Food Runner

TGI Friday’s Settles Wage Theft Case for $19.1 Million

TGI Friday's Wage theft lawsuit

A nationwide wage theft lawsuit against TGI Friday’s has been settled for $19.1 million according to a court filing by the workers’ attorneys in New York federal court. The settlement, which covers 28,000 restaurant workers, is a record amount for resolution of a wage theft lawsuit in the restaurant industry. This settlement is the latest example of fast casual restaurants across the United States paying out millions of dollars on wage theft cases.

The lawsuit alleged that TGI Friday’s failed to pay its tipped hourly food service workers the proper minimum wage, overtime pay, and misappropriated tips. Attorneys for the servers, bussers, runners, bartenders, barbacks and hosts, claimed that TGI Friday’s failed to satisfy the strict requirements under the Fair Labor Standards Act (“FLSA”) and the New York Labor Law (“NYLL”) that would allow them to pay a reduced minimum wage rate to tipped employees. In particular, TGI Friday’s had a policy and practice that required tipped employees to spend over two hours and/or in excess of 20% of their work shift performing non-tip producing “side work.” Side work included, general cleaning of the restaurant, preparing food in bulk for customers, cutting produce, refilling condiments, and stocking and replenishing the bar and service areas. According to attorneys for the workers, this practice violated the “80/20 rule” and TGI Friday’s should have paid the tipped employees the full minimum wage rate, rather than reduced tipped minimum wage rate.

The front of the house workers also alleged that TGI Friday’s required them to perform “off the clock” work for which they were never compensated. “Off the clock” work consisted of requiring them to arrive at the restaurant one hour before customer service to perform side work, requiring them to punch in after they got their first table, and punch out before they performed closing side work. As a result of these practices, workers were not compensated for all the hours they worked and when they worked over forty hours per workweek, they were not paid overtime pay. Furthermore, the lawsuit claimed that TGI Friday’s required tips to be distributed to employees who are not entitled to tips under the FLSA and/or NYLL such as, silverware rollers and expeditors. Additionally, workers were given only one uniform, which TGI Friday’s failed to launder or pay workers the statutory uniform allowance. Finally, TGI Friday’s was accused of making unlawful deductions from employee wages for customer walkouts.

If approved, the settlement would resolve a nationwide class action brought by more than a dozen workers, alleging violations of the FLSA and claims brought under the labor or unfair competition laws of nine states: California, Colorado, Connecticut, Florida, Illinois, Maryland, Michigan, New Jersey and New York.

 

Indian Restaurant Ordered to Pay $1.4 million to Five Restaurant Workers for Wage Violations

Indus Valley wage violations

Indus Valley Restaurant, an Indian restaurant on the Upper West Side, has been ordered by a New York Judge to pay $1.4 million in back pay and damages to five former restaurant workers for wage violations.

Indus Valley, now closed, was accused by the workers of failing to pay minimum wage, overtime, and spread of hours pay as required by the Fair Labor Standards Act and New York Labor Law. The workers who sued the restaurant included two cooks, a food runner, a waiter, and a busboy. The workers, who regularly worked up to seventy-two hours per week, were each paid a fixed weekly salary, rather than an hourly wage. They did not receive overtime payment when they worked over forty hours in a workweek.  Three of the employees are also owed unpaid minimum wages.

The decision follows an inquest at which the employees gave sworn testimony about their weekly schedules and payments from Indus Valley.  The owners failed to appear and were held in default by the Court.  Indus Valley is ordered to pay $1,412,318.66 plus interest, for unpaid wages, liquidated and statutory damages. Laura Rodriguez, an associate at Pechman Law Group, was lead attorney on this case.

EEOC Sues Ruby Tuesday For Age Discrimination

Ruby Tuesday EEOC age discrimination

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.

Opening A Restaurant in New York: Legal Issue Boot Camp

New York City Bar Association Logo

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.

Restaurant Workers Get 2017 Pay Hike

back of house cooks

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.

Sushi Samba to Pay $2.37 Million to Settle Wage Theft Claims

sushi samba logo

Workers at Sushi Samba restaurant locations in New York, Florida, Las Vegas and Illinois will receive $2.37 million as a result of a lawsuit, filed by former servers, bussers, runners, and bartenders, alleging improper application of the tip credit, failure to pay minimum wages, overtime pay and other federal and state wage violations.

Sushi Samba, a popular chain of sushi restaurants blending Brazilian, Japanese, Peruvian influences, with nationwide and international locations is alleged to have paid its waitstaff the tipped minimum wage without providing adequate notice as well as improperly allocating 5% of the waitstaff’s tips to sushi chefs. Attorney’s for the waitstaff alleged that the sushi chefs had no interaction with customers and therefore should not have received tips. Employees at certain locations also reported that they were required to work off the clock and that Sushi Samba hosted private parties whereby a 20% service charge was added to the total price paid by customers, but not distributed to the waitstaff in its entirety.

The proposed settlement, which covers over 500 workers, was submitted for preliminary approval to Magistrate Judge Ronald L. Ellis on November 30, 2015.

Haru Restaurants Sued for Discrimination Against Hispanics

haru japanese fusion logo

A pattern of discrimination against Latino workers at Haru Resturant has been alleged in a lawsuit filed in Manhattan federal court.

Haru is a chain of Japanese restaurants that employs 1,000 Hispanic employees as bussers and runners. According to the class action lawsuit, management refused to promote runner Richard Martinez to waiter even though he was more than qualified for the job, Martinez claims that it is common for managerial staff to promote non-Hispanic bussers and runners to waiters over their more experienced Hispanic counterparts. In addition to not being experiences, Martinez says some of the new hires were also not fluent in English. Furthermore, management would ask him to train new waiters because he was most knowledgeable about the menus. When Martinez complained about the discrimination, management retaliated by reducing the hours he worked.

Martinez is suing on behalf of all the Hispanic employees who have experienced discrimination in Haru Restaurants in the last three years. Attorneys for the workers seek to vindicate the civil rights of the Hispanic employees and recover economic and compensatory damages, under the Title VII of the Civil Rights Act of 1964, the New York City Human Rights Law, and the New York State Human Rights Law.

Happy National Waiters and Waitresses Day!

old school waiter photo

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.

Servers at Le Cirque Sue For Minimum Wage and Overtime Violations

le cirque logo

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.

Average Wage of New York City Waiter and Waitress is $23.34 According to a Pay Survey

nyc hospital alliance

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.

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