Court orders Long Island horse trainer, stable to pay $132K to 52 employees after US Department of Labor finds wage theft, falsified records

Gargan Stables Corp., Danny Gargan must pay $37K in penalties for willful violations, shortchanging workers at Belmont, Aqueduct racetracks, other locations

NEW YORK – A federal court has ordered a prominent Long Island thoroughbred horseracing stable and its owner to pay a total of $132,631 in back wages and liquidated damages to 52 grooms and hot walkers at several locations, including Belmont and Aqueduct racetracks. The stable owner failed to pay workers the overtime wages they earned.

The action by the U.S. District Court for the Eastern District of New York follows an investigation by the U.S. Department of Labor Wage and Hour Division. Investigators found that Danny Gargan and Gargan Stables Corp. paid certain employees at the racetracks, stables and other locations a fee per horse handled and not per hour as stated in their payroll records.

In addition to shortchanging workers’ hours and unlawfully denying them overtime when they worked more than 40 hours in a workweek, the division determined the employer falsified payroll records to give the appearance that employees were paid by the hour when they were not. The court affirmed the department’s assessment of $37,368 in civil money penalties for willful wage theft and for falsifying records in violation of the Fair Labor Standards Act.

Following the division’s investigation and litigation by the department’s Office of the Solicitor, the court entered a consent judgment ordering the defendants to pay $66,315 in back wages and an equal amount in liquidated damages to the affected workers.

The judgment also requires the defendants to:

  • Hire, at their own expense, a qualified compliance monitor to review their payroll and record keeping practices to ensure FLSA compliance, recommend changes to any non-compliant practices and consult with the defendants on any changes to their time or recordkeeping practices.
  • Implement and use an electronic timekeeping system to ensure accurate recording of employees’ work hours.
  • Train employees, in languages they understand, on the proper use of the timekeeping system and pay them for that training time.
  • Post and provide employees with information and documents in English and Spanish about the FLSA’s requirements and their FLSA rights.

The order also permanently enjoins the defendants from inaccurately editing or altering employees’ work hours, having employees work “off the books,” retaliating or discriminating against employees who engage in FLSA protected activity and requiring or asking employees to kick back wages.

“The defendants took advantage of their employees by underpaying them and then tried to hide this illegal behavior by falsifying their payroll records,” said Wage and Hour Division District Director David An in Westbury, New York. “Gargan Stables Corp. and Danny Gargan have learned that disregard for federal labor laws and their employees’ rights have costly consequences. We suggest other employers review their own pay practices to prevent violations. The Wage and Hour Division has many tools to assist employers and workers in understanding the law.”

“To put it plainly, underpaying employees is wage theft. The U.S. Department of Labor has, and will continue to pursue all necessary legal avenues to obtain proper compensation for employees and deter future violations by employers. This settlement – the latest of several with racing industry employers – compensates these underpaid workers and includes enhanced training and timekeeping requirements to change this employer’s behavior and prevent future violations,” said Regional Solicitor of Labor Jeffrey Rogoff in New York.

The division’s Long Island District Office conducted the original investigation. Senior Trial Attorney David J. Rutenberg of the regional Office of the Solicitor in New York litigated the case for the department.

Workers can call the Wage and Hour Division confidentially with questions – regardless of their immigration status – and the department can speak with callers in more than 200 languages.

For more information about the FLSA and other laws enforced by the division, contact the agency’s toll-free helpline at 866-4US-WAGE (487-9243). Learn more about the Wage and Hour Division, including a search tool to use if you think you may be owed back wages collected by the division.

Walsh v. Gargan Stables Corp. and Danny Gargan

Civil Action No. 21-cv-03390

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