IFCO Unit Paying $2.5 Million in OT Case

The North American unit of IFCO SYSTEMS, N.V., a Dutch company, is in the news again for agreeing with a U.S. federal agency to pay a hefty penalty for employment violations. The U.S. Labor Department on Tuesday announced IFCO Systems North America Inc. has paid $1.6 million to its employees and been fined $963,050 in civil penalties by DOL's Wage and Hour Division for overtime violations. On Dec. 19, 2008, the parent company announced IFCO Systems North America Inc. had agreed to pay $20.6 million to the U.S. government in an immigration case in a deal that removed the possibility the North American company would be criminally charged.

IFCO SYSTEMS is a logistics company with operations on several continents. It operates a pool of more than 96 million Reusable Plastic Containers used mainly to move perishable fresh produce to grocery retailers, and its North American unit operates a national network of Pallet-Management Services with more than 125 million pallets sorted, repaired, and reissued annually, according to information available on the company's Web site.

Tuesday, DOL said the Wage and Hour investigation found 1,751 employees in 17 states were not properly paid for overtime as the Fair Labor Standards Act requires. The investigators worked in Colorado, Florida, Indiana, Kansas, Kentucky, Louisiana, Massachusetts, Michigan, Minnesota, Mississippi, Missouri, Ohio, Oklahoma, Oregon, Tennessee, Texas, and Utah on the case, according to DOL.

"The Department of Labor is a voice for working families, and I am committed to ensuring that employers comply with federal labor laws so workers can have confidence they will receive the compensation they've earned and deserve," Labor Secretary Hilda Solis said in her department's news release. DOL said the company has paid back wages and civil penalties in full and has agreed to injunctive relief that enjoins it from further violations of the FLSA. A separate 2002 Wage and Hour Division investigation in Atlanta, Ga., found the company had violated FLSA, resulting in $30,538 in OT back wages paid to 67 employees.

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