Hospitality Industry Employee Risks: Labor Department Orders South Dakota Hotel To "Pay Back 72 Foreign Workers" For "Impermissible Recruitment Fees"

“…since 2009 Labor Department rules have required businesses to agree it “has contractually forbidden any foreign labor contractor or recruiter whom the employer engages in international recruitment of H-2B workers to seek or receive payments from prospective employees.”

“…Global Employment Agency required impermissible payments from prospective employees from $530 to $1,500…”

The Labor Department announced it had ordered Custer State Park Resorts to pay back $93,000 to its 72 foreign workers hired for the 2010 tourism season. The payments covered impermissible recruitment fees and unpaid overtime. The department fined Custer State Park Resorts an additional $65,000 in civil penalties, which it is appealing. Each year, Custer State Park Resorts hires about 375 to 400 employees, with fewer each year being guest workers, Schmaltz said.

Schmaltz said the unpaid overtime resulted from confusion in the guest worker rules. The bulk of the Labor Department fine Schmaltz said – roughly $60,000 – is repayment for fees taken by Kaubisch.

“We relied too heavily on this vendor who was supposed to know the laws and regulations,” Schmaltz said. “We put too much faith into what Scott knew.”

Kaubisch said he charged the fees to workers “to take care of them.” He took phone calls at all hours, arranged rides and helped secure housing for guest workers. It wasn’t until the investigation last spring, Kaubisch said, that Labor Department officials told him collecting fees was illegal.

Read more: http://rapidcityjournal.com/news/employers-ordered-to-pay-back-foreign-staff/article_1eea0e92-65a9-11e1-886a-001871e3ce6c.html#ixzz1oA6hDlvr