On June 10, 2011, the U.S. District Court for the Northern District of Georgia (Atlanta Division) entered a Consent Judgment (the “Judgment”) permanently enjoining Chueng Kong Holding, Inc. d/b/a United Food and Xin Guo (aka) Victor, as an individual owner, from violating the Fair Labor Standards Act (“FLSA”). The Judgment resolves a lawsuit filed by the U.S. Department of Labor (“DOL”) alleging willful violations of the minimum wage, overtime and recordkeeping provisions of the FLSA. (Solis v. Chueng Kong Holding Inc. and Xin Guo, Case No. 1:11-cv-1604-ODE).

As part of the Judgment, United Food and Xin Guo (the Defendants”) are permanently barred from (1) failing to pay any employee the applicable minimum hourly rate, (2) employing any person for more than 40 hours in a workweek unless the employee is compensated for all hours in excess of 40 at an overtime rate at least one and one-half times the regular rate at which the employee is employed, and (3) failing to make, keep and preserves adequate and accurate employment records. Additionally, the Defendants are required to pay $311,905.34 in back wages to the DOL for distribution to 41 employees. The back wage payments to individual employees range from $675.75 to $20,087.36. To comply with the Judgment, the Defendants are required to deliver to the DOL separate cashier’s checks, certified checks or money orders in eight installments through November 2011. The DOL will deliver the back wages to the employees’ last known addresses. In the event that the Defendants default on any of the installment payments, the unpaid balance becomes immediately due and payable.

The Judgment is another example of the DOL’s commitment to enforcing the wage and hour and recordkeeping requirements of the FLSA. As we continue to monitor the DOL’s focus in this area, we encourage all employers to review the regulations, their employee classification and pay practices to avoid a similar result. Please refer to our latest Executive Alert on the FLSA (Have You Managed and Eliminated the Risk of an Overtime Lawsuit?).