The Department of Labor announced today that HR software provider/ insurance broker Zenefits will be required to pay unpaid overtime to 743 employees across two states.
The agency conducted an investigation in which they found Zenefits had violated the Fair Labor Standards Act by 'missclassifying' the employees in San Francisco and Scottsdale, Arizona as exempt from minimum wage and overtime. The company then paid the workers a flat salary for all hours worked.
Zenefits is now on the hook for $3.4MN in unpaid overtime and has agreed to 'enhanced compliance', where they will be monitored by the Dept. of Labor to deter any future wage violations for an undisclosed time.
"This case allows us to level the playing field for all of the employees who play by the rules. We are dedicated to protecting both workers and employers" said Ruben Rosalez, Wage and Hour Divsion Regional Administrator.
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