Judge’s ruling affirms $191.4K civil penalties vs Tinian Dynasty

An administrative law judge in San Francisco has affirmed the U.S. Department of Labor’s Wage and Hour Division’s decision to impose $191,400 in civil penalty against the owner and management of Tinian Dynasty Hotel and Casino for willful and repeat violations of the overtime provisions of the Fair Labor Standards Act.

In an order issued on May 18, 2012, Labor’s administrative law judge Jennifer Gee ruled that the Wage and Hour Division has shown that the civil penalty assessed against Hong Kong Entertainment (Overseas) Investments Ltd. and its president, Kwan Man, was appropriate.

Gee determined that as a matter of law, Kwan exercises economic control over HKE’s employees and qualifies as an employer under the FLSA.

The judge, however, ruled that because HKE financial controller Raymond Chan’s degree of control over HKE’s employees is disputed, and there is evidence pointing in both directions, she cannot decide his status as an employer under the FLSA, as a matter of law, as this time.

“Because the civil money penalties were assessed against HKE, Mr. Kwan, and Mr. Chan jointly, and Mr. Chan’s status cannot be resolved through summary decision, I cannot order payment of the civil money penalties until his status is determined,” said Gee in a 26-page order.

The judge set a hearing for Sept. 6, 2012, at 9am in the Department of Labor courtroom in San Francisco, California, to decide on the issue of whether Chan is an employer under the FLSA and also liable for the civil money penalties.

According to Labor records, Wage and Hour Division filed civil penalties against the respondents for willful and repeated violations of FLSA provisions. Wage and Hour moved for summary judgment, arguing that it has shown all facts necessary to impose civil money penalties against the respondents.

Wage and Hour argued that, as a matter of law, the civil money penalties of $191,400 assessed against the respondents was appropriate and should be affirmed.

The respondents, through counsel G. Anthony Long, argued, among other things, that majority of the evidence submitted by Wage and Hour is not admissible under the Federal Rules of Evidence and cannot be considered.

In her order, Gee stated that it is uncontested that Chan and Kwan were both fully aware of HKE’s obligation under the FLSA to pay employees their overtime wages on time and had gained that knowledge by the close of the first investigation, at the latest.

The first investigation refers to the Wage and Hour’s investigation of HKE’s payroll practices for the period from Feb. 6, 1999, to Feb. 9, 2001. Wage and Hour did a second investigation of HKE’s payroll practices from March 16, 2007, to May 26, 2007.

Gee found that Wage and Hour supplied evidence that in 1999 to 2001 at least some of HKE’s employees were not paid the overtime wages they were owed within two weeks of their regular payday.

The judge said she finds no evidence that contradicts the facts put forward by Wage and Hour, facts that show that respondents paid overtime wages late in 2007.

Gee found the respondents’ overtime violations in 2007 were willful violations, and were “both repeat and willful.”

Tinian Dynasty Hotel and Casino is one of the CNMI’s largest private-sector employers. The investigation found the employer withheld the overtime earnings from 348 employees when they failed to pay these workers over four bi-weekly pay periods. The back wages were subsequently paid in full.

“We are very pleased with this decision,” said Ruben Rosalez, acting regional administrator of the division’s Western Region. [B][I](With PR)[/I][/B]