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Labor Department says staffing firm must pay $1.1 million in back wages; firm disputes statement

October 11 2018

The US Department of Labor announced Coastal Staffing Services LLC will pay $1.1 million in back wages to 1,412 employees involved in post-Hurricane Harvey recovery efforts in Southeast Texas. However, the staffing provider said it disagrees with the government's statements, and that it did pay its employees independent of the government's investigation. It also said it has provided proof to the department the wages were paid.

In its announcement, the Labor Department reported its Wage and Hour Division found the Sulphur, La.-based firm violated the overtime and minimum wage provision of the Fair Labor Standards Act when it failed to pay employees overtime pay and paid less than the federal minimum wage when it missed payrolls after Hurricane Harvey last year, according to the Department of Labor. And the company violated recordkeeping requirements by failing to maintain accurate records of the number of hours employees worked.

Coast Staffing released a statement in response to the Department of Labor's announcement:

"Coastal Staffing Services, LLC has policies and procedures in place to ensure that its employees are paid their full wages, in a timely manner, at often above-market rates. In the aftermath of Hurricane Harvey, Coastal was unable to timely process a portion of its payroll due to numerous circumstances out of its control. However, Coastal always intended to pay its employees in full, and Coastal did, in fact, pay its employees, independent from the Department of Labor’s investigation. For that reason, Coastal respectfully disagrees with the Department of Labor’s statements. To date, Coastal has provided proof to the Department of Labor that it voluntarily paid the wages due, and that its employees actually received the wages at issue. At this time, Coastal and the Department of Labor have identified approximately $2,500 in aggregate wages that 11 employees at issue may not have received, generally because the employees did not cash the checks that Coastal sent to the employees. To the extent any employees did not receive their full wages, which appears to be approximately $2,500 or less, Coastal will voluntarily remit those wages to the Department of Labor, to be distributed to the employees at issue."

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