A federal court has mandated the operators of four Milwaukee-area chicken franchise restaurants to pay $442,140 to 29 employees. This order follows an investigation by the U.S. Department of Labor. The U.S. District Court for the Eastern District of Wisconsin directed Chicken Palace LLC and Valdemar Escobar, owner of two Milwaukee locations and two in Kenosha and Waukesha, to compensate affected workers with $221,070 in back wages and an equal amount in liquidated damages. Additionally, a civil money penalty of $10,000 was imposed for willful Fair Labor Standards Act violations.

The department’s Wage and Hour Division discovered that from March 7, 2021, through March 8, 2023, the employer violated federal regulations by paying straight-time rates for overtime hours over 40 in a workweek, failing to pay minimum wage, and not maintaining accurate time records.

“Our food service industry investigations too often find employers violating federal overtime, minimum wage and recordkeeping regulations,” said Wage and Hour Division District Director Kristin Tout in Minneapolis. “The Department of Labor will continue to hold employers accountable while making sure every worker is paid what they rightfully earned.”

“Failing to pay workers their required wages hurts employees and results in the entire restaurant community facing unfair competition,” added Regional Solicitor Christine Z. Heri in Chicago. “This outcome should remind employers that the Department of Labor will take appropriate action—including litigation—to protect workers who are denied their pay.”

Chicken Palace LLC and Escobar have agreed to provide employees with information on federal wage protections in languages they speak and are prohibited from future FLSA violations.

The family-owned Fiesta Garibaldi Restaurant Group owns the Chicken Palace brand along with other restaurants operating as Fat Valdy’s, Fiesta Café, and Fiesta Garibaldi Mexican Grill. Only the four Chicken Palace restaurants are involved in this judgment.

Senior trial attorney Travis Gosselin represented the department's Office of the Solicitor in this case.

In fiscal year 2023, more than $29 million was recovered by the Wage and Hour Division for nearly 26,000 food service industry workers nationwide.

The division offers a restaurant compliance toolkit explaining wage laws for both employers and workers. For confidential compliance assistance or if you think you may be owed back wages collected by the division, employees can call their toll-free helpline at 866-4US-WAGE (487-9243).

An app is available for iOS and Android devices to ensure hours worked are accurately recorded.

U.S. Department of Labor v. Chicken Palace LLC

Civil Action No. e 2:24-cv-01124-LA