A diner in a Philadelphia suburb must return $1.35 million in back wages and damages to more than 100 employees after it used its waiters’ tips to pay its bussers’ wages, the Department of Labor announced Wednesday.
Federal Judge Eduardo Robreno ruled last month that Empire Diner in Lansdowne, Pennsylvania, “willfully” violated labor laws and ordered it and two defendants – the owner and a manager – to pay $675,626.67 and an equal amount in damages to the affected employees, totaling $1.35 million. Empire Diner said it plans to appeal the decision.
A Labor Department investigation found Empire Diner violated minimum wage, overtime and recordkeeping laws. The chief offense was skirting tip credit requirements by using the service staff’s tips to pay for bussers’ wages, according to the Department of Labor.
The department first filed a lawsuit against the restaurant in 2018. The restaurant's website indicates it operates a single location.
Empire Diner required its servers to give 10-15% of their tips to the restaurant at the end of their shifts for a tip pool. The servers were paid a cash wage of $2.83 per hour while the restaurant claimed a tip credit for the difference between the cash wage and the federal minimum wage of $7.25 an hour. But Empire Diner retained some of the tips to pay the bussers' wages and not for a valid tip pool, according to court documents.
Empire Diner in Pennsylvania to pay $1.35 million for illegal tip pool (usatoday.com)
Federal Judge Eduardo Robreno ruled last month that Empire Diner in Lansdowne, Pennsylvania, “willfully” violated labor laws and ordered it and two defendants – the owner and a manager – to pay $675,626.67 and an equal amount in damages to the affected employees, totaling $1.35 million. Empire Diner said it plans to appeal the decision.
A Labor Department investigation found Empire Diner violated minimum wage, overtime and recordkeeping laws. The chief offense was skirting tip credit requirements by using the service staff’s tips to pay for bussers’ wages, according to the Department of Labor.
The department first filed a lawsuit against the restaurant in 2018. The restaurant's website indicates it operates a single location.
Empire Diner required its servers to give 10-15% of their tips to the restaurant at the end of their shifts for a tip pool. The servers were paid a cash wage of $2.83 per hour while the restaurant claimed a tip credit for the difference between the cash wage and the federal minimum wage of $7.25 an hour. But Empire Diner retained some of the tips to pay the bussers' wages and not for a valid tip pool, according to court documents.
Empire Diner in Pennsylvania to pay $1.35 million for illegal tip pool (usatoday.com)
