Silicon Valley Company Paid Employees Less than 2 Dollars an Hour

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Summary: Electronics for Imaging was fined by the U.S. Department of Labor and forced to pay back pay to employees it had paid just $1.21 per hour for 120-hour work weeks.

Electronics for Imaging, a Silicon Valley company that specializes in digitizing images claims that an “administrative error” led to measly paychecks for eight employees from Bangladore, India. The workers were paid wages of just $1.21 an hour for 120-hour work weeks that they spent installing computers in the company’s headquarters.

  

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The U.S. Department of Labor investigated after an anonymous tip gave them information about the payroll violation. According to the Huffington Post, the company had to pay $40,000 in back wages and overtime, plus a $3,500 fine.

Michael Eastwood, the assistant district director for the Labor Department’s San Francisco division, said, “These folks were not only not getting time-and-a-half when working extremely long hours, they weren’t making the basic minimum wage.”

Electronics for Imaging responded that it did not realize that it was illegal to pay temporary workers the same wage that they would earn in their home countries. The hourly wage of $1.21 was the equivalent of Indian rupees. “We unintentionally overlooked laws that require even foreign employees to be paid based on local U.S. standards,” it said in a statement.

Eastwood added that Electronics for Imaging kept no documentation of the hours the Indian workers logged. The workers were technically owed only $20,000 in back pay and overtime, but the regulators doubled that to $40,000 to compensate for damages. Again, the company blamed an “administrative error” for the lack of timekeeping.

David Lindsay spoke on behalf of Electronics for Imaging. He stated that the violation occurred last year, and that the owed wages and back pay were already paid. All dues had been paid by August, he said.

The company earned a net income of $109.11 million last year. In 2012, it earned $83.27 million. Its stock price has constantly increased over the past five years.

Last year, another tech company was busted for wage theft. Bloom Energy Corporation had to pay out close to $64,000 in back pay and damages to 14 Mexican workers who were only paid $2.66 per hour. Eastwood noted, “Unfortunately, we do see a high level of wage theft violations. But we want to send a clear message that the Department of Labor is here and we are vigorously enforcing the Fair Labor Standards Act.”

Photo credit: bargaineering.com