American Homes 4 Rent, Inc. has agreed to pay more than $400,000 in overtime back wages, according to the U.S. Department of Labor.
Investigators with the department's Wage and Hour Division say the violations began when the Agoura Hills-based company changed the titles of more than 100 workers from "property inspector" to "field superintendent." With that change, the company claimed the employees were no longer hourly, but instead salaried workers who were "exempt" from overtime.
"The titles changed for the employees, but their duties remained the same, and they were still working the same number of hours as when they were being paid on an hourly basis" says Francisco Ocampo of the Wage and Hours Division's Los Angeles office. When those hours added up to more than 40 in a week, the workers were no longer getting overtime.
"There's always a big misnomer that people believe that if they're paid on a salaried basis - employers and employees - that they are not entitled to any overtime," Ocampo told KPCC, reiterating that this is a false understanding of U.S. labor law.
"Misclassifying non-exempt workers with fancier titles so that they look exempt is not an uncommon practice," Koonse continued. "But the size of this employer - American Homes 4 Rent - and the scale of this citation is pretty huge." The company owns more than 30,000 homes in 22 states and offers them as rental properties.
The Obama Administration is also moving to make more salaried workers eligible for overtime. Nationally, workers who earn less than $23,600 per year are currently automatically eligible for overtime. The president wants to more than double that salary threshold to $50,440.
Tia Koonse, a legal and policy research manager at the UCLA Labor Center, said this crackdown, coupled by the push for a higher overtime threshold shows a change in the way the feds view overtime.
"We can look at this as evidence that this is going to be a priority of this administration - expanding overtime protections and making sure that they are enforced for people," she said.