A recent case brought to light by the U.S. Department of Labor (DOL) reveals the consequences of disregarding labor laws, particularly in the restaurant industry. In Idaho Falls, Idaho, a restaurant was found guilty of multiple violations, including underpayment of wages and improper employment of minors, resulting in a hefty penalty of $319,000.
The investigation, conducted under the Fair Labor Standards Act, uncovered a series of infractions spanning from February 23, 2020, to February 22, 2023. The restaurant in question had paid its servers and bartenders below the federal minimum wage of $7.25 per hour by utilizing tip credits and incorporating customer tips into their hourly wages. Furthermore, the establishment had a tip-pooling system that mandated employees to share their tips with back-of-the-house staff. The restaurant also failed to adhere to overtime pay requirements and breached child labor laws by allowing minors aged between 14 and 15 to work during prohibited hours (Julie A. Su, Acting Secretary of Labor, United States Department of Labor v. Granite Mountain Restaurants, LLC; U.S. District Court for the District of Idaho, Case No. 4:24-cv-00059).
As a consequence, the restaurant is obligated to pay restitution, damages, punitive damages, and penalties totaling $319,000. The U.S. Department of Labor reports that it has recovered more than $1.7 million in unpaid tips for over 1,000 workers in Oregon and Idaho in the past two years and considers wage theft a major concern for employees and restaurant workers alike. This highlights the DOL’s commitment to protecting worker’s rights and enforcing labor regulations and the high cost that can be associated with violations.
We at Idaho Employment Lawyers understand that these laws and regulations are complicated, and it can be hard to manage and ensure compliance. We want to help! As our first Lunch & Learn of the year, Ben and Doug will be going over Hiring Youth Workers & What Your Business Should Be Aware Of. This session will provide valuable insights into navigating the complexities of labor laws, particularly concerning minors in the workforce, and implementing strategies to foster a culture of compliance within your organization. *Please note that this training is not for agricultural organizations or industries.