U.S. Department of Labor Investigation Results in Pennsylvania Manufacturer Paying $358,040 in Back Wages, Damages and Penalties

PHILADELPHIA, PA - In a settlement reached with the U.S. Department of Labor’s Wage and Hour Division (WHD), Havpak Inc. will pay $158,230 in back wages and an equal amount in liquidated damages to 126 employees after a WHD investigation found overtime violations of the Fair Labor Standards Act (FLSA) at its facilities in King of Prussia and Malvern, Pennsylvania. The Erie, Pennsylvania-based packaging, assembly, and manufacturing employer will also pay a civil money penalty of $41,580 for the willfulness of the violations.

In addition to paying the back wages, damages and penalty, Havpak will change its business practices to come into FLSA compliance in the future.

WHD investigators determined that – from May 30, 2015, to June 2, 2018 – Havpak used four temporary staffing agencies to staff an additional 50 to 100 employees on a daily basis to perform production work. They found that three Pennsylvania staffing agencies - DDT Packing Inc. and TTM Packing Inc., both in Philadelphia, and L&D Staffing in Springfield - paid temporary staff straight time for all of the hours that they worked, including those in excess of 40 hours in a workweek. The FLSA requires those hours to be paid as overtime, at time-and-one-half employees’ regular rates of pay. WHD determined Havpak Inc. to be a joint employer of the temporary staffing agencies’ employees, and liable for the overtime payments.

WHD also found that in some cases Havpak failed to include production bonuses into the calculation when determining employees’ overtime rates, resulting in payments at rates lower than those required by law. The employer also violated FLSA recordkeeping requirements when it failed to display a required FLSA poster at its facility.

“Using temporary staffing agencies does not absolve employers from their responsibilities under the law,” said Wage and Hour District Director James Cain in Philadelphia, Pennsylvania. “Employers must ensure that their employees are paid the minimum wage and required overtime rates. We encourage all employers to reach out to us and to use the many tools we offer to help them understand their responsibilities so they can avoid costly violations.”

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

WHD’s mission is to promote and achieve compliance with labor standards to protect and enhance the welfare of the Nation's workforce. WHD enforces Fderal minimum wage, overtime pay, recordkeeping, and child laborrequirements of the Fair Labor Standards Act. WHD also enforces the Migrant and Seasonal Agricultural Worker Protection Act, the Employee Polygraph Protection Act, the Family and Medical Leave Act, wage garnishment provisions of the Consumer Credit Protection Act, and a number of employment standards and worker protections as provided in several immigration related statutes. Additionally, WHD administers and enforces the prevailing wage requirements of the Davis Bacon Act and the Service Contract Act and other statutes applicable to Federal contracts for construction and for the provision of goods and services.

The mission of the Department of Labor is to foster, promote, and develop the welfare of the wage earners, job seekers, and retirees of the United States; improve working conditions; advance opportunities for profitable employment; and assure work-related benefits and rights