Tag Archives: Federal Wage Laws

Hospitality Industry Employment Risks: Florida Hotel Settles Federal “Wage Violation” Investigation For $30,000 In Back Pay; Failed To Maintain Accurate Payroll Records

“Even when an employer contracts with a payroll service company, as this one did, the employer is required by federal labor laws to record and Hospitality Industry Wage Violation Lawsuitsmaintain accurate records of hours worked by employees. The employer is responsible for submitting accurate data for the preparation of employees’ paychecks,” said James Schmidt, director of the Wage and Hour Division’s Tampa District Office. “It is illegal for an employer to falsify the number of hours worked by employees.”

The division has noticed the noncompliance in the hospitality industry and is concentrating its resources on investigating and remedying violations, informing workers of their rights and providing compliance assistance to employers. Since 2009, the division has concluded nearly 5,100 cases involving hotel and motel employers, resulting in more than $16.1 million in back wages for more than 30,000 workers nationwide.

Olympia Development Group LLC, doing business as Safety Harbor Resort and Spa in Tampa, has paid 37 employees $30,786 in back wages after an investigation by the Wage and Hour Division of the U.S. Department of Labor identified violations at the resort of the Fair Labor Standards Act’s overtime, minimum wage and record-keeping provisions.

The investigation disclosed that management changed employees’ time records, removing hours they had worked before and after their scheduled shifts, and deducting meal breaks, regardless of whether those breaks had actually been taken. These deductions from employees’ timecards, in addition to violating record-keeping provisions, resulted in both minimum wage and overtime violations when hours worked went unpaid.     Additionally, tipped employees were paid in violation of FLSA minimum wage requirements when, in addition to their direct cash wages they received from the employer, they did not collect enough in tips to earn minimum wage, yet the employer failed to make up the difference. Tipped employees were also paid in violation of FLSA overtime requirements when their overtime rates were based on time and one-half their direct cash wages rather than the full minimum wage of $7.25 per hour.

The employer has paid all the back wages found due and has agreed to comply with the FLSA in the future.

The FLSA requires that covered, nonexempt employees be paid at least the federal minimum wage of $7.25 per hour, as well as time and one-half their regular rates of pay for hours worked over 40 per week. In general, hours worked includes all time an employee must be on duty, or on the employer’s premises or at any other prescribed place of work, from the beginning of the first principal work activity to the end of the last principal activity of the workday. Additionally, the law requires that accurate records of employee’s wages, hours and other conditions of employment be maintained.

The Wage and Hour Division’s Tampa District Office can be reached at 813-288-1242. Information on the FLSA and other federal labor laws is available by calling the division’s toll-free helpline at 866-4US-WAGE (487-9243) or by visiting http://www.dol.gov/whd.

For more: http://www.dol.gov/whd/media/press/whdpressVB3.asp?pressdoc=Southeast/20131210.xml

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Hospitality Industry Employment Risks: New York Restaurants Settle Federal “Wage Violation” Lawsuit For $288,000; Failed To Pay Workers Overtime, Operated “Illegal Tip Pool”

“…The restaurants’ failure to pay them overtime dropped their pay below the federal minimum of $7.25 an hour, the department said. Employees Hospitality Industry Wage Violation Lawsuitscovered by federal minimum-wage and overtime laws must be paid at least 11/2 times their regular hourly wage they when they work more than 40 hours a week…the restaurants operated an “illegal tip pool” in which tipped employees were forced to share their tips with the kitchen staff…”

Two Nassau sushi restaurants and an executive have agreed to pay more than $288,000 to settle federal charges that they “willfully” failed to pay 70 workers minimum wage and overtime, the U.S. Labor Department said.

Xaga Sushi in Merrick and Hewlett, and their president, Mei Yu Zhang, agreed to pay $261,887 in back wages and $26,322 in penalties, the Labor Department announced Monday.

The department contends the restaurants failed to pay the servers, busboys and kitchen staff overtime, even when some employees regularly worked as many as 50 hours a week. Instead, they were paid a flat monthly rate no matter how many hours they worked, the department said.

For more: http://www.newsday.com/classifieds/jobs/2-nassau-sushi-restaurants-to-pay-288g-to-settle-wage-charges-1.6581960

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Hospitality Industry Legal Risks: Florida Hotel Violated Federal Wage & Labor Laws By Creating “Employment Relationship” By “Directly Supervising” Staffing Company Employees

“…investigators determined that the hotel was liable for repayment of back wages because hotel staff had directly supervised those employed Hospitality Industry Wage Violation Lawsuitsby the staffing agency, creating what Young referred to as “joint employment relationship”…generally the using company tries to avoid the responsibility of the employers by staying out of the direct supervision of the employees or payment…however, we found there was enough direct supervision by Castillo Real employees on the staffing company’s employees to then create an employment relationship…Based on that relationship the hotel was found liable for the repayment of back wages…”

The U.S. Department of Labor found that two-thirds of the staffing companies that provide employees to north Florida’s hospitality industry investigated as part of a new initiative were not in compliance with federal wage and labor laws.

According to a DOL release, the hotel will pay $17,890 in back wages after it was discovered that employees provided by staffing company Maja LLC regularly were not paid overtime after working more than 40 hours a week providing services such as housekeeping and laundering. Additionally, some weeks employees’ wages fell below the federally required minimum wage.

Michael Young, district director of the DOL’s Wage and Hour Division’s Jacksonville District Office said the practice of using staffing companies to fill positions formerly managed by hotels themselves is becoming more prevalent across the country. The initiative looking into compliance among staffing companies was undertaken in four of the 10 districts in the Southeast.

For more:  http://news.wjct.org/post/investigation-finds-north-florida-hotels-violated-federal-labor-laws

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Hospitality Industry Legal Risks: Ohio Restaurant Operator Sued For “Fair Labor Standards Act” Violations And “Unjust Enrichment”; Employees Forced To “Tip Out” Managers And Others Not Regularly Receiving Tips

“…According to the lawsuit, restaurant employees weren’t allowed to keep all of their tips because they were required to “tip Hospitality Industry Wage Violation Lawsuitsout” managers and other employees who do not regularly and customarily receive tips. That resulted in employees’ being paid less than minimum wage…a tip pool can’t include managers or other workers, such as chefs or dishwashers, who don’t typically receive tips…The lawsuit requests a jury trial for five counts of Fair Labor Standard Act violations and a count of unjust enrichment. It seeks an unspecified amount in damages that (the attorney) said would ultimately prove “substantial.””

A federal lawsuit filed Monday alleges that Jeff Ruby Culinary Entertainment, which runs Jeff Ruby’s Steakhouse and Jeff Ruby’s Carlo & Johnny, forced employees to share tips with managers and other workers in violation of the Fair Labor Standards Act. The practice allegedly stopped about a year ago, but lawyers for three former employees aim to recoup losses from a two-year period beginning in 2010.

Lawyers Sarah Clay Leyshock and Kristen M. Myers – both of the law firm Beckman Weil Shepardson LLC – filed the class-action suit on behalf of the three former employees as well as anyone else who might step forward in the case. Two of the represented employees worked at Carlo & Johnny in Montgomery while the third worked at the Downtown steakhouse, Leyshock said.

“Under the Fair Labor Standard Act, employees are required to retain their own tips. The one exception is that employees can be required to share their tips in a valid tip pool,” Leyshock said. She said invalid tip pools are fairly common, but still illegal.

For more:  http://news.cincinnati.com/article/20130827/NEWS/308270075/Suit-Two-Ruby-eateries-skimmed-tips

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Hospitality Industry Legal Risks: Missouri Restaurant Owes Six “Undocumented Alien Workers” $450,000 In Back Pay And Penalties; Court Rules “Federal Labor Law Trumps Federal Immigration Law”

“…The court held that “aliens, authorized to work or not, may recover unpaid and underpaid wages” under rights granted by the Fair Labor Hospitality Industry Wage Violation LawsuitsStandards Act…The appellate judges said that “numerous district courts, including the one in this case, and the secretary of labor all agree: Employers who unlawfully hire unauthorized aliens must otherwise comply with federal employment laws…”

In a case that pit U.S. labor law against immigration law, a panel of federal appellate judges has ruled that six undocumented workers are owed about $450,000 in back pay and penalties for uncompensated work at a Kansas City restaurant — the popular Jerusalem Cafe in Westport. The 8th Circuit U.S. Court of Appeals said this week that federal labor law trumped federal immigration law in this instance.

The court ruled that a former owner and former manager of Jerusalem Cafe could not argue that the workers were in the United States illegally and therefore lacked standing to sue for unpaid wages.

That argument, the appellate panel said, is akin to saying that Al Capone couldn’t have been prosecuted for tax evasion because his earnings were illegally made. (The infamous mobster was jailed on such charges.)

The lawsuit said five of the six workers had each worked 77 hours a week at the restaurant. It said the workers were known to lack official work authorizations and were paid in cash on a weekly basis.

The case attracted national attention, prompting the U.S. secretary of labor to file a brief on behalf of six workers who were employed at the restaurant in the period spanning 2007 to 2010.

Read more here: http://www.kansascity.com/2013/08/01/4383369/court-says-undocumented-workers.html#storylink=cpy

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Hospitality Industry Employment Risks: South Carolina Restaurants Ordered To Pay $391,000 In Back Wages To Workers; Servers Paid Below Mandated $2.13 Per Hour And Received Tips Only

“…the restaurants agreed to maintain future compliance with the FLSA by keeping accurate records of employees’ work hours, wages and other required employment information; paying all employees at least the Hospitality Industry Wage and Hour Litigationfederal minimum wage; and providing overtime compensation and informing employees in advance that the tip credit will be used…”

Three restaurants in South Carolina have been ordered to pay $391,000 in back wages to workers, as the result of a Department of Labor investigation. The restaurants, all individually owned branches of the San Jose Mexican restaurant chain, owe 37 employees wages for overtime and minimum wages. The DOL’s Wage and Hour Division also found violations in record-keeping provisions.

Following widespread noncompliance in the state’s restaurant industry, the Wage and Hour Division began a multiyear enforcement initiative. Since 2009, more than $2.5 million has been paid to workers, following 2,500 investigations.

All three of the restaurants failed to properly compensate employees. Servers were paid below the mandated $2.13 per hour and made to rely on tips for pay. Other employees were paid flat salaries below the minimum wage requirements, with no regard to hours worked.

For more:  http://ohsonline.com/articles/2012/12/21/three-restaurants-must-pay-391000-in-employee-back-wages.aspx?admgarea=news

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Hospitality Industry Legal Risks: Workers File Class-Action Lawsuit Against Los Angeles Hotel For "Millions Of Dollars In Unpaid Wages"

“…(the suit) alleges that management has routinely required them to work through required lunch breaks and rest periods and after clocking out…Housekeepers also claim hotel management refused to reimburse them after requiring them to buy cleaning supplies such as sponges and gloves to clean guest bathrooms…”

The suit also alleges that a majority of Holiday Inn LAX employees are earning less than $11.97 per hour, the minimum living wage for hotel workers in the LAX corridor.

Workers at the Holiday Inn Los Angeles International Airport filed a class action lawsuit on Thursday demanding millions of dollars in alleged unpaid wages. A non-union group of bartenders, housekeepers, cooks and other workers filed the suit with support from L.A. hospitality labor union Unite Here Local 11.

Adrian Valencia, general manager at Holiday Inn LAX, said the hotel was surprised by the lawsuit.

“We had never been contacted by the union until Monday, when they stormed in yelling and screaming into the administration offices,” he said. “We pay the annual living wage increase as of July 1 each year and we have some of the best scores for a Holiday in as far as cleaning. We use proper procedures here at the hotel.”

Randy Renick, the attorney representing the workers, said the goal of the suit is to address long-standing labor grievances.

For more: http://www.labusinessjournal.com/news/2012/oct/04/lax-hotel-employees-file-suit-unpaid-wages/

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Hospitality Industry Legal Risks: Wisconsin Restaurant Sued By Former Employees For Violation Of State And Federal Wage Laws; Plaintiffs Seek $46,000 Plus Liquidated Damages And Attorneys Fees

“…servers are paid at a sub-minimum wage rate, plus their tips…the complaint alleges that Ginza management wholly failed to pay any base compensation to Wu and Qin, who only received tips…in addition, the restaurant did not pay overtime compensation when the employees worked over forty hours each workweek…”

“…the restaurant failed to have their servers sign a tip declaration each pay period…and failed to pay the two servers in the amount of $46,000. Under the Fair Labor Standards Act, the servers are entitled to their back pay, plus an equal amount of liquidated damages and attorneys’ fees and costs…”

Two former servers at Ginza Japanese Restaurant in Wauwatosa filed suit Friday in federal court in Milwaukee against Ginza PZW Corp. and Ping Xiao Fang, who operates the business, alleging violations of both state and federal wage laws.

According to one of the plaintiffs, Ginza initially paid her no wages at all, only letting her keep tips. Later, both of the servers assert, Ginza did begin cutting paychecks, but then simply demanded they pay the restaurant back the after-tax portion of their pay.

For more:  http://wauwatosa.patch.com/articles/ginza-restaurant-sued-over-employee-pay

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