A proposed collective and class action out of Massachusetts alleges steakhouse chain Fleming’s has impermissibly taken a “tip credit” against certain tipped workers’ hourly wages.
The 24-page suit says that although an employer may, under certain circumstances, pay tipped employees such as servers and bartenders less than the minimum hourly wage by taking a “tip credit” against their pay obligations, it was illegal for Fleming’s to do so.
In particular, the lawsuit claims that the restaurant failed to properly inform tipped workers in advance of its intention to rely on a tip credit to meet its minimum wage obligations. Fleming’s also required tipped employees to buy certain work-related clothing and perform excessive amounts of non-tipped work, the complaint alleges.
Per the case, workers were paid at a subminimum rate for non-tipped activities that were unrelated to their tip-generating work, such as vacuuming, taking out the trash, doing dishes, chopping fruit, polishing glasses and scraping gum. Moreover, workers were required to spend more than 20 percent of their time on non-tipped tasks that were related to their tipped duties, including rolling silverware, setting tables, refilling condiments and brewing tea and coffee, the complaint relays.
“As a result of these violations, Defendants have lost the ability to use the tip credit and therefore must compensate Plaintiff and all similarly situated worked [sic] at the full minimum wage rate, unencumbered by the tip credit, and for all hours worked,” the lawsuit contends. “In other words, Defendants must account for the differences between the wages paid to Plaintiff and all similarly situated workers and the minimum wage rate.”
When informing an employee about a tip credit, an employer must disclose the amount of the cash wage the individual is to be paid; the amount by which their wages are increased on account of the tip credit; that they will retain the entirety of all tips they receive, except for tips contributed to a valid tip pool; and that the tip credit shall not apply to any worker who is not properly informed, the complaint states. With regard to a tip pool, such is valid only if tips are shared among wait staff or service employees, i.e., those who customarily receive tips and do not have managerial responsibilities, per the case.
Moreover, tipped workers whose pay is subject to a tip credit must be notified that they may not be paid lower than the statutory $2.13 per hour, the filing adds.
According to the lawsuit, defendant OS Restaurant Services operates Fleming’s Prime Steakhouse & Wine Bar locations in 25 states. The plaintiff behind the suit worked at the defendants’ Boston location as a server and bartender from around October 2017 through May 2020 and was paid an hourly wage of less than $5 per hour, the case states.
The lawsuit alleges Fleming’s managers were eligible to receive bonuses based in part on “meeting or exceeding certain labor cost targets,” which the case says “created an incentive to keep the amount paid to tipped employees low.”
The case looks to cover all current and former tipped employees who worked at a Fleming’s Prime Steakhouse & Wine Bar for at least one week within the last three years.
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