The New York City Bar Association will hold the CLE program “Opening A Restaurant in New York: Legal Issue Boot Camp” on March 24. The program will focus on the corporate, real estate, liquor license, and labor/employment issues involved in opening a restaurant in New York City. Speakers on the panel include Jack Gordon, partner at Kent, Beatty & Gordon LLP; Carolyn Richmond, partner at Fox Rothschild LLP; Sonal Shah, General Counsel of Ark Restaurant Group; Alex Victor, partner at Davidoff, Hutcher & Citron LLP; and Larry A. Welch, Associate at Golenbock Eiseman Assor Bell & Peskoe LLP. Lou Pechman will be chairing the event. For more information on the program please visit the event page.
On December 31, 2016, restaurant workers throughout New York State will begin to see changes in the payment structure of their wages.
Back of the House Workers
Back of the house workers (cooks, dishwashers, stockers, and others without direct customer contact) will receive an increase from the current minimum wage rate of $9.00/hour beginning December 31, 2016, according to the following specifications:
|New York City – Large Employers (with 11 or more employees):||$11.00|
|New York City – Small Employers (with 10 or fewer employees):||$10.50|
|Long Island & Westchester:||$10.00|
|Remainder of New York State:||$9.70|
Front of the House Workers
New York State law allows employers in all industries, except building service and fast food, to satisfy payment of the minimum wage by combining a “cash wage” paid by the employer with a credit or allowance for tips that the employee receives from customers. For example, employers in the Hospitality Industry could satisfy the 2016 minimum wage of $9.00 by combining a cash wage of at least $7.50 with a tip allowance of no less than $1.50 per hour. Employers need only pay a cash wage of $7.50/hour to workers, so long as the employees receive at least $1.50/hour from customers in tips.
Beginning on December 31, 2016, tipped front of the house restaurant workers (servers, bussers, bartenders, hosts, hostesses, and others with direct customer contact) will still be required to receive the same 2016 minimum hourly wage rate of $7.50/hour from their employers. However, as of December 31, 2016, tipped restaurant workers must receive at least the following amount in tips per hour in order for employers to use the tip credit:
|New York City – Large Employers (with 11 or more employees):||$3.50|
|New York City – Small Employers (with 10 or fewer employees):||$3.00|
|Long Island & Westchester:||$2.50|
|Remainder of New York State:||$2.20|
Fast Food Workers
Additionally, restaurant workers in the fast food industry will see an increase in hourly wage rates. Employees who qualify for this increase include any person working at a fast food establishment whose job duties include at least one of the following: customer service, cooking, food or drink preparation, delivery, security, stocking supplies or equipment, cleaning, or routine maintenance.
On December 31, 2016, the minimum hourly wage rates for all fast food workers will increase according to the following specifications:
|New York City:||$12.00|
|Rest of the State:||$10.75|
For more information about your rights as a restaurant worker, take a look at our Top 10 Restaurant Pay Violations.
A Texas Roadhouse restaurant in Columbus, Ohio will pay $1.4 million to settle a class sexual harassment suit filed by the U.S. Equal Employment Opportunity Commission (EEOC). EEOC had charged the restaurant with victimizing a group of female employees as young as 17 years old by subjecting them to sexual harassment and then retaliating against them for complaining.
According to EEOC’s lawsuit, the manager of the restaurant in the Reynoldsburg section of Columbus, Eric Price, harassed women and teen girls working in server, hostess and other front-of-the-house positions. In the suit, EEOC identified 12 victims of his abuse who suffered unwelcome touching, humiliating remarks about their and other females’ bodies and sexuality, and pressure for sexual favors in exchange for employment benefits or as a condition of avoiding adverse employment action. EEOC charged that the harassment began in 2007, continued for over three and a half years until the manager was fired in May 2011, and was coupled with retaliation against employees who opposed the abuse.
Although the companies’ owners and individuals with high-level authority received multiple complaints about the manager’s abusive conduct throughout his employment, they failed to take prompt, effective action to put a stop to the abuse, EEOC said. Price was not fired until May 2011, when he was seen on a surveillance video touching a 17-year-old female employee in his office at the restaurant during work hours, the agency charged.
Harassment and discrimination based on sex violate Title VII of the Civil Rights Act of 1964. Title VII also forbids employers from firing or otherwise retaliating against an employee because she complained about discriminatory conduct. EEOC filed suit (EEOC v. East Columbus Host, LLC d/b/a Texas Roadhouse and Ultra Steak, Inc., Civil Action No. 2:14-cv-1696) in U.S. District Court for the Southern District of Ohio, Eastern Division, after first attempting to reach a pre-litigation settlement through its conciliation process.
On Sept. 2, U.S. District Court Judge James L. Graham issued an order denying East Columbus Host and Ultra Steak’s motion for summary judgment on EEOC’s sexual harassment claims. He found that EEOC had presented sufficient evidence to overcome the motion. In rejecting the employers’ argument that they had established an affirmative defense because some of Price’s victims allegedly delayed or failed to complain, Judge Graham held that questions remained regarding the companies’ efforts to stop any sexually harassing behavior.
Referring to evidence that previous complaints had been made against the restaurant manager, the court noted that EEOC had described a pattern of complaints, including evidence that “less than a month into his tenure, Price made sexual remarks to … [a] high school-aged hostess … [who] did complain, and the only response she got was not from the corporate office, but from the very person she feared: Eric Price,” who told her “not to get other people involved if she had a problem.” A jury, Judge Graham held, “could see this as the first failure in a long line of tepid responses in the face of near-constant complaints, bookended by sexual harassment of teenage girls.” The court also rejected the defendants’ argument that EEOC had failed to conciliate its claims against them as required by Title VII.
In addition to the $1.4 million in monetary relief to the victims, the five-year consent decree resolving the lawsuit requires the companies to offer reinstatement to injured women identified by EEOC in agreed locations and positions. The decree prohibits the companies from rehiring the offending manager.
The decree further requires East Columbus Host and Ultra Steak to put in place an electronic recordkeeping system to track all gender discrimination and retaliation complaints of any kind and includes mandatory reporting of any allegedly discriminatory or retaliatory adverse employment action, such as failure to hire or promote.
Further, the companies must provide training to all employees on discrimination and retaliation. Supervisory, management, and human resources personnel are to be trained on their duty to monitor the work environment; how to receive and investigate complaints of harassment or discrimination; and how to respond to complaints effectively with corrective action. East Columbus Host and Ultra Steak also are required to report to EEOC on how they handle any internal complaints of gender discrimination or retaliation, and they must post a notice about the settlement at all restaurants covered by the decree.
EEOC recently updated its [email protected] website (at http://www.eeoc.gov/youth/), which presents information for teens and other young workers about employment discrimination. The website also contains curriculum guides for students and teachers and videos to help young workers learn about their rights and responsibilities in the workforce.
Today is National Waiters and Waitresses Day. To commemorate, check out this blog about the top ten wage violations in the restaurant industry written by waiterpay.com founder Louis Pechman, featured on the Huffington Post.
Tom Colicchio’s ‘Wichcraft sandwich restaurants have been hit with a lawsuit in Manhattan federal court, claiming that the restaurants failed to pay minimum wage and overtime pay, and misappropriated workers’ tips.
Attorneys representing a group of baristas, bartenders, porters, delivery persons, cooks, food preparers, hosts, and cashiers, claim that ‘Wichcraft failed to pay employees the proper overtime premiums at the rate of one and one half times the regular rate for work in excess of forty hours per workweek, as required both by the Federal Labor Standard Act and New York Labor Law. The attorneys also claim that ‘Wichcraft paid employees at an invalid “tip credit” minimum wage and did not provide employees a tip credit notice, as required by State law. According to the lawsuit, ‘Wichcraft illegally retained gratuities, improperly deducted meal allowances, and made employees pay for their uniform maintenance.
The wage theft lawsuit against ‘Wichcraft seeks compensation for unpaid wages, liquidated damages and attorneys’ fees and costs.
Johnny Utah’s has been hit with a complaint alleging sexual harassment, as well as minimum wage and overtime violations, tip theft, and spread of hours violations of the New York Labor Law and Fair Labor Standards Act.
The Complaint, filed on behalf of eight waitress at against Johnny Utah’s Rockefeller Center location in New York federal court, alleges the Midtown restaurant, which is advertised as a “wild west party” and known for its mechanical bull, subjected its female servers to unwanted sexual conduct such as inappropriate touching, comments, and propositions. The lawsuit alleges that among other things, servers were expected to flirt with patrons, ride the bar’s mechanical bull shirtless, and kiss other female servers. The waitresses and bartenders were expected to take shots with and sit on the laps of male customers and were told to ignore any unwanted touching. Any employee who complained was assigned fewer shifts or was terminated.
Additionally, the lawsuit claims that the servers did not receive the minimum wage, overtime, and “spread of hours” pay they were lawfully entitled to receive. According to the lawsuit, employees regularly worked 60 to 70 hours per week but were only paid for 40 hours of work. Servers also were required to share their tips with managers and their tip money was often withheld to cover cash register shortages.
Lawyers for the workers are seeking to recover minimum wages, overtime compensation, spread-of-hours pay, misappropriated tips, uniform-related expenses, unlawful deductions, compensatory damages, liquidated damages, and attorneys’ fees.
A waiter at Le Cirque restaurant, recognized as one of the best restaurants in New York City, has filed a class action complaint in Manhattan federal court on behalf of all front of the house employees, other than captains, employed at the restaurant since September 17, 2008.
The lawsuit alleges that the restaurant violated the minimum wage provisions of the Fair Labor Standards Act and the New York Labor Law when it paid service employees a reduced tipped minimum wage rate without adhering to the laws’ requirements by which it could take the “tip credit.” Attorneys for the workers claim that the restaurant should not have paid the workers the federal tipped minimum wage because the restaurant allowed captains, who were managerial employees, to share in the tips, and also failed to adequate notice of the tip credit to the service employees.
Under the Fair Labor Standards Act (“FLSA”), employers are allowed to take a “tip credit” and pay waiters, bussers, and bartenders below the federal minimum wage of $7.25 per hour. (Note: minimum wage in New York is now $8.00 per hour). For example, the “tip credit” for waitstaff in New York is currently $3.00 per hour, meaning that waiters, busboys, and bartenders can be paid an hourly minimum wage of $5.00 per hour. The Fair Labor Standards Act only allows employers to take this tip credit when the employees have been informed of the tip credit provisions of that law, and when the worker is allowed to retain all of the tips that he receives or is only required to share his tips with other workers who also customarily and regularly receive tips, such as servers, busboys, runners and bartenders.
The complaint against the restaurant alleges that the captains had authority to set schedules, discipline employees, grant or deny vacation requests, interview prospective employees, run pre-shift meetings, control station assignments, and recommend employees for hire, fire, and promotions.
The case against Le Cirque seeks back wages, penalties, and attorneys’ fees and costs. This is the second lawsuit brought against Le Cirque for wage violations. Waiters who staffed private parties sued in 2009 over the restaurant’s retention of a mandatory service charge of as much as 20% paid on private parties.
The average wage of a server in a New York City restaurant is $23.34 per hour, according a tip wage survey conducted by New York City Hospitality Alliance.
The pay survey, which was taken by employers at 486 New York City restaurants and bars employing approximately 15,000 tipped employees, revealed that besides the average $23.34 hourly wage for servers, bartenders earn approximately $27.48 per hour, and bussers and food runners earn about $17.11 per hour. Cocktail servers and bartenders at clubs and lounges make approximately $31.21 an hour and $32.35 an hour, respectively, and bussers and food runners at those nightlife establishments make an average of $18.84 per hour.
The survey was released by the New York City Hospitality Alliance, an industry advocacy group, on October 17, 2014, in anticipation of a Wage Board hearing that was held by the New York State Department of Labor on October 20. At the hearing, advocates were pushing for the elimination of the tip credit, which would require employers to pay tipped employees an additional $4.00 after the minimum wage increases. Restaurant employers and industry representatives, however, argued that the elimination of the tip credit would have devastating economic effects, resulting in among other things, hiring freezes, layoffs, lower wages, and few restaurants openings.
The New York City Hospitality Alliance proposed freezing the $5.00 per hour for tipped employees making a living wage of about one and one-half times the current minimum wage when their tips are added to the base wage. If the $5.00 per hour plus tips equals less than that, the employer pays a higher hourly tip wage.
Restaurants in Charleston and Myrtle Beach have been accused of stealing tips from their workers and failing to pay overtime pay, according to two recently filed federal court cases.
Servers and bartenders at Triangle Char & Bar Restaurants, located in Charleston, South Carolina, allege that they were paid less than minimum wage and required to pay out of their tips for losses such as waste, spillage, and theft. The lawsuit also claims that the waiters and bartenders were required to work “off the clock” but were not paid overtime pay for hours worked over 40.
In another tip theft case, Bret Herspold, a server at King Kong Sushi Bar & Grill in Myrtle Beach, South Carolina, claims that he and other servers were unlawfully required to share a portion of their tips with “back-of-the-house” kitchen staff and that they were not paid overtime wages for hours worked over 40.
Lawyers for the workers at the restaurants seek unpaid wages, compensation for illegally retained tips, liquidated damages, and attorneys’ fees.