Federal Contractor Pays $25,170 in Wages and Benefits Owed After U.S. Department of Labor Investigation

VINCENNES, IN – The Knox County Association for Remarkable Citizens Inc. (KCARC) – a federal contractor based in Vincennes, Indiana – has paid 95 current and former employees a total of $25,170 – including $3,755 to 28 workers with disabilities - following an investigation by the U.S. Department of Labor's Wage and Hour Division (WHD).

WHD investigators found KCARC violated the overtime provisions of the Fair Labor Standards Act (FLSA) and requirements under the FLSA's Section 14(c) that sets guidelines for the employment of workers with disabilities.

WHD investigators found:

• KCARC's cut and sew division improperly calculated the overtime rates of hourly workers. The employer paid workers production bonuses when they met goals, but failed to include those bonuses in the workers' rates when calculating their overtime. This improper calculation resulted in $21,415 in back wages due to 67 employees.
• KCARC failed to obtain the required number of sources for the wage survey it conducted to determine wages for workers with disabilities under the Section 14(c) program.
• KCARC failed to complete a task analysis properly when conducting the time studies it used to set commensurate rates for workers with disabilities, and improperly rounded wages.

"The employer's pay practices denied employees the wages they earned," said Wage and Hour Division District Director Patricia Lewis, in Indianapolis. "These violations can easily be avoided, and we encourage all employers to come to us for confidential assistance to understand their responsibilities under the law."

In response to WHD's findings, KCARC agreed to adjust their wage survey collection methods to determine the wages workers under the 14(c) program should receive. KCARC also agreed to use a digital time keeping system and to ensure overtime calculations include production bonuses for all non-exempt employees.

Employers who discover overtime or minimum wage violations may self-report and resolve those violations without litigation through the PAID program. For more information about Section 14(c), the FLSA, or other federal labor laws, call the Wage and Hour Division's toll-free helpline at 866-4US-WAGE (487-9243). Information is also available at https://www.dol.gov/whd.