Wage and Hour Cases in the News

Several restaurant industry labor law cases could make considerable changes in how the industry manages workers. Under the Fair Labor Standards Act (FLSA), tipped employees are subject to hourly wages that are lower than the minimum wage because they expect to make up the difference in tips. Employees in two recent cases involving national restaurant chains argued the same legal point - when restaurant managers demand that tipped employees spend considerable time working at tasks where they do not receive tips, this work demand violates wage and hours law under the FLSA and state statutes.

The cases were:

  • Flood et al v. Carlson Restaurants Inc. et al. TGI Friday's is a restaurant chain owned by Carlson Restaurants Inc. A class action lawsuit filed by former servers, bartenders, employees busing tables, hosts and other tipped workers alleged that the restaurant required employees to work earlier than the scheduled hours of serving customers to do cleaning, restocking and bulk food preparation. These were usually the tasks of minimum wage restaurant workers. The case was filed in New York, but as a national restaurant chain lawsuit, it could potentially affect restaurant employees nationwide.
  • Souper Salad. LNC Ventures LLC, the parent company of Souper Salad settled a case filed in a Texas federal court. The plaintiff, Matthew Scott, requested that the court certify a class for all individuals working for tips at Souper Salad during the three years previous to the complaint. The case alleged that 20 percent of the employees' work schedules involved non-tipped duties. This work demand is greater than allowed for tipped employers. Souper Salad owns 39 restaurants and has six franchises in seven states. Scott sued for compensation for total hours worked that failed to meet FLSA standards, liquidated and punitive damages, interest and attorneys' fees. The settlement was confidential. However, Scott's employment law attorney said they were pleased with the settlement outcome.

 

Topics:  Employer Liability Issues, FLSA, Minimum Wage, Restaurant Industry, Wage and Hour

Published In: Labor & Employment Updates

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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