Federal judge orders garnishment of unpaid back wages anddamages from Tazewell County accounting firm and president

BLUEFIELD, Va. — U.S. Magistrate Judge Pamela Meade Sargent ordered the garnishment of an additional $5,002 in liquidated damages from the Tazewell County accounting firm of Raymond A. Froy Jr., CPA, P.C., and its president, Raymond A. Froy Jr., after ruling that the defendants failed to meet the terms of a consent judgment with the U.S. Department of Labor.

"Employers face legal consequences when they fail to comply with the terms of consent judgments," said John DuMont, director of the division's Pittsburgh District Office, which conducted the investigation. "Compliance with labor laws matters, and we will use all enforcement tools available to ensure employers abide by the law."

Under the terms of the Jan. 11, 2013, consent judgment, which resolved a lawsuit filed by the department that alleged violations of the Fair Labor Standards Act, the accounting firm agreed to pay $17,003 in back wages and liquidated damages to six employees by Feb. 1, 2013. The consent judgment stipulated that, if the terms of the agreement were not met, the firm would become liable for an additional $5,002 in liquidated damages. Because the employer chose not to pay the full amount he agreed to pay, the judge ordered the garnishment of the additional liquidated damages and remaining unpaid back wages, bringing the total to $22,005.

Investigators from the division's Pittsburgh District Office found the firm violated the FLSA's minimum wage, overtime and record-keeping provisions by paying tax preparers straight-time wages for all hours worked, rather than time and one-half their regular rates of pay for hours worked beyond 40 per week. The employer also failed to pay two employees at least the federal minimum wage; did not record dates of birth for minor employees; and failed to make, keep and preserve adequate and accurate records of employees' wages, hours and other conditions of employment.

On Aug. 27, 2013, the court issued a Writ of Continuing Garnishment to National Bank directed at the accounts of the defendants for the amount that remained due to the department under the consent agreement. Froy filed an Objection to Garnishment on Sept. 15, which the judge overruled on Nov. 25. The judge ruled that the defendants did not present any claim or evidence that the property held by National Bank was subject to a valid claim of exemption, or that the department failed to comply with the statutory requirements for the issuance of the Writ of Garnishment. The court found that there was no good cause for setting aside the terms of the consent judgment.

The FLSA requires that covered, nonexempt employees be paid at least the federal minimum wage of $7.25 for all hours worked, plus time and one-half their regular rates, including commissions, bonuses and incentive pay, for hours worked beyond 40 per week. Earnings may be determined on a piece-rate, salary, commission or some other basis, but in all such cases, the overtime pay due must be computed using the employee's average hourly rate. Employers are also required to maintain accurate time and payroll records. The FLSA provides that employers who violate the law are liable to employees for their back wages and, as a general rule, an equal amount in liquidated damages. Back wages and liquidated damages are paid directly to the affected employees.

For more information on the FLSA and other federal laws administered by the Wage and Hour Division, call the division's Pittsburgh District Office at 412-395-4996 or its toll-free helpline at 866-4US-WAGE (487-9243). Information also is available at http://www.dol.gov/whd/.

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Civil action number: 1:12cv00017, Solis v. Raymond A. Froy Jr., CPA, P.C., and Raymond A. Froy Jr., individual