Medical Staffing Agency Ordered to Pay $7.2 million in Back Pay
February 03, 2022
The U.S. Department of Labor (DOL) has announced that Medical Staffing of America LLC, dba Steadfast Medical Staffing, has been ordered by a federal district court in Virginia to pay liquidated damages of at least $3,619,716 and back pay of at least $3,619,716 to 1,105 employees. Steadfast, which is based in Norfolk, Virginia, is a healthcare industry employment agency that serves healthcare facilities throughout the United States by providing independent medical personnel. The court found that the staffing agency intentionally deprived its nurses and aides of rightfully earned overtime wages in violation of the Fair Labor Standards Act (FLSA).
DOL investigation and findings.The DOL's Wage and Hour Division conducted an investigation that found Steadfast had improperly and willfully classified its aides and nurses as independent contractors, rather than as employees. Consequently, the staffing agency paid its workers straight-time wages instead of time-and-a-half for overtime (over 40 hours per week). Steadfast also did not maintain accurate records of the total number of weekly hours worked. Both of these actions violated the FLSA.
Court's findings and judgment.The court, in its judgment, found that Steadfast had exercised extensive control over its nurses' manner of work, and so had employed them under the FLSA. This control was manifest in the staffing agency's scheduling of work, training and insuring its workers, setting the pay rate, paying wages, tracking the nurses' hours, and the supervision and discipline it exercised. The court rejected Steadfast's good-faith defense that it had been advised by legal counsel that its workers were likely properly classified as independent contractors, finding that position objectively unreasonable.