The U.S. Department of Labor has recovered over $450,000 from a Honolulu air cargo carrier that failed to pay 250 employees their full wages and benefits while fulfilling a $113 million U.S. Postal Service contract to transport mail between airports in Hawaii.
The recovery follows an investigation by the department’s Wage and Hour Division into Rhoades Aviation Inc., operating as TransAir. The investigation determined that the employer disregarded requirements under the Service Contract Act, which mandates prevailing wages and fringe benefits for employers under federal contracts.
Division investigators found several violations by TransAir:
- Paying incorrect and lower prevailing wage rates to 208 material handling laborers, resulting in $268,839 in back wages.
- Not disbursing correct health and welfare benefits, holiday pay, and vacation pay to 208 workers, leading to $156,106 in recovered fringe benefits.
- Failing to pay correct overtime wages to 55 workers, resulting in $12,650 in overtime wages and $12,625 in liquidated damages.
“Our investigation found TransAir failed to comply with federal service contract regulations regarding worker compensation,” said Wage and Hour Division District Director Terence Trotter in Honolulu. “The U.S. Postal Service’s federal contract obligated TransAir to not only comply with standards for mail delivery but also for standards that deliver the lawful payment and benefits to workers performing those labor-intensive services.”
Investigators also determined that TransAir unlawfully made 30-minute deductions for lunch breaks not taken, causing the employer to underreport and underpay overtime hours in violation of the Fair Labor Standards Act.
Since 1982, Rhoades Aviation Inc.’s fleet of TransAir aircraft has provided air cargo services within Hawaii, delivering packages, mail, animals, oversized baggage, emergency equipment, and other items. In addition to its USPS contract, the company fulfills contracts with UPS, FedEx, and Pacific Air.
More information about the Wage and Hour Division can be found on their website. A search tool is available for individuals who believe they may be owed back wages collected by the division. Employees and employers seeking confidential compliance assistance can call the agency’s toll-free helpline at 866-4US-WAGE (487-9243). The department offers support in more than 200 languages.
Additionally, the agency's new Timesheet App is available for free download on iOS and Android devices in English or Spanish to ensure accurate tracking of hours worked and pay received.
