After an investigation by the U.S. Department of Labor's Wage and hour division, a federal judge has ordered Sunnyvale-based Bloom Energy to pay a group of 14 workers a total of $63,844 in back wages and liquidated damages. The judge found that Bloom had willfully paid the workers less than the minimum wage, denied them overtime pay, and violated the recordkeeping requirements of the Fair Labor Standards Act.
According to the Labor Department's investigation, Bloom Energy, a manufacturer of solid oxide fuel cells, brought the workers in from Chihuahua, Mexico, to work with a group of U.S. workers on refurbishing some power generators. Apparently, Bloom paid the Mexican workers in pesos, and only in the equivalent of $2.66 an hour.
"It is appalling that this was happening right in the heart of Silicon Valley, one of the wealthiest per capita areas in the U.S.," said a spokesperson for the Wage and Hour Division.
The FLSA requires U.S. employers pay the federal minimum wage and to compensate appropriately classified employees for overtime at one-and-a-half times their base rate. What's more, the law also prohibits companies from moving their goods into the stream of commerce if they are produced in violation of those provisions or fail to keep accurate wage and hour records.
As a result, the DOL asked Bloom not to ship any of its products until the minimum wage and overtime dispute was resolved. That likely cost the company a substantial amount, as its client list includes major companies such as Google, Wal-Mart, Coca-Cola and eBay.
The federal judge found Bloom's violations of the FLSA to be willful, so the DOL fined the company more than $6,000 in a civil penalty and required it to enter into a consent decree. Such agreements typically require companies to fully reassess their policies and training and to formulate new ones capable of ensuring that such violations do not occur again. Since retaliation against employees who seek to enforce their FLSA rights is also illegal, those new policies must also prevent reprisals.
Bloom Energy has now paid the civil penalty and has forked over the back wages and liquidated damages to the affected workers.
"The department remains vigilant in protecting the rights of vulnerable workers and to ensuring they are paid the wages they have rightfully earned," said the DOL spokesperson.
Source: U.S. Department of Labor Wage and Hour Division press release, "US Labor Department investigation reveals Silicon Valley employer significantly underpaid workers from Mexico," Feb. 4, 2013