US Department of Labor recovers $450K in wages, benefits for 250 workers of Honolulu air cargo carrier that disregarded federal regulations

HONOLULU – The U.S. Department of Labor has recovered more than $450,000 from a Honolulu air cargo carrier that shortchanged 250 employees of their full pay and benefits while fulfilling a $113 million U.S. Postal Service contract to move mail between airports in Hawaii.

The recovery follows an investigation by the department’s Wage and Hour Division of Rhoades Aviation Inc., operating as TransAir, that determined the employer recklessly disregarded requirements in the Service Contract Act that sets prevailing wages and fringe benefits that employers under federal contract must pay.

 Specifically, division investigators found TransAir violated federal regulations by doing the following:

• Paying incorrect and lower prevailing wage rates to 208 material handling laborers for whom the division recovered $268,839 in back wages.
• Not disbursing correct health and welfare benefits, holiday and vacation pay to 208 workers for whom the division recovered $156,106 in fringe benefits.
• Failing to pay correct overtime wages to 55 workers for whom the division recovered $12,650 in overtime wages and $12,625 in liquidated damages.

“Our investigation found TransAir failed to comply with federal service contract regulations regarding worker compensation,” said Wage and Hour Division District Director Terence Trotter in Honolulu. “The U.S. Postal Service’s federal contract obligated TransAir to not only comply with standards for mail delivery but also for standards that deliver the lawful payment and benefits to workers performing those labor-intensive services.”   

Investigators also determined TransAir unlawfully made 30-minute deductions for lunch breaks not taken, causing the employer to underreport and underpay overtime hours, in violation of the Fair Labor Standards Act. 

 Since 1982, Rhoades Aviation Inc.’s fleet of TransAir aircraft has provided air cargo service and charters within the state of Hawaii to deliver packages, mail, animals, oversized baggage, emergency equipment and other items. In addition to its USPS contract, the company fulfills contracts with UPS, FedEx and Pacific Air.

 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 and how to file an online complaint. For confidential compliance assistance, employees and employers can call the agency’s toll-free helpline at 866-4US-WAGE (487-9243), regardless of where they are from. The department can speak with callers in more than 200 languages.

 Download the agency’s new Timesheet App for free on iOS and Android devices in English or Spanish to ensure hours and pay are accurate.