A federal court order required the owner of a defunct Detroit-area transport company to pay approximately $274,000 in back wages and interest to 326 former drivers.
The consent order entered March 3 in the U.S. District Court in the Eastern District of Michigan resolves a lawsuit brought by the U.S. Department of Labor against Timothy Schultz for misclassifying drivers as independent contractors and failing to pay overtime.
“The U.S. Department of Labor will hold employers who violate federal wage laws accountable and take all necessary steps to recover back wages due to employees,” said Timolin Mitchell, Detroit Wage and Hour Division district director.
Schultz agreed to pay back the former ProCorp drivers over a five-year period in the consent order. He is required to pay $252,416 in overtime back wages and $21,403 in interest.
Two of Schultz’s current companies, Downrier Staffing Group and Navicorp, agreed to future Fair Labor Standards Act compliance. Schultz and his former operations manager made the agreement to classify drivers as employees, not independent contractors.
ProCorp, which ended operations in 2019, paid workers to drive newly manufactured cars to lots for storage and rail yards to ship outside of Detroit. Downriver Staffing Group does the same kind of work as ProCorp. Navicorp supplies staff to metro Detroit manufacturers.
