Two Johnny Rockets restaurants in the Washington, D.C. metropolitan area will pay 55 servers $571,460 for unpaid minimum wages, overtime and other damages. The judgment follows a Department of Labor investigation, which revealed that the restaurants required its servers to contribute a portion of their total tips back to the restaurant. Johnny Rockets then unlawfully distributed the servers’ tips to cooks and dishwashers. In addition, Johnny Rockets failed to pay the servers required overtime wages when they worked more than 40 hours in a week, and did not keep accurate records of all hours worked by employees.
Many restaurants require servers to pool their tips for workers to share equally. A valid tip pool may not include employees who do not receive tips customarily and regularly, such as dishwashers, cooks, chefs and janitors. When an employer utilizes employees’ tips for any purpose other than a valid tip pool, as was the case at Johnny Rockets, it is a violation of the tip credit provision of the FLSA. As a result, no tip credit may be claimed, and the employees are entitled to receive the full cash minimum wage on a retroactive basis, as well as a return of the tips that were misappropriated.