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DOL Wage and Hour Investigation Forces South Florida Restaurants To Pay Nearly $700K in Back Wages

December 5, 2011

Wage and hour issues are a growing problem in workplaces around the country, as our Irvine, California employment lawyers blog frequently discusses, especially in low wage industries where minimum wage, overtime payment and record-keeping requirements are often overlooked--a violation of the Fair Labor Standards Act (FLSA).

As managing partner of Howard Law, PC, Vincent Howard recently reported on the U.S. Department of Labor's ongoing enforcement initiative, under the Wage and Hour Division (WHD), targeting the restaurant industry in various states across the country--where comprehensive noncompliance with the FLSA's overtime, record-keeping and minimum wage provisions have been found.

According to a DOL press release, in 2011, the WHD conducted a thorough investigation of 34 full-service restaurants in South Florida, recovering $664,704 in back wages for 271 employees of the restaurants. The WHD also assessed civil money penalties in the amount of $14,520 in penalties, for employers who willfully repeated FLSA laws.

The common FLSA employer violations that were found during these wage and hour investigations were paying employees cash wages or off-the book payments with no record-keeping, requiring employees to work for tips only or for a fixed payment for all hours worked instead of paying minimum wages or overtime payment, requiring managers to participate in a tip pool, and falsifying the time and payroll records of employees.

Under federal labor laws, employers are required to pay workers $7.25 per hour, the national minimum wage, for nonexempt employees covered under the FLSA. Employees are also required under federal law to receive overtime compensation that is one and one-half the employees' regular rates of payment, which includes bonuses, commissions, and any incentive pay for all hours worked beyond a forty-hour work week. The FLSA also requires that employers keep clear time and payroll records for each employee.

As our Santa Ana employment attorneys blog has also recently reported, under the FLSA, employers are only obligated to compensate tipped employees $2.13 per hour in wages if that amount plus any tips the employee receives totals at least $7.25 per hour, the minimum wage. If the combination of the employee's tips and the employer's direct wages do not total the minimum wage--the employer is responsible for covering the wage difference. Employers are also allowed to create a tip pool or sharing arrangement among employees who regularly receive tips--but this may not include employees who do not regularly receive tips, such as cooks, chefs, janitors, or dishwashers. Also, any deductions in employee paychecks for customer walkouts, broken dishes, or cash shortages are illegal if they reduce the wages of the employee to below the minimum wage.

US Labor Department initiative nets more than $682,000 in back wages, penalties for labor law violations affecting 271 South Florida restaurant workers, U.S. Department of Labor Press Release, December 1, 2011

Related Web Resources:

U.S. Department of Labor: Wage and Hour Division (WHD), Fair Labor Standards Act (FLSA)

Department of Labor (DOL): Wage and Hour Division (WHD)

Related Blog Posts:

DOL Continues Long Island Wage and Hour Enforcement Initiative to Stop FLSA Violations, California Employment Lawyers Blog, December 3, 2011

DOL Recovers Over $2.3M in Wage and Hour Back Wages for 578 NY Restaurant Workers, California Employment Lawyers Blog, November 30, 2011

Restaurant Pays $83K in Back Wages for Overtime, Minimum Wage Violations of FLSA, California Employment Lawyers Blog, November 17, 2011

DOL Forces Wok King Restaurant to Pay $531K in Wage and Hour Violations, California Employment Lawyers Blog, October 10, 2011

DOL Continues to Track Down Federal Wage and Hour Law Violations in the Workplace, California Employment Lawyers Blog, September 8, 2011

CA Wage and Hour Lawsuit Settlement--66 Japanese Employees to Receive $145K in Overtime Back Wages, California Employment Lawyers Blog, August 22, 2011

Another DOL Investigation Brings Restaurant Employees $275K in Overtime Back Wages, California Employment Lawyers Blog, July 18, 2011

Taqueria Restaurant to Pay Workers Nearly $250K in Overtime Back Pay and Minimum Wages, California Employment Lawyers Blog, June 15, 2011

NY Pizzerias Found in Violation of the Fair Labor Standards Act, California Employment Lawyers Blog, April 23, 2011

Feds Crack Down on Wage and Hour Violations in NY Restaurants, California Employment Lawyers Blog, April 15, 2011

DOL Wage and Hour Division Audits for Low Wage Industry Violations, California Employment Lawyers Blog, July 20, 2010

New Study Reveals More Abuse of Low-wage Workers in Los Angeles, California Employment Lawyers Blog, January 11, 2010