Fox Bindery, President Henry Fox Fined $598,366 for Minimum Wage, Overtime Violations

Using employment agencies to provide staffing for your temporary laborer needs does not exonerate an employer from making sure that those employees are, in turn, being properly paid by the staffing agencies in accordance with federal minimum wage and overtime regulations. Henry J. "Hank" Fox, president and primary shareholder of Lansdale, Pa.-based Fox Bindery Inc., found that out the hard way — and his firm has been fined $598,366 in back wages, damages and penalties as a result.

Following an investigation by the U.S. Department of Labor’s Wage and Hour Div. (WHD), the U.S. District Court for the Eastern District of Pennsylvania entered a consent judgment on Dec. 7, 2018, requiring Fox Bindery to pay $274,183 in back wages and an equal amount in liquidated damages to 556 current and former employees. The agency also assessed the employer and its owner a $50,000 civil penalty.

Investigators found Fox Bindery violated the minimum wage, overtime and record-keeping provisions of the Fair Labor Standards Act (FLSA). According to the Department of Labor investigation, Fox Bindery hired several hundred primarily Vietnamese and Hispanic workers who were obtained through two temporary employment agencies to fill laborer positions from March 2013 to 2016. WHD determined Fox Bindery and the staffing agencies jointly employed the temporary workers, who worked as machine operators, helpers, paper feeders and other unskilled capacities.

WHD’s investigation also found that the temporary employment agencies — Sun Flower Services and Riverside Quality Services — knowingly failed to pay temporary employees for additional time they worked in excess of 40 hours a week, and knowingly paid employees who performed work for Fox Bindery less than the minimum wage of $7.25 per hour, a FLSA violation.

Investigators also determined "Fox Bindery made no effort to determine if these employees were properly paid, despite receiving detailed invoices from the temporary staffing agencies." As a result, in addition to paying back wages, liquidated damages and civil penalties, Fox Bindery and owner Hank Fox agreed to change the company's business practices and comply with the FLSA going forward.

Printing Impressions accessed court documents relating to the case and also reached out to Henry Fox last week for comment, but did not receive a response. However, Philly.com published a written statement that was purportedly issued by Fox on Friday, Jan. 4. He wrote: “Fox Bindery is very troubled by the actions of our former temp agency. During the time in question, we fully paid the agency the rates which would have allowed them to appropriately compensate all involved. We are committed to ensuring we have implemented policies to guarantee that all our employees, temporary or otherwise, are fairly compensated.”

According to the civil complaint, Fox Bindery Inc. is an entity also known as Fox Group. Fox Group consolidated from three locations in Quakertown, Pa., into a 150,000-sq.-ft. space in Lansdale in 2015, an article written by Printing Impressions for its July 2015 issue indicates.

As reported then, Fox Group serves both the package and commercial printing worlds with a full menu of finishing solutions — cutting, folding, saddle stitching, perfect binding and Wire-o/plastic coil. It has a division called DieFX that is a full-service, in-house die making service. Its structural design operations offer CAD/plotter services and an in-house design team. Fox Group also provides laminating (spot and UV coating, film lamination), folding and gluing, fulfillment services (poly-bagging, handwork and tipping), variable data imaging (barcoding, inkjetting) and direct mail capabilities, the article said.

But, as the current Fox Group website indicates, the firm has also evolved into a provider of folding cartons and digital packaging for small- and medium-size consumer goods manufacturers seeking engineering, design, printing, finishing and shipping services. The business operates an HP Indigo 30000 digital press for short-run printing, rapid prototyping, customized product offerings, and frequent and season redesigns.