Company Finds Out The Hard Way It's Illegal To Pay $1.21 An Hour In America

This takes egregiously low wages to a whole new level.

A Silicon Valley company that digitizes images said Thursday that an "administrative error" led to it paying eight workers flown in from Bangalore, India just $1.21 an hour to work 120-hour weeks installing computers in the company's headquarters.

Electronics For Imaging paid the workers $40,000 in back wages and overtime and a $3,500 fine after the U.S. Department of Labor investigated the payroll violation based on an anonymous tip, a department official told The Huffington Post.

"These folks were not only not getting time-and-a-half when working extremely long hours, they weren't making the basic minimum wage," Michael Eastwood, assistant district director for the Labor Department's San Francisco division said.

In a statement, the company said it didn't realize it was illegal to pay workers temporarily in the United States the same wages they earn in their home countries. The $1.21 was equivalent to what the employees made in Indian rupees.

“We unintentionally overlooked laws that require even foreign employees to be paid based on local U.S. standards,” the company said in a statement.

Eastwood said the company also failed to keep documentation of the hours worked by the Indian employees. Though the workers were only owed $20,000 in back pay and overtime, regulators doubled that amount to $40,000 in the settlement to compensate for damages.

The company blamed an “administrative error” and said it took steps to ensure it would not occur again.

David Lindsay, a spokesman for the company, told HuffPost the labor violation occurred last year, and that the back wages, overtime and fine had already been paid. Eastwood confirmed that all dues were paid in August.

Electronics For Imaging earned a total net income of $109.11 million last year, up from $83.27 million in 2012. The stock price has climbed steadily over the last five years:

Wage theft is nothing new in the Silicon Valley region. Last year, Bloom Energy Corporation was forced to pay out nearly $64,000 in back pay and damages to 14 workers from Mexico who were paid just $2.66 an hour.

"Unfortunately, we do see a high level of wage theft violations," Eastwood said. "But we want to send a clear message that the Department of Labor is here and we are vigorously enforcing the Fair Labor Standards Act."

This story has been updated with a quotes from the U.S. Department of Labor

Gap Between Richest And The Rest Widened After The Recession: Fed

Sept 4 (Reuters) - The gap between the richest Americans and the rest of the nation widened after the Great Recession, a survey by the Federal Reserve showed on Thursday, suggesting deepening U.S. income inequality.

Though incomes of the highest-earners rose, none of the groups analyzed by the Fed had regained their 2007 income levels by 2013, underscoring deep scars from the financial crisis and its aftermath.

The data comes from a massive survey of consumer finances conducted by the Fed Board of Governors every three years. Many other studies have also shown the lasting effects of the recession and documented rising income disparity in the United States.

The Fed survey released suggests that wealth and income is concentrated not just within the top 1 percent, as some analyzes have suggested, but actually among a slighly broader slice of the ultra-rich: the top 3 percent.

From 2010 to 2013, average income for U.S. families rose about 4 percent after accounting for inflation, the survey showed. All of the income growth was concentrated among the top earners, the survey showed, with the top 3 percent accounting for 30.5 percent of all income.

The disparity was even greater by wealth, with the top 3-percent holding 54.4 percent of all net worth in 2013, up from 51.8 percent in 2007 and 44.8 percent in 1989.

Fed Chair Janet Yellen has called income inequality a disturbing trend, attributing some of it to the weak jobs market but also to underlying trends like technology and globalization.

Overall for U.S. families, wealth stabilized from 2010 to 2013, after falling sharply during the prior three years. Fed economists attributed that pattern to the declines in home and business ownership during the recession, which stripped many families of their biggest sources of wealth.

Families with income in the bottom half of those surveyed reduced their participation in retirement plans, continuing a trend seen from 2007 to 2010, but middle-income families increased their participation somewhat, the survey found. Still, overall participation rates were down from levels seen in 2007.

Although wealth did not change much overall, many measures of debt decreased, the survey found, driven largely by declines in home ownership. On average, debt fell 13 percent.

(Reporting by Ann Saphir; Editing by Tom Brown)

Chipotle CEO Details Why His Company Is Better Than Other 'Irrelevant' Fast Food Chains

Most mega fast food chains are being pulled in two directions these days — trying to satisfy those consumers who want quality ingredients and healthier options, while also pushing bottom-dollar value menu items to diners whose primary goal is to eat something fast and cheap. It would seem like one of these would have to win out in the long run, and according to the co-CEO of Chipotle, the cheap and easy route will soon be a thing of the past.

In an interview with The Street, Chipotle co-CEO Monty Moran says the company is taking down traditional fast food, which he deems “irrelevant,” by opening more locations and showing customers that the other chains don’t care as much about the consumer or their employees.

“By traditional fast food I mean where the predominant goal is the cheapening of the raw ingredients, the automation of the work such that anyone could do it that you don’t need training so that they turn over their employees without any care for them, where it’s a game of value meals and cheapening and cheapening the food experience,” he says.

Another reason Chipotle will contribute to the downfall and replace traditional fast food chains is its emphasis on where food comes from.

“Get suppliers to start thinking how they raise food differently because there are more folks like Chipotle, they will have to do things according to our protocols,” he says. “A fifth way is changing customer perception so that customers are aware where their food comes from and start making demands of grocers and restaurants to provide food in a way that makes sense to them.”

It’s hard to imagine how fast food is irrelevant considering McDonald’s alone is 20-times larger than Chipotle. But even with such a wide gap, Moran says Chipotle will continue leading the way – through its own locations or imitations – in changing the face of fast food.

Chipotle’s Monty Moran Unwraps the Restaurant’s Success Story [The Street]

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Customer Data May Have Been Exposed By Malware At UPS Stores In 24 States

Some customers of The UPS Store may have had their credit and debit card information exposed by a computer virus found on systems at 51 stores in 24 states.

A spokeswoman for UPS says the information includes names, card numbers and postal and email addresses from about 100,000 transactions between Jan. 20 and Aug. 11.

United Parcel Service Inc. said Wednesday that it was among U.S. retailers who got a Department of Homeland Security bulletin about the malware on July 31. The malware is not identified by current anti-virus software.

The company is not aware of any fraud related to the attack, spokeswoman Chelsea Lee said.

Atlanta-based UPS said it hired a security firm that found the virus in systems at about 1 percent of the company's 4,470 franchised locations. At many stores, the intrusion did not begin until March or April.

Lee said that the problem was fixed by Aug. 11 and the company took additional steps to protect systems at other stores. She said the affected stores were not linked electronically, and UPS is still investigating how they were compromised.

UPS said it is providing identity protection and credit monitoring help to affected customers.

The affected stores were in Arizona, California, Colorado, Connecticut, Florida, Georgia, Idaho, Illinois, Louisiana, Maryland, Nebraska, Nevada, New Jersey, New York, North Carolina, North Dakota, Ohio, Oklahoma, Pennsylvania, South Dakota, Tennessee, Texas, Virginia and Washington.

From the company's description, the breach appeared far smaller than one that hit Target Corp. during the holiday-shopping season, when hackers stole credit and debit card information involving millions of customers. Fallout from the incident is still hurting profits. Target, which said Wednesday that second-quarter profit fell 62 percent, has spent $235 million related to the breach, partly offset by $90 million in insurance payments.

The UPS breach won't have a material financial impact on the company, Lee said.

Last week, Supervalu said that hackers might have stolen names, account numbers, expiration dates and other information from card holders who shopped at up to 200 of its grocery and liquor stores. Restaurant operator P.F. Chang's, Goodwill thrift stores and other retailers have been hit by data breaches.

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A list of the 51 locations of The UPS Store where malware was discovered is at www.theupsstore.com/security

Facing Historic Drought, California Lawmakers Vote To Place $7.5 Billion Water Plan On The Ballot

SACRAMENTO, Calif. (AP) — Driven to action by the state's historic drought, California lawmakers on Wednesday voted to place a $7.5 billion water plan before voters in November.

The measure marks the largest investment in decades in the state's water infrastructure and is designed to build reservoirs, clean up contaminated groundwater and promote water-saving technologies.

It replaces an existing water bond that was approved by a previous Legislature but was widely considered too costly and too bloated with pork-barrel projects to win favor with voters.

After weeks of difficult negotiations, the ballot measure sailed through both houses of the Legislature: 77-2 in the Assembly and 37-0 in the Senate. Republican Tim Donnelly of Twin Peaks and Democrat Wesley Chesbro of Arcata cast the dissenting votes in the Assembly.

Gov. Jerry Brown signed the legislation, AB1471, shortly after the Legislature acted. Citing the overwhelming bipartisan support, the Democratic governor said he probably had never seen Democrats and Republicans so united in his lifetime.

"It's about water, it's about our future, it's about Californians coming together," Brown said.

The evening votes in the Assembly and Senate came after the Democratic governor and lawmakers from both parties were finally able to clear their main hurdle, a disagreement about how much money should be spent on new reservoirs and other storage projects.

A state with a population that exceeds 38 million and an agricultural industry that feeds the nation has been struggling to meet the increasing demands for water after three dry winters.

The push to revamp the 2009 ballot measure, which was $11.1 billion and had been delayed from statewide votes twice, gained momentum as the worst drought in a generation intensified throughout the state. It has forced farmers to fallow fields, led to double-digit unemployment in many rural areas, turned large expanses of reservoirs into mud flats and prompted local governments to mandate water-use restrictions and impose fines for water waste.

Senate President Pro Tem Darrell Steinberg, D-Sacramento, said water was something many Californians had previously taken for granted.

"The need is so great in California," he said, referring to the wide margin of support the spending measure enjoyed in the Legislature. "The time is now."

The relatively swift and overwhelming votes for passage in both houses of the Legislature were in contrast to the weeks of difficult negotiations to replace the existing and more costly water bond that already was on the November ballot.

Brown wanted a much smaller bond to attract voters and minimize state debt, while many Democratic lawmakers fought against money for reservoirs and sought strong environmental protections for the Sacramento-San Joaquin River Delta.

The proposal approved Wednesday includes $2.7 billion dedicated to storage projects, which likely would include a new reservoir in what is now a bucolic agricultural valley in Colusa County north of Sacramento and another in the Sierra Nevada northeast of Fresno.

That amount is more than Democrats and the governor had proposed for new reservoirs but less than the $3 billion included in the old ballot measure, which was approved by a previous Legislature in 2009.

The breakthrough on water storage was hailed by Republican lawmakers, who saw it as a top priority. Democratic lawmakers who represent agricultural areas in the Central Valley also pushed for the reservoir funding.

"This now offers us an opportunity to guarantee the future," said Sen. Jim Nielsen, a Republican who represents a largely agricultural region in Northern California that will be home to one of the proposed reservoirs. "This is not about us and not about the next election; it's about our grandchildren."

Numerous agricultural, environmental and business groups quickly endorsed the legislative compromise. The plan includes $7.1 billion in new borrowing and $425 million from previous bonds that would be redirected to the updated water priorities. Redirecting that money requires voter approval.

Provisions in the latest bond proposal involving water recycling and cleanup of contaminated groundwater could increase the availability of water during future droughts. The bond also includes other water projects not directly related to supply, such as watershed improvements and flood management.

Democrats needed Republican support in the Senate but not in the Assembly, where they hold a supermajority. Even so, the governor has said bipartisan support for the bond measure is crucial to show voters that it has wide support.

Assembly Speaker Toni Atkins, D-San Diego, said lawmakers can show a united front and make a strong case to voters that the water plan is worth supporting.

"People should feel a sense of comfort that when you got the boat rowing in the right direction that we are going to be OK, we are going to succeed," she said. "I think we are all going to become cheerleaders for doing the right thing."

Wednesday's scheduled vote was timed to the secretary of state's deadline for printing voter pamphlets, which lawmakers had earlier pushed back by two days.

___

Fenit Nirappil can be reached at http://www.twitter.com/FenitN.

Dow Tops 17,000 For First Time After Positive Jobs Report

* Dow tops 17,000 for first time; S&P 500 near 2,000

* Nasdaq closes at highest since 2000

* U.S. June jobs report well above forecasts

* PetSmart rallies as hedge fund seek sale

* Dow up 0.5 pct; S&P 500 up 0.6 pct; Nasdaq up 0.6 pct (Updates to close)

By Ryan Vlastelica

NEW YORK, July 3 (Reuters) - Wall Street's holiday-shortened session ended with multiple records on Thursday, with the Dow topping 17,000 for the first time after the June jobs report came in much stronger than expected.

Both the Dow and S&P 500 ended at their third consecutive record highs. The Nasdaq ended at its highest since 2000 and rose for a third straight week. The three major indexes wrapped up a week of solid gains on the day before the Independence Day holiday, when the U.S. stock market will be closed.

The U.S. economy added 288,000 jobs in June, racing past the 212,000 that economists had expected. The U.S. unemployment rate fell to 6.1 percent, the lowest since September 2008, confirming expectations that the economy bounced back in the second quarter after a dismal start to the year.

Thursday's gains were broad, with nine of the 10 primary S&P 500 sector indexes rising for the day. The only negative group was utilities, down 1.1 percent. The utilities sector struggled as the June jobs data suggested that the Federal Reserve may raise interest rates earlier than had previously been anticipated. Investors favor utilities in a low interest-rate environment because the sector is a dividend play.

"The report was very good and a real sign the economy is starting to take off," said David Kelly, chief global strategist at J.P. Morgan Funds in New York, which has about $450 billion in assets under management. "That said, it isn't an unmixed positive for the market because it suggests the Fed will consider raising rates in the first quarter."

The Dow Jones industrial average rose 92.02 points or 0.54 percent, to 17,068.26. The S&P 500 gained 10.82 points or 0.55 percent, to 1,985.44. The Nasdaq Composite added 28.19 points or 0.63 percent, to 4,485.93.

For the week, the Dow rose 1.3 percent, the S&P 500 advanced 1.25 percent and the Nasdaq climbed 2 percent. With the week's gains, the Nasdaq has gained for seven of the past eight weeks, rising more than 10 percent over that period.

The Dow is underperforming other major indexes so far this year, with blue chips up about 3 percent in 2014. Both the S&P 500 and Nasdaq have gained more than 7 percent.

About 55 percent of stocks traded on the New York Stock Exchange ended higher, while 64 percent of Nasdaq-listed stocks closed in positive territory.

Volume was extremely light in the shortened session, with only 3.49 billion shares traded on all U.S. platforms, according to BATS exchange data. The five-day average is 6.29 billion.

The Dow Jones Transportation Average closed at a record 8,294.74, after hitting an intraday all-time high at 8,298.17.

PetSmart Inc was the S&P 500's biggest gainer, jumping 12.5 percent to $67.28 in its largest one-day advance since May 2012. The rally came after activist hedge fund Jana Partners LLC said it planned to ask PetSmart to explore a sale and reported a 9.9 percent stake in the retailer.

Paccar Inc shares rose 5.4 percent to $67.25 after analysts published comments in a research note from a senior executive of Daimler, who said he heard Volkswagen was planning a bid for the truck maker, a claim that Volkswagen denied.

Regado Biosciences plummeted 58.4 percent to $2.81 after the Data Safety Monitoring Board started an unplanned review of data from a trial and the company said patient enrollment has been put on hold until the DSMB returns with recommendations. (Editing by Jan Paschal)

14 More Companies That Likely Will Deny Employees Birth Control

Hobby Lobby was just one of dozens of for-profit companies that challenged Obamacare's so-called contraception mandate, which requires companies with 50 or more employees to cover FDA-approved forms of birth control as part of their health care plans.

Many of those companies -- there are 48 of them with cases pending in lower courts, according to the National Women's Law Center -- are "closely held," meaning Monday's Supreme Court decision likely frees them to deny contraception coverage to their employees if they have a legitimate religious objection. (A closely held company is one where the majority of outstanding stock is owned by five or fewer people, according to the IRS.)

HuffPost read the court filings of these cases to determine which of those companies were easily identified as being "closely held" and how many employees were likely to be affected.

So what happens next for all these companies?

"These companies with cases pending, they will probably just go to court and file something simple, saying, 'In light of Monday's decision, we should prevail. We should be exempt from complying with this rule,'" says Louise Melling of the American Civil Liberties Union, which filed amici briefs on behalf of the government in some of these cases.

Melling said she thinks this "will happen very soon."

Here are some of the next companies that will likely win the right to deny contraception coverage to their employees:

1. Tyndale House Publishers

A bible published by Tyndale House Publishers.

This Christian book and Bible publisher, which sued the federal government in 2012 over the Affordable Care Act’s requirement to cover contraception, said in a statement provided to HuffPost that it was “delighted” with the Supreme Court’s Hobby Lobby decision.

“We hope the way is now clear for our court to rule that Tyndale House Publishers is not obligated to provide early abortion-causing items, which we find morally objectionable,” the statement said. Tyndale House, which is based in Illinois, has 260 full-time employees, according to court documents. Among other things, the company is known for publishing the works of evangelical icon and Focus on the Family founder James Dobson.

2. Trijicon
Trijicon, a Michigan-based company that makes rifle scopes, is no stranger to church-versus-state controversies. In 2010, it was revealed that the manufacturer had been stamping Bible verses onto its gun sights, many of which were used by U.S. and British soldiers in Iraq and Afghanistan. (The company later agreed to stop the practice.) In August of last year, a district court granted Trijicon a preliminary injunction in its case challenging the federal government’s mandate that companies with more than 50 employees provide coverage for birth control or pay a fine. Trijicon has more than 200 employees, according to the court filing.

Above, a rifle with a scope made by Trijicon.

3. Encompass Develop, Design & Construct
The owner of this Kentucky-based architecture and construction firm also sued the government last year, saying that the Affordable Care Act’s requirement to cover “abortion-inducing drugs” would lead to a “wrongful taking of human life” that, as an evangelical Christian, he found “sinful.” The case is currently pending. Encompass has about 70 employees who could be affected by the Hobby Lobby decision.

4. Holland Chevrolet
Holland Chevrolet is a West Virginia-based corporation that sells and services cars. The company provides health insurance to about 150 full-time employees, according to court documents from its 2013 case against the U.S. Department of Health and Human Services. Company owner Joe Holland, a born-again Christian, says in the lawsuit that it is “profoundly immoral” to “endorse any form of abortion.”

5. Johnson Welded Products
Citing freedom of speech violations, this manufacturing company, which makes parts for air brake systems for large vehicles, filed suit last year against the Obamacare birth control coverage requirement. Monday’s Supreme Court decision “will ensure a victory for our case,” Robert Muise, the attorney representing the company, told HuffPost. Johnson Welded Products is a family-run company with more than 200 employees, Muise said.

6. Barron Industries, Inc.
Barron Industries, a family-owned metal casting and machining company based in Michigan, was granted a preliminary injunction by a district court last year in its case challenging the contraception mandate. The company, which has 56 full-time staffers, holds mass for employees at its own on-site chapel, according to the Thomas More Law Center.

7. Zumbiel Packaging
Zumbiel Packaging, a privately owned company in northern Kentucky that makes packaging for consumer products, filed suit against the Obama administration last year, saying that the clause of the Affordable Care Act requiring them to provide certain types of contraception violated the company’s religious beliefs and constitutional rights.

8. Eden Foods
Eden Foods is a natural food company based in Michigan that has 128 full-time employees, according to court documents. The company also sued the government last year, saying the requirement to provide FDA-approved contraceptives was “an unprecedented despoiling of religious rights.” Though a district court denied Eden Foods the injunction it had requested, late last year the company asked the Supreme Court to review that decision.

Eden Foods is one of dozens of companies poised to deny contraception coverage to employees.

9. Ozinga Bros.
This concrete maker in Illinois has more than 750 employees, and sued the government in May 2013 for forcing it to provide FDA-approved forms of contraception in its health care packages. The Hobby Lobby decision means Ozinga, a closely held company, probably won’t have to.

10. Korte & Luitjohan Contractors
Korte & Luitjohan is a construction company based in Illinois with around 90 full-time employees, according to court documents. The company sued the government in 2012 over the contraception requirement and was denied an injunction, but that decision was later reversed. The case is currently pending.

11. Hart Electric LLC
Hart Electric is an electrical-component maker based in Illinois with 54 employees, according to court filings. The company’s owners sued the Obama administration in 2013 over the Obamacare contraception mandate, and the case is still pending.

12. Sioux Chief Manufacturing
Sioux Chief, a company in Missouri that makes plumbing products, also sued the government last year over the mandate, and the case is still pending. The company employs 370 people full time at its location in Missouri, according to court documents.

13. Beckwith Electric
Beckwith Electric, a family-owned company in Florida that makes micro-processor technology, sued the government last year, saying it had a conscientious objection to covering “abortifacients” for employees. The case is currently pending.

14. Randy Reed Automotive, Randy Reed Buick, Randy Reed Nissan, Randy Reed Chevrolet
These family-run car dealerships in Missouri, which have around 179 full-time employees, also sued the federal government over the ACA requirement to cover contraception. The companies’ case cites a “deeply held religious belief that life begins at conception” as its objection to the contraception. The case is currently pending.

Alexander C. Kaufman contributed to this report.