Owners of 11 senior living properties to pay $1 million in back wages, damages

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U.S. Department of Labor seal
U.S. Department of Labor seal

The owners of 11 senior living properties will pay more than $1 million in back wages and damages to more than two dozen employees following two separate court rulings in the U.S. District Court for the Northern District of California, the U.S. Department of Labor announced this week.

“Too many hardworking men and women who tend to the most basic needs of our loved ones continue to be shortchanged for their efforts,” said Ruben Rosalez, regional administrator for the Wage and Hour Division's western region. “We aim to put a stop to that through strong enforcement of federal labor laws along with a robust outreach and education program.”

The owners of San Miguel Homes for the Elderly of Union City have agreed to pay $425,000 in back wages and damages to 26 caregivers working at its Union City, CA, facilities after admitting they did not pay minimum wage and overtime, the labor department said.

The department had sued the residential care provider in December, saying that the owners had refused to meet with Wage and Hour Division investigators and had claimed that they were not obligated to comply with the Fair Labor Standards Act. In January, according to the labor department, the division learned that the San Miguel's owners were threatening to sue workers suspected of cooperating with the investigation and were having employees falsify timesheets.

The consent judgment in the case also requires the company to provide adequate coverage during all shifts to eliminate the practice of employees working off the clock and to ensure that the company pays employees properly for all hours worked.

Under a separate ruling, Razel Cortez and Elizabeth Palad, who own eight residential care facilities in central California, will pay unpaid wages and damages of $643,992 after reportedly violating minimum wage and overtime provisions of the FLSA. The facilities involved are Walnut Creek Willows in Walnut Creek, Elizabeth's Care Home 1 and 2 in South San Francisco, Samantha's Care Home in San Bruno, New Haven Care Home in Union City, and Rayzel's Villa and Villa San Lorenzo in San Lorenzo.

The employer misclassified caregivers as independent contractors, paid them a flat monthly salary “well below” minimum wage, provided no premium for overtime even though the employees often worked 60 hours per week, and failed to keep any records of hours worked, according to the labor department. The consent judgment in the case also requires the defendants to hire a third-party monitor to audit their compliance with the FLSA, to post copies of the consent judgment and notices of employee rights in both English and Tagalog at each of their facilities, to provide detailed pay stubs to every employee each pay period and direct them to review the documents, and to provide contact information for the Wage and Hour Division, in both languages, with every pay stub.

McKnight's Senior Living did not receive a response to requests for comments made to the owners of the facilities.

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