Department of Labor recovers $724K in back wages, damages for 255 workers after Phoenix contractor denied overtime pay, falsified records

4 days ago
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IES Residential capped overtime at 8 hours despite employees working up to 60 hours per week

PHOENIX – The U.S. Department of Labor has recovered $724,082 in back wages and damages for 255 employees of an electrical contractor in Phoenix who denied them overtime wages and falsified records.  

An investigation by the department’s Wage and Hour Division found IES Residential – a subsidiary of one of the nation’s largest electrical, HVAC and plumbing, solar and cable installation contractors – capped employees’ overtime at eight hours despite some employees working up to 60 hours in a workweek.

The division also learned the employer told workers – some who arrived as early as 4:45 a.m. and worked as late as 7 p.m. to record 40 hours or less on their timesheets unless their overtime was pre-approved. When IES Residential did approve, the employer limited overtime to eight hours per week even when employees worked as many as 23 hours of overtime in a workweek.

“The U.S. Department of Labor will hold employers accountable for wage theft, particularly in cases like this one, where IES Residential deliberately attempted to evade the law by instructing employees to falsify timesheets to avoid paying overtime wages,” said Wage and Hour Division District Director Eric Murray in Phoenix. “Employers who fail to pay workers their full wages may face costly consequences, including penalties for intentional acts to cover-up their violations.”

Specifically, the division found IES Residential denied the affected workers overtime wages for hours over 40 in a workweek, including pre-shift and post-shift activities, and did not keep accurate records of hours worked, both violations of the Fair Labor Standards Act.

In addition to recovering $362,041 in back wages and an equal amount in liquidated damages, the division assessed IES Residential $20,000 in civil monetary penalties for their willful disregard of labor laws.

Headquartered in Stafford, Texas, IES Residential Inc. has more than 40 U.S. locations across the country. IES Residential, Inc. is one of the largest divisions of IES Holdings Inc. in Houston, whose 6,500 employees design and install electrical and technology systems and provide infrastructure products and services for data centers, residential housing, and commercial and industrial facilities.

In fiscal year 2022, the division recovered nearly $32.9 million in back wages for 17,127 construction industry workers. The division completed more than 2,200 investigations in FY22 in the construction industry and by wages recovered, the industry ranks second among the division’s low wage, high violation industries.  

For more information about the FLSA and other laws enforced by the Wage and Hour Division, contact the division’s toll-free helpline at 866-4US-WAGE (487-9243). Learn more about the Wage and Hour Division, including a search tool to use if you think you may be owed back wages collected by the division. Download the agency’s new Timesheet App for android devices to ensure hours and pay are accurate.

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