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Farmers Insurance Will Pay $1.5M in Overtime Back Wages for FLSA Violations

July 9, 2011

Our Santa Ana labor and employment attorneys have been following the recent wage and hour announcement that Los Angeles-based Farmers Insurance Inc., has agreed to compensate 3,459 employees over $1.5 million in overtime back wages, after the U.S. Department of Labor (DOL) found that the insurance company systematically violated record-keeping provisions the Fair Labor Standards Act (FLSA) in over eleven call centers located in Florida, Texas, Oklahoma, Michigan and Oregon.

According to the DOL's Wage and Hour Division investigation, the company was found to have violated the record-keeping provisions of the FLSA by not accounting for the time employees worked performing pre-shift duties. Employees regularly worked for thirty minutes before their shifts, which was work that went unpaid and unrecorded. The weekly duties included turning on computer work stations, initiating specific software applications that were integral to begin call center duties, and logging into the company's phone systems.

Because the necessary employee pre-shift work was not recorded, the times were kept from the company's official time an payroll records, leaving employees without any overtime compensation--which under federal labor laws should be one and one-half times their regular rates of pay for any hours that exceed forty in a workweek.

Under the federal Fair Labor Standards Act, covered employees must be paid for any pre-shift or post-shift responsibilities, and for attending mandatory meetings. Employers must also compensate workers with at least $7.25 per hour, the federal FLSA minimum wage requirement for every hour worked in a forty hour work week. Any hours worked beyond forty must be paid with overtime at one and one-half the workers' regular pay rates, including bonuses, incentive pay, and commissions.

Farmers Insurance will pay $1,520,705 in back wages, and reportedly agrees to comply with the FLSA in the future.

Our Lake Forest labor and employment lawyers represent employees who have experienced California wage and hour issues. In cities throughout Orange County, California, contact us today for a free consultation about your California labor and employment rights.

Los Angeles-based Farmers Insurance to pay more than $1.5 million in back wages to nearly 3,500 employees following US Labor Department investigation, U.S Department of Labor Press Release, July 6, 2011

Related Web Resources:

U.S. Department of Labor: Wage and Hour Division (WHD), Fair Labor Standards Act (FLSA)

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