The U.S. Department of Labor has secured a consent judgment to recover $1.3 million in back wages, withheld tips, and liquidated damages for 51 workers employed by a Wilkes-Barre restaurant and its owner. The court's decision follows an investigation by the department’s Wage and Hour Division and extensive litigation by the Office of the Solicitor, which identified several violations of federal wage regulations by La Tolteca Wilkes-Barre Inc., operator of La Tolteca Authentic Mexican Restaurant, and owner Carlos De Leon.
The investigation revealed that the employers violated the Fair Labor Standards Act by requiring servers and bartenders to surrender a percentage of their tips based on total sales to the restaurant at each shift's end, rather than contributing them to a valid tip pool. Additionally, they failed to keep records of how the tips were used, making it impossible to prove the validity of the restaurant’s tip pool. Investigators also found that three non-exempt salaried cooks were not paid overtime wages for hours worked over 40 in a workweek.
“Customer tips for good service are the property of the people who earned them, not their employers,” said Wage and Hour Administrator Jessica Looman. “Misuse of all or any portion of tips by management violates workers’ rights.”
The judgment requires La Tolteca Wilkes-Barre Inc. and De Leon to pay $651,778 in back wages and restored tips, plus an equal amount in liquidated damages. They will also pay a $26,443 civil money penalty due to the willful nature of the violations. The consent judgment permanently prohibits future FLSA violations by these employers.
“The outcome of this investigation and litigation shows restaurant industry employers that illegally tampering with their workers’ wages and tips violates their rights and can have costly consequences,” said Solicitor of Labor Seema Nanda.
The Wage and Hour Division’s Wilkes-Barre District Office conducted the investigation while the regional Office of the Solicitor in Philadelphia litigated the case. The division is currently distributing monies owed to affected workers.
Current and former employees who believe they are owed wages are encouraged to use the division’s Workers Owed Wages online search tool or contact the division’s Wilkes-Barre District Office at (570) 826-6316 for inquiries.
The Fair Labor Standards Act mandates that most employees in the U.S. be paid at least the federal minimum wage for all hours worked and overtime pay at not less than time-and-a-half for hours worked over 40 in a workweek.
Employers and workers can call the division confidentially with questions regardless of immigration status. The division offers assistance in more than 200 languages through its toll-free helpline at 866-4US-WAGE (487-9243). The agency’s new Timesheet App is available for Android and iOS devices in English and Spanish to ensure hours worked and pay are accurately recorded.
