Cruise line to pay $526K in wages for labor law violations

Norwegian Cruise Lines will pay crew members of the Honolulu-based Pride of America $526,602 in back wages as a result of a federal investigation that found employees were not paid for overtime and in some cases were paid less than the minimum wage, the U.S. Department of Labor said Wednesday.

The Miami-based company committed "systematic violations" of the federal Fair Labor Standards Act in the case that involved 2,059 employees from July 2009 through November 2011, a department spokesman said.

Norwegian Cruise Lines agreed to a "compliance plan" to bring its pay practices into line with federal law, said Terence Trotter, director of the Wage and Hour Division of the Labor Department’s Honolulu District Office

"We appreciate that this employer came into compliance once the issues were identified. We hope that this case sends a clear message to employers about taking steps to ensure they are in compliance with all applicable federal labor laws," Trotter said.

An investigation determined that Norwegian Cruise Lines paid employees straight time for mandatory weekly emergency drills regardless of the number of hours they had worked in the week, the department said.

Most of the employees typically worked nearly 60 hours per week and should have received pay at 1 1/2 times their regular rates for all hours in excess of 40, including during the emergency drills conducted each Saturday, the department said. That single violation accounted for the largest share of the back wage payments owed to the employees.

The investigation also found that because the cruise company took large meal and lodging credits, some employees were paid less than the federal minimum wage of $7.25 per hour. The company also failed to record and pay housekeeping staff for time spent cleaning cabins between cruises. Further, employees often began work before their scheduled shifts, yet these hours were neither recorded nor compensated, the department said.

The Pride of America, which has about 900 employees, is the only U.S.-flagged ship that Norwegian Cruise Lines operates. Employees on U.S.-flagged ships are covered by U.S. labor laws.

Norwegian Cruise Lines did not respond to requests for comment.