Travelon Transportation in Eden Prairie must pay $254,628 in back wages and damages to 21 drivers after the U.S. Department of Labor prevailed in a five-day trial this month.
The Labor Department found that Travelon, a medical transportation company, misclassified employees as independent contractors to avoid paying overtime. It also found that the company made deductions from drivers' wages for van leasing, insurance, maintenance, dispatch and use of a tablet.
Those deductions meant that wages for drivers sometimes fell below the federal minimum wage of $7.25 per hour.
The damages are levied against Alpha & Omega USA Inc., which does business as Travelon, and its owner Viktor Cernatinskij.
The Labor Department filed suit against Travelon after it refused to comply with the findings of the investigation, which also found the company was not keeping accurate records of the number of hours that drivers were working. In some cases, the department said Travelon failed to pay drivers for all of the weeks that they drove.
A district court decision in 2021 awarded back wages and damages. After Travelon appealed, the Eighth Circuit Court of Appeals reversed the summary judgment in July 2022 and remanded the case for trial.
The jury finding on June 16 was unanimous, and U.S. District Judge David Doty on Tuesday signed the order against Travelon. The order also says Travelon must classify all future drivers as employees.
Calls to Travelon and Cernatinskij were not immediately returned.
