U.S. Department of Labor Investigation Results in Drywall Construction Company Paying $354,763 in Back Wages to 558 Employees

BURLESON, TX – After an investigation by the U.S. Department of Labor’s Wage and Hour Division (WHD), Rice Drywall Inc. – based in Burleson, Texas – has paid $354,763 in back wages to 558 employees to resolve overtime violations of the Fair Labor Standards Act (FLSA).

WHD investigators found that the employer contracted with several construction and temporary drywall labor providers – RRT Construction, Carreno Interiors, J & R Drywall Services Inc., and JAC Contractor Inc. – and misclassified those companies’ employees as independent contractors. This practice resulted in overtime violations when those employees worked more than 40 hours in a workweek but were paid only their straight time hourly rates without overtime. WHD determined that Rice Drywall Inc. and the subcontractors jointly employed those workers. The employer also failed to accurately record and maintain records of the hours these employees worked, also an FLSA violation.

“Our investigations frequently find violations that stem from employers improperly classifying employees as independent contractors and then failing to pay them overtime,” said Wage and Hour Division District Director Jesus A. Valdez, in Dallas, Texas. “Employers should use the results of this investigation as an opportunity to review their pay practices and should contact the Wage and Hour Division if they need clarification on the employment relationship or have any other questions about how to comply with the law.”

The Department offers numerous resources to ensure employers have the tools they need to understand their responsibilities and to comply with federal law, such as online videos, confidential calls, or in-person visits to local WHD offices.

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 the FLSA and other laws enforced by the Division, contact the toll-free helpline at 866-4US-WAGE (487-9243). Information is also available at www.dol.gov/whd including a search tool for workers who may be owed back wages collected by WHD.