US Forest Service Contractor Challenges DOL Demand To Pay $128,000 In Backwages and Benefits; Ends Up Paying $25,000

A US Forest Service contractor who was working on wildfire suppression was subject to an audit by the Department of Labor and told it owed $128,000 in additional wages and benefits under federal labor laws.  The contractor challenged the demand.  After the DOL inspector countered with slightly lower demands, each of which was rejected by the contractor, and told the contractor that the matter would be more severely viewed by his supervisor, the issue was ultimately taken over by the inspector’s supervisor.  After a detailed analysis, the supervisor determined that the initial demand for payment was excessive and only approximately $25,000 was owed by the contractor.

The issue involved many complex labor law issues, such as the appropriate hours when employees travel to remote sites, fringe benefits and employees who worked in different positions during the same work day.  The matter demonstrates that a government contractor should not simply assume a DOL demand for payments is in fact accurate.  DOL’s policy is to focus on educating employers, not fining them, and it pays to insist that the DOL explain very carefully to you the legal basis for any alleged underpayment so that you can not only confirm it is correct, but fully understand the labor laws and avoid making any errors in complying with them in the future.