Legal Ordeal Ends For Phoenix Area Business After Government Failed To Disclose Evidence

PHOENIX, March 6, 2019 /PRNewswire/ — Austin Electric Services, Arizona’s premier residential electrical contractor reached an agreement with the U.S. Department of Labor in a lawsuit that lingered for years after it was discovered that the government failed to disclose evidence, including statements from employees that Austin Electric Services was following the law.

The actions of lawyers for the Department of Labor prompted Senior U.S. District Court Judge Roslyn Silver to openly discuss sanctions against the Department of Labor, and to question the professionalism of the attorneys.

In 2016, the U.S. Department of Labor filed a lawsuit against Austin Electric Services claiming overtime rules were not followed. The company has maintained its innocence and had been fighting the allegations ever since.

Less than a month before the case was scheduled to go to trial, attorneys for the U.S. Department of Labor admitted that they failed to disclose evidence in the case. The evidence the Department of Labor withheld included numerous employee statements that directly contradicted the allegations made by the Department of Labor. At a December 27th hearing, Judge Silver brought up the issue of sanctions against the Department of Labor.

Shortly after Austin Electric Services’ request to dismiss was filed with the Court, and immediately after the Court’s comments regarding sanctions, the Department of Labor engaged in settlement negotiations to resolve the lawsuit.

Both sides agreed to settle the matter for a fraction of what the government had sought in the litigation and Austin Electric Services admitted no wrongdoing. The parties reached a settlement on December 31, 2018.

Rather than endure more costly litigation, Austin Electric Services will pay a settlement, the majority of which will go to its employees at issue in the case. The settlement allows this locally-owned, Avondale-based business to focus on continuing to serve Arizona as well as continuing to put Arizonans to work.

Toby Thomas, President and Founder of Austin Electric Services, said, “We have always and will continue to treat our workers fairly. This lawsuit should have never gone this far. Had all the evidence been properly disclosed by the Department of Labor, this case would have been resolved long ago, and without the staggering legal costs.”

The settlement also dismissed a second lawsuit filed by the Department of Labor. In that matter, the government claimed that individuals representing Austin Electric Services violated rules governing retaliation by hiring a law firm to conduct a human resources audit. Austin Electric Services maintains the audit was necessary to ensure ongoing compliance with a variety of employment-related laws and best practices.

The Department of Labor failed to offer any evidence that supported its allegations that Austin Electric Services’ co-owners, Scott Tonn and Toby Thomas, engaged in any wrongdoing. The Department of Labor dropped the second lawsuit even though it received no settlement funds from Mr. Tonn. Similarly, Mr. Thomas did not pay any money to resolve the first lawsuit. Mr. Tonn said, “While we were prepared to see both lawsuits through to the end, we thought it would be best for us to focus on more productive activities.”

Over the last several years, Austin Electric Services has trained as many as 150 refugees from Cuba, Africa, the Middle East, and Eastern Europe. In addition to the six-month training program, Austin Electric Services has also helped the refugees obtain driver’s licenses and provided the refugees a company vehicle in some instances to get to and from job sites.

The company has also spearheaded a program to train and employ former inmates deserving of a second chance to succeed, hiring as many as 70 reformed inmates and providing them with valuable and lasting job skills.

For questions or media inquiries, please contact Michael Anthony Scerbo at [email protected].

Austin Electric was founded in 1997 by Toby Thomas. Toby saw that there was a need in the residential electrical market for a company that could provide a great service at a fair price. Toby grew his business to be Arizona’s best residential electrical contractor by building strong relationships with his customers and surrounding himself with a support team of like-minded customer service-oriented professionals. To get more information about Austin Electric Services, please visit www.austinelectricservices.com or call (623) 773-2600.

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