Residential nursing care facilities management company in Illinois to pay $3M in overtime back wages to 3,024 caregivers after federal investigation

PEORIA, IL – More than 3,000 caregivers at 84 residential nursing care facilities across three Midwestern states must be paid $2,939,576 in back overtime wages by the locations’ Illinois-based management company to resolve violations found in a U.S. Department of Labor investigation.

The department’s Wage and Hour Division found Petersen Health Care Inc. of Peoria failed to pay the correct overtime because the employer wrongly assumed the affected workers were not entitled to overtime pay. They failed to pay wages for meal periods of less than 20 minutes, did not add bonuses and other incentive pay to workers’ hourly rate when calculating overtime pay, and failed to maintain accurate records of work hours. Their actions violated the Fair Labor Standards Act.

“While residential healthcare workers at Petersen Health Care Inc. provided around-the-clock, daily living assistance and delivered essential care to people in need, they were subject to pay practices that underreported their hours of work and denied them the pay they were legally due.” said Wage and Hour Division Acting Administrator Jessica Looman. “The U.S. Department of Labor will ensure that workers who commit themselves to caring for others will receive the wages they earned so they can also take care of themselves and their families.”

In addition to agreeing to pay the overtime back wages, the company’s primary owner and CEO Mark Petersen signed an enhanced compliance agreement with the department to comply with the Fair Labor Standards Act in the future.

From 2019 to 2021, Wage and Hour Division investigations recovered more than $22.7 million for Midwest healthcare workers as a result of violations of worker protections under the Fair Labor Standards Act.

In March 2022, the Bureau of Labor Statistics reported that the 682,000 healthcare and social services workers left their positions and the field had more than 2 million openings. As the aging U.S. population grows and demand for home healthcare services increases, employment in a variety of healthcare sectors is projected to grow 16 percent from 2020 to 2030 – faster than the average for all occupations – adding about 2.6 million new jobs.

“As healthcare industry employers struggle to retain and recruit workers to provide the services necessary for their businesses to succeed, failing to respect workers’ rights and pay workers their full wages means that these essential workers will look elsewhere for employment,” Looman added.

Petersen Health Care Inc. manages skilled nursing, assisted living, memory care and rehabilitation facilities across Illinois, Indiana, Iowa and Missouri. The division has found the company systematically violated wage and hour laws on numerous occasions in as many as 30 investigations in the last two decades. In 2009, a consent judgment was executed ordering Petersen to pay $42,000 and to comply with the FLSA. In the last six years, the division found back wages of $88,000 due in seven investigations that incorporated findings at several other locations.     

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). Learn more about the Wage and Hour Division, including a search tool to use if you think you may be owed back wages collected by the division.