Tag Archives: Wages

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

Leave a comment

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

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

Leave a comment

Filed under Employment Practices Liability, 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/

Leave a comment

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

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.

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

Leave a comment

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

Hospitality Industry Legal Risks: Florida Hotel Sued By U.S. Dept Of Labor For “Dodging Taxes By Paying Employees Entirely In Cash” And Denying Overtime

“…The U.S. Department of Labor says the Cavalier Hotel and Crab Shack on Ocean Drive owes its employees $160,000 and that owner Ralph Abravaya skirted taxes by paying his employees in tips and refusing them overtime pay…”

“…Department of Labor’s Wage and Hour Division, says a two-year investigation revealed Abravaya had dodged taxes by paying employees entirely in cash. He also underpaid them by denying them overtime when they worked more than 40 hours per week..”

An art deco hotel on South Beach is locked in a battle with the federal government over the kind of accusations that have gotten the 99 percent so riled up recently.

 “Yeah we screwed up,” Abravaya admits to Riptide. “Alright, so slap me in the hand. But don’t tell me you are going to destroy the business or fine me $300,000. If Abravaya loses in court, he will have to pay a total of $320,000 in fines and unpaid wages, plus court costs.

The hotelier admits that a manager did falsify records in an attempt to escape investigation. But Abravaya says he fired the employee as soon as he learned of the deception. He insists that when he took over the hotel and restaurant in 2009, he simply continued the policy set by the previous owner and paid the employees $6 an hour plus their tips — more than they were owed by law.

For more:  http://blogs.miaminewtimes.com/riptide/2012/03/cavalier_hotel_and_crab_shack.php

Leave a comment

Filed under Labor Issues, Liability, Management And Ownership, Risk Management

Hospitality Industry Legal Risks: Massachussetts Hotel Settles Class-Action Lawsuit Over “Withholding Portion Of The 20 Percent Service Charge” Billed To Banquet Patrons

One-third of the 20 percent service charges billed to patrons at banquets was withheld, said Anthony Chavarry of Dalton, who was the whistleblower and leading plaintiff on behalf of the workers.

“…only employees directly involved in service to customers are entitled to share tips — waitpersons, bartenders and buspersons are included. But food and beverage service managers, sales staff and others are not entitled to any portion of gratuities…”

The Crowne Plaza Hotel, owned by the Berkshire Common Corp., has agreed to settle a class-action lawsuit filed at Berkshire Superior Court in November 2009 on behalf of 150 current and former employees who served customers at banquets between November 2006 and June 2010 at the city’s largest lodging establishment.

The $1.3 million settlement, which awaits expected final approval at a fairness hearing May 1, includes legal fees. The workers will share about $850,000, depending upon the amount of time they were employed at the hotel during the period covered by the lawsuit, said attorney Paul Holtzman of the Boston firm Krokidas and Bluestein, which specializes in employment law.

Some employees may see payouts in the tens of thousands of dollars, he said. After the settlement gains the final green light from Berkshire Superior Court, Berkshire Common is required to send out settlement checks by Oct. 17, according to court documents. Copies of the settlement documents are in the mail to the employees affected.

The hotel does not admit any liability, according to the class-action settlement documents.

For more:  http://www.berkshireeagle.com/ci_19954538

Leave a comment

Filed under Labor Issues, Liability, Management And Ownership, Risk Management

Hospitality Industry Legal Risks: Restaurant Group Loses Appeal To Supreme Court Over “Minimum Wage” Lawsuit Regarding “Underpayment Of Tip Income”

Many…employees claimed that, because they spent more than 20% of their time performing duties such as cleaning and prepping, they should earn full minimum wage during hours worked without tips.

Applebee’s turned to the Supreme Court in October seeking to overturn an earlier ruling from a federal court of appeals in Missouri allowing the case to proceed to trial in September. The company claims that prep work and cleanup is part of employees’ tip-earning responsibilities.

The Supreme Court on Tuesday turned down an appeal from Applebee’s International Inc., which is battling a lawsuit from more than 5,500 bartenders and servers accusing the restaurant chain of underpaying them.

The high court declined to hear Applebee’s case, which focuses on a practice in which restaurants pay employees reduced minimum wage by factoring in the extra boost provided by tips.

Known as a “tip credit,” the practice is banned in states such as California and Minnesota but permitted in Missouri, where many of the plaintiffs work.

For more:  http://www.latimes.com/business/money/la-fi-mo-applebees-supreme-court-20120117,0,6981441.story

Leave a comment

Filed under Claims, Labor Issues, Liability, Management And Ownership, Risk Management

Hospitality Industry Legal Risks: Ten Indiana Hotels Named In “Overtime Lawsuit” Involving Housekeepers And Food Service Staff

 “…to get all the rooms cleaned, she didn’t take lunch breaks or worked past the end of her shift…she estimates she is owed $5,200 for unpaid work over the past two years…”

 “…intends to ask the court to make the lawsuit a class action open to more than 1,000 local hotel employees who worked for Hospitality Staffing during the past three years…”

An attorney representing 14 Indianapolis hourly hotel workers plans to file a lawsuit today alleging their employers failed to pay them for overtime. Ten Indianapolis hotels, including some of the city’s largest, and the staffing company for which the employees worked, Hospitality Staffing Solutions, are named in the prepared complaint. Jeffrey A. Macey, an Indianapolis attorney for the workers, said he plans to file the 24-page document today in U.S. District Court in Indianapolis.

Most of the 14 workers making the allegations were housekeepers or food service staff.

For more:  http://www.indystar.com/article/20120109/LOCAL18/201090328/10-Indianapolis-hotels-named-lawsuit-alleging-workers-weren-t-paid-overtime?odyssey=tab%7Ctopnews%7Ctext%7CIndyStar.com

Leave a comment

Filed under Labor Issues, Liability, Management And Ownership, Risk Management, Training

Hospitality Industry Employee Risks: California Hotel Operator Ordered By Labor Commission To Pay “Back Wages And Penalties” For Denying Housekeepers 10-Minute Rest Periods

“…43 of the 80 employees at Embassy Suites Irvine filed formal complaints with the Labor Commissioner about the rest-period issue. Of the seven hearings that have so far been held, all seven workers received awards averaging $5,261 each…”

HEI Hospitality LLC, which manages the 293-room hotel, was recently ordered by a state Labor Commissioner hearing officer to pay $36,827 in back wages and penalties to full-time housekeepers who were denied 10-minute rest periods. The breaks are a legally mandated minimum standard in California.

Those housekeepers earned an average of $8.92 an hour before taxes. Their work included scrubbing toilets and showers, vacuuming, mopping floors on their knees, changing blankets and sheets, cleaning out microwaves, refrigerators and coffeemakers, taking out the trash, wiping down mirrors and counters and changing shower curtains.

The housekeepers said HEI would assign them workloads of 16 or 17 rooms to clean in an eight-hour shift, threaten them with discipline if they did not finish all their work on time and give them extra work such as cleaning hallways if they were seen standing around. Several of them were never made aware, as is required by law, that they had a right to take the breaks.

For more:  http://www.ocregister.com/news/hei-323823-employees-workers.html

Leave a comment

Filed under Labor Issues, Liability, Management And Ownership, Risk Management, Training

Hospitality Industry Employee Risks: Hotel Management Must Establish “Off-The-Clock” Policies For Employee Responses To Business Calls, Texts And Emails

Adding to the complexity of off-the-clock rules are the number of employees who respond to e-mails, text messages or phone calls after their shift is finished. Workers often do so by choice, but the employer could be held liable for overtime should the employees file a later claim.

“Time spent on these activities will likely be deemed compensable,”

One area that has attracted a significant amount of attention in recent years is rest periods; defined as requiring a 10-minute break period for every four hours of work, and meal periods of at least 30 minutes for shifts lasting longer than five hours.

Previously employers were required by law to ensure their employees took breaks appropriately, but it was difficult to manage, particularly for employees who preferred to take a break and conduct personal business at their desk or work station.

In an appeal of a court order in the case of Brinker Restaurant Corp. vs. Superior Court, the appeal reversed the stricter order, ruling that rest and meal breaks need only be made available, and not ensured.

As this is an issue that affects so many people and produced so many lawsuits, the California Supreme Court granted a review of Brinker decision. A final ruling is expected this year.

“We recommend counseling employees to get off the clock and take their break,” Poole said.

There should also be wording describing the break periods the employee is required to take, at the bottom of every time sheet or card an employee signs, Koegle said. Repeatedly signing a time card with the advisory would be one means of acknowledging the law by employer and employee alike.

Employers should include strong written policy in their company employee handbook that nonexempt employees are not expected to work after-hours, and advise their employees of the policy.

Last, companies requiring employees to change in and out of uniforms at the workplace must compensate the employees for the time spent doing so.

Privacy expectations

The recent technology explosion brings a whole new set of complications for employers. The U.S. Supreme Court rules that an employee with a company-issued device such as a cell phone, smart phone or computer has a reasonable right to privacy while using the equipment.

First Amendment rights protect employee messages, even those a company deems objectionable. A company must have a reasonable cause to search text, e-mails or Internet browsing by an employee.

It is expected however that in the next few months the courts will rule in a company’s favor, granting a company the right to prohibit activity such as surfing the Internet for pornography. Employee use of social media, whether performing duties on the job or for personal use, is also a hot topic.

Companies will need to craft well-written employee policies outlining actions that are subject to discipline or termination. The next question will be how policies can be enforced if an employee violates policy after-hours when they are off-duty.

For more:  http://www.the-signal.com/section/36/article/40833/

Leave a comment

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