Tennessee Mexican Restaurants Reach Agreement with Department of Labor on Overtime and Minimum Wage Violations

Two Mexican restaurants in Tennessee have agreed to pay $39,232 in minimum and overtime back wages to 23 restaurant workers after investigations by the U.S. Department of Labor’s Wage and Hour Division revealed willful and repeated violations of the Fair Labor Standards Act at two locations of La Campina Mexican Grill. The department also assessed $4,301 in civil money penalties for these willful and repeated violations. Investigations conducted by the Wage and Hour Division revealed that the restaurant willfully and repeatedly failed to record and compensate employees for all hours of their work, in violation of the FLSA’s minimum wage, overtime and record-keeping provisions. After conducting employee interviews and reviewing payroll documents, investigators determined that restaurant workers were often made to work more than 40 hours per week – without regard to overtime compensation – and were paid a flat salary that did not yield at least the minimum wage of $7.25 for all hours of their work. Investigators also found that the company created and maintained inaccurate records of its employees’ work hours, rates of pay, and wages actually paid. La Campina Mexican Grill restaurants and owner Ricardo Sanchez have agreed to comply with the FLSA and to implement new business procedures to record and compensate employees accurately for all hours of their work, in accordance with the law. The FLSA requires that covered, nonexempt employees be paid at least the federal minimum wage of $7.25 per hour for all hours worked, plus time and one-half their regular rates of pay, including commissions, bonuses and incentive pay, for hours worked beyond 40 per week. Employers are required to keep accurate records of all hours worked by covered employees. The FLSA permits an employer to take a tip credit toward its minimum wage obligation for tipped employees that is equal to the difference between the required cash wage, which must be at least $2.13 per hour ($5.00 in New York), and the federal minimum wage. Employers may create a tip-pooling or sharing arrangement among employees who customarily and regularly receive tips, but a valid tip pool may not include employees who do not customarily and regularly receive tips, such as dishwashers, cooks, chefs and janitors.