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Ohio: Five Hotels Sued for Wage and Overtime Violations

By Susan R. Heylman  6/5/2014

Citing violations of the Fair Labor Standards Act (FLSA)’s minimum wage and overtime provisions, the U.S. Department of Labor’s Wage and Hour Division (WHD) filed a lawsuit in federal district court against Darpan Management Inc., the company’s five hotels, and the company’s owners, Darshan Shah, Vibhakar Shah and Prakash Patel.  

Darpan Management, based in Hillard, Ohio, was charged with FLSA violations at four locations in Columbus, Ohio: the Baymont Inn and Suites, the Country Inns and Suites and two Four Points by Sheraton hotels. The fifth location was the Holiday Inn Express and Suites in Reynoldsburg, Ohio.

“Darpan Management failed to meet minimum legal wage standards for housekeeping and other staff in these hotels,” said George Victory, the WHD district director in Columbus. “This practice, as well as failing to pay overtime and maintain accurate records, resulted in a substantial loss of income for these employees.”

In addition, Victory said, the company misclassified housekeepers as independent contractors and paid them by the room, so that in many cases, they did not even earn the minimum wage.

With regard to the charges relating to the 28 workers directly employed by Darpan Management as hotel staff, the investigators found that the company failed to pay some of them for training time, resulting in minimum wage violations. Also, it only paid them overtime after they had worked over 80 hours in a two-week period, as opposed to after 40 hours in a work week as required by law.

In addition, WHD claimed that Darpan Management did not compute hours accurately, further resulting in uncompensated overtime, and wrongly misclassified some workers as exempt from overtime. This resulted in a charge that the employer failed to maintain accurate and complete payroll records.

WHD filed a second lawsuit to address similar violations for workers jointly employed by Darpan Management and Fantastic Cleaning Ltd., which provides hotel staff to Darpan. WHD investigators found violations of the FLSA’s minimum wage and record keeping provisions for 61 workers jointly employed by Darpan Management and Fantastic Cleaning.

According to WHD, Fantastic Cleaning, which provided housekeepers, attendants, and laundry staff for the hotels owned and operated by Darpan Management, misclassified the housekeepers as independent contractors rather than as employees. Because they were paid by the room, the housekeepers frequently did not earn enough to make the federal minimum wage of $7.75 per hour. The employees also were not paid legally required overtime at time and one-half the regular rate when they worked beyond 40 hours in a workweek.

The investigators determined that the employers owed a total of $42,288 in back wages for these 61 jointly employed workers.

Both of the lawsuits seek back wages and an equal amount in liquidated damages for 89 hotel workers.

Perez v. Darpan Management, S.D. Ohio, Nos. 2:14-cv-00351, 2:14-cv-00352 (filed April 16, 2014).     

Susan R. Heylman, J.D., is a freelance legal writer and editor based
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