new staff and provide proper training to ensure understanding and compliance with Section 14(c).

Due to its aforementioned corrective actions, its commitment to ensure future protection of its workers and a follow-up investigation, the division has concluded that TTP can operate as a Section 14(c) certificate holder on a conditional basis until August. This allows TTP to continue to operate with little to no interruption and ensures that workers with disabilities continue to receive income, and educational and vocational training. The division will continue to closely monitor TTP's adherence to the law. TTP's vocational programs provide workers with disabilities opportunities to perform services such as product assembly and packaging, janitorial work, food processing and packaging, and other work.

The Wage and Hour Division is pursuing new strategies to strengthen compliance with Section 14(c) and maximize the impact of its benefits for workers with disabilities, their employers, families and communities. These strategies include training more investigators on the provisions of the law; using all available enforcement tools to remedy and deter future violations; providing new compliance assistance materials and tools; and hosting new compliance conferences for employers, community rehabilitation programs, advocates, workers and other interested parties.

The investigation was conducted by the division's district office in Hartford, Conn. Information about subminimum wage rates can be found at http://www.dol.gov/whd/regs/compliance/whdfs39.pdf. For more information about the FLSA and other federal wage laws, call the Wage and Hour Division's toll-free helpline at 866-4US-WAGE (487-9243). Information is also available at http://www.dol.gov/whd/.