Labor Department Cites East Cobb Company

The U.S. Department of Labor has announced it has reached a settlement with an East Cobb construction company which was found to be using illegal labor practices.

Pegasso Construction & Floor Covering LLC had misclassified all its employees as independent contractors, and paid them a weekly salary instead of an hourly wage. Pegasso also failed to pay overtime to workers who had put in over 40 hours in a week. Some Pegasso employees actually made less than minimum wage when their weekly salaries were divided by the hours that they worked, investigators said.

The company was found to be in violation of the Fair Labor Standards Act, the Davis-Bacon and Related Acts and the Contract Work Hours and Safety Standards Act, the Department of Labor said. The last two violations stemmed from Pegasso’s federally-financed work at Ft. Gordon, where it did not pay overtime and failed to accurately report its payrolls.

The Pegasso settlement requires the company to fully adhere to all labor law in the future, to pay workers $135,819 in back wages, and to reclassify its workers as hourly employees to ensure they are paid fairly.