U.S. Department of Labor Investigation Results in Puerto Rico Disaster Recovery Contractor Paying $1,341,829 in Back Wages to 1,853 Employees

SAN JUAN, PR – After a U.S. Department of Labor Wage and Hour Division (WHD) investigation, Xperts Inc. – a San Juan, Puerto Rico, disaster response contractor – has paid $1,341,829 in back wages to 1,853 employees to resolve violations of the McNamara-O'Hara Service Contract Act (SCA), the Contract Work Hours and Safety Standards Act (CWHSSA), and the Fair Labor Standards Act (FLSA).

WHD investigators determined that the contractor violated the SCA when it failed to pay employees the full amount of the prevailing wages, fringe benefits, and holidays required by law under its federal contract. Xperts Inc. violated the CWHSSA by failing to pay employees required overtime when they worked more than 40 hours in a workweek on the contract. The employer also violated FLSA recordkeeping requirements when it failed to keep accurate records of the number of hours employees worked. As a result, Xperts paid employees $777,379 for the SCA wage violations and $564,450 for the CWHSSA overtime violations.

"The U.S. Department of Labor continues to support ongoing efforts in Puerto Rico to recover from the aftermath of hurricanes Irma and Maria by ensuring all workers are paid fairly and in accordance with applicable federal laws," said Wage and Hour Division Caribbean District Director Jose Vazquez. "Our work continues to level the playing field so that contractors who abide by the law do not find themselves at a competitive disadvantage to those who do not. We encourage all contractors to reach out to us for guidance and to make use of the many tools we provide to explain their responsibilities."

The SCA requires contractors and subcontractors performing services on prime contracts in excess of $2,500 to pay service employees in various classes no less than the wage rates and fringe benefits found prevailing in the locality, or the rates, including prospective increases, contained in a predecessor contractor's collective bargaining agreement. The Contract Work Hours and Safety Standards Act (CWHSSA) requires contractors and subcontractors to pay workers employed in the performance of covered contracts one-and-one-half times their basic rates of pay for all hours worked over 40 in a workweek.

For more information about the FLSA, SCA, CWHSSA, and other laws enforced by the Wage and Hour Division, contact the 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 https://www.dol.gov/whd.

The mission of WHD is to promote and achieve compliance with labor standards to protect and enhance the welfare of the Nation's workforce. WHD enforces Federal minimum wage, overtime pay, recordkeeping, and child labor requirements 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.

Read this news release En Español