Tag Archives: Restaurants

by | September 18, 2012 · 6:12 am

Hospitality Industry Legal Risks: Pennsylvania Restaurant Franchise Settles "Class-Action Discrimination Lawsuit"; Employees Denied Promotion Can Get Compensation For "Lost Opportunities"

The lawsuit said that the company relegated black employees to  back-of-the-kitchen work and denied them promotional opportunities…Under the settlement, anyone who worked for Covelli’s Panera franchises from  Jan. 11, 2008, through Jan. 11, 2012, for more than one year, and applied for or  wanted a promotion, can get compensation for alleged lost opportunities…for  each hour worked after their first year, they can get 70 cents — roughly what  they would have gotten through a one-level promotion.

Around 200 to 300 current or former employees of Panera Bread franchisee  Covelli Enterprises stand to get payments under a class action lawsuit  settlement that won preliminary approval from a federal judge at a hearing  today.

Attorney Sam Cordes, who represents Mr. Vines and the class of employees,  told U.S. District Chief Judge Gary Lancaster that the settlement terms will  soon be published in newspapers in areas in which Covelli franchises  operate.

Judge Lancaster gave the settlement his initial nod, though he is expected to  hold a hearing to hear any objections from class members. Neither Mr. Cordes nor the attorney for Covelli would comment after the  hearing. Neither had an estimate of the costs to the firm.

In addition to the payments to black employees, Mr. Vines would get $10,000  and Mr. Cordes $66,000 under the settlement agreement.

Read more: http://www.post-gazette.com/stories/local/region/panera-class-action-settlement-gets-preliminary-approval-653740/#ixzz26pWk7kLY

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by | September 16, 2012 · 7:31 am

Hospitality Industry Legal Risks: Restaurants Forced To Settle "Class-Action Lawsuits" For "Wage And Hour" Claims; Potential Damages Are Double Wages Owed Dating Back 2-6 Years

“… a restaurant  is permitted to require front-of-the house employees to “pool” their tips, the  pool may be illegal if it is shared with employees who interact with customers  only indirectly. And if the pool is illegal, regardless of the reason, the  restaurant can incur enormous liabilities to employees, even if those employees  each collect hundreds of dollars per week in tips, which is often the case…”

The hospitality industry is under siege by attorneys who stand to gain big  fees from huge class-action settlements. The same gains do not apply, however,  to the waitstaff and other restaurant employees on whose behalf these lawsuits  are filed.

On a federal level, wage and hour claims are brought under the Fair Labor  Standards Act, passed in the 1930s to address intolerable conditions, such as  child labor and six-day workweeks of 10- to 12-hour days without overtime pay.  Such conditions were long ago eradicated from most restaurants and other  establishments, but the FLSA, as well as state wage and hour laws, have  continued to expand by prohibiting common practices that many eateries have  followed for years.

When faced with class actions, most restaurants have few options. Potential  damages often amount to double the wages or tips owed, dating back from two to  six years. Prejudgment interest rates can be as high as 9%, depending on the  state, and plaintiffs’ “reasonable” attorneys’ fees can be enough to put many  operations out of business. Not included here are the costs of defense counsel,  the hit to the restaurant’s reputation, and the disruption of daily operations.  For many owners, settling the plaintiffs’ claims, regardless of their merit, is  the most reasonable business decision.

Read more: http://www.crainsnewyork.com/article/20120916/OPINION/309169972#ixzz26e5yTkfQ

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by | September 13, 2012 · 6:15 am

Hospitality Industry Legal Risks: Illinois Restaurant Sued For "Negligence" After Repairman "Set On Fire" By Employee; Seeks $50,000 In Damages

“…a recently filed lawsuit argues the East China Inn was negligent, and seeks more than $50,000 in damages…the man was standing on top of the stove inspecting a sprinkler system and changing a fuse…he needed medical treatment for a year…”

A fire suppression repairman has sued the East China Inn restaurant on Randall Road in Batavia, arguing he was set on fire while working during an October 2010 visit. Matthew Rapp, 25, of Oak Forest sustained severe burns to his left leg after someone turned on a wok while Rapp was atop a stove fixing fuses, his attorney said.

“He got burned quite badly,” said attorney Matt Willens, adding Rapp was burned mostly on his left leg from his ankle to his knee. “Because of the burn, he missed 21 weeks of work. He was burned by grease.”

The suit states that Rapp visited the Chinese restaurant on Oct. 12, 2010, for his job with Fire Science Techniques. “A restaurant employee turned on the stove or continued to work on the stove that the plaintiff was working above which set the plaintiff on fire,” the lawsuit states.

For more: http://www.dailyherald.com/article/20120912/news/709129713/

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by | September 8, 2012 · 6:10 am

Hospitality Industry Employee Risks: Restaurant Owners Use "Written Integrity Tests" To Limit High Costs Of "Employee Theft And Drug Use"

“…restaurant  owners  must address ethical issues when evaluating job applicants for  employment.  Historically, employers have relied upon reference checks,  criminal background checks and interviews to address these issues…now a growing number of restaurant owners use written integrity testing  to improve their  ability to screen  out high risk job  applicants…”

Employee theft and other forms of counterproductivity are highly significant  factors in determining the success of restaurants.  While employers tend to  have some awareness of the frequency with which employees engage in theft, drug  use and other counterproductive behaviors, the following research findings are  helpful in providing an objective  perspective of  how  frequently  these problematic behaviors occur:

  • The National Restaurant Association recently reported that the cost of  employee theft for its members is $8.5 billion annually or approximately 4  percent of food sales.
  • A study released in 2007 by the U.S. Substance Abuse and Mental Health  Administration indicated that the highest rate of illicit drug use occurs among  restaurant workers. A whopping 17 percent admitted to illegal drug use in the  last month.

Extensive research documents that integrity tests are good predictors of  whether an individual will engage in various forms of workplace  counterproductivity (e.g., theft, illegal drug use).  Also, these  assessments do not adversely impact minority candidates, which is a major  downside to criminal background checks.  Further, integrity tests are  relatively inexpensive and can be easily administered online. As a result, high  risk applicants can be screened from contention before wasting time and money on  interviews, criminal background checks and reference checks.

Read more at  http://www.business2community.com/human-resources/screening-job-applicants-to-minimize-employee-theft-and-other-forms-of-counterproductivity-in-the-restaurant-industry-0274014#MbysIc4cypbhdqY1.99

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by | September 7, 2012 · 6:20 am

Hospitality Industry Employment Risks: Florida Restaurant Group Faces Lawsuit For "Failing To Pay Minimum Wages" And Forcing Employees To Work "Off-The-Clock" (Video)

The lawsuit accuses the Orlando, Florida-based company of failing to pay federally mandated minimum wages and forcing its waiters and waitresses to work “off-the-clock” before or after their shifts.

[youtube=http://www.youtube.com/watch?v=PoEWJzbMDw0]

The lawsuit accuses the Orlando, Florida-based company of failing to pay federally mandated minimum wages and forcing its waiters and waitresses to work “off-the-clock” before or after their shifts.

Darden Restaurants Inc, best known for its Olive Garden and Red Lobster chains, was hit with a lawsuit in federal court in Miami on Thursday accusing one of the largest U.S. restaurant operators of violating federal labor laws by underpaying workers at its popular eateries across the country.

Filed under the Fair Labor Standards Act, it also claims many Darden employees have failed to receive appropriate overtime wages for work in excess of 40 hours per week.

Only two plaintiffs are named in the 19-page complaint filed on Thursday in U.S. District Court for the Southern District of Florida.

For more:  http://in.reuters.com/article/2012/09/06/usa-darden-lawsuit-idINL2E8K6HAN20120906

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by | September 6, 2012 · 6:07 am

Hospitality Industry Legal Risks: California Restaurant Chain Faces Class Action Lawsuit For "Race, Color And Age Discrimination"

The suit alleges that In-N-Out Burger “recruits, hires and maintains a work force that is predominantly under the age of 40 and/or non-African-American.”…the suit also seeks back pay as well as compensatory damages and punitive damages on behalf of people who have been unlawfully denied employment with In-N-Out Burger.

A Berkeley law firm has filed a class action lawsuit alleging that Irvine-based restaurant chain In-N-Out Burger maintains hiring practices that discriminate on the basis of race, color and age. The suit, which was filed in Alameda County Superior Court on Tuesday, was filed on behalf of two black men from Oakland over the age of 40 who recently applied for jobs at In-N-Out Burger restaurants in Oakland and San Francisco but weren’t hired.

The suit says both men were qualified for the jobs they applied for and alleges that they weren’t hired because of their race and their age.

The restaurant chain has 210 restaurants in California and thousands of employees but the suit charges that “very few” are over 40 and/or black.

Steve Tidrick, the attorney for the plaintiffs, said the suit alleges that In-N-Out Burger has “a pervasive policy of discrimination on the basis of race, color and age” in its hiring practices and seeks to end those practices through injunctive relief.

For more:  http://www.mercurynews.com/breaking-news/ci_21477996/oakland-lawsuit-accuses-n-out-burger-racial-and

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by | September 5, 2012 · 6:17 am

Hospitality Industry Legal Risks: Georgia Restaurant Group Settles Alcohol-Related "Wrongful Death Lawsuit" For $1.1 Million; "Post-Shift Drinking By Employees Is Rampant In Restaurant Industry"

 “It is rampant in the restaurant industry…it is a
culture of post-shift drinking, and in some restaurants, drinking during the
shift. It’s almost like a fringe benefit in some high-end restaurants, this
tradition of drinking after work.”

Husk’s owner, Marietta, Ga.-based Neighborhood Dining Group Inc., and its insurer agreed last month to settle the suit for $1.1 million. The company denied fault or liability.

The fiery crash and lawsuit also have put restaurants across the USA on notice that a tradition at many restaurants — in which employees share a drink after work in a spirit of camaraderie — can have devastating consequences.

The 4 a.m. crash occurred last December, when Adam Burnell, 32, an assistant manager and sommelier at Charleston’s Husk restaurant, allegedly drove his Audi into the back of a Mustang driven by Quentin Miller, 32. The crash slammed Miller’s car into a concrete wall; it erupted in flames, trapping him inside. He died at the scene. Burnell, who prosecutors said had a blood-alcohol level of 0.24%, three times the legal limit, was charged with felony driving under the influence.

Miller’s family filed a wrongful-death lawsuit, alleging that Husk allowed Burnell to drink to excess on its premises after hours and then drive drunk. It was a stumble for a restaurant that was named “Best New Restaurant in America” by Bon Appetit magazine months earlier. Husk also was ranked one of the “101 Best Places to Eat in the World” by Newsweek magazine last month.

Burnell, who sustained minor injuries and is awaiting trial, was not named as a defendant.

Neighborhood Dining Group already had a policy that prohibits employees of its four restaurants — three in Charleston and one in Atlanta — from drinking on the premises, President David Howard says.

For more:  http://www.usatoday.com/news/nation/story/2012-09-04/restaurants-drinking-lawsuit-crash-south-carolina/57586486/1

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by | September 3, 2012 · 6:18 am

Hospitality Industry Theft Risks: Wisconsin Restaurant Employee Arrested For "Cashing Two Unauthorized Businsess Checks" In His Name

“…the owner of Espana Restaurant and Bar discovered Johnson had cashed two unauthorized checks from the business in his name for $160 and $350…the checks were kept in a locked desk drawer in the basement of the business and were pre-signed to pay vendors…”

A 37-year-old Wauwatosa man is facing charges after he allegedly stole two checks from his employer and then cashed them in his name. Dana James Johnson was charged Thursday in Milwaukee County Circuit Court with one count of theft. If convicted, he faces up to nine months in prison and $10,000 in fines.

Officers then went to Community Financial, 4525 W. North Ave., where they found security video footage of Johnson coming into the bank and cashing the checks.

For more:  http://wauwatosa.patch.com/articles/tosa-man-charged-with-stealing-checks-from-a-milwaukee-restaurant

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by | August 29, 2012 · 1:15 am

Hospitality Industry Legal Risks: Hotel And Restaurant Owners Should Maintain "Employment Practices Liability Insurance" And Institute Complaint Procedures To Reduce Employee Lawsuits

 “…these suits catch employers by surprise since, even if they terminate an employee for a business reason, every separated employee can claim discrimination on the basis of a protected class such as race, gender or sexual orientation…”

Employers who can afford it purchase Employment Practices Liability Insurance (EPLI) to protect their businesses.

In the last three to four years, HR lawsuits have been on the rise, and unfortunately, there does not seem to be any end in sight. The U.S. Department of Labor reports the number of lawsuits related to the Fair Labor Standards Act, alone, increased 35 percent in three years. And this is only one small area that an employer can be sued. The following steps can be taken to minimize lawsuits:

  • Your employee handbook must contain broad and multi-tiered complaint procedures so employees have sufficient recourse when they feel victimized by harassing or discriminating behavior.
  • Provide annual employment law training to all of your supervisors and require them to sign acknowledgments.
  • Educate your employees at the time of hire – during orientation, for instance – about the avenues open to them should they have a problem and need to complain.
  • Most critically, take prompt remedial action when someone complains. In other words, do something about it within 48 hours or less of receiving the complaint. It is best to seek legal advice when such a complaint occurs.

For more:  http://www.floridatrend.com/article/14575/more-employees-are-suing-employers

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by | August 23, 2012 · 6:05 am

Hospitality Industry Legal Risks: Wisconsin Restaurant Owners Sued For $550,000 For "Negligence" In Alcohol-Related Shooting Death Of Patron

“… the defendants (are accused) of violating the Illinois Wrongful Death Act… were negligent for failing to take reasonable actions to protect customers, allowing a patron with weapons to be on the premises and allowing people inside the restaurant who were “quarrelsome, disorderly, hostile and vicious.”

The family says they have lost their means of support while also suffering a loss of society, consortium, guidance and companionship. The Ortizes ask to be awarded more than $550,000 in damages plus courts costs.

A Pontoon Beach restaurant is accused of causing the death of a Granite City man who was shot and killed there last year. Brenda Ortiz, as special administrator of the estate of Jesus Ortiz-Flores, and Luis F. Ortiz filed a lawsuit Aug. 15 in Madison County Circuit Court against La Mexicana Inc., also known as La Mexicana Restaurant Inc., Orlando Gudino, Berzain Gudino and Oscar Guidno. Choteau Properties Inc. is also listed as a defendant.

The 37-page lawsuit stems from a shooting that happened at La Mexicana on Chouteau Trace Parkway in Pontoon Beach on August 19, 2011, the suit states. According to statements made by police to media immediately following the incident, Jesus Ortiz-Flores, 20, was shot once in the head in the parking lot of the La Mexicaca restaurant and died immediately. Plaintiff Luis Ortiz, who was 18 at the time, was allegedly shot multiple times during the incident but survived.

Brenda Ortiz and Luis Ortiz accuse La Mexicana restauraunt, the owners and managers and Choteau Properties, the owner of the building, of directly contributing to the shootings. The Ortizes contend the restaurant served alcohol to the alleged shooter, Fernando Gallegos, 17, allowing him to become intoxicated and then attack Ortiz-Flores, causing his death. They say the defendants’ actions constitute a violation of the Illinois Dram Shop Act.

For more:  http://www.madisonrecord.com/news/246266-la-mexicana-restaurant-in-pontoon-beach-sued-over-shooting-death

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