The U.S. District Court for the Northern District of Illinois has issued a default judgment against Skokie Maid and Cleaning Services Ltd. in Skokie, and its owner, Jadwiga Malewicka, for failing to answer a complaint filed by the U.S. Department of Labor seeking a total of $501,893.44 in back wages and liquidated damages for 75 workers. The lawsuit, which resulted from investigations conducted by the department’s Wage and Hour Division, alleged violations of the Fair Labor Standards Act’s minimum wage, overtime and record-keeping provisions, the Illinois Department of Labor said on Thursday.
“It is unacceptable for any employer not to pay workers their rightfully earned wages or to classify workers as independent contractors to circumvent wage laws,” said Karen Chaikin, acting regional administrator for the Wage and Hour Division in the Midwest. “The Labor Department is committed to seeing that these workers are compensated in accordance with the law.”
The suit alleged that the company, which operates as Skokie Maid, and Malewicka misclassified 75 current and former cleaning employees as independent contractors and willfully failed to pay them for all hours worked. The employees also were not compensated with overtime pay for hours worked in excess of 40 per week, as required. Finally, the defendants failed to keep proper payroll records, the Illinois Department of Labor said in a press release.
The judgment requires the defendants to pay $250,946.72 in back minimum wage and overtime compensation plus an equal amount in liquidated damages for the period of Nov. 16, 2008, to July 31, 2011. It also enjoins the company from future violations of the FLSA’s record-keeping requirements.
The case was litigated by the department’s regional solicitor in Chicago. Due to the willful nature of the minimum wage and overtime violations, the Wage and Hour Division has assessed civil money penalties of $70,125.
The misclassification of employees as independent contractors is an alarming trend, particularly in industries that often employ low-wage, vulnerable workers and in which the Wage and Hour Division historically has found significant wage violations, the Labor Department said.
The FLSA requires that covered employees be paid at least the federal minimum wage of $7.25 for all hours worked, plus time and one-half their regular hourly rates for hours worked beyond 40 per week, according to the Labor Department.