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 Real Cases, Real Costs: What Small Business Owners Can Learn from Recent DOL Fines


You don’t have to be a massive corporation to end up in the Department of Labor’s spotlight. Just this year, multiple small- and mid-sized businesses—including landscapers, healthcare providers, and contractors—were hit with massive fines for labor violations.

Could these situations have been prevented? Maybe not entirely—after all, anyone can sue for any reason—but with the right HR systems in place, the risk could’ve been drastically reduced.

🚨 3 Real HR Legal Fails (And How to Avoid Them)

1. Misclassification of Independent Contractors – $319K in Back Wages
📍 Case: A Louisiana landscaping company misclassified 49 workers as independent contractors, denying them overtime pay. The Department of Labor recovered $319,065 in back wages.

✅ What Could Have Helped:

  • Reviewing job duties vs. classification under FLSA

  • Using contractor agreements that align with DOL & IRS rules

  • Performing regular audits of job roles

⚠️ Why It Happens:
Many small businesses assume “1099” status means “no benefits.” But it’s about control—scheduling, supervision, and direction of work.

2. Willful Overtime Violations – $7.4M in Wages & Damages
📍 Case: A Phoenix-based drywall and painting company denied overtime pay to more than 1,400 employees. They were ordered to pay $7.45 million.

✅ What Could Have Helped:

  • A documented, compliant overtime policy

  • Manager training on overtime rules

  • Accurate timekeeping systems

⚠️ Why It Happens:
Some employers allow or even encourage working “off the clock.” That’s not legal—and it won’t hold up during an audit.

3. Home Care Workers Misclassified – $446K in Wages & Damages
📍 Case: Two Louisiana home care providers misclassified 88 workers, resulting in $446,334 in back wages and damages.

✅ What Could Have Helped:

  • Clarifying employee vs. contractor roles

  • Understanding caregiver-specific labor rules

  • Solid onboarding with proper documentation

⚠️ Why It Happens:
In industries with flexible or remote work, businesses often incorrectly assume contractor status applies. Not true under most FLSA rules.

👀 What This Means for You

If you're thinking, “That won’t happen to us,” consider this: the DOL doesn’t care if you meant well—only whether you’re compliant. And the bigger your team grows, the bigger the risk.

✅ How We Help

At Purciarele Group, we help businesses avoid costly HR missteps before they happen. From job classification audits to compliant handbooks, we’ve got your back.

📅 Let’s Talk.
A smart HR strategy won’t make you lawsuit-proof—
but it will make you stronger, safer, and ready for whatever comes next.

🎯 Schedule your complimentary consultation today. Purciarele Group

We love HR... so you don’t have to. 💼💙

Sources:

  • DOL Landscaping Case

  • DOL Phoenix Contractor Case

  • DOL Home Care Case                                                                                                                                                                                                                                                                                                                                       

  • #PurciareleGroup #SmallBusinessTips #HRMatters #WageAndHour #Compliance #HRConsulting #LaborLaw #AvoidTheFine #BusinessGrowth #DOLCases #IndependentContractor

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