Articles Posted in Restaurant FLSA violations

According to an analysis from the Federal Judicial Center (FJC), more workers than ever are filing wage-and-hour lawsuits. These cases are brought pursuant to the Fair Labor Standards Act (FLSA), which establishes standards for private and government employees pertaining to overtime, youth employment, and minimum wage.

Many FLSA cases involve debates about whether a worker (or class of workers) should be classified as “exempt” from overtime rules. (Per the Department of Labor’s website, “Covered nonexempt workers are entitled to a minimum wage of not less than $7.25 per hour effective July 24, 2009. Overtime pay at a rate not less than one and one-half times the regular rate of pay is required after 40 hours of work in a workweek.”)

The employment lawyers at Joseph & Kirschenbaum have brought many high profile FLSA matters over the past several years. However, our firm is obviously not solely responsible for the flourishing FLSA activity!

A recent audit of the Los Angeles Department of Transportation revealed substantial overtime pay for workers in the traffic paint and sign division – on average, workers were paid $48,000 in overtime compared to just over $8,000 for workers in other city departments, including police and firefighters. But while the figures may sound excessive, an audit found there wasn’t enough evidence to support a legal claim against the division. And what’s more, the workers say the additional overtime was earned.

According to Los Angeles Department of Transportation General Manager Seleta Reynolds, the overtime occurred during a time during the tenure of former Mayor Antonio Villaraigosa. During his time in office, more than 100 miles of bike lanes were commissioned and thousands of city streets had been recently resurfaced, requiring extensive hours of striping. At that time, the division employed just three crews and had access to only two trucks, resulting in significant backlogs of work which, in turn, caused the overtime to build up.

Since the audit, the city has approved the hiring of at least 20 additional employees for the traffic paint and sign division, sending a clear signal the division has been overworked.

Our New York wage and hour attorneys strive to assist workers who’ve experienced grievous harms, like harassment, discrimination, and retaliation. We also hope to educate the broader public about some of the shameful practices that contribute to worker misery and inequality.

To wit, a recent story in the New York Times caught our eye and kindled our ire.

Apparently, fast food restaurants around the country, such as Jimmy John’s, have been asking their sandwich shop workers to sign “non-compete” clauses. If you’re not familiar with these clauses, they are agreements that prevent employees from seeking work at competitive businesses within a certain timeframe.

The New York Times recently ran a provocative story that speaks to what motivates our New York employment lawyers to get up every morning and do what we do.

The story highlighted the differences between the lives and lifestyles of Danish fast food workers and fast food workers here in the United States. Believe it or not, if you work at a Danish Burger King, you can earn $20 an hour. Even though the cost of living in Denmark is higher than it is in the United States, this much higher hourly wage allows fast food workers in Denmark to pay their rents and mortgages, support their families, and live decent lives.

Hampus Elofsson, a 24 year-old Danish Burger King worker, explained: “You can make a decent living here working at fast food…you don’t have to struggle to get by.”

Our New York employment attorneys have witnessed the awful impact of wage cuts and lower salaries on working conditions and employee morale. But what happens when wages go up — when hourly rates are raised on a city, state, or federal level? It’s easy to see how wage hikes work out well for employees. But can wage hikes also benefit business owners and employers?

Our answer is an emphatic yes. Here are five ways that wage hikes benefit everyone:

1.    Security and loyalty. Employees who have one well-paying job don’t need to constantly search for better employment. They don’t need to be working second jobs to make ends meet, leaving them exhausted and distracted at work. A well-paid employee has no incentive to go elsewhere and plenty of incentive to keep performance quality high.

Our New York employment attorneys applaud the work of Minnesota lawmakers, who recently raised the state minimum wage from $6.15 per hour to $8 per hour. Smaller businesses have more time to prepare for these changes, and they won’t be expected to pay as much as large employers. However, one small restaurant, the Oasis Café in Stillwater, MN, has chosen a public and possibly embarrassing route to show its frustration with the new wage laws.

Customers at the Oasis Café have started to see a new line item on their bills – a flat, 35 cent “minimum wage fee” added to every order. Rather than raising the prices of menu items, the owners of the Oasis decided to make their customers aware of how the wage hike affects them.

“The Oasis management says they estimate the pay increase is costing them more than $10,000 a year,” CBS Minnesota reports. When the restaurant responded to customer complaints on Facebook, they said, “Rather than increase the prices of our menu items, we chose to charge a flat fee.”

Our New York employment attorneys aren’t the only ones seeing more cases related to wage theft. As more companies cut corners and more employees report shrinking paychecks, the number of lawsuits grows nationwide.

Current or recent cases involving wage theft include:


• Schneider.
A national trucking company that provide services to Walmart is now paying out $21 million in a settlement with Rangel and other individuals robbed of their rightful overtime pay.

Our New York employment attorneys have been examining recent efforts by the White House to strengthen workers’ overtime protections. The 2014 initiative, which began in March, seeks to reevaluate and adjust existing policies to reflect the changing realities of the workforce and ensure every employee receives fair pay.

According to the White House, current overtime laws fail to take into account the current economy and the circumstances of American workers. For instance, the “white collar exemption” is often used by employers to prevent salaried workers earning more than $561 per week – or working in certain professions – from earning overtime pay when they work more than 40 hours. This negatively affects many low-income workers, who work long hours without adequate compensation.

The Presidential Memorandum seeks to work with the Secretary of Labor to address several concerns, including:

In our last post, we discussed the basic theories and history behind tipping, as presented in the Accounting Degree Review’s comprehensive infographic, “Tipping in the United States.” Today, we will discuss the current state of affairs for tipped employees and how they can ensure they receive fair compensation for their work, including seeking advice from reputable New York employment attorneys.

As the infographic indicates, tipped employees only need to earn $30 per month in tips to “qualify” for the subminimum wage, which is currently frozen at $2.13 per hour. However, for full-time employees, $30 in tips on top of the subminimum wage paid by the employer still amounts to much less than minimum wage.

In addition, most states offer employers a “tip credit,” which reduces the wages they must pay to tipped employees based on the tips they receive. The law also stipulates that when employees don’t make enough between tips and their hourly wages to equal minimum wage, the employer must make up the difference. However, many employers do not comply with this law, even when staff or other entities discover the discrepancy.

New York employment attorneys are keeping a close watch on the changing laws and trends in our country. According to the Bureau of Labor Statistics, over 2.3 million servers currently work in the United States, many of whom depend on tips for their livelihood. Consumers pay $42 billion in tips to servers every year, but many people know little about where their money goes.

This excellent infographic from Accounting Degree Review provides valuable information for tipped employees (and their customers) about the history and current state of compensation for servers.

Equity Theory and Tipping