Midwest nursing care company owes caregivers $3 million in overtime wages after 'systematically' violating wage laws for two decades, federal investigation says

• The US Department of Labor found Petersen Health Care Inc. owes staff $3 million in overtime wages.
• The company manages a chain of residential nursing care facilities across the Midwest.

A nursing care management company owes $3 million in overtime wages to caregivers at 84 facilities throughout the Midwest following a federal investigation, the US Department of Labor announced last week.

Petersen Health Care Inc. was found in violation of the Fair Labor Standards Act after failing to pay the correct overtime wages to more than 3,000 caregivers at facilities in Illinois, Iowa, and Missouri, the agency alleged.

The caregivers will receive $2,939,576 in "back overtime wages" for the period of June 2018 and June 2020, the DOL announced.

"While we have agreed to settle this matter, we do not agree with the Department's claims or the assumptions they made in determining their findings. Petersen Health Care pays, and has always paid, its employees fairly and equitably for all time worked," Greg Wilson, the company's senior VP of operations said in a statement to Insider, but he added that "the current economic environment dictated settlement of the matter."

"We regularly review and evaluate our pay practices to ensure our hard working employees are being compensated fairly and equitably for all time spent caring for our seniors in need," he continued.

It isn't the first time the company has been fined over wage and hour law violations. The Department of Labor has investigated Petersen Health Care 30 times over the last two decades, and determined the company "systematically violated wage and hour laws on numerous occasions," according to a May press release. Seven of the investigations found a combined $88,000 in unpaid wages.

US nursing homes have lost 241,000 workers since the start of the pandemic

Long term care facilities — which include nursing homes, assisted living facilities, residential care, and in-home care — continue to struggle with major workforce shortages, according to data from the Bureau of Labor Statistics. In March, the industry saw its lowest employment levels since 2007.

Nursing homes have lost 15.2% of its total workforce since 2019, the American Health Care Association and National Center for Assisted Living reported. Employees in the emotionally and physically challenging industry often face burnout, low pay, and poor working conditions, NPR reported in February.

The US Department of Labor said it's recovered a total of $22.7 million for healthcare workers across the Midwest between 2019 and 2021. During the Great Resignation, employers across the country faced heightened levels of competition for new hires. This brought discussions of worker pay and treatment to the forefront, particularly in industries that were on the frontline of the pandemic.

"As healthcare industry employers struggle to retain and recruit workers to provide the services necessary for their businesses to succeed, failing to respect workers' rights and pay workers their full wages means that these essential workers will look elsewhere for employment," Jessica Looman, the Department of Labor's Wage and Hour Division acting administrator, said following the settlement.