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August 31, 2006
Dept. of Labor Says Katrina Cleanup Contractor Misclassified Workers

The U.S. Department of Labor (DOL) has filed a lawsuit against Benitez Drywall LLC, a Houston-based drywall company, and its owners, accusing them of regularly misclassifying employees as independent contractors and failing to pay overtime.

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The department says the company violated the overtime and recordkeeping provisions of the federal Fair Labor Standards Act (FLSA). The lawsuit seeks back wages, damages, and interest. The department says it expects back wages to exceed $500,000 for more than 500 construction workers.

Benitez Drywall performed on contracts for reconstruction along the Mississippi Gulf Coast. The department says it found FLSA violations during an investigation of the Beau Rivage Hotel and Casino contract in Biloxi, Mississippi, and other worksites.

The department has accused other companies of similar violations during the cleanup and reconstruction on the Gulf Coast after Hurricane Katrina. The department's Wage and Hour Division has dispatched additional investigators to the Gulf Coast region and created a Gulf Coast Task Force to provide increased enforcement support and boost compliance outreach activities.

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