Dimora Ristorante, an Italian restaurant in Norwood, New Jersey, has paid $60,000 to a former waiter to settle a wage violations lawsuit for unpaid minimum and overtime wages and tip theft. The waiter argued that Dimora unlawfully required all front-of-the-house tipped employees, such as waiters and bussers, to pool their tips and share portions of them with two of the restaurants’ managers.
Under the FLSA, a restaurant can require front-of-the-house employees to pool and share their tips. However, the restaurant violates the FLSA if managers participate in the tip pool. Only non-managerial tipped employees can participate in the tip pool. If a restaurant violates this rule, it loses the tip credit, which is the privilege of paying front-of-the-house tipped employees at a reduced hourly wage rate. If this happens, the restaurant must pay back the tipped employees the tip credit, i.e., the difference between the full minimum wage rate and whatever reduced amount it paid them (which cannot be lower than $2.13 in New Jersey).
This is what the waiter argued against Dimora. According to the waiter, Dimora required him to share portions of his tips with two managers who hired, fired, interviewed, directed the duties, and set the work schedules of tipped employees. Because of this violation of the FLSA, the waiter claimed that the restaurant should not have paid him at the reduced wage rate of $2.90 per hour. He argued that because Dimora violated the FLSA, it should have paid him the full minimum wage rate of $8.38 in effect in 2016 in New Jersey. In other words, the waiter claimed he was owed the tip credit of $5.48 (i.e., the difference between $8.38 and $2.90) per hour worked up to 40 per workweek. The waiter also claimed that the restaurant failed to pay him any wages at all for hours worked over forty per workweek.
The waiter was represented by Louis Pechman and Gianfranco Cuadra of Pechman Law Group PLLC.
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