The recent wage and hour dispute of a popular sports bar chain could not have come at a better time. As Democrats in Congress lobby to raise minimum wage to $10.10 an hour, and the federal wage tip to $7.10 an hour, the labor department has announced a settlement ruling the sports bar chain owes a multi-million dollar amount in back pay, illegal appropriation of tips from servers and other minimum wage and overtime regulations.
The chain has several subsidiaries in nearby Pennsylvania and New Jersey and has allegedly underpaid over a thousand workers. Restaurants and other food establishments have long opposed the raise stating it will result in lost jobs and increased prices on menu items.
According to the labor department, the case represents a landmark achievement in a suit filed against an employer for violation of tip wages. Restaurant proprietors are required to pay the difference if the $2.13 minimum wage an hour of the servers’ tips don’t total $7.25. This has not always been the case. The restaurant has also been accused of violating the time and a half regulation when workers exceed 40 hours weekly.
Labor Department investigations indicated the establishment also had servers to put a percentage of their daily table sales in a pool. It was later found the managers often kept over half the tip pool.
Spokespersons for the sports bar chain has disputed these allegations, but admitted their tipping policies could be revisited. While promising to further implement federal guidelines in complex tip wages, the chain has reached a settlement of $6.8 million.
As part of the agreement, the company will undergo compliance monitoring and publish articles on the obligations of employers to follow wage and hour laws.
Cases of unfair wage and hour violations abound in many states, not just New York and the surrounding area. In this case, the workers received compensation but not all cases end this way. If you are a victim of unfair wage and salary injustice, you have rights under the law and deserve to inform yourself of how to protect yourself from unfair pay practices.
Source: The New York Times, “Sports Bar Chain Agrees to Pay $6.8 Million for Violating Wage Laws” Steven Greenhouse, Feb. 20, 2014