David Neil, Commissioner of the Iowa Division of Labor Services (DLS), announced recently that the DLS has assessed fines of $9,988,200 and back wages of approximately $265,000 against Agriprocessors, Inc. The violations allegedly occurred during the period from January 1, 2006 to June 30, 2008. The fines were $339,700 for illegal deductions of “sales tax/miscellaneous”, $9,643,600 for illegal deductions for frocks, and $4,900 for shorting paychecks. A total of $264,786.45 was allegedly illegally deducted from employees resulting in the back wages claim. Agriprocessors, Inc. has thirty days to contest the penalties before they become final. Vision Payroll strongly recommends consulting with your labor law attorney to ensure all wage deductions are done properly.
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A former floorman and several former waitresses and dancers have filed an amended class action complaint against Schiek’s Palace Royale (Schiek’s), a live adult entertainment club in Minneapolis, owned and operated by VCG Holding Corp. (NASDAQ VCGH). Among the complaints, the plaintiffs allege that although Schiek’s charged patrons $22 for “twenty dance dollars”, plaintiffs only received $18 in exchange and dance dollars expired after fourteen days. Also, the waitresses and entertainers allege they were required to hand out free admission passes before reporting to work and were not compensated for their time doing so. The waitresses and dancers also allege that they were not compensated for time “spent working to meet Defendant’s appearance standards.” They further allege that they were required to pay for uniforms and other clothing of a “sexually provocative” nature, which “were not suitable for use on other occasions.” Waitresses were also allegedly required to pay if a patron left without paying, an incorrect bottle of liquor was served, or food was dropped. They allege that they did not consent to these deductions in writing and charges sometimes resulted in their being paid less than the Minnesota minimum wage.
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On July 13, 2008, a new law went into effect mandating treble damages for wage and hour violations by Massachusetts employers. Prior to passage of Chapter 80 of the Acts of 2008, triple damages were allowed, but treated as discretionary by state judges. Generally, employers who acted in good faith were not assessed treble damages under the old law. Now, employers’ intent is irrelevant and three times the lost wages or other benefits will be awarded on all wage and hour lawsuits where the plaintiff prevails. Employers will also be required to pay “the costs of the litigation and reasonable attorneys’ fees.” We strongly recommend that all Massachusetts employers review their wage and hour policies and consult with their attorneys if they have any questions.
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