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Thursday, June 01, 2017

Rochester Senior Living Facilities reaches $328K settlement for underpaying employees

All WNY News     Thursday, June 01, 2017    


ROCHESTER – Attorney General Eric T. Schneiderman today announced a $328,000 settlement with First Realty Management Co., Inc. and the seven Legacy Senior Living ("Legacy") complexes it operates in the greater Rochester area for failing to pay its employees the minimum wage. Per the terms of the settlement, Legacy has agreed to pay $328,000; that includes over $238,000 in back pay to 15 current and former employees who were compensated well below the minimum wage, as well as over $89,000 in damages, interest and penalties. Legacy must also improve its record-keeping practices, clearly inform workers of their rights, and submit to monitoring.

To date, Attorney General Schneiderman has won back nearly $30 million in stolen wages for over 21,000 workers across New York.

"Every worker has a right to be paid the wages he or she has earned – period," said Attorney General Schneiderman. "We'll use all tools at our disposal to ensure that New York's workers are treated with the fairness and dignity they deserve."

The Attorney General's investigation determined that Legacy failed to pay the required minimum wage to 15 Live-In Safety Coordinators, who answered emergency calls from Legacy residents on an "on-call" basis between 8:00 p.m. and 8:00 a.m., and performed housekeeping or light maintenance for 10 hours each week. Legacy did not pay any cash wages to these Live-In Safety Coordinators; instead, Legacy only provided them with an apartment and utilities for free or at a reduced rate, as long as they worked in that capacity. However, the Attorney General contends that, based on the number of hours worked by the employees, Legacy was required to pay cash wages in addition to providing the living accommodations to bring these employees' hourly pay up to the required minimum wage.

Under State Law, when determining whether an employer has paid minimum wages to its employees, "wages" may include cash and other non-cash compensation given to an employee for the employee's benefit such as the use of an apartment. However, the value an employer may credit toward wages for the use of an apartment is capped by law, and Legacy's failure to pay any cash wages to its employees violated the New York Labor Law, resulting in an underpayment of $238,896.70. Legacy has agreed to pay these back wages as well as $79,170.75 in interest and liquidated damages, all of which will be distributed to current and former employees. In addition, Legacy has agreed to pay to New York State $9,932.55 in penalties and costs.

Between January 1, 2010 and February 2014, Legacy paid its employees below the required minimum wage and overtime rate, in one case paying less than the equivalent of $2.00 an hour to a live-in employee. During most of the time period covered by the investigation, the applicable minimum wage was between $8.00 and $9.00 per hour. New York's minimum wage is currently $9.70 per hour in Monroe County, and it will increase to $10.40 per hour on December 31, 2017.  Legacy also failed to keep records of the actual hours worked "on-call" by Live-in Safety Coordinators during the time period at issue, and failed to give employees notice that their wages included an allowance for the use of the apartment as required by law.

Legacy's unlawful employment practices were brought to the attention of the Attorney General by a former Legacy Live-In Safety Coordinator who had been sued by Legacy for back rent because the employee remained in the apartment provided by Legacy after employment was terminated. Since Legacy had not paid cash wages to Live-In Safety Coordinators, the former employee did not have enough money for a security deposit for another apartment, and needed to remain in the apartment for 30 days after terminating employment with Legacy. Legacy sued the former Live-In Safety Coordinator for $2,000, seeking one month's back rent, at which point the former employee sought assistance from the Attorney General's office.

In addition to paying $328,000 in restitution, damages, and penalties, the agreement requires Legacy to maintain records of hours worked by employees, and post a notice informing all employees of their rights, including wage-and-hour laws and the right to freedom from retaliation. Legacy will also submit to monitoring for two years to ensure compliance with the agreement and wage-and-hour laws.

Anyone who is aware of a violation of workplace rights in New York State is encouraged to file a complaint with the Office of the Attorney General by filling out a complaint form or by calling the Labor Bureau at (212) 416-8700.


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