The owner of Redmond Herbal Spas has been ordered to pay 23 massage therapists over $135,000 in back wages and liquidated damages.
This order came after a Department of Labor investigation found employees were incorrectly classified as independent contractors. The employees were paid on a commission-only basis, which violated the Fair Labor Standards Act.
"Employees worked long hours and did not receive the legally required minimum wage and overtime. These employees were unlawfully treated as independent contractors and denied basic employment rights. Misclassifying employees as independent contractors hurts employees and their families and gives an unfair competitive advantage to violators," said Donna Hart, director of the DOL Wage and Hour Division's Seattle District Office.
Judge Thomas Zilly also said time clocks must be installed at the three area spas, the owner must retain a payroll vendor and submit quarterly copy of the payroll to the Wage and Hour Division.
Employees worked for the company at location in Redmond, Northgate and Everett. The Redmond and Everett locations have since closed.
Under FLSA, Employees must be paid at least the federal minimum wage of $7.25 plus overtime. Additionally, companies are supposed to accurately record the hours employees work.