The presence of federal labor investigators in the territory looking into violations of labor laws has resulted in an unusually high number of local businesses being cited by the U.S. Department of Labor compared to past years, when it was very seldom that any member of the private sector faced penalties for such violations.

Because of these violations by the private sector, the U.S. Department of Labor’s Wage and Hour Division (WHD) has collected some half-a-million dollars in back wages owed to several employees, some of whom were subjected to having their pay deducted for uniforms, according to USDOL-WHD records.

USDOL opened a local office in early February this year, after the federal agency signed a memorandum of understanding with Gov. Lolo Matalasi Moliga. It has since been working with ASG and the private sector to ensure full compliance with federal labor laws.

Since the WHD office was opened here with rotating investigators from the U.S. mainland, a total of six local companies were cited for non compliance of the federal Fair Labor Standards Act (FLSA) provisions, according to a Samoa News review of USDOL-WHD records and press statements for 2014.

This is the highest number of private sector members — which does not include ASG  and its entities — cited by the federal government for FLSA violations compared to past years, when it was very rare for any local business to be cited for labor law violations.

Responding to Samoa News questions, Terrance Trotter, director of the WHD district office in Honolulu, said that in 2014 the agency visited many private sector establishments that were found to be in violation of the FLSA.

“While it was determined that these establishments collectively owed approximately $500,000 in back wages to more than 600 workers, the division has also worked with these employers to review the steps that they will take to maintain compliance with the FLSA in the future,” he said from Honolulu last Friday.

Educating the public on federal labor laws “empowers workers through a clearer understanding of the statute’s baseline employee protections while also educating employers on compliance standards,” Trotter said.

He stressed that USDOL-WHD is committed to protecting workers’ rights under the law as well as educating the community's employers so that “we can return lawfully entitled wages to workers, prevent violations in the future and create an environment where employers do not gain an unfair competitive advantage in their industry through underpayment of minimum wages and overtime premiums.”

Asked as to the type of evidence investigators found during their review of local businesses, Trotter said improperly counting and paying for actual hours worked has been a recurring problem that has been cited in several of  their investigations.

“Specifically, several employers have been found to not properly pay for all hours actually worked, including employee time worked during scheduled meal breaks as well as uncompensated pre and post shift activities,” Trotter explained.

“The under reporting of hours worked can lower an employee’s hourly wage rate below the industry minimum wage,” he said. “It also leads to uncompensated overtime hours of work. The payment of a minimum wage and an overtime premium are considered basic entitlements under the FLSA.”

Trotter revealed that investigators have also observed that some local employers have used the wrong (i.e. lower) industry wage rates when calculating their employee payroll obligations.

For example, restaurant and department store businesses should pay at least the retail industry minimum wage rate of $4.60 per hour rather than the miscellaneous activities wage rate of $4.20 per hour.

Trotter emphasized that it’s important for businesses subject to FLSA requirements to pay workers at least the minimum wage based on their industry of employment, rather than the specific — miscellaneous — activities of the worker.

Among the local businesses cited by USDOL-WHD, is an employer — a restaurant — who deducted the cost of uniforms from employees’ pay checks.

“Restaurant industry employers cannot make deductions for uniform clothing expenses when the payment of such establishment related clothing has the effect of reducing an employee’s gross wages below the minimum wage,” he explained.

Asked if he believes the presence of a USDOL office in the territory helped identify businesses not complying with federal labor laws, Trotter pointed out that the investigator based in the territory works directly within the American Samoa community rather than remotely from Hawai’i.

“There is a clear need to have a local federal investigator based on the number of violations found and the frequency of technical inquiries with the agency’s on-site investigator,” he said.

“Our on-site presence has allowed the Wage and Hour Division to provide a local resource to both the private sector employees and their employers to improve their collective understanding of federal labor standards and respond directly to organizations and individuals seeking assistance through our department,” Trotter said.

According to the USDOL official, the WHD has met with representatives from the local Chamber of Commerce to promote compliance with the FLSA in the private sector as well as other organizations and media representatives to further community awareness of the FLSA requirements.

Asked if WHD is still having problems explaining to local residents who employ domestic workers, that these workers must be paid minimum wage according to federal laws, Trotter said WHD has met with representatives from the domestic violence shelter community to promote awareness of an entitlement to a minimum wage for domestic workers who are being housed in shelters.

“We continue to educate the public on an entitlement of a minimum wage of $4.20 per hour for live-in domestic workers,” he said. “Most recently, we provided an educational session on the FLSA protections afforded live-in domestic workers during the Human Trafficking Seminar held on Nov. 28, 2014.”

Trotter encourages employers, employees and associations to directly contact the WHD local Wage Hour Investigator at 254-4585 for compliance questions or if there is a need to schedule a compliance assistance training. The USDOL Wage Hour Division can also be reached at (808) 541-1361.

Details of American Samoa’s minimum wage structure, and other information on FSLA can be found online at: www.dol.gov/whd