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December 15, 2003
Overtime Calculations Dig Hole for Mining Company

Dynatec Corporation USA, a Utah-based mining company, has paid $178,495 in back wages to 221 employees following an investigation by the U.S. Department of Labor.

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The department's Wage and Hour Division says it found that the company miscalculated the overtime wages earned by workers who routinely worked as many as 70 hours per week.

The Fair Labor Standards Act requires that employees be paid one-and-one-half times their regular rate of pay for hours worked over 40 per week. In addition, bonus payments must generally be included in the calculation of a worker's hourly rate when figuring the overtime premium. Bonuses that are required by an expressed or implied contract or promise must be included in the regular rate of pay. Examples of these so-called "nondiscretionary" payments include bonuses that are in any way connected to effort and output, such as attendance bonuses, production bonuses, and incentive pay.

The department says Dynatec did pay workers one and one-half times their regular hourly pay for excess work hours, but failed to add the substantial production bonuses which workers routinely earned to the base pay before making the calculations. The resulting shortfall was $178,495.

The back wages will compensate 221 miners and mechanics for work performed during the two-year period ending November 22, 2002.

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