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.
Maine Fish Market, a popular seafood restaurant in East Windsor, Connecticut, paid $750,000 in back wages to approximately 70 employees for unpaid wages and tip theft violations. The class action lawsuit alleged that Maine Fish Market neglected to pay the federal minimum wage to its servers and bartenders and failed to pay overtime wages to the restaurant’s kitchen workers. In addition, servers claim they were unlawfully required to pay for breakages, customer walkouts, and uniforms. The restaurant also took ten to fifteen percent of each servers’ tips on a daily basis and allegedly used this money to pay other employees’ wages. As per the Fair Labor Standards Act and the Connecticut Minimum Wage Act, employers are not entitled to any of the tips earned by servers.
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.
An investigation by the U.S. Department of Labor’s Wage and Hour Division found that the owners of 13 Charleston, South Carolina area restaurants violated minimum wage, overtime, and recordkeeping provisions of the Fair Labor Standards Act (FLSA).
Under the FLSA, employers are allowed to take a “tip credit” and pay tipped employees below the full federal minimum wage per hour if the employees will make at least minimum wage after keeping their tips. To legally apply the tip credit, a restaurant must ensure that all tips received by tipped employees are retained by the employees (unless there is a valid tip pooling arrangement). In the present case, the employer required servers to give a percentage of their tips back to them and compelled three servers to work for only tips. The restaurant owners also required workers at some locations to purchase their uniforms, which reduced their earnings below the minimum wage.
The investigation also found that the employer failed to pay cooks, dishwashers and runners for all hours worked, resulting in these employees not earning minimum wage for all hours worked. Furthermore, these workers did not receive overtime pay of time-and-one-half for all hours worked beyond 40 in a workweek. Lastly, the owners failed to keep legally mandated time and attendance records.
Judge C. Weston Houck, of the U.S. District Court for the District of South Carolina, approved a consent judgment between the department and the owners, who will pay a total of $1,179,045 to 119 employees, which includes $589,523 in back wages and an additional equal amount in liquidated damages for all affected employees who worked at any of the 13 restaurants from Aug. 13, 2011 to Dec. 13, 2014.
Former cooks and dishwashers at Lupo Verde, a popular Italian restaurant in Washington D.C., have sued for unpaid overtime pay and other wage and hour violations.
Lupo Verde, recently ranked among the “Top Ten Hottest Italian Restaurants in D.C.” by Zagat and written up in Zagat for having “reliably good food coming from the kitchen” allegedly paid its kitchen laborers at their regular hourly rate for overtime hours.
According to the Complaint, the restaurant issued biweekly paychecks reflecting hours worked except when the workers accrued overtime hours. In those weeks the restaurant intentionally omitted the “hours worked” line from the pay stubs and paid all hours worked at the worker’s regular rate. The Complaint also alleged that the restaurant violated the notice, record-keeping and posting requirements of the District of Columbia Wage Payment and Collection Law.
Attorneys for the workers are seeking unpaid wages in the amount of $87,576.00, liquidated damages, interest, attorneys’ fees and court costs.
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.
Chipotle Mexican Grill has been hit with a wage theft class action by a former worker who claims that there is a corporate policy requiring cooks, servers, cashiers, and cleaning workers to work “off the clock.”
According to the class action lawsuit, filed on October 8 in Minnesota federal court, Chipotle required its hourly-paid workers to punch out at the end of their shift, then continue working on “clean up” and other related tasks. The restaurant worker also alleges that Chipotle held mandatory training and meetings for its workers, but did not pay them for attending. As a result, Chipotle failed to pay its workers minimum and overtime pay in violation of the Fair Labor Standards Act and Minnesota state wage laws.
Attorneys for the workers are seeking unpaid minimum wages, unpaid overtime pay, liquidated damages, interest, and attorneys’ fees.
The soul food and salad bar restaurant chain Manna’s will pay a total of $956,482 in back wages and liquidated damages to 85 low-wage workers following an investigation by the department’s Wage and Hour Division. The restaurants will also pay $31,952 in post-judgment interest and $39,737 in civil money penalties to the department because of the repeated and willful nature of the violations of the Fair Labor Standards Act (FLSA).
The restaurants engaged in widespread violations of the FLSA’s minimum wage, overtime and record-keeping requirements. Specifically, the restaurants paid cooks, dishwashers and cashiers flat salaries for all hours worked instead of paying them overtime at time and one-half their regular rates of pay when they worked more than 40 hours in a workweek, as the law requires.
In addition to paying the back wages owed, the restaurant chain agreed to maintain future compliance with the FLSA. The restaurants will post FLSA posters in English and any other languages spoken by employees and will inform employees of the terms of the judgment in a language they understand.
The FLSA requires that covered employees be paid at least the federal minimum wage of $7.25 per hour, as well as time and one-half their regular rates for every hour they work beyond 40 per week. The law also requires employers to maintain accurate records of employees’ wages, hours and other conditions of employment, and prohibits employers from retaliating against employees who exercise their rights under the law. The FLSA provides that employers that violate the law are, as a general rule, liable to employees for back wages and liquidated damages payable to the workers.
Cooks and dishwashers have sued Planet Wings restaurants located in New York for minimum wage, overtime, and spread of hours violations. According to the Complaint filed by attorneys for the workers in New York federal court, the popular wings restaurant paid its employees a weekly salary of $480 per week for 75 hours of work, which equaled an hourly rate below the minimum wage rate required by law, and failed to pay for overtime hours worked over 40.
A former cook and delivery worker at Energy Kitchen in New York, a restaurant chain touting a health conscious menu of items that are all under 500 calories, sued the restaurants for failing to pay minimum wage and overtime pay, tip theft and other Fair Labor Standards Act (FLSA) and New York Labor Law wage violations.
The Complaint, filed by Camerino Hernandez, alleges that six Energy Kitchen restaurants unlawfully took a tip credit and failed to pay their workers the proper minimum wage, overtime for hours worked over forty in a workweek, and spread-of-hours pay when the servers worked more than ten hours in a day. Attorneys for the employees also claimed that the restaurants deducted money from their workers’ pay for breakage, customer walkouts, mistakes, and uniform related expenses.
The class action lawsuit seeks unpaid wages, recovery of the unlawful pay deductions, liquidated damages and attorneys’ fees for violations of the FLSA, the New York Labor Law, and New York State Department of Labor Regulations.