A recent class action case was brought against BL Restaurant Operations LLC, the company behind the upscale bar and grill chain Bar Louie. The claimants are bartenders employed by the chain, who allege that the salaried restaurant management was taking tips from the pool intended for the hourly-paid bartenders, failing to notify employees of tip credit, and required employees to spend more than 20% of their time engaged in untipped side-work. A number of legal issues brought up by the case are common concerns in the food service industry. Understanding these issues can help employers and employees alike to protect themselves from employment law violations.
Tip pooling. Tip pooling is allowed by many states. Employers can require that employees add their tips into a collective pool, from which each employee is paid a share. Employers cannot require employees to pay in to the pool beyond what is minimum wage, so if a portion of tips is being counted towards the employee earning minimum wage, they must retain those tips. Additionally, owners may not take tips from the pool. In many states, managers are also forbidden from taking tips out of the common pool.
Tip credit. Tip credit is a credit that an employer may take towards the employer’s minimum wage obligation to tipped employees. Currently, the maximum tip credit allowed under federal minimum wage is $5.12 per hour. Claiming this tip credit allows employers to pay tipper workers a minimum of $2.13 per hour, as the rest of the wage is assumed to be made by tips earned. If adequate tips are not earned to meet the minimum wage, the employer is obligated to pay the difference. Failure to notify employees of the tip credit provisions will prohibit employers from paying employees less than the minimum wage.
Side work. Side work constitutes time spent performing tasks other than serving tables, such as cleaning, rolling silverware, restocking, or resetting. These tasks are not tipped work. Employers are allowed to take a tip credit for some time that employees spend on these tasks, however, if an employee spends more than 20% of their time on shift performing these tasks, they must be paid minimum wage for that time.
The claimants allege that BL Restaurant Operations LLC are breaking the law in regards to these legal issues. The alleged actions of the defendant are in violation of employment law, and can earn stiff penalties if the claims are found to be true.
To read more about the lawsuit, click here.
Employment laws are in place to protect employees. If your employer has denied you fair wages, there is help. Experienced Houston employment attorneys can help you fight for your rightful pay. Our team will work hard for the best outcome for you, and we are dedicated to protecting employees who have faced discrimination, wrongful termination, or retaliatory actions. We make every effort to ensure our clients receive fair compensation.
Contact Shellist Lazarz Slobin LLP by calling (713) 352-3433 today to schedule a case consultation.