Last month, El Azteca, a Wisconsin business which owns four restaurants, reached a consent judgment in U.S. District Court to resolve a lawsuit filed by the U.S. Department of Labor. The U.S. Department of Labor’s Wage and Hour Division conducted an investigation and discovered numerous violations of the Fair Labor Standards Act.  The violations included:

–          Failing to keep records of daily and weekly hours worked.

–          Failing to pay employees the federal minimum wage for all hours worked.

–          Failing to pay overtime.

–          Paying kitchen staff, a flat salary without regard to numbers of hours they worked.

–          Making illegal deductions from servers’ pay for uniform shifts, nametags and aprons.

Under the consent judgment, the restaurant will pay 129 current and former employees $350,000 in back wages, and $350,000 in liquidated damages.  The defendants will also be paying $25,000 in civil penalties.  Additionally, the restaurants are now required to provide to employees:

1)      Several wage and hour division publications in both Spanish and English;

2)      The Wage and Hour division’s phone number; and

3)      Each pay day, a pay stub showing the pay period, hours worked, rate of pay, overtime hours worked, overtime rate and all deductions.

The FLSA provides that employers who violate the law are generally liable to employees for any back pay, and an equal amount of liquidated damages. The law also prohibits employers from retaliating against employees who exercise their rights under the law.

I have blogged in the past about FLSA issues in the food service industry. The Department of Labor has targeted their investigative efforts on FLSA violations.  Take this opportunity to:

1) confirm your business is accurately tracking hours worked and maintaining records of hours worked;

2) all employees are being compensated correctly; and

3) all your required posters are up to date.