Huddle House, Inc. has agreed to pay more than $60,000 to 128 employees and to step up compliance with wage and hour laws.
In addition, Labor Department officials assessed $48,317 in civil money penalties for repeat and child labor violations.
The Labor’s wage and hour investigations were initiated under a multiyear enforcement initiative focused on the restaurant industry in Georgia, where widespread noncompliance with the FLSA’s minimum wage, overtime, record-keeping and child labor provisions had been found–particularly among companies that use a franchise business model.
Investigators found that some Huddle House employees did not receive at least the minimum wage because the cash wage paid by the employer plus tips received did not equal minimum wage for all hours worked, and in other cases, employees only received tips and were not paid a cash wage. Additionally, some employees’ pay dropped below the minimum wage because they were required to share tips with non-tipped employees, or because deductions were made for breakage losses, damages and check-cashing fees. Salaried nonexempt employees, such as cooks, were paid a salary that did not equal minimum wage.
Overtime violations involved tipped employees not receiving overtime at the correct rate and salaried nonexempt employees not receiving overtime pay, as well as overtime paid to some employees after 80 hours in a two-week period rather than after 40 hours in a workweek. The child labor violation involved a 15-year-old employee who was allowed to work more hours than permitted by the FLSA, which limits minors to no more than three hours on a school day or 18 hours in a school week.
The investigation covered Huddle House restaurants in Adel, Barnesville, Buford (two restaurants), Calhoun, Cedartown, Dallas, Douglas (two restaurants), Dublin, Elberton, Gray, Jeffersonville, Marietta, Milledgeville, Reidsville, Rockmart, Rome, Royston, Sandersville, Springfield, Summerville, Swainsboro, Sylvania, Toccoa and Waynesboro, Ga.; West Plains, Mo.; and Buckhannon, W.Va.
“This enforcement initiative is aimed at strengthening compliance among restaurants operated as franchises. The division has found many FLSA violations in this highly competitive industry sector resulting from practices, such as requiring employees to work exclusively for tips, paying cash wages that fall below the federal minimum wage, making illegal wage deductions and failing to pay proper overtime compensation to tipped and salaried employees,” said Janet Campbell, director of the Wage and Hour Division’s Atlanta District Office.