Servers at Houlihan’s—a popular New Jersey bar and restaurant chain, are suing A.C.E. Restaurant Group Inc., Houlihan’s franchise owners responsible for operating about 15 Houlihan’s locations in the Garden State. The lawsuit, filed in a New Jersey federal court, alleges that for approximately three years, Houlihan’s maintained a policy of arranging forced tip-pooling agreements, and failed to pay their employees the minimum wage. According to the lawsuit, Houlihan’s forced their servers to pool their tips with kitchen expediters, hostesses, and other non-tipped employees.
Under the Fair Labor Standards Act (FLSA), tip pooling is permitted only when it is “limited to employees who customarily regularly receive tips.” Attorneys for the employees are seeking unpaid minimum wages, unpaid wages, liquidated damages, and attorney’s fees.