Brooklyn preschool operator intimidated employees, demanded workers return back wages owed to them, US Labor Department alleges

NEW YORK — The owner and operator of several Brooklyn preschool facilities threatened and tried to force employees to be part of a kickback scheme to fake payment of back wages owed to them, the U.S. Department of Labor has alleged in a federal court complaint.

Wage and Hour Division investigators in the New York District Office earlier found Flowers of the Sun Inc., doing business as Ilene's Sunflower, and Ilene Lieberman owed 35 current and former employees $20,838.45 in overtime required by the Fair Labor Standards Act. On June 1, the defendants agreed pay the back wages in four monthly installments beginning June 8 and to supply proof of payment to the division.

Instead, a complaint filed in the U.S. District Court for the Eastern District of New York alleges that Lieberman told the employees she did not believe she owed them back wages. Lieberman explained to employees that she would issue two checks to each employee, one supposedly representing the back wage amount and the second for the balance of their current weekly wages, an arrangement that would generate proof of payment without paying the owed wages. She then submitted canceled checks to the department to prove payment and required employees to sign forms waiving their rights to sue under the FLSA. She required several employees to kick back the recovered wage amounts to her. As a result, some employees received less than the minimum wage for that payroll period, or the back wages owed to them. Lieberman attempted to threaten and intimidate those employees who did not cooperate with her scheme.

"Threatening, underpaying and withholding wages from employees are illegal and unacceptable," said Maria Rosado, the division's deputy regional administrator in New York. "We've taken this legal action to stop this behavior and ensure that these employees receive all wages to which they are entitled."

The department obtained a temporary restraining order on June 29 prohibiting the defendants from:

• Withholding back wages or requiring employees to kick back those wages.
• Deducting back wages from employees' current wages.
• Terminating or threatening to terminate, intimidate, coerce, retaliate or discriminate against any employee.

On July 15, the court extended and strengthened the June 29 temporary restraining order to require the defendants to:

• Provide payroll records to the Wage and Hour Division from May 25 to Sept. 8, 2015.
• Provide the division with seven days' notice of any terminations or layoffs of employees.

"While we don't often seek a restraining order against an employer, this is a case where protecting workers' rights to earn proper wages in a workplace free of intimidation demanded legal action," said Jeffrey S. Rogoff, the department's regional solicitor in New York.

A hearing for a preliminary injunction against the defendants is scheduled for Aug. 13.

The FLSA requires that covered, nonexempt employees be paid at least the federal minimum wage of $7.25 per hour, as well as time and one-half their regular rates for every hour they work beyond 40 per week. The law also requires employers to maintain accurate records of employees' wages, hours and other conditions of employment, and prohibits employers from retaliating against employees who exercise their rights under the law.

The Wage and Hour Division's New York City District Office conducted the investigation. Attorneys Allison Bowles and Lindsey Rothfeder of the department's regional Office of the Solicitor in New York will litigate the case.

For more information about the FLSA, contact the division's toll-free helpline at 866-4US-WAGE (487-9243) or its New York City District Office at 212- 264-8185. Information also is available at http://www.dol.gov/whd/.

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Perez v. Flowers of the Sun Inc., doing business as Ilene's Sunflower and Ilene Lieberman

Civil Action Number: 1:15-cv-03785-ENV-SMG