NEW YORK (TheStreet) -- Yesterday the United States Department of Labor announced that professional networking Web site LinkedIn (LNKD) had agreed to pay nearly $6 million in unpaid wages and damages to 359 former and current employees. LinkedIn paid $3.3 million in overtime pay and $2.5 million in damages.
When LinkedIn was notified of the violations, it agreed to pay all overtime back pay due and take steps to correct its processes, the Labor Department stated.
LinkedIn was caught using a practice very common in Silicon Valley and across the U.S, especially in social media and start-up companies -- off-the-clock work.
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"This company has shown a great deal of integrity by fully cooperating with investigators and stepping up to the plate without hesitation to help make workers whole," said Dr. David Weil, administrator of the Wage and Hour Division at the Labor Department. "We are particularly pleased that LinkedIn also has committed to take positive and practical steps towards securing future compliance."
An investigation by the Department of Labor found LinkedIn was in violation of overtime and record-keeping provisions of federal law.
The Fair Labor Standards Act requires that covered, nonexempt employees be paid at least the federal minimum wage of $7.25 per hour for all hours worked, plus a higher wage of time-and-one-half their regular hourly rates for hours worked beyond 40 per week. The FLSA provides that employers who violate the law are, as a general rule, liable to employees for their back wages and an equal amount in liquidated damages. Liquidated damages are paid directly to the affected employees. Additionally, the law requires employers to maintain accurate time and payroll records, and it prohibits retaliation against employees who exercise their rights under the law.