The New York Post reported on the growing trend of delivery worker lawsuits where food-delivery services are “stiffing” their workers to remain competitive. Louis Pechman, founder of waiterpay.com, was quoted in the article.
Ruby Tuesday, a national casual dining restaurant chain, violated federal law by refusing to hire a qualified applicant at its Boca Raton, Fla., location because of his age, the U.S. Equal Employment Opportunity Commission (EEOC) charged in a lawsuit filed in federal court in Florida.
According to the EEOC’s lawsuit, the restaurant declined to hire a qualified applicant with over 20 years of experience in the food and beverage industry for a general manager position at its Boca Raton restaurant. In response to an inquiry by the applicant as to why Ruby Tuesday declined to hire him, the company informed him it was seeking a candidate who could “maximize longevity.” According to the lawsuit, the applicant was 59 when he applied for the job, and the individual who got the job was 17 years younger. Attorneys for the EEOC contend that the failure to hire the applicant violated the Age Discrimination in Employment Act.
A spokesman for the EEOC said, “Age cannot be a factor in whether or not someone can earn a living. The Age Discrimination in Employment Act was put in place precisely to protect people against this type of conduct. The bustling hospitality industry needs to be reflective of all of the members of our community.”
In 2013, Ruby Tuesday paid $575,000 to resolve another age discrimination lawsuit brought by the EEOC on behalf of older restaurant workers in Western Pennsylvania and Ohio.
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.
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.
Five Papa John’s locations in New York have been accused of failing to pay its delivery workers the minimum wage, shaving hours from their pay, and requiring them to pay for bicycles and safety equipment used to do their jobs. The lawsuit brought by New York Attorney General Eric Schneiderman seeks to recover $2 million in damages for more than 400 delivery workers who were underpaid.
The lawsuit is the result of lengthy investigation by the Attorney General’s Labor Bureau that uncovered a multitude of wage violations by Papa Johns that included paying its delivery workers $5.00 an hour rather than the minimum wage of $7.25 at the time, shaving work hours by rounding down, improperly calculating overtime pay, requiring delivery workers to purchase bikes, helmets, locks, and chains at a cost of $500.00 a year, failing to pay spread of hours pay which is an additional hours of pay required when an employee worked more than 10 hours in a day, and not compensating for “call-in pay” which requires compensation for being called into work and then being sent home early.
In a press release on the filing of the lawsuit, Attorney General Schneiderman stated, “Nobody who works 40 hours a week should have to live in poverty.” He continued, “Like every other business in New York, fast-food employers must follow the law. My office will combat wage theft whenever and wherever we see it in order to protect the rights of hardworking New Yorkers, including pizza delivery workers and others who toil at fast-food restaurants.”
Pizza Hut is being sued by a former delivery driver for keeping all of the mandatory service charges it charged its customers and for unpaid overtime pay.
According to the lawsuit, filed on August 11 in Manhattan federal court, Pizza Hut charged its customers a mandatory $2.75 “delivery fee” for deliveries and misled its customers to believe the fee was a tip for its delivery drivers. As a result, delivery workers were often not paid tips directly from customers. However, Pizza Hut did not pay its delivery drivers any part of the delivery fees, allegedly violating New York labor laws. Under New York Labor Law, mandatory service charges that are purported to be gratuities belong to the employees.
The lawsuit also alleges that Pizza Hut violated the Fair Labor Standards Act by failing to pay its delivery drivers the correct overtime pay for hours worked over forty because it did not include the delivery drivers’ share of the delivery fee into their regular wages.
Attorneys for the delivery drivers are seeking unpaid gratuities, unpaid overtime pay, liquidated damages, and attorneys’ fees.
U.S. Representative Michael Grimm was indicted for lying in a New York federal court lawsuit alleging minimum wage, overtime and spread of hours violations of the Fair Labor Standards Act (“FLSA”) and New York Labor Law (“NYLL”). Grimm turned himself in on April 28, 2014.
Grimm, a representative for New York’s 11th Congressional District, was named as a defendant in a lawsuit brought in 2011 by delivery workers at Healthalicious, a health food restaurant Grimm owned and managed. The lawsuit alleged that the delivery workers were paid less than minimum wage and were not paid for all the overtime hours they worked. The delivery workers were paid in cash and were never given legally required notice of the applicable wage and hour requirements of the FLSA and NYLL.
In January 2013, Grimm was deposed as part of the lawsuit. While under oath, Grimm allegedly lied about paying Healthalicious employees in cash, and misstated his interactions with the payroll management company, and his use of email while managing Healthalicious’ business.
Delivery workers for Fresh Direct, an online food and grocery retailer, have sued for unpaid wages and violations of the overtime provisions of the Fair Labor Standards Act (“FLSA”) and New York Labor Law. According to the Complaint filed in Manhattan federal court by the delivery workers, Fresh Direct misled its customers in believing that the delivery charge it imposes on customers is a gratuity. Attorneys for the delivery workers claim that the company’s acceptance and retention of gratuities belonging to the delivery workers violate the New York Labor Law.