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Overtime Wages in New York City’s Restaurant Industry

July 10th, 2018 Victoria Breese

New York City employees in the restaurant industry, including servers, chefs, sous chefs, bartenders, dishwashers, and others, have increasingly been wrongfully denied their overtime wages. According to the Fair Labor Standards Act (FLSA), overtime pay “must be paid at a rate of at least one and one-half times the employee’s regular rate of pay for each hour worked in excess of 40 hours per week.” When determining the regular rate for a tipped employee, such as a server, all components of the employee’s wages must be considered, including any tip credit. Many restaurant owners illegally avoid paying both tipped and non-tipped employees their rightful overtime wages.

Recent Cases of Overtime Wage Abuse in the Restaurant Industry in New York City

Overtime wage abuses happen frequently in popular New York City restaurants that you have probably enjoyed frequenting. Just last year, an assistant manager at an IHOP restaurant on Staten Island won $40,000 in a settlement for unpaid overtime wages. IHOP wrongly classified her assistant manager position as exempt from overtime pay benefits. However, assistant managers are not always exempt from the overtime wage provisions in the FLSA and New York Labor Laws.

A Subway located at Times Square in New York City reached a similar $42,500 settlement last year when a sandwich preparer alleged that he did not receive overtime pay. He claimed to have worked up to 60 hours a week making sandwiches and preparing toppings. Yet, he never received any overtime pay. Subway has faced many similar lawsuits in the past. Most notably, Subway violated wage payment laws more than any other fast food restaurant in 2014.

Finally, at L & B Spumoni Gardens, a pizzeria located in Brooklyn in New York City, a former cook filed a federal lawsuit last March. While working there for thirteen years, the former cook alleged that the owners often skirted employees of mandatory overtime pay. Despite working up to 75 hour work weeks, the cook claims that he always received the same hourly pay rate. The complaint filed in Brooklyn’s federal court revealed that there are 16 similarly situated employees at the pizzeria.

How Do Restaurants Violate Overtime Wage Laws?

Restaurant owners may knowingly or unknowingly violate these laws in a variety of ways. For example, owners may misclassify certain workers as “management.”. Salaried workers in managerial positions are sometimes exempt from overtime. However, if someone with a managerial title has similar job duties to other employees who do receive overtime pay, such as cleaning or serving food, then he or she also has a legal right to overtime wages. Sous chefs, assistants managers and hosts/hostesses in New York City are often misclassified as exempt orovertime ineligible when, in fact, they are nonexempt and eligible for overtime pay.

Additionally, tipped employees are often illegally denied overtime pay. According to the FLSA, tipped employees must be paid at least $2.13 per hour from the employer. The rest of the hourly pay may come from the tips the employee earns. However, if tips do not equal the federal minimum wage, or $7.25 per hour, the employer must compensate for the remaining amount. This compensation for any remaining amount includes the time and a half hourly rate for any overtime hours.

Earn Back your Rightful Overtime Wages in New York City

Restaurant owners may be in violation of overtime wage laws either with malicious intent or simply ignorance on current labor laws. Regardless, employers are legally accountable to follow all FLSA laws. If you believe you may have a legal claim to unpaid overtime wages in New York City, the Working Solutions Law Firm, located in New York City, can assist you. Contact us today at (646) 430-7930 to schedule a free case evaluation and receive experienced legal counsel.