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September 20, 2007
Firms to Pay Nearly $1M to Hurricane Katrina Workers

L & R Security Inc. and HKA Enterprises Inc. have agreed to pay a total of $941,537 in back wages to 382 current and former security guards and debris removal workers. 

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The U.S. Department of Labor's Wage and Hour Division accused the companies of failing to pay these workers properly in the wake of Hurricane Katrina as required by the Fair Labor Standards Act (FLSA), the Service Contract Act (SCA), and the Contract Work Hours Safety Standards Act (CWHSSA). Both companies were subcontractors to the prime contractor, CH2M Hill of Englewood, Colorado.

L & R Security, which is based in New Orleans, provided armed security at Federal Emergency Management Agency (FEMA) trailer sites in New Orleans. The Wage and Hour Division alleged that the company, from August 2005 to July 2006, paid straight time for overtime hours worked by guards on both federal and non-federal contract jobs in violation of the CWHSSA and the FLSA.

The subcontractor also failed to pay the required prevailing wage rate and fringe benefits required by the SCA, according to investigators. L & R Security has agreed to pay $185,385 in back wages to 239 workers. Additionally, the department has assessed a fine of $37,620.

The investigation of HKA Enterprises Inc., which is based in Duncan, South Carolina, covered the period from October 8, 2005, to December 3, 2005. The company provided debris removal monitoring in New Orleans under a separate FEMA contract after Hurricane Katrina.

The Wage and Hour Division alleged that the company paid workers straight time for hours worked in excess of 40 per week in violation of the FLSA. HKA Enterprises has agreed to pay $756,152 in back overtime wages to 143 workers.

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