A federal judge has issued an injunction against Diamond Tree Experts of Salt Lake City that prohibits it and its owner from retaliating against employees who refuse to kickback overtime pay that is mandated by law.
The company and owner Robert Trent Van Dam also are required to pay back wages to an employee who was misclassified as exempt from federal overtime laws.
In settling the case, Van Dam did not admit to any violations but agreed to pay $44,000 in back wages and damages.
An attorney for Diamond Tree Experts, James Tracy, said the company adamantly denies all of the allegations but settled the case because the cost of defending itself was much higher than the settlement costs.
"Diamond Tree Experts was faced with the prospect of spending hundreds of thousands of dollars to defend itself in court," said Tracy in a statement. "As a small local business, it was simply unable to pay that kind of expense."
A previous Labor Department investigation had found that Van Dam failed to pay overtime wages after workers put in more than 40 hours in one week. Then subsequently it found that when the company paid back wages, Van Dam demanded a kickback of the funds and fired one worker who refused.
The Labor Department then sued Van Dam and his company.
"Requiring the return of an employee's earnings and retaliating against the employee are illegal and unacceptable practices," Cynthia Watson, regional Labor Department investigator, said in a statement.
Two employees will receive $22,000 in wages and an equal amount in damages.