HR Management & Compliance

Jury to Determine Whether Restaurant’s FLSA Violations Were ‘Willful’

By Kate McGovern Tornone, Editor

A federal district court has determined that a jury should decide whether a restaurant “willfully” violated the Fair Labor Standards Act (FLSA) when it declined to research the law’s requirements and ignored a warning that its compensations policies were not in compliance.

In Alshehabi v. Hymans Seafood Co. No. 2:14-cv-2724 (D.S.C. June 30, 2016), an employee alleged on behalf of a class of 160 waiters, bartenders, and bussers that Hymans Seafood operated a tip pool that ran afoul of the FLSA’s requirements.

The restaurant required servers and bartenders to “tip out” the salad preparer and the dishwasher, according to the complaint. Because the tip pool included employees who do not customarily receive tips, it was invalid, and the restaurant was therefore not entitled to take a tip credit and pay the workers less than minimum wage, the employee alleged.

The complaint also alleged that the employer charged servers and bartenders a $2 breakage fee each shift to compensate the business for broken or missing plates, glasses, and silverware.

Read more.