Opinion ID: 723390
Heading Depth: 2
Heading Rank: 2

Heading: Payments to the Recruiting Company

Text: 19 An employer may not require employees to make payments for facilities that would reduce their hourly pay below the minimum wage. 29 C.F.R. § 531.3(d). The government argues that the defendants are obliged to reimburse the employees for their recruitment costs, but cites no case, statute or regulation that requires an employer to pay recruiting costs to a third-party recruiter. 2 20 The government also argues that any deductions from the employees' paychecks were an illegal kickback. See 29 C.F.R. §§ 531.35, 531.40. FLSA regulations prevent an employer from deducting from an employee's paycheck on behalf of a third-party if the deduction directly or indirectly benefits the employer. See 29 C.F.R. § 531.40(a); Brennan v. Veterans Cleaning Serv., Inc., 482 F.2d 1362, 1370 (5th Cir.1973). The regulations seek to prevent employers from pushing their costs of doing business onto their employees. 21 Although this argument may have prevailed in relation to the enterprises' earlier collection practices, there was little evidence that the defendants directly or indirectly made or benefited from deductions during the limitations period. During the relevant time, the employees received full paychecks, then deposited all or a portion into a separate bank account. The court made an explicit finding that the employees repaid their notes voluntarily and that these collection methods were not coercive. This finding was supported by evidence at trial. 22 Based on the court's explicit findings, we hold that the defendants were not responsible for paying for the employees' recruiting costs.