A publishing company near Philadelphia has been ordered by a judge to pay back wages – possibly up to $1.75 million — to more than 6,000 employees after it neglected to pay for bathroom or other short breaks, according to a statement released by the Department of Labor Monday.
American Future Systems, also known as Progressive Business Publications, violated the Fair Labor Standards Act by docking its telemarketers’ wages “for virtually all time not spent making sales calls, sometimes bringing their wages below the federal minimum wage,” the DOL said. The federal minimum wage for nonexempt employees is $7.25 per hour for all hours worked, plus time and a half for hours worked beyond 40 per week.
While the exact amount has not been determined, the DOL estimates that Progressive and its president, Edward Satell, “are liable for at least $1.75 million in back wages and liquidated damages to more than 6,000 employees who worked in 14 call centers” for violations occurring through June 2013.
“Our company has a liberal break policy of allowing our telemarketers to choose unpaid breaks anytime, for any reason, for as long as they want,” Satell said Tuesday. “This flex work policy was greatly valued by many of our employees to handle their personal needs.”
Satell said he will appeal the decision, issued by a judge in the U.S. District Court for the Eastern District of Pennsylvania on Dec. 16, 2015. “If upheld, we’d have to discontinue this generous policy,” Satell said. “We have very good legal reasons to be hopeful that the court will reverse the ruling.”
“For far too long, American Future Systems penalized its employees for taking breaks to meet the most basic needs during the work day — stretching their legs, getting a glass of water or just using the restroom,” said Jim Cain, district director for the department’s Wage and Hour Division.
Investigators from the division found that PBP telemarketers had to clock in and out for every break, “even those as short as two to three minutes,” the DOL said. PBP deducted the break time from the total hours worked each week.
The Fair Labor Standards Act does not require lunch or coffee breaks. “However, when employers do offer short breaks (usually lasting about 5-to-20 minutes), the law considers the breaks compensable work hours that must be included in the sum of hours for the work week and considered in determining overtime,” the DOL said.
Progressive Business Publications, founded in 1959 and based in Malvern, Pa., publishes and sells primarily business newsletters.
Written by Roger Yu of USA Today
(Source: USA Today)