Giant Company LLC, a Pennsylvania supermarket chain, recently was found to have violated the Fair Labor Standards Act (“FLSA”) in the way it calculated overtime payments to its employees during the COVID-19 pandemic.
Frontline workers across the country performed heroically during the COVID-19 pandemic, but they have also been underpaid and placed in extreme danger.
The Department of Labor’s Investigation
The U.S. Department of Labor’s Wage and Hour Division conducted an investigation into overtime payments made to essential workers of the large Northeast supermarket chain during the Coronovirus pandemic. “Grocery workers are among our lowest-paid essential workers, and deserve to take home every penny of the wages they earn,” said a spokesperson from the Wage and Hour Division office in Wilkes-Barre District.
Giant increased essential workers’ hourly pay by $2 from March 2020 to May 2020. Then, beginning in May 2020, the chain decided to decrease the hourly rates of employees by $2 per hour and began paying lump sum bonuses instead. Over the course of the next year, Giant paid bonuses in June 2020, October 2020, and February 2021. However, the company failed to include these bonus payments in its calculations of the employees’ regular rate of pay, which is used to determine the amount of overtime pay due. In other words, the three bonuses were not included in the overtime calculations, resulting in overtime amounts that were less than required under federal law.
The Department of Labor determined that this practice violated the workers’ rights under the FLSA.
Workers Were Awarded More Than $165,000 in Unpaid Overtime
The Wage and Hour Division ordered the company to pay $165,653 in past-due wages to 3,314 workers at 192 Giant, Foodsource, and Martin’s stores located in Maryland, Pennsylvania, Virginia, and West Virginia. Giant learned an important lesson about wage and hour law: shifting pay from an hourly rate to a bonus does not mean the employer may exclude it when calculating overtime.
How do I find out whether my employer underpaid me?
This case serves as an example of the issues that can arise for those who work in occupations that pay an hourly rate. You need to be aware of your rights in order to make sure that you are receiving the full amount of compensation you should receive for work performed.
If you have questions about the actions of your employer, please contact the lawyers at Edelson Lechtzin LLP to learn if you have claims for unpaid compensation. We offer free, no-obligation consultations to discretely discuss your case. We can help you understand your options and learn more about your next steps. Call us at 844-696-7492 or send us an email.