Laws protecting the wages of tipped workers apply whether they work in restaurants or in grocery stores where food is served. A South Carolina employer learned this expensive lesson after a U.S. Department of Labor investigation.

Investigators with the department’s Wage and Hour Division found that Hang Lung Inc. – operator of H&L Asian Market, a North Charleston business that includes a grocery and restaurant – illegally kept all tips left by restaurant customers. H&L also failed to pay employees overtime as required when they worked over 40 hours in a workweek. The employer’s actions violated the Fair Labor Standards Act.

The division recovered $154,033 in back wages and liquidated damages for 10 employees.

“Tipped employees work hard to deliver good service and earn every tip they receive. When employers keep the tips for themselves and fail to pay the overtime when due, they not only violate federal labor laws but they also deny the workers the respect they are due,” said Wage and Hour Division District Director Jamie Benefiel in Columbia, South Carolina. “The U.S. Department of Labor encourages workers and employers at grocery stores and restaurants to contact Wage and Hour staff if they have questions about rules concerning pay, hours or tips.”                                   

For information about the FLSA and other laws enforced by the division, contact the agency’s toll-free helpline at 866-4US-WAGE (487-9243). Workers can call the Wage and Hour Division confidentially with questions – regardless of their immigration status – and the department can speak with callers in more than 200 languages.  A Restaurant Compliance Toolkit is available for employers seeking additional compliance resources.  Learn more about the Wage and Hour Division, including a search tool to use if you think you may be owed back wages collected by the division.