Get instant
small business insurance quotes

Home > Employment Practices Liability Insurance > News

Iowa company sued for payment failures


The U.S. Department of Labor recently setled a lawsuit it had filed against an Iowa-based food company for allegedly failing to pay a significant number of mentally disabled workers.

The lawsuit claims the company did not pay the plaintiffs minimum wage, nor any wages for overtime hours worked. As part of the settlement, the 31 disabled workers will receive $880,777 for wages that were unpaid between 2006 and 2009. The same total will also be paid for damages, bringing the total payment to nearly $1.7 million, or $55,000 per worker.

According to a report in the West Liberty Index, the employees had worked at the company from the late 1970s up until 2009. Thus, they were owed a significantly higher amount of back pay. However, as part of the settlement, the Labor Department will not seek any further funds from the food company.

Also part of the settlement, the company ensures it will adhere to minimum wage standards, as well as overtime payments and record-keeping laws.

This case highlights the importance of following all of these regulations, as well as adhering to legal employment practices. Failure to do so may lead to similar lawsuits, citing a company's professional liability. 

WHY Business Insurance Now?

Learn why thousands of small businesses trust Business Insurance Now as their insurance agency.

Take 15 minutes to see how we can help you protect your business.

  • FREE, no-obligation quotes.
  • Complete one online application to compare multiple quotes.
  • Fast response—typically less than 24 hours on week days.
  • We are a nationwide insurance agency covering 48 states.
  • We work directly with you to evaluate your insurance options.
  • We only work with the top business insurance carriers in the country.
  • Expert, licensed insurance agents to guide you through the process.