$348K Recovered by USDOL in Arizona Wage Fraud Case

VW Connect assessed $48K in penalties for intentional violations

A federal investigation has recovered $348,380 in back wages and liquidated damages for 144 underpaid workers of an Arizona construction employer who failed to pay their overtime wages.

The U.S. Department of Labor’s Wage and Hour Division determined that VW Dig LLC – operating as VW Connect – automatically deducted 30-minute meal break periods every day even when employees worked through these periods, a violation of the Fair Labor Standards Act. The employer also failed to pay all hours worked due to improper recordkeeping that resulted in work hours often missing from payroll.

The investigation found the employer owed workers $174,190 in overtime wages earned for hours worked over 40 in a workweek. In addition to back wages and an equal amount of damages, the department assessed VW Connect with $47,926 in penalties for the willful nature of the violations.

“Manipulating timesheets to avoid paying a worker’s full earnings illegally denies them the wages on which they depend to care for themselves and their families. It also deprives them the dignity they are due,” said Wage and Hour Division District Director Eric Murray in Phoenix. “The outcome of this investigation shows that employers who violate the law can face costly consequences in the form of damages and penalties.” In fiscal year 2021, the Wage and Hour Division recovered more than $36 million in wages owed to more than 21,000 construction industry workers. The Bureau of Labor Statistics projects more than 220,000 industry workers quit their jobs in April 2022 – the third highest number since 2012 – and 449,000 job openings in the industry, all of which makes for a job market in which employers must compete for workers.

“Employer who don’t pay workers all of the wages they’ve earned are likely to find it increasingly difficult to retain and recruit the people they need,” Murray explained. “Companies that comply with the law by paying full wages and benefits – and treating workers with the dignity and respect they deserve – will have a competitive advantage over those who cheat workers.”

Read news release on US Department of Labor