American Airlines Federal Credit Union said an unintentional clerical error caused it to incorrectly calculate overtime, leading to an agreement with the U.S. Department of Labor to pay nearly 300 current and former employees more than $83,000.
An investigation by the Dallas District Office for the department’s Wage and Hour Division revealed the $5.4 billion Fort Worth, Texas-based credit union violated the Fair Labor Standards Act’s overtime and record keeping provisions, the agency said.
Now, AACU is forking out $83,608 in overtime back wages to 295 current and former tellers, loan officers and customer service representatives, the Labor Department said.
The CU wrongly classified its salaried employees as exempt and paid them “straight-time” wages; it also failed to maintain accurate time and payroll records of employees’ work hours and wages, the investigation determined.
The FLSA requires employers to pay covered workers the federal minimum wage of $7.25 for all hours worked, plus time and one-half their regular pay rates, including commissions, bonuses and incentive pay, for all hours worked in excess of 40 per week.
“This company profited from employees working overtime without paying proper wages,” Southwest Wage and Hour Division Regional Administrator Cynthia Watson said in an Aug. 1 press release.
“According to labor standards, work hours should be counted, recorded and paid for fairly. A nonexempt employee who works more than 40 hours a week is due overtime wages for those hours at a rate of time and one-half his or her regular pay,” Watson said.
AACU told Credit Union Times in a statement that an unintentional clerical error had been made in the formula the CU used to calculate overtime. The credit union said it has adjusted its formulas so the error won’t occur again.
"As soon as the Department of Labor advised the credit union about the error, we immediately undertook prompt remedial measures,” the statement read. “We worked closely with the DOL and voluntarily conducted a nationwide audit to identify people affected by the incorrect formula, and we made those people whole by paying them any additional money needed to correct the error.”