Articles Posted in Restaurant FLSA violations

Your boss docked your overtime unfairly. Or maybe your husband — or someone you love –got harassed or discriminated against at work.

Why? Why do some employers mistreat and underpay their workers?

Entrepreneurs are hardwired to trim overhead, when they can. A restaurant owner, for instance, knows that any money that goes towards payroll must come out of the company’s coffers. To that end, the very act of running a business puts pressure on owners to minimize labor costs.

Among the pantheon of crimes against workers, tip pool violations are far from the most dramatic. We’ve come a long way in the United States since the days of the Triangle Fire, and we no longer allow young children to work horrendous hours and dangerous jobs. Our laws provide protections for the underprivileged and for members of special classes.

On the other hand, problems like wage and hour issues and tip pool violations are pretty awful, and they have ripple effects that can cascade throughout society.

How Tip Pool Violations Can Set Off a Cascade of Unfair Situations

Did your restaurant manager steal your tips? Has your supervisor sent raunchy emails to you and your staff? Did a company unfairly deny you overtime pay for contract work? If so, odds are that you’re kicking yourself and saying things to yourself like:

• I’m an intelligent person who’s also street-smart. Yet I still wound up stuck in a dysfunctional work relationship/arrangement. Why did that happen, and what can I change about myself and/or the way I work to avoid having to go through this again?

Consider these explanations and see whether they resonate with you:

Getting a class action status approved for a Federal Labor Standards Act (FLSA) case is no small task, even for the experienced employment law attorneys here at Joseph & Kirschenbaum. However, achieving this milestone can be critical. It can make all the difference in the world, when it comes to getting obtaining fair treatment and benefits.

In that light, we were very pleased to learn that a United States District Court Judge recently granted us class action status, in a case that pits restaurant workers against a very well-known set of New York City sushi restaurants.

The plaintiff alleges, among other things, that the defendants:

Violating the Fair Labor Standards Act (FLSA) can cost you a pretty penny, whether you own one restaurant… or 55 of them.

QSR Management, a New Jersey Company that owns 55 Dunkin’ Donuts franchises in Staten Island and New Jersey, has agreed to pay out nearly $198,000 in back wages to 64 managers at locations around the Tri-State area. A U.S. Labor Department investigation discovered that the company had not been paying its managers fair overtime, per FLSA rules. The company argued that the managers were exempt from overtime because they collected a salary. Perhaps the QSR management team didn’t read the Fair Labor Standards Act closely enough. According to news reports, QSR:

• Docked the store managers’ pay when the managers worked less than 60 hours a week;

A restaurant class action lawsuit — alleging serious violations of the Federal Labor Standards Act (FLSA) — has put a Cincinnati restaurateur in the hot seat.

The class action alleges that waitstaff at Jeff Ruby’s Steakhouse and Carlo & Johnny had been compelled (illegally) to share their tips with managers and other workers who didn’t normally receive tips. The plaintiffs allege that this tip pool sharing not only violated the FLSA but also bumped the workers’ wages below minimum wage. Sarah Leyshock, a lawyer for the plaintiffs, stated the case plainly: “The law simply states that managers cannot be tipped out… 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 pool.”

Allegedly, this raiding-of-the-tips lasted from the beginning of 2010 through 2012.

Thousands of workers in the fast food industry recently launched a multi-city protest, demanding higher wages, the opportunity to unionize, and an increase in the federal minimum wage to $15 per hour (up from the current $7.25 per hour).

Despite the impassioned and heartrending stories out of Detroit, New York, Chicago and elsewhere, observers remain skeptical about whether the protests can change policy.

Restaurant industry organizations and other critics claim that raising the minimum wage to $15 per hour would lead to the loss of jobs and the closing of businesses. Some political groundswell for changing the minimum wage exists — there hasn’t been a hike, since 2009. President Obama recently pushed for a more modest increase, up to $9 per hour. Other, more progressive advocates in Congress want to bump the rate up to $10.50 per hour.

Attorney D. Maimon Kirschenbaum is no stranger to the nuances of the Fair Labor Standards Act (FLSA). He earned his bona fides, in part, by advocating for the FLSA rights of restaurant labors, such as dishwashers and wait staff.

But his clients in one of his latest cases may surprise observers. He is representing lawyers.

Kirschenbaum filed a class action recently in New York Federal Court against a large legal firm (Skadden, Arps, Slate, Meagher & Flom) and a staffing company, Tower Legal Staffing. The plaintiffs argue that Skadden took advantage of out-of-work law school grads. They allege they were hired to do simple document review with no room for judgment…without being paid fair overtime, per the FLSA.

Contrary to widespread misunderstanding, the Fair Labor Standards Act (“FLSA”) and parallel state wage and hour laws provide overtime protection to many salaried employees.  The FLSA requires time and one-half be paid to all employees for work in excess of forty hours/week unless a specific exemption from this requirement is applicable.  Because the laws are considered “socially remedial”, meaning in the best interests of the Nation as a whole, they were passed with the intention to provide remedies to the maximum number of workers possible.  Exemptions from overtime are narrowly interpreted, and an employee must fall clearly and unmistakably within the scope of an exemption for it to be lawfully applicable.  Overtime eligible is the rule.  Exemption is the exception.
 
A common error made by employers is the designation of an employee by title as a “supervisor” or “manager” (or “assistant manager”), pay them a salary, and consider the worker exempt from overtime, without regard for the duties the worker actually performs.  For example, the Executive exemption requires management, with the authority to hire and fire subordinate employees, to be the primary duty of an exempt executive.  Many first level supervisors are treated as exempt, even though their duties make them eligible for overtime pay.  As space is too limited in this blog to delve into all the legal details, we only highlight that exemptions are often incorrectly applied.  An employee’s title, job description, and salary are all insufficient to warrant exemption if the actual work performed does not rise to the level of management necessary, as demonstrated by numerous court decisions on this subject.  We find many employees that raise questions are often surprised that they too are eligible to be paid overtime for weekly hours worked in excess of forty.

If you believe you have been misclassified as exempt or were the victim of wage theft in any other way, please contact us at (212) 688-5640 or use  the electronic form on this site.

On June 24th, Jefferson Cowie wrote a provocative Op-Ed in the New York Times, “The of Future Fair Labor.” The article offers a fascinating perspective on the history and future of the Fair Labor Standards Act (FLSA). As attorneys who’ve helped thousands of people obtain fair treatment and redress wrongs done by means of New York Labor Laws and the Fair Labor Standards Act (FLSA), we found many of Mr. Cowie’s points resonant and thought provoking.

Mr. Cowie begins by pointing out that the Fair Labor Standards Act – signed into law in President Franklin Roosevelt’s administration – had its roots in helping to promote “rudimentary standards of decency.” The Act put an end to child labor, created a minimum wage, capped the official work week, and mandated overtime for additional labor worked.

Over the past seven and half decades, the FLSA has been one of the central guiding lights in labor law. The Equal Pay Act, signed by President Kennedy, amended the FLSA to ensure “equal pay for equal work” for women, minorities, and others.

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