When the USDOL's (US Department of Labor) Wage and Hour Division discovers that goods are produced in violation of the FLSA's (Fair Labor Standards Act) minimum wage, overtime or child labor provisions, the agency can petition a judge to restrain those goods from being shipped via interstate commerce . The action is commonly referred to as the "hot goods" provision.
This was the situation in a very recent case when Wage and Hour investigators discovered that Exist, Inc., a clothing manufacturer out of Fort Lauderdale, FLA, violated the overtime and record-keeping provisions of the FLSA. The employer had paid 77 employees straight time wages and not overtime at the required time and one-half when employees worked beyond 40 hours in a work week. In addition, the employer failed to keep accurate and complete payroll records.
Officials at Exist, Inc. voluntarily agreed not to ship the goods produced until the employees were paid back wages after receiving the agency's notice that the goods produced were "hot." The firm paid $238,534 in back wages to the 77 employees the next day and agreed to comply with the FLSA moving forward.
For additional information regarding the FLSA's "hot goods" provision, go to https://www.dol.gov/whd/regs/compliance/whdfs80.pdf. If you have questions about the FLSA or its enforcement by the USDOL's Wage and Hour Division contact CAI's Advice & Resolution Team at 919-878-9222 or 336-668-7746.
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