Tag Archives: Tip Pool

Mastro’s Restaurant Accused of Stealing from Tip Pool

tip pool

Tipped employees at Mastro’s Steakhouse in Chicago sued the restaurant in Illinois state court, claiming that the restaurant illegally retained a portion of the tip pool, and failed to pay its servers the correct minimum wage.

Former Mastro’s busser Jose Murata brought the class action in Illinois State Court against Mastro’s, accusing the restaurant of violating Illinois Minimum Wage Law and the Illinois Wage Payment and Collection Act when it kept part of the pool of tips shared by its front of the house employees.

Attorneys for the severs claim that “the net effect of defendant’s policies and practices is that defendant willfully failed to pay the full amount of compensation earned and due to plaintiff and all other similarly situated employees,” and that “defendant thus enjoyed ill-gained profits at the expense of its hourly employees, including its Tip Credit Employees and Tip Pool Employees.” The class action lawsuit alleges that “in exchange for said labor, defendant was obligated to plaintiff and each member of putative … class the full amount of wages they earned, including tips. Defendant’s practice of operating an illegal tip pool and its improper taking of the Tip Credit has resulted in defendant’s Tip Credit Employees not being paid the full amount of minimum wages owed to them.” The lawsuit, claims that the restaurant was not allowed to take a tip credit because it failed to pay the proper amount of wages to its servers.

Restaurants cannot require servers to share their tips with non-service employees who do not customarily and regularly receive tips, such as dishwashers, cooks, chefs, janitors, and managers. Restaurants can require waiters to split their tips from customers with other front of the house employees who provide personal service to customers as a principal and regular part of their duties (such as bussers, bartenders, barbacks, food runners, captains who provide direct food service to customers, and hosts who greet and seat guests).

New York City’s Gramercy Tavern Will Pay $695,000 to Restaurant Workers for Wage Theft

Gramercy Tavern, the popular Danny Meyer-owned upscale eatery located in New York City’s Flatiron District has agreed to pay $695,000 to current and former restaurant workers for wage theft violations, including an allegedly illegal tip pool and failure to pay workers the minimum wage.  The lawsuit, brought by two former bussers, claims Gramercy Tavern engaged in unlawful tip pooling practices by requiring service employees, such as service staff, bussers, runners, captains, and other service workers to share their tips with non-service employees. According to the lawsuit, these non-service employees included expeditors, silverware polishers, wine managers, and other workers who did not regularly and customarily interact with customers.

The bussers had claimed Gramercy Tavern used a tip credit to pay its workers at the tipped minimum wage, despite retaining a portion of the tips shared by employees and requiring them to participate in the illegal tip pool with non-service employees.  Employers may not use a tip credit unless the service employees retain 100% of all tips and gratuities they receive.

The workers also alleged that Gramercy Tavern required clients to pay an automatic “service charge” of 20% of the total bill for private events, but that none of these gratuities were distributed to the event’s service workers, in violation of the New York Labor Law.

The settlement will be distributed to approximately 220 waiters, waitresses, captains, bussers, food runners, and coffee runners who worked at Gramercy Tavern at any time between June 23, 2011 and September 15, 2016.  The settlement was approved on May 17, 2017 by Judge James C. Francis, a federal judge in New York.

 

DOLs Tip Pool Rule Poses Tough Decision For Restaurants

Law 360 Logo

Tip pooling was the topic of a recent Law 360 article that discussed the legal challenges the U.S. Department of Labor’s tip pooling rule could face. The tip pooling rule bars restaurants from requiring their wait staff to share tips with employees in the back of the house. The rule might be revisited in the wake of a new administration. Louis Pechman, founder of waiterpay.com was quoted in the article discussing tip splitting by front and back of the house workers.

Chili’s Restaurants Sued for Requiring Servers to Tip Out Expediters

chilis logo servers

Chili’s policy of requiring servers to share their tips with expediters has been challenged in a federal court class action lawsuit. According to the wage theft lawsuit, Chili’s locations in New Jersey, Delaware, Indiana, Michigan and Ohio forced their servers to split tips with expediters. Expediters are individuals who generally work at or near the kitchen area traying food orders for pick-up by servers and who do not interact with restaurant customers.

The lawsuit alleges that Chili’s forces waiters and waitresses who regularly take orders and actually serve the restaurant’s customers to share their earned tips in a pool with expediters who do not interact with the customers at all. As a result, a percentage of the tips customers leave intended for their servers end up in the hands of the food expediters with whom customers neither communicate nor likely ever see.

The lawsuit claims this illegal tip sharing policy was uniformly applied throughout the forty-six Chili’s locations owned and operated by Quality Dining, Inc. The workers claim that as a result of this company wide policy, the restaurant has forfeited its right to take a tip credit under the Fair Labor Standards Act.

 

 

 

Rainforest Café’s Tip Out Policy Challenged in Lawsuit

Servers at the Rainforest Café have filed a lawsuit against the restaurant alleging that its tip out policy unlawfully requires its waitstaff to share tips with non-service employees.

The lawsuit, which was filed in Massachusetts Superior Court by two waitresses, alleges that the Burlington, Massachusetts wild animal themed restaurant required them to give a portion of their tips to hosts and hostesses to supplement the wages of these non-waitstaff workers.  The workers also allege that the restaurant retained a portion of their gratuities for bussers, hostesses, and bartenders even when no bussers, hostesses, or bartenders were working during their shifts.

Lawyers for the waitresses claim that because of the illegal tip share policy, along with the improper deductions from the waitstaff’s pay, the company failed to pay its workers the lawful minimum wage as required by Massachusetts wage and hour law.

Philippe Restaurants Hit With Overtime and Tip Skimming Class Action

Philippe restaurants on Long Island and Manhattan have been hit with a class action lawsuit by servers and bartenders who complain that they have been denied minimum wage and overtime pay and that the restaurants improperly took a tip credit under the Fair Labor Standards Act (“FLSA”).  The lawsuit claims that managers at the restaurant unlawfully received tips from the tip pool and that the restaurant also made illegal deductions from gratuities and failed to pay spread of hours pay required by the New York Labor Law.