U.S. Department of Labor Investigation Results in San Diego-Area Chain Restaurants Paying $31,939 to Resolve Wage Violations

SAN DIEGO, CA – Twenty-five El Pollo Loco restaurants in San Diego County – operated by Pel/Lion LLC of Oceanside, California – will pay 35 employees $31,939 after a U.S. Department of Labor Wage and Hour Division (WHD) investigation found violations of the Fair Labor Standards Act (FLSA).

WHD investigators found Pel/Lion LLC failed to include non-discretionary bonuses paid to hourly managers in their regular earning rates when calculating their overtime pay. This exclusion resulted in overtime rates lower than those required by law. The investigation also found that the employer paid flat salaries to maintenance workers without regard to the number of hours they actually worked. This practice resulted in overtime violations when these employees worked more than 40 hours in a week and were not paid overtime. The company also failed to maintain accurate time records for the salaried workers, resulting in recordkeeping violations under the FLSA. 

“No employer should gain a competitive advantage by failing to pay its workers in compliance with the law,” said Wage and Hour Division District Director Rodolfo Cortez in San Diego. “We encourage all employers to make use of the many tools we offer to help them understand their responsibilities, and to reach out to us directly, and confidentially, with any questions they may have about how to comply with the law.”  

For purposes of calculating overtime pay, the FLSA requires that non-discretionary bonuses must be included in the regular rate of pay. Non-discretionary bonuses include those that are announced to employees to encourage them to work more steadily, rapidly or efficiently, and bonuses designed to encourage employees to remain with a facility.

For more information about the FLSA and other laws enforced by the Wage and Hour Division, contact the Division’s toll-free helpline at 866-4US-WAGE (487-9243). Employers who discover overtime or minimum wage violations may self-report and resolve those violations without litigation through the PAID program.  Information is also available at www.dol.gov/whd including a search tool to use if you think you may be owed back wages collected by WHD.