Category Archives: Employment Practices Liability

by | April 14, 2013 · 6:56 am

Hospitality Industry Employment Risks: North Carolina Restaurant Franchisee Faces “Civil Contempt” Charges For Breach Of EEOC “Sexual Harassment Lawsuit” Settlement

“…an 18-year-old female employee was being sexually harassed by a male coworker who talked to her about his sex life in addition to making EEOCsexual gestures toward her…the suit goes on to claim that the female worker was fired after police went to the restaurant to investigate her complaint…The decree required the company to pay $17,500 in relief to the female employee in addition to establishing or enforcing policies against sexual discrimination and retaliation for reporting sexual harassment…”

A franchisee operating the Dairy Queen restaurant in Winston-Salem’s Hanes Mall is being held in civil contempt by a federal judge because it breached terms of an agreement resolving a sexual harassment lawsuit, according to the Winston-Salem Journal. In December 2011, the agency filed a lawsuit against YS&J Enterprises Inc. in U.S. District Court for the Middle District of North Carolina.

Back pay and monetary damages were sought in the suit.

According to the Journal, the company entered into a consent degree with the EEOC, which was signed by Judge James Beaty in October.

For more:  http://myfox8.com/2013/04/13/dairy-queen-at-hanes-mall-held-in-contempt-over-harassment-suit/

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by | April 11, 2013 · 6:34 am

Hospitality Industry Legal Risks: New York Restaurant And Caterer Sued For “Retaining 20% Service Personnel Charge”; Seeking Class-Action Status For More Than $1 Million In Tips

“…(the complaint states) a ‘reasonable customer’ would have believed the surcharge to be a gratuity…if customers asked if the waiters and waitresses got tips, they were ordered ‘to respond, as instructed by defendants, that they did receive tips’…(the Hospitality Industry Wage Violation Lawsuitsdefendants) knowing or intentional demand for, acceptance of, and/or retention of the mandatory charges paid by customers when contracting with defendants, when such customers were led to believe that such mandatory charges would be paid to plaintiff, defendants have willfully violated New York law…(plaintiffs) seek class certification, restitution of the tips, and costs…”

A class action claims an upstate New York restaurant and caterer cheated its workers out of more than $1 million in tips.

The defendants added a 20 percent “service personnel charge” to all its banquet hall bills, but servers never saw dime one of it, lead plaintiff Ryan Picard claims in Albany County Supreme Court.

Picard claims the family-owned businesses ran the game for 6 years, at the expense of more than 100 workers.  Named as defendants are six entities associated with the Mallozzi family of suburban Schenectady, who operate bakery, restaurant, hotel and catering businesses in Albany and Schenectady counties.

For more:  http://www.courthousenews.com/2013/04/11/56574.htm

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by | April 3, 2013 · 5:34 am

Hospitality Industry Employment Risks: Wisconsin Restaurant Servers File “Wage Violation Class-Action Lawsuit”; Claims Owners “Transferred Cost Of Doing Business” To Workers

“…the complaint says servers were forced to pay for their uniforms, aprons, hot pads to serve fajitas, order pads and name tags — and that’s not Hospitality Industry Wage Violation Lawsuitsall…anytime a customer walked out without paying the bill, the servers had to pay. Anytime a customer said, this is not what I ordered, food or alcohol drink, the server had to pay for that…the owners were essentially transferring the cost of doing business on to the servers, who were only being paid $2.33 an hour…”

A group of servers at La Fuente restaurant have filed a class action lawsuit against the restaurant — saying they are sick of footing the bill for food sent back to the kitchen. The claim says servers were expected to work and not get paid — and that they were stuck with the bill when customers would skip out. Larry Johnson is a labor attorney representing servers at two La Fuente locations. Johnson says it was written policy to have the servers start shifts early and prepare the restaurant, but they weren’t allowed to clock in until customers arrived, and so now, a server has served the owners with a class action lawsuit.

“Setting up tables, putting rolling silverware, filling salt shakers, working, making coffee, all that kind of stuff to get the restaurant ready,” Johnson said.

The suit now requests those unpaid wages and if they win the case, the court could double it, along with attorneys fees. Johnson says it is too early to know how much money that could be, but he says it’s the price companies pay when they don’t follow the law.

For more:  http://fox6now.com/2013/04/02/group-of-la-fuente-servers-file-class-action-suit-against-owners/

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by | April 1, 2013 · 1:02 am

Hospitality Industry Legal Risks: Arizona Restaurant Settles “Disability Discrimination Lawsuit” For $65,000; Server With Traumatic Brain Injury Was Fired By New Manager

“…(the plaintiff) worked tirelessly to be a good server after suffering a traumatic brain injury. The ADA prohibits EEOCemployers like Outback from firing individuals like John who add so much to the workplace…”

Outback Steakhouse will pay $65,000 and furnish other relief to settle a disability discrimination lawsuit filed by the U.S. Equal Employment Opportunity Commission (EEOC), the agency announced today.

The EEOC’s lawsuit, EEOC v. OSI Restaurant Partners, LLC d/b/a Outback Steakhouse and OS Restaurant Services, Inc., Civil Action No. 2:11-cv-01754-NVW, charged Outback with firing server John Woods days after a new manager took over at Outback’s Phoenix Metrocenter location. According to the EEOC’s suit, John Woods had worked successfully under Outback’s prior manager, but a new manager terminated Woods because of his disability, traumatic brain injury.

Disability discrimination violates the Americans with Disabilities Act (ADA). The EEOC filed suit in U.S. District Court of Arizona after first attempting to reach a pre-litigation settlement through its conciliation process.

After the court denied Outback’s motion for summary judgment, Outback agreed to a 24-month consent decree that requires the company to pay Woods $65,000; revise its policies concerning disability discrimination; train its Arizona managers on the laws prohibiting disability discrimination; and post notices in Arizona Outback Steakhouses regarding employees’ rights under the ADA.

“Managers cannot fire employees because of their mistaken beliefs about what individuals with disabilities can accomplish,” EEOC Phoenix District Director Rayford Irvin said. “We are pleased with the resolution of this case, and we are hopeful that this agreement will help prevent discrimination in the workplace going forward.”

For more:  http://www.natlawreview.com/article/outback-steakhouse-to-pay-65000-to-settle-eeoc-disability-discrimination-lawsuit

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by | March 14, 2013 · 5:53 am

Hospitality Industry Employment Risks: Michigan Motel Settles “Pregnancy Discrimination Lawsuit” For $27,500; Safety Of Unborn Fetus No Reason For Employment Exclusion

“…according  to the EEOC’s suit, Ramin fired a housekeeper after she reported her pregnancy  to them.  Management stated it could not  allow the employee to continue to work as a housekeeper because of the  EEOCpotential harm to the development of her baby, the EEOC said…”

Ramin Inc., the owner of a Comfort Inn & Suites  in Taylor, Mich., will pay $27,500 to settle a pregnancy discrimination lawsuit  (EEOC v. Ramin, Inc., 2012-cv-15015) filed by the U.S. Equal Employment  Opportunity Commission (EEOC), the agency announced today.

Title VII  of the Civil Rights Act of 1964, as amended by the Pregnancy Discrimination Act  (PDA), protects female employees against discrimination based on  pregnancy.  Under the statute, an  employer may not exclude pregnant women from employment based on the employer’s  supposed concerns about the safety of the mother or unborn fetus.  The EEOC filed suit after first attempting to  reach a pre-litigation settlement through its conciliation process.

In a consent decree filed with the  U.S. District Court for the Eastern District of Michigan, the company agreed to  pay $2,500 in back pay and $25,000 in compensatory and punitive damages.  In addition, Ramin agreed to a permanent  injunction enjoining it from discriminating against an employee due to her  pregnancy or requiring a pregnant employee to provide medical documents that  releases her to work.  The decree  requires that Ramin provide training to all of its managerial and non-managerial  employees on sex and pregnancy discrimination; draft a new employee policy  regarding sex and pregnancy discrimination; post a notice regarding the suit  for all employees; and report to the EEOC for four years.  The injunction, training, policy revisions,  and EEOC monitoring constitute targeted, equitable relief that aims to prevent  similar violations in the future.

For more: http://www.eeoc.gov/eeoc/newsroom/release/3-12-13a.cfm

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by | March 13, 2013 · 6:31 am

Hospitality Industry Legal Risks: Hotel And Restaurant Employees Subjected To “Conditions Or Actions Intended To Humiliate, Harass Or Destroy Career” File “Constructive Discharge Lawsuits”

“…the intolerable or aggravated category (of constructive discharge) are actions intended to humiliate (e.g., demoting a vice president to janitor overnight); actions intended to harass (e.g., requiring a black employee to Hospitality Industry Termination Lawsuitswork extra hours for the same pay as white co-workers and punch a clock while others do not); actions intended to destroy the employee’s career or guarantee job loss (e.g., sudden, unexplained drops in performance ratings, skipped promotions, forced demotions, pay cuts)…”

Here’s how one state supreme court defined constructive discharge: “An employee who is forced to resign due to actions and conditions so intolerable or aggravated at the time of his resignation that a reasonable person in the employee’s position would have resigned, and whose employer had actual or constructive knowledge of the intolerable actions and conditions and of their impact on the employee and could have remedied the situation, but did not, is constructively discharged.”

Factors that may contribute to a constructive discharge claim—either singly or in combination—include whether an employee suffered:

  • a demotion
  • reduction in salary
  • reduction in job responsibilities
  • reassignment to menial or degrading work
  • reassignment to work under a younger supervisor
  • involuntary transfer to a less desirable position
  • badgering, harassment or humiliation by the employer
  • offers of early retirement or encouragement to retire
  • offers of continued employment on terms less favorable than the employee’s former status
  • a threat of violence or actual physical assault
  • a threat of termination

For more:  http://www.businessmanagementdaily.com/glp/43084/Termination-Guidelines.html

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by | March 12, 2013 · 6:31 am

Hospitality Industry Legal Risks: Hotel And Restaurant Management Must Conduct Criminal Background Checks To Avoid “Negligent Hiring Lawsuits”; Screening Must Be Relevant To Job Description To Avoid Discrimination

“…Hospitality employers (conduct criminal-background checks) to avoid negligent hiring lawsuits – a lawsuit from a guest or customer, for example, based on a hotel’s failure to properly screen an employee who later does Hospitality Industry Criminal Background Checks (2)harm…for each job description, (management) should prepare a memo that describes the relevance of, and need for, such information and how it is related to the particular job description…it is inconsistency in the selection of what type of background check each applicant gets that can often get employers sued for discrimination…”

According to some studies, over 90% of employers conduct criminal-background checks for some job applicants and over 70% of employers conduct background checks on all potential new hires. This includes many hospitality-industry employers. Most decision-makers want information about criminal behavior and other related data before bringing a candidate into the organization.

For example, the Equal Employment Opportunity Commission (EEOC) and some states are taking the position that, given the disproportionate rate of minorities that are arrested and convicted of crimes, an employer’s policy of disqualifying all applicants with criminal history can have a discriminatory impact on minority candidates and thereby violate Title VII’s discrimination laws.

Each state has its own position on the use of arrest and conviction records. Even when abiding by those parameters, there is still the need for a comprehensive, consistent set of procedures regarding the use of criminal history to avoid claims of discrimination. The key here is to identify by job description prior to hiring candidates, what kind of criminal background information (including how many years back) the company will look for and to ensure that the same level of background check is done for every applicant for that position.

Establishing a policy and procedure to make sure each applicant for a job description gets the same background check and having a defensible job-related justification for the relevancy and need for the information for each job position is critical to defending against future discrimination claims.

For more:  http://www.mondaq.com/unitedstates/x/225564/employee+rights+labour+relations/And+By+The+Way+Are+You+A+Criminal

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by | March 9, 2013 · 8:19 am

Hospitality Industry Legal Risks: Idaho Restaurant Chain Sued By Male Employee Who Claims “Only Women Allowed To Work As Bartenders”

“…lawsuit claims that service manager (stated) that the Louisville,Ky.-based chain’s regional director “only wanted girls working in the bar.” The complaint (states that restaurant) told women employees to wear tank EEOCtops and shorts to work and to “flirt with every guy that sits at the bar top…”

A former employee of the Texas Roadhouse restaurant in Ammon alleges only women can work as bartenders there, according to a complaint filed with the U.S. District Court of Idaho. Tim Fenton was employed at the restaurant as a trainer, bartender and server before his dismissal in October 2012.Fenton lost out on bartending assignments and Baird allegedly promoted a woman to tend bar that he had a crush on.

Baird also demoted Fenton from his position as a trainer allegedly in retaliation for his and his wife’s reports to Texas Roadhouse about the discrimination. Sam Angell, Fenton’s attorney, said his client made a formal complaint to the chain’s human resources department, but did not receive a report back regarding an investigation of the charges or its findings.

According to the Texas Roadhouse in Ammon, Baird is no longer employed at the restaurant. A representative for Texas Roadhouse corporate headquarters said he hadn’t seen the lawsuit so could not comment.

In order to pursue a job discrimination lawsuit in federal court, plaintiffs must first file a charge with the Equal Employment Opportunity Commission. According to Angell, the EEOC determined it would not be able to complete its investigation in the required 180 days so it issued a “Notice of Right to Sue.”

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by | March 1, 2013 · 7:12 am

Hospitality Industry Legal Risks: Oregon Restaurant Chain Sued For “Forcing Minimum-Wage Employees To Cover Shortages In Cash Register”

“…Employees were required to pay kickbacks regardless of the reason for the shortage, regardless of fault and regardless of the impact of the kickback on the employee’s earnings over the pay period…those employees Hospitality Industry Wage Violation Lawsuitswere not granted any corresponding credits when the cash register had surplus funds…”

A Portland attorney is suing the state’s largest lottery retailer, alleging that it routinely violated Oregon’s minimum wage law.

Attorney Paul Breed claims that Oregon Restaurant Services Inc., which owns the lucrative Dotty’s deli chain, illegally forced minimum-wage employees to pay “kickbacks” to cover shortages in the cash register at the end of their shifts.

Under state law, tips don’t count toward the minimum wage. In fact, the Oregon Restaurant and Lodging Association has long lobbied the Legislature to allow “tip credit,” so tips could count toward the minimum wage, $8.95 an hour.

No Oregon employers are allowed to deduct money from workers’ wages to cover shortfalls in the till, no matter how much they earn, says Christie Hammond, deputy director of the state labor bureau, known as BOLI. Employers may ask workers to make payments to defray the costs of shortfalls only if they earn more than minimum wage, or the cost wouldn’t cause their wages to fall below minimum wage, Hammond says.

So what are restaurants and other retailers to do when they want to hold employees accountable for missing money in the cash register at the end of the day? Employers have other legal recourse if they think an employee is stealing from them or otherwise losing money, Hammond says. “But they shouldn’t be the judge and jury to decide if the employee is guilty of the shortage.”

For more:  http://www.koinlocal6.com/news/local/story/Lawsuit-slams-Dottys-kickback/LroqQJeb4EaClTE2VdLNaA.cspx

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by | February 23, 2013 · 8:35 am

Hospitality Industry Legal Risks: New York Restaurants Now “Randomly Targeted” For Wage Violations By Labor Department; “Liquidated Damages” Can Double Back Wages Owed

“…officials at the local U.S. Department of Labor office say that in prior years, they relied on employee tips to launch investigations… the random inspections now drive as many investigations as employee Hospitality Industry Wage Violation Lawsuitscomplaints…those probes increasingly turned up egregious violations including kitchen workers being paid as little as $2 an hour…Starting in 2011, the office launched a restaurant initiative, focusing on a different segment each year. The initial focus was pizza and pasta restaurants. Last year it was diners; this year, Asian restaurants…”

The U.S. Department of Labor is targeting Long Island‘s largest private-sector employer, the restaurant industry, charging it with widespread minimum-wage and overtime violations.

The department has launched a campaign of random inspections with growing impact: In the 12 months through Sept. 30, it obtained court orders against 89 employers for such violations on the Island — about half of the roughly 180 orders obtained in all the United States by the Wage and Hour Division of the Department of Labor, according to Irv Miljoner, the Westbury-based district director for Long Island. Of the Island employers being sanctioned, 66 are restaurants.

As part of the stepped-up litigation, local Labor officials are increasingly seeking liquidated damages, which double the back wages owed. “Before this we would just go in and we would get back wages for a two-year period, and they would pay it and we’re done,” said Richard Mormile, assistant director of the Long Island office. “We have upped those consequences.”

Overall in fiscal year 2012, the office’s investigators found that local employers, mostly restaurants and diners, owed $8.6 million in back wages, up 28 percent from $6.7 million they uncovered the year before.

This year’s effort has already resulted in one of the largest settlements ever for the local office. An Asian restaurant chain with two locations on Long Island — Asian Moon, in Garden City and Massapequa Park — and a location in Westchester agreed to a court order requiring it to pay more than $1 million to settle charges that it underpaid 255 employees over three years and altered records to hide the violations. The department’s lawsuit charged that food preparers and dishwashers worked 55 hours a week without being paid overtime.

For more:  http://www.newsday.com/classifieds/jobs/u-s-labor-dept-checks-li-restaurants-for-wage-violations-1.4694410

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