Reports indicate that the restaurant chain, TGI Fridays has agreed to settle a wage and hour class action suit for $19.1 million. The lawsuit asserts that the chain underpaid many of its employees in violation of the Fair Labor Standards Act (FLSA) for many years. Included in the settlement are bussers, wait staff, runners and bar tenders.
The FLSA sets forth numerous provisions protecting workers, including minimum wage and overtime pay requirements, as well as specific guidelines concerning tipped workers. For example, tipped employee must be paid minimum wage. However, if he or she customarily and regularly receives more than $30 per month in tips, then an employer is only required to pay $2.13 per hour in direct wages if that amount combined with the tips received at least equals the federal minimum wage. If the combined amount is less than minimum wage, the employer must make up the difference.
Further, employers may require that employees take part in a "tip pool" (where all tips are shared), however, the arrangement may only be among employees who customarily and regularly receive tips, such as waiters, waitresses, bellhops, counter personnel (who serve customers), bussers, and service bartenders. Those who don't customarily and regularly received tips, such as restaurant managers, dishwashers, cooks, chefs, and janitors are not entitled to share in the pool.
Here, the complaint asserted that TGI Friday failed to pay all overtime wages, forced tipped workers to share their earnings with non-tipped workers, and failed to keep proper wage records.
Roughly 28,000 former workers will receive a portion of the payout.
For more information, or if you have any wage or hour question, please do not hesitate to contact our Atlanta wage and hour lawyers at Buckley Beal, LLP for an immediate consultation.