The U.S. branch of a Hong Kong-based e-commerce solutions company will pay more than $1 million in back wages to warehouse employees in Kentucky and California, The Department of Labor (DOL) said this week.
California-based WIN.IT America, Inc.—the U.S. branch of Hong Kong-based WIN.IT Information Technology Co.—owes back wages to 995 warehouse workers who were underpaid for overtime work, according to the DOL’s Wage and Hour Division (WHD).
The determination stems from an investigation into illegal pay practices at the company's Hebron, Ky., warehouse. A broader investigation found that WIN.IT America failed to include merit-based bonuses in employees’ regular rates of pay when calculating overtime rates. By doing so, the City of Industry, California-based employer paid overtime at rates lower than required under the Fair Labor Standards Act, according to WHD.
The investigation also found that WIN.IT paid some workers straight-time rates for all hours worked, failing to pay the additional half-time rate for hours over 40 in a work week. WIN.IT also misapplied the overtime rules for some salaried employees, which denied them overtime wages when required, according to WHD.
The investigation included WIN.IT warehouse locations in Hebron and Walton, Kentucky, and Walnut and City of Industry, California.
"What began as an investigation of pay practices at a Hebron, Kentucky, warehouse became a wide-ranging review of a prominent e-commerce solutions provider that found systemic failures to ensure their workers’ rights to be paid all of their hard-earned wages,” Deputy Principal Wage and Hour Division Administrator Jessica Looman said in an August 8 press release. “As the demand for warehouse workers and the popularity of online shopping grows, e-commerce employers must ensure they comply fully with federal protections of workers’ wages and benefits.”
The WHD did not give a time frame for when the violations occurred, but said they will work to locate affected employees, according to spokesperson Eric Lucero.
WIN.IT America, Inc. was not assessed any penalties as a result of the investigation, Lucero also said.