Four Minneapolis restaurants, operating under shared ownership, are set to pay $105,784 in back wages, damages, and penalties following an investigation by the U.S. Department of Labor. The department's Wage and Hour Division found that Boludo Holding Co., along with its owners Jerad Rassmussen and Facundo Defraia, violated the Fair Labor Standards Act (FLSA) overtime provisions. This affected 51 employees who were deprived of $44,915 in earned overtime wages across Boludo El 38, Boludo Downtown, Boludo Uptown, and Boludo Como locations.
In addition to withholding overtime pay, one employee at the Uptown restaurant was terminated after cooperating with investigators. "Retaliating against workers who engage in protected activities...is a blatant violation of the law that we will not tolerate," stated Kristin Tout, Wage and Hour Division District Director in Minneapolis.
The restaurants owe $44,915 in back wages and an equal amount in liquidated damages. Additionally, they face $15,954 in civil money penalties for child labor and tip retention violations.
The investigation revealed several violations of the FLSA: including managers in a tip pool meant for servers; failing to combine hours worked at multiple locations for overtime calculations; allowing workers to use false identities to avoid paying overtime; paying straight-time rates for overtime hours; not maintaining accurate employment records; and failing to properly distribute tips or maintain records of such payments.
Kristin Tout highlighted the impact of these practices: "Too often...employers violate federal overtime...regulations while workers remain unaware of their rights or afraid to question whether their paychecks are accurate."
As part of the resolution, Boludo has agreed to implement a worksheet for payroll processing that ensures compliance with FLSA regulations regarding overtime pay.
In fiscal year 2024 alone, the Wage and Hour Division recovered over $35 million in back wages for more than 27,500 food service industry workers nationwide. In Minnesota over the past five years, $2.46 million was recovered due to similar violations affecting 865 food service workers.
For more information on wage laws or assistance with compliance issues, employees and employers can contact the agency's helpline or utilize resources like their Timesheet App available on iOS and Android devices.
