Department Of Labor Targets Hospitality Employers

Volume 9, Issue 5
July 13, 2010

The Department of Labor ("DOL") is reported to be preparing a "Hotel and Motel Resort Pilot Initiative" for fiscal year 2010 which will target for investigation hospitality employers. The DOL's Wage and Hour Division is purportedly focused on two overall areas of compliance - H2B requirements and the Fair Labor Standards Act - and has reportedly characterized the hospitality industry as one with a "high-risk" for violations of such laws. The Division conducted a similar enforcement initiative in the Pittsburgh, Pennsylvania area in 2009 which was intended "to promote compliance with the minimum wage, overtime, record keeping and child labor laws." Regarding the Pittsburgh initiative, the DOL announced in November 2009 that "[c]ommon violations cited during these investigations include failure to pay for all hours of work, failure to pay the statutory overtime premium, and misclassification of salaried workers as exempt without regard to the salary level or the duties performed." The fiscal year commences on October 1, 2010. Reports indicate that the DOL's Wage and Hour Division will investigate hospitality employers who employ individuals using H2B visas, staffing companies which supply workers to hospitality employers, and other hospitality employers in certain, presently unspecified, geographic areas. It has also been reported that once a property is selected for audit/investigation, all employers on the property - including separately owned venues - will be investigated. It is not clear whether Nevada's hospitality employers will be included in this initiative. While some reports indicate that gaming properties may be excluded due to the high level of regulation and unionization which may already be present, the best course is to ensure now that you are fully in compliance with H2B and FLSA requirements.

KZA Employer Report articles are for general information only; they are not intended and should not be construed to be legal advice. Reading or replying to such articles does not establish an attorney-client relationship. In addition, because the subject matters and applicable laws discussed in Employer Report articles are often in a state of change and not always applicable to every type of business entity or organization, readers should consult with counsel before making decisions based on the same.