Malvern's PBP Refused To Pay For Employees' Bathroom Breaks: Judge

MALVERN, PA - For employees of a Malvern marketing and publishing company, taking a break to get a drink of water or use the bathroom was a matter of dollars and cents.

Telemarketing workers at Progressive Publications (PBP) had their pay docked for nearly every single second they didn’t spend making sales calls, according to the U.S. Department of Labor.

Now, owner Ed Satell and the company owe employees a payday of $1.75 million in back wages and damages for a direct violation of the Fair Labor Standards Act, a federal judge ruled.

When workers had their pay docked, it often brought their wages below the federal minimum wage, according to the Department of Labor.

It is most certainly not the first time PBP has been brought under legal or public scrutiny.

The Better Business Bureau (BBB) has been warning businesses around the region and the nation about PBP’s “deceptive” business practices for years.

>>Malvern Firm Billing Companies For Unwanted Newsletters, BBB Warns

Complaints filed with Consumer Affairs and the BBB reflect allegedly abysmal working conditions at many PBP locations, including bullying, sexual harassment, and unfair treatment. The bulk of the complaints, however, actually came from companies that believed they were unfairly billed and treated in an underhand manner.

“Many of these businesses are clearly frustrated and angry,” said Michelle Corey, BBB president and CEO. “They complain that the company tries to get them to pay for products they never ordered and did not want, or that they believe were provided without charge.”

Corey said some of the businesses say they have fought Progressive for months over the company’s billing practices.

Complaints against PBP and the associated International Credit Recovery have come from all 50 states and Washington, D. C. Over one 12 month period, the BBB logged about 900 complaints against Progressive and more than 280 complaints against International Credit Recovery.

Employees with Progressive Business Publications said that in 2014, Satell used company-wide meetings in Malvern as a platform to rail against raising the minimum wage.

During that same period of time, Satell and the company were refusing to come into compliance with federal law on paying wages during the course of litigation.

Progressive’s lack of cooperation will increase significantly the amount of back wages and damages due its employees as a result of its illegal pay policy, the Department of Labor said.

Although the exact amounts have not yet been determined, the Department of Labor estimates that for violations occurring through June 2013, Progressive and Satell are liable for at least $1.75 million in back wages and liquidated damages to more than 6,000 employees who worked in 14 call centers throughout Pennsylvania, New Jersey and Ohio.

“For far too long, American Future Systems penalized its employees for taking breaks to meet the most basic needs during the work day – stretching their legs, getting a glass of water or just using the restroom,” said Jim Cain, district director for the department’s Wage and Hour Division, in a press release. “The judge’s decision reaffirms how clear the FLSA is about short breaks being compensable, and goes a long way in making these employees whole by awarding liquidated damages.”

Issued on December 16, 2015, by a judge in the U.S. District Court for the Eastern District of Pennsylvania, the decision resolves the primary issues in a department lawsuit filed after a Wage and Hour Division investigation found that telemarketers had to clock in and out for every break, even those as short as two to three minutes.

The timekeeping system then deducted the break time from their total hours worked each week. The Wage and Hour Division advised the company that the practice violated the law, but the employer failed to comply with the FLSA. The court found the company also violated FLSA recordkeeping requirements.

“Rehabilitative breaks have always been considered compensable time under the law,” said Oscar L. Hampton, the department’s regional solicitor in Philadelphia. “This action underscores how aggressively we plan to enforce the law to ensure that workers receive the proper wages.”

The Wage and Hour Division’s Philadelphia District Office conducted the investigation. Attorneys in the department’s Philadelphia regional solicitors’ office litigated the case.

For more information about federal wage laws, call the Wage and Hour Division’s toll-free helpline at 866-4US-WAGE (487-9243). Information also is available athttp://www.dol.gov/whd/