Gas Station Owner Owes Employees Millions, Including Two Paramus Sites

A Madison man has agreed to pay $2 million in overtime back wages and $1 million in damages to employees at gas stations he owns throughout New Jersey, including at two he used to operate on Rt. 17 in the borough, the U.S. Labor Department announced Thursday.

Employees often worked up to 84 hours per week but did not receive earned overtime pay, a department news release said.

The agreement involves 417 workers at 72 gas stations Waseem Chaudhary operated. Two Shell stations in Paramus no longer operated by Chaudhary, one at 655 South Rt. 17 and the other at 612 North Rt. 17, are stations involved in the agreement.

Petroleum Marketing Group, which owns the Paramus sites, said Chaudhary stopped operating the sites several months ago because of an unrelated business deal and the sites currently are operated by independent operators not affiliated with Chaudhary or any of his affiliated companies.

The agreement was reached after the U.S. Department of Labor’s Wage and Hour Division found violations of the Fair Labor Standards Act, which requires that covered, nonexempt employees be paid one-and-a-half times their regular rates for hours worked beyond 40 hours a week. The law also requires accurate records of employees’ wages and hours.

"Instead, many employees were paid partly on the payroll and partly off the books, sometimes in cash, to disguise the improper payment of overtime," the department said. "The employer also failed to maintain accurate records of the hours employees worked."

Because of the "repeat and willful nature of the violations," the department also assessed $91,000 in civil money penalties against him, the news release said.

Proactive measures to ensure future compliance with labor laws, including a three-year monitoring program at each gas station, are part of the agreement.

Other measures include biometric time clocks being installed in each establishment, a notice to workers about the terms of the compliance agreement, Fair Labor Standards Act training for all employees in English and other languages, and a toll-free telephone number for workers to report violations.

Voicemails seeking comment were left for Chaudhary on Thursday.

“This agreement returns hard-earned wages to workers in one of only two states that still mandates full-service gas pumps,” acting Secretary of Labor Seth D. Harris said.

“All gas station owners and operators in New Jersey should take note of this precedent by reviewing their payroll practices and legal obligations. Gas station attendants are few in number, earn low wages, work long hours and often lack English proficiency—factors that contribute to their vulnerability as well as the importance of protecting their right to be paid properly.”

The department said a consent judgment outlining the terms of the agreement has been filed in the U.S. District Court for the District of New Jersey. The monitoring program will be supervised by an independent monitor who will report to the department. 

For more information on the Fair Labor Standards Act and other federal laws administered by the Wage and Hour Division, call the division’s Northern New Jersey Office at 908-317-8611, its toll-free helpline at 866-4US-WAGE (487-9243) or visit http://www.dol.gov/whd.

This post was updated to say Waseem Chaudhary no longer operates the locations in Paramus.