WASHINGTON, D.C. – Attorney General Karl A. Racine today released the Office of the Attorney General’s (OAG) 2022 Labor Day Report, highlighting the office’s continued work over the past nearly eight years to stand up for District workers and hold employers accountable. Since 2017, OAG has launched more than 75 workers’ rights investigations and recovered over $7 million for workers and the District.
AG Racine also announced recent wins in two separate workers’ rights enforcement actions and the recovery of over $725,000, including more than $650,000 in restitution for over 550 harmed workers. These wins resolve a lawsuit against Executive Security Services, LLC (ESS) and an investigation into CareFirst BlueCross BlueShield for failing to pay their workers their full hard earned wages on time. These enforcement actions continue OAG’s efforts to hold businesses accountable if they harm workers and violate DC’s wage and hour laws.
“On Labor Day, we celebrate the thousands of hardworking people in the District and millions across the country who help keep our communities running and give our city life. Over the past nearly eight years, our office has prioritized standing up for vulnerable workers and holding employers accountable when they deny employees their hard-earned wages and benefits. Our new report reinforces the importance of this work and the impact on DC workers,” said AG Racine. “On top of this, the resolutions of these workers’ rights lawsuits continues to make clear to any employer attempting to skirt our wage and hour protections or take advantage of hard-working District residents, that they will be met with the full enforcement capabilities of my office.”
OAG’s 2022 Labor Day Report
OAG’s new 2022 Labor Day report explains how over the past more than seven years, OAG has prioritized working every day to stand up for District workers, including by fighting wage theft, protecting workers’ rights and making sure they get the wages and fair treatment they deserve, and holding employers accountable if they mistreat workers or do not follow workers’ rights law.
The report provides a resource to District workers about their rights and reinforces how OAG uses every tool available to fight for District workers through legal action, education efforts about workers’ rights laws, and most recently, the office’s mediation process designed to resolve smaller-value workers’ rights claims from residents. So far, OAG has recovered over $50,000 for District workers through this mediation process.
In 2017, OAG gained enforcement authority to hold employers accountable when they mistreat workers and to put industry on notice that we will go after them if they do not follow workers’ rights laws. Last year, the office established the Workers’ Rights and Antifraud Section at OAG, which is a team of attorneys and investigators who are dedicated to fighting wage theft.
OAG’s 2022 Labor Day Report is available here.
OAG’s Lawsuit Against Executive Security Services
ESS is a Maryland-based security company that employs security personnel and provides unarmed and armed guards, background investigations, and other security services to stores and property management companies in the District and across the region.
OAG filed suit against ESS on March 16, 2021, alleging that over the course of several years, ESS misclassified workers as independent contractors in violation of DC’s wage-and-hour laws and, in doing so, cheated these workers out of hard-earned wages and benefits. Worker misclassification is a form of payroll fraud where employers improperly categorize workers as independent contractors even though they should be considered employees. Unscrupulous companies do this to strip workers of legal protections, reduce costs, and evade paying their fair share of payroll taxes.
OAG’s lawsuit also alleged ESS failed to pay workers for all the hours they worked, paid employees irregularly, provided payment using checks that bounced when cashed, and refused to provide paid sick leave as required under DC law, including pandemic-related sick leave.
To resolve allegations of worker misclassification and other wage-and-hour violations, ESS will be required to:
- Pay $239,575 in restitution and liquidated damages to affected workers.
- Pay $35,424 in penalties and costs to the District.
- Implement measures to ensure compliance with the District’s wage and hour laws, including agreeing to treat ESS security guards as W-2 employees and not as independent contractors.
A copy of the court order is available here.
OAG’s Investigation of CareFirst
CareFirst BlueCross BlueShield is a health insurance provider servicing DC and the surrounding Metro area comprised of five entities – Group Hospitalization and Medical Services, Inc., Service Benefit Plan Administrative Services Corporation, CareFirst of Maryland, Inc., Trusted Health Plan, Inc., and CareCo, LLC.
OAG’s investigation uncovered evidence that CareFirst violated the District’s Wage Payment and Collection Law by failing to promptly issue employees’ final paychecks when they left the company. Under DC law, employers are required to issue final checks to fired employees within one working day. For employees who resign or quit, employers are required to issue their final paycheck within seven days or by the next regular payday, whichever comes first. OAG also alleged that CareFirst violated this requirement with respect to hundreds of its employees.
To resolve OAG’s investigation without litigation, CareFirst will be required to:
- Pay $412,041 in restitution payments to approximately 370 employees.
- Pay $50,000 in penalties to the District.
- Comply with the final paycheck provisions of the District’s Wage Payment and Collection law.
A copy of the settlement agreement is available here.
The ESS and CareFirst matters were handled by Assistant Attorneys General Nicole Tortoriello and Charlie Sinks, former Assistant Attorneys General Taylor Larson and Ali Nevitt, and Investigators Ashley Norman and Jonathan Thervil, under the supervision of Section Chief Graham Lake of the Workers’ Rights and Antifraud Section of OAG.
DC Wage & Hour Laws
The District’s Minimum Wage Revision Act (MWRA) creates a baseline wage of $15.20 per hour, which will be $16.10 per hour effective July 1, 2022. If an employee works more than 40 hours per week, the MWRA requires the employer to pay them an overtime rate of 1.5 times their regular rate. The District’s Sick and Safe Leave Act (SSLA) requires employers to provide paid sick leave, accrued t rates that are keyed to the size of the employer. Workers can learn about their rights under District law and how they can get help if their rights are being violated here.
How to Report Wage and Hour Violations
Workers who believe that their rights have been violated, or that they have experienced wage theft or other wage and hour violations, can contact OAG by calling (202) 442-9828 or emailing email@example.com or firstname.lastname@example.org.