Philadelphia-based medical staffing agency to pay $9.3 million in back wages and damages for 1,756 workers

A Philadelphia-based medical staffing provider will pay $9.3 million in back wages and damages to more than 1,750 employees who were denied overtime pay after a consent judgment obtained by the U.S. Department of Labor.

U.S. Medical Staffing Inc., which is headquartered near Broad and Walnut Streets, will also pay a $700,000 civil penalty, court documents indicate. The judgment was secured by the Labor Department’s Office of the Solicitor in Philadelphia in the U.S. District Court for the Eastern District of Pennsylvania on Monday.

The Labor Department filed its complaint against U.S. Medical Staffing earlier this month, alleging that the medical staffing company denied 1,756 employees overtime pay between September 2017 and May. The company provides medical staff such as residential aides, personal care assistants, and licensed practical nurses to clients that include schools and group homes throughout the Philadelphia area.

An investigation found that U.S. Medical Staffing paid the employees their standard rate for hours over the standard 40-hour workweek, rather than the time-and-a-half rate required under the Fair Labor Standards Act. In some instances, the company also misclassified employees as independent contractors, or claimed to be a registry for its clients to employ workers, the Labor Department said in a statement.

A representative for U.S. Medical Staffing did not immediately respond to a request for comment. The company agreed to the judgment after months of negotiation with the department’s Office of the Solicitor, according to the statement.

“This consent judgment makes clear to all healthcare industry employers that just like U.S. Medical Staffing, they will be held accountable when they fail to pay employees their legally earned wages,” solicitor of labor Seema Nanda said. “The U.S. Department of Labor is prepared to use every tool available, including litigation, to prevent employers from violating workers’ rights.”

As part of the judgment, U.S. Medical Staffing will pay $4.65 million in back wages, an equal amount in liquidated damages, and the $700,000 civil penalty. The Labor Department’s Wage and Hour Division will distribute the payments to affected employees, the judgment indicates.

“As employers struggle to find the people they need to operate their businesses, those who ignore workers’ rights to full wages and benefits are likely to struggle to retain and recruit workers,” Wage and Hour principal deputy administrator Jessica Looman said. “Employers who abide by the law will certainly have a greater appeal than those who do not.”

Read the consent judgment below: