Tag Archives: Restaurants

Hospitality Industry Insurance Risks: California Restaurant Owners Charged With “Felony Worker’s Compensation Fraud” For Failing To Insure Twelve Employees; Fines Totalling $18,000

“…an anonymous complaint (alleged) that the restaurant did not have workers’ comp insurance as required by law…following a visit to the restaurant, a civil citation (was issued) with penalties totaling $18,000 for failing workers comp fraudto insure their 12 employees…businesses not carrying valid workers’ compensation coverage are considered uninsured and face a “Stop Notice and Penalty Assessment” from the Labor Commissioner and fines of $1,500 per employee, up to $100,000. If an injury occurs, the fine increases to $10,000 per employee. A worker injured while working for an uninsured employer can sue for damages and the employer is presumed negligent in such cases…”

The owners of a restaurant in San Marcos, Calif. have been charged with felony counts of workers’ compensation fraud and forgery following a referral by the California Labor Commissioner Julie A. Su’s criminal investigation unit to the San Diego District Attorney’s Office.

The district attorney’s charges, filed in San Diego Superior Court on Jan. 29, allege that Rhythm City Grill owners John Fletcher Johnson and Annette Lucille Thomas each committed two felony counts of forgery of a workers comp insurance policy and a misdemeanor charge of conducting business without workers’ compe insurance. Johnson was also charged with an additional felony for submitting a false document to a government agency. He and Thomas were arraigned Feb. 14.

If convicted, Johnson and Thomas face up to 16 years in prison for the felony charges. The failure to secure workers’ comp insurance carries a misdemeanor charge of 1 year and a fine.

For more: http://www.insurancejournal.com/news/west/2013/02/19/281769.htm

Comments Off on Hospitality Industry Insurance Risks: California Restaurant Owners Charged With “Felony Worker’s Compensation Fraud” For Failing To Insure Twelve Employees; Fines Totalling $18,000

Filed under Crime, Injuries, Insurance, Labor Issues, Liability, Management And Ownership, Risk Management

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

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

Filed under Employment Practices Liability, Insurance, Labor Issues, Liability, Management And Ownership, Risk Management, Training

Hospitality Industry Legal Risks: Restaurant Owners Increasingly Targeted With EEOC Lawsuits Over “Family Medical Leave Act” Liability; Employees Who Use Up “Available Paid Sick Leave” Assert Disability Rights

“…Previously, if an employee had exhausted all twelve weeks of FMLA leave and any other available leave, they could be terminated without employer liability…however, the EEOC recently has taken the position that Paid Sick Leave In Hospitality Industryonce leave is exhausted under the FMLA, this can trigger an employer’s affirmative duty to provide a reasonable accommodation  to an employee’s disability, which can include providing additional leave..”

For 2013, food service employers can expect a continued aggressive approach from the Equal Empoyments Opportunity Commission (“EEOC”) as to violations of the Americans with Disabilities Act (“ADA”) in the restaurant industry.  The significant increase of ADA charges and lawsuits by the EEOC and private claimants, which began in early 2012, shows little sign of abating in the new year.

Back in 2008, Congress passed the Americans with Disabilities Act Amendment Act (“ADAAA”), which was intended to counter a series of U.S. Supreme Court decisions that significantly limited employees’ ability to assert and prevail in disability lawsuits.  Under the ADAAA, and the EEOC’s final regulations, approved in 2011, the definition of what constitutes a disability was significantly broadened.  As a result, employees who previously would not have been considered disabledEEOC under the ADA, now fall under its statutory protections.  Prior to the amended Act, employers could often prevail in litigation on the basis of whether the employee actually was considered disabled under the narrow interpretations of the Supreme Court decisions.  With the new broad definition, most cases now hinge on whether the employer reasonably accommodated the employee’s disability..

One source of increased litigation and attention from the EEOC is when the ADA intersects with the Family and Medical Leave Act (“FMLA”) as to leave for a serious medical condition.   Under this scenario, employees who were terminated after exhausting FMLA leave are asserting EEOC Charges and filing lawsuits under the ADA.  Employers are also being forced to agree to high dollar settlements with the EEOC to avoid the prospect of the federal agency filing suit on behalf of employees and former employees.

For more:  http://www.bluemaumau.org/surge_ada_disability_lawsuits_continue_2013_restaurant_and_food_service_employers_crosshairs

Comments Off on Hospitality Industry Legal Risks: Restaurant Owners Increasingly Targeted With EEOC Lawsuits Over “Family Medical Leave Act” Liability; Employees Who Use Up “Available Paid Sick Leave” Assert Disability Rights

Filed under Employment Practices Liability, Health, Insurance, Labor Issues, Liability, Management And Ownership, Risk Management

Hospitality Industry Legal Risks: Colorado Hotel And Restaurant Sued By Woman Who “Drank Bleach In A Water Glass”; Lawsuit Seeks $100,000 For “Negligence And Breach Of Implied Warranties Of Merchantability And Wholesomeness Of Food”

“…(plaintiff) suffered serious and continual medical problems, including the inability to eat effectively, persistent acid reflux syndrome, digestive problems and other symptoms…(her) relationship with her husband Hospitality Industry Injury Lawsuitsand her ability to care for her children have been affected…among the claims in the lawsuit are negligence, breach of implied warranties of “merchantability and wholesomeness of food,” loss of consortium and a violation of Colorado’s premises liability statute…”

A Basalt woman is suing the owner and operator of the Viceroy Snowmass, alleging that she was served and drank out of a glass that had bleach in it at the hotel’s Eight K restaurant. The incident happened during brunch in February 2011, according to the lawsuit by Janine and John Reichert. The suit, filed Tuesday in Pitkin County District Court, seeks more than $100,000. It lists Base Village Owner, the hotel’s owner, and Viceroy operator KHM Snowmass as the defendants.

After being seated, a waiter poured water for the Reicherts’ party from a pitcher, wrote their attorney, Alan Feldman of Aspen, in the lawsuit. “Immediately after Janine drank from the glass, she jumped up out of her seat, stating that she had drank chemicals and needed to get to the bathroom as she was going to throw up,” the lawsuit says. “Janine’s throat began to burn and swell up. … [She] raced to the restroom, where she became violently ill.”

John Reichert dipped his finger in her glass and allegedly tasted a bleach solution. The wait staff then cleared all of the glasses from the table and disposed of their contents, Feldman wrote. One Eight K employee allegedly told John Reichert that “it is typical for the water pitchers to be soaked in a solution of bleach for sterilization and that the waiter could have picked up a water jug soaking in this bleach solution, believing it to be drinking water,” Feldman wrote.

However, as Janine Reichert was talking to a poison-control operator, a manager allegedly told her that she had ingested merely the residue from the bleach left on the jug.

For more:  http://www.aspendailynews.com/section/home/156795

Comments Off on Hospitality Industry Legal Risks: Colorado Hotel And Restaurant Sued By Woman Who “Drank Bleach In A Water Glass”; Lawsuit Seeks $100,000 For “Negligence And Breach Of Implied Warranties Of Merchantability And Wholesomeness Of Food”

Filed under Claims, Food Illnesses, Guest Issues, Injuries, Insurance, Liability, Maintenance, Training

Hospitality Industry Information Security Risks: Hotels, Restaurants And Retailers Accounted For 78% Of “Data Breaches By Cyber-Criminals” In 2012; “Weak Or Guessable Passwords” Is Most Common Vulnerability

“…Almost one-third of all victims had critical systems administered by a third party…Attackers had no trouble exploiting that weakness, with vulnerable remote-access systems accounting for the method of entry in 47 cybercrime in hotelspercent of the cases…in most cases, users – not software vulnerabilities – were to blame. Almost 90 percent of systems had weak or easily guessable passwords, with “Password1″ continuing to be the most common, according to Trustwave’s report…”

An analysis of breach data for 2012 found that retailers and the hospitality industry continued to command the most interest from cyber-criminals, accounting for 78 percent of the breaches documented by security services firm Trustwave.

The businesses are typically easy targets, having outsourced the administration of important servers and business data to firms that focus more on keeping the systems functioning than on security, says Christopher Pogue, director of digital forensics and incident response for Trustwave’s SpiderLabs.

“An integrator may have 1,000 customers and may do remote administration for all of them using, not 1,000 passwords, but maybe two or three,” Pogue said. “That leaves a vulnerability that can be exploited by attackers.”

For more:  http://www.techweekeurope.co.uk/news/retailer-hotel-crime-107589

Comments Off on Hospitality Industry Information Security Risks: Hotels, Restaurants And Retailers Accounted For 78% Of “Data Breaches By Cyber-Criminals” In 2012; “Weak Or Guessable Passwords” Is Most Common Vulnerability

Filed under Crime, Liability, Maintenance, Management And Ownership, Privacy, Risk Management, Technology, Theft

Hospitality Industry Legal Risks: New York Restaurant Sued By Woman Hit By Car Outside Building; Neglected To Install “Curbs And Bollards”

“…the (plaintiff’s attorney) said Wendy’s only installed pedestrian safety blocks after the crash in December. He said if the restaurant had curb stops and bollards in place at the time of the incident, the tragedy would Hospitality Industry Injury Lawsuitshave been prevented…”

Theresa DiMilia and her 11-year-old daughter Samantha walked out of the Wendy’s restaurant on December 4 in Williston Park when suddenly a car being driven by an elderly woman smashed into them and pinned them against the wall. “The pain was so unbearable. I remember my daughter Samantha asking me if she was dead — ‘Am I alive mommy, am I alive?’” Theresa DiMilia told 1010 WINS’ Mona Rivera.

Their legs were crushed. Samantha DiMilia was treated and released after suffering a severely fractured leg. Now, two months later, Samantha is walking again, but Theresa DiMilia is still in a wheelchair after having both legs fractured in the incident.

The lawsuit names the driver of the vehicle who hit the DiMilias — 75-year-old Margaret Hogarty of Mineola — as well as Wendy’s International Inc. and Westbury Properties, LLC, which owns the property where the restaurant is located, as defendants.

For more:  http://newyork.cbslocal.com/2013/02/11/wendys-named-as-defendant-in-multimillion-suit-filed-by-injured-mother-daughter/

Comments Off on Hospitality Industry Legal Risks: New York Restaurant Sued By Woman Hit By Car Outside Building; Neglected To Install “Curbs And Bollards”

Filed under Claims, Guest Issues, Injuries, Insurance, Liability, Management And Ownership, Risk Management

Hospitality Industry Property Risks: Hawaii Restaurant Kitchen Fire Caused By Gas Leak In Deep Fat Fryer; Flames Spread Through Ventilation System Resulting In $2.5 Million In Damage

“…the cause of the fire was an accidental gas leak to a deep fat fryer.  The cause of the leak is undetermined.  A pilot light in the appliance was the source of ignition for the leaking gas…the flames spread quickly through Restaurant Firethe ventilation system, creating a challenge for firefighters…”

Honolulu Fire Department investigators said the fire started in the kitchen of The Cheesecake Factory at the Royal Hawaiian Shopping Center just before 3:30am Friday.

Damage is estimated at $2,500,000.  This includes damage to the restaurant’s kitchen, exhaust duct and smoke damage to adjacent businesses in the shopping center.

A restaurant cleaning employee described hearing an explosion and tried putting out the fire with an extinguisher.

“The ducting system is designed to move cooking grease and smoke up to the roof where there’s penetration,” said Capt. Terry Seelig, HFD spokesman. Shocked employees watched helplessly as crews worked to contain the fire.

Comments Off on Hospitality Industry Property Risks: Hawaii Restaurant Kitchen Fire Caused By Gas Leak In Deep Fat Fryer; Flames Spread Through Ventilation System Resulting In $2.5 Million In Damage

Filed under Claims, Fire, Insurance, Maintenance, Management And Ownership

Hospitality Industry Health Risks: “Norovirus Food Poisoning” Class-Action Lawsuit Filed Against Wyoming Restaurant; Health Department Report Confirms Outbreak Source

“…according to the WDOH, 31 employees who worked at the Golden Corral restaurant were infected with norovirus while working…the lawsuit was filed on behalf of (those who) purchased food or drink at the Golden Norovirus OutbreakCorral Casper restaurant between November 20, 2012 and December 13, 2012 and (were exposed to) diarrhea and vomiting from multiple employees of the Golden Corral…”

Customers of the Casper, Wyoming Golden Corral filed a class action lawsuit against the restaurant Friday, alleging they were part of a norovirus food poisoning outbreak that was traced to food served at the restaurant in December. The lawsuit was filed in Federal District Court in Wyoming (Case Number 13CV024J) by Jason Ochs of The Ochs Law Firm and William Marler of Marler Clark.

According to a Wyoming Department of Health (WDOH) report, at least 305 patrons of the Casper Golden Corral restaurant became ill with norovirus infections after eating at the restaurant between November 17, 2012 and December 19, 2012. Norovirus infection causes nausea, diarrhea and/or vomiting and is highly infectious. Investigators from the Wyoming Department of Health Infectious Disease Epidemiology Program and Casper-Natrona County Health Department stated in their report that they were not able to determine exactly how norovirus was introduced to the restaurant, but said ill food-handlers could have contributed to the spread of norovirus among Golden Corral patrons.

The complaint states that named plaintiff Paul Feyhl, a Casper resident, ate at the Golden Corral restaurant on December 8, 2012 and subsequently fell ill with norovirus. According to court documents, the lawsuit was filed on behalf of Mr. Feyhl and “others similarly situated” who purchased food or drink at the Golden Corral Casper restaurant between November 20, 2012 and December 13, 2012 and whose exposure to norovirus was caused by:

1.    Exposure from diarrhea and vomiting from multiple employees of the Golden Corral
2.    Consumption of contaminated food and drink prepared by Golden Corral employees
3.    Exposure to, or close proximity with, persons who ate food or drink at the Golden Corral restaurant or were exposed to the restaurant’s infected employees.

For more:  http://www.prweb.com/releases/2013/2/prweb10414517.htm

Comments Off on Hospitality Industry Health Risks: “Norovirus Food Poisoning” Class-Action Lawsuit Filed Against Wyoming Restaurant; Health Department Report Confirms Outbreak Source

Filed under Food Illnesses, Guest Issues, Health, Insurance, Labor Issues, Liability, Management And Ownership, Training

Hospitality Industry Legal Risks: New York Restaurant Sued By Former Delivery Workers For Deducting Money To Pay For “Online Order Service Fees”

“…the judge (stated) that tip deductions “were only permissible to the extent that they ‘did not enrich [the employer], but instead, at most, merely restored it to the approximate financial posture it would have occupied Hospitality Industry Lawsuitif it had not undertaken to collect credit card tips for its employees…the restaurant unlawfully retained almost $17,000 and compared the practice to passing on the cost of rent or materials to delivery workers…”

A lawsuit brought by former delivery workers against an Upper West Side restaurant that deducted money from their tips to pay the service fees of food-delivery Web sites can proceed, a federal judge has ruled. The ruling came in a suit filed against Indus Valley, on Broadway at West 100th Street, where eight former delivery workers say the restaurant kept 12 to 15 percent of their tips when customers placed their orders through services like Seamless and Grubhub.com.

Indus Valley sought to have the suit dismissed. It admitted to withholding the workers’ tips but said the practice was permissible to recoup fees charged by online delivery sites, in the same way that restaurants are allowed to deduct a percentage from tips left via credit card to cover credit card companies’ fees for converting those tips to cash.

But the judge, Alison J. Nathan of United States District Court for the Southern District of New York, rejected both Indus Valley’s argument and its request to dismiss the suit. A representative from Indus Valley declined to comment.

The service agreements with the delivery Web sites included charges for commissions and “advertisement fees,” in addition to  credit card processing fees. The agreements, Judge Nathan wrote, “suggest that Indus Valley deducted from gratuities costs beyond those incurred as the result of converting credit card gratuities to cash.”

A lawyer for the workers, Jane Chung, said that labor law bars restaurants from taking from workers’ tips without an explicit exemption, and said that the judge’s ruling effectively declares Indus Valley’s practice illegal.

For more:  http://cityroom.blogs.nytimes.com/2013/02/05/restaurant-loses-effort-to-have-ex-delivery-workers-suit-dismissed/

Comments Off on Hospitality Industry Legal Risks: New York Restaurant Sued By Former Delivery Workers For Deducting Money To Pay For “Online Order Service Fees”

Filed under Employment Practices Liability, Labor Issues, Liability, Management And Ownership

Hospitality Industry Business Risks: Hotel And Restaurant Companies Must Make Plans For “Natural Disasters” That Comply With Federal Employment And Safety Laws

“…Employers only have to pay em­­ployees for hours actually worked, unless they have a collective bargaining agreement or contractual arrangement that says otherwise. Normally, employees are not entitled to pay for Coastal Floodingwork that was scheduled, but did not occur because of the disaster…Floods and other natural disasters may bring allergens and pollutants to the workplace, triggering possible ADA accommodations. Employees may need time off under the FMLA…”

When Hurricane Sandy roared up the East Coast in October, it brought immense destruction to heavily populated areas. Similarly, the June 2012 derecho storm that tore through the Midwest and Mid-Atlantic produced destructive winds and at least one tornado. People in the Midwest and the South are still dealing with prolonged drought.

All brought business to at least a temporary standstill. Employers must be prepared for a variety of disaster scenarios. And while they focus on getting up and running again, they must still comply with federal em­­ploy­­ment laws.

THE LAW: The Fair Labor Standards Act (FLSA) sets strict wage-and-hour requirements for paying employees—regardless of how high the water rises. Floods and other natural disasters may bring allergens and pollutants to the workplace, triggering possible ADA accommodations. Employees may need time off under the FMLA.

Employers that must clean up their facilities may face hazards requiring worker protections under the Occupational Safety and Health Act.

WHAT’S NEW: In the wake of Hur­­ricane Sandy, the U.S. Depart­­ment of Labor has launched a disaster pre­­paredness page with guidance and contact information for both employers and employees.

Additionally, OSHA provides count­­less resources on handling flood and cleanup hazards in its Fact Sheet on Natural Disaster Recovery.

HOW TO COMPLY: Employers must deal with two very practical matters in the aftermath of a natural disaster: workplace cleanup and paying workers. Federal law affects both.

Cleaning up

A major disaster changes the workplace’s entire environment. Power may be out, gas lines may have ruptured, overhead electrical wires may be dangling. All can be deadly.

Cleanup is hard work. OSHA ad­­vises cleanup crews to use good lifting techniques and take frequent breaks. When lifting heavy objects, employees should work in teams so no one has to lift more than 50 pounds alone.

Make first aid kits readily available. Provide training so employees know how to prevent infection by cleaning and protecting cuts and abrasions. Pro­­tective clothing should include watertight boots with steel toes and insoles, long pants, safety glasses and a hard hat if there’s a danger of falling debris.

If cleanup crews encounter mold, they should wear respirators approved by the National Institute for Occupational Safety and Health.

When handling hazardous chemicals, employees must follow specific instructions for protective clothing.

When moving ladders or scaffolds, make sure employees know to watch for low-hanging power lines. When connecting generators to active power systems, instruct them to shut down and lock main breakers to prevent energizing outside power lines on which utility workers may be working. Have expert electricians inspect lines that are damaged or submerged.

Similarly, if anyone detects a gas leak, ensure they know to evacuate the building and notify utility crews.

FLSA issues

Natural disasters can wreak havoc on payroll operations. Maintain redundant systems to avoid losing payroll records and preserve the ability to issue paychecks. Many payroll companies offer cloud or offsite storage of wage-and-hour data so even if your facility is damaged or destroyed, existing payroll information is preserved.

Generally, employers must meet regularly scheduled paydays, but disasters have a way of upsetting normal routines. Employers that anticipate having difficulty meeting payroll should contact the DOL’s Wage and Hour Divi­­sion at (866) 4USWAGE (487-9243) for guidance.

For more:  http://www.businessmanagementdaily.com/34280/disaster-averted-make-emergency-preparedness-part-of-your-job

Comments Off on Hospitality Industry Business Risks: Hotel And Restaurant Companies Must Make Plans For “Natural Disasters” That Comply With Federal Employment And Safety Laws

Filed under Claims, Employment Practices Liability, Insurance, Labor Issues, Management And Ownership, Risk Management, Training