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New Jersey Gas Station Owner Must Pay $4 Million in Back Wages

PISCATAWAY, N.J. -- The U.S. Department of Labor obtained a judgment against Raceway Petroleum and Nicholas Kambitsis to pay $3.9 million in unpaid overtime wages and liquidated damages to more than 700 of their former and current employees, predominantly gasoline attendants, according to a release by the Department of Labor.

Raceway Petroleum Inc., a company with gas stations and convenience stores throughout Central and Southern New Jersey, along with its owner Nicholas Kambitsis, will pay $100,000 in civil money penalties.

"This action underscores our commitment to pursuing all available legal means to ensure workers receive their proper wages," said Secretary of Labor Hilda L. Solis. "The Labor Department will not tolerate employers who violate the rights of workers and attempt to circumvent the law."

More than 25 witnesses testified during three weeks of trial before a jury in the United States District Court, District of New Jersey. Some employees described working as many as 100 hours a week. For part of the period covered by the lawsuit, Raceway deducted up to two hours of breaks daily. Many of the employee witnesses testified they received less than one half hour of break time each day.

The consent judgment resolves a lawsuit filed by the department in 2006. An investigation by the Wage and Hour Division found beginning in June 2002 Raceway and Kambitsis violated the Fair Labor Standards Act by failing to pay employees time and one-half their regular hourly rates when they worked in excess of 40 hours in a workweek and by failing to keep accurate time and payroll records. It was later determined the defendants failed to come into compliance through December 2009.

The company also must retain an independent monitor to ensure FLSA compliance, train employees on their rights, install a mechanical or electronic timekeeping system that accurately records employee hours at each of its gas stations and provide professional training on the proper use of the time clocks in languages understandable to the employees. Within 90 days, a supplemental judgment will be submitted for the court's approval. It will provide the names of the employees owed back wages and liquidated damages, the amounts due each employee and the schedule for their payments.
The FLSA requires covered employees be paid at least the federal minimum wage, as well as one and one-half times their regular rates of pay for hours worked over 40 per week. Additionally, the law requires accurate records of employees' wages, hours and other conditions of employment be maintained. The federal minimum wage for covered, nonexempt employees is $7.25 per hour.

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