Sweeping Decision: Janitorial Firm to Pay $4 Million for Bilking Workers

E & R Services Inc., a Las Vegas-based subcontractor that provided janitorial services to retail businesses in California, has been ordered to pay $3.9 million in owed wages and penalties after California Labor Commissioner Angela Bradstreet filed a civil suit seeking a default judgment. The company had janitorial contracts with FoodMaxx supermarkets and Fry’s Electronics.

The California Department of Industrial Relations (DIR) Division of Labor Standards Enforcement first launched its investigation after initially receiving wage claims from 15 employees who worked in several northern California cities including San Jose, Oakland, Sunnyvale, and Fremont. DIR discovered that E & R Services failed to properly pay at least 50 employees who worked across California from December 2006 through January 2009.

“This case is nothing short of routine and systematic fraud,” said DIR Director John C. Duncan. “It is a testament to the fact that workers who are being denied their rights can make a difference. Cases like this help fight California’s underground economy that not only robs hard-working people of the money they deserve but also impedes the success of companies that are following the law.”

A default judgment was filed in State Superior Court in Los Angeles County after E & R Services failed to make an appearance or respond to an initial complaint. This is the first default judgment ever to include a violation of Labor Code section 2810, which makes it illegal to subcontract janitorial and other services without providing sufficient funding to allow the subcontractor to comply with all laws. The Labor Commissioner’s Office determined that E & R Services provided insufficient funds to subcontractors for janitorial work. E & R Services is no longer in business.

“California will not tolerate employers who operate in total disregard of the law and try to increase their profits by underfunding subcontractors, cheating workers out of wages, and undermining the ability of legitimate competitors to compete for work in this tough economic climate,” said Labor Commissioner Angela Bradstreet. “Labor Code Section 2810 was created specifically for violations like this to address the particular problems faced by low wage workers who are oftentimes more vulnerable to being exploited.”

The investigation found that the company paid employees a fixed sum of $60 a day, which resulted in minimum wage violations. E & R Services also failed to pay overtime, did not provide employees with meal and rest breaks, and evaded payroll taxes.

Download Center

HTML - No Current Item Deck
  • Safety Management Software - Free Demo

    IndustrySafe Safety Software’s comprehensive suite of modules help organizations to record and manage incidents, inspections, hazards, behavior based safety observations, and much more. Improve safety with an easy to use tool for tracking, notifying and reporting on key safety data.

  • Create Flexible Safety Dashboards

    IndustrySafe’s Dashboard Module allows organizations allows you to easily create and view safety KPIs to help you make informed business decisions. Our best of breed default indicators can also save you valuable time and effort in monitoring safety metrics.

  • Schedule and Record Observations

    IndustrySafe's Observations module allows managers, supervisors, and employees to conduct observations on employees involved in safety critical behavior. IndustrySafe’s pre-built BBS checklists may be used as is, or can be customized to better suit the needs of your organization.

  • Why Is Near Miss Reporting Important?

    A near miss is an accident that's waiting to happen. Learn how to investigate these close calls and prevent more serious incidents from occurring in the future.

  • Get the Ultimate Guide to Safety Training

    When it comes to safety training, no matter the industry, there are always questions regarding requirements and certifications. We’ve put together a guide on key safety training topics, requirements for certifications, and answers to common FAQs.

  • Industry Safe
comments powered by Disqus

OH&S Digital Edition

  • OHS Magazine Digital Edition - May 2019

    May 2019

    Featuring:

    • RESPIRATORY PROTECTION
      Why Pick a PAPR? 
    • FIRE SAFETY TRAINING
      Fire Safety: Plan, Prevent, Train, Recover
    • PROTECTIVE APPAREL
      The Truth About Heat Stress and FRC
    • AIHCE EXP 2019 PREVIEW
      Underestimated No More
    View This Issue