BROOKLYN — The U.S. Department of Labor is taking legal action against a health care staffing provider in Brooklyn, accusing it of making employees sign contracts that would require them to work for the company for three years or pay back their rightfully earned wages.
The lawsuit alleges that some employees earned less than the federal minimum wage, which is a violation of the Fair Labor Standards Act. The complaint seeks an injunction against Advanced Care Staffing LLC and its CEO, Sam Klein, to prevent them from reducing employees’ wages below federal minimums or enforcing contracts that require employees to cover future profits, attorneys’ fees or arbitration costs.
“Federal law forbids employers from clawing back wages earned by employees, for employers’ own benefit,” said Solicitor of Labor Seema Nanda. “Employers cannot use workers as insurance policies to unconditionally guarantee future profit streams. Nor can employers use arbitration agreements to shield unlawful practices. The Department of Labor will do everything in its power to make sure employees are being paid their hard-earned wages, and to safeguard them from these types of exploitative practices.”
The Department of Labor is also seeking back wages and liquidated damages for affected employees.
According to the complaint, the contracts required employees to complete at least three years of full-time employment to keep their earned wages, and those who left before the contracts expired would be forced into private arbitrations and required to pay ACS’ future profits, attorneys’ fees and arbitration costs.
The complaint also alleges that the contracts and arbitration demands have a chilling effect on employees’ rights to be free from an unsafe or hazardous workplace and obtain the wages they are owed.
The case was filed by the department’s Office of the Solicitor and stems from an ongoing investigation by the Wage and Hour Division.
