The United States Department of Labor recently investigated 110 restaurants across the Portland area for possible violations of the Fair Labor Standards Act (FLSA). Restaurants across the nation are notorious for wage and hour violations, and the Portland district director of the Labor Department, Jeffrey Genkos, has stated that restaurants are regularly on the department’s “radar.” Wage and hour violations are common in restaurants partly because the workforce is often vulnerable and accustomed to lower wages. This is no reason or excuse, however, for restaurant owners and managers to take advantage of the workers.
The most recent investigations happened because the Oregon state Bureau of Labor and Industries received 186 separate complaints from restaurant and other food service employees in less than one year, from July 2011 to June 2012. State labor investigators began looking into the complaints for possible FLSA violations and also began making unannounced visits to restaurants across the Portland area.
The results of the investigation thus far are shocking: agents found violations in approximately four out of every five restaurants investigated. The most common violations found involved:
-Incorrect classification of workers in order to deny overtime pay or improper reporting of overtime hours
-Requiring employees to work additional hours off the clock by not paying for work completed prior to clocking in, or ordering an employee to stay and clean up after he or she has clocked out
-Deducting missing cash register money from employees’ paychecks
-Forcing employees to pay for their own uniforms
-Forcing employees to pay for broken equipment
These violations added up to nearly $740,000 in back pay for an estimated 500 restaurant employees. The top two offenders in Portland were Sinju Sushi with a whopping 81 violations and El Indio Mexican Restaurant with 21 violations.
Minimum Wage for Restaurant Employees
Many people believe it is acceptable to pay restaurant workers less hourly wages because they make tips. This is not exactly accurate, however. Under FLSA, minimum wage is $7.25 per hour. Tipped employees may be paid as low as $2.13 per hour as long as their tips cause their hourly pay to total at least $7.25. Therefore, restaurant employees must receive at least the minimum hourly rate plus overtime pay if they work over 40 hours a week. Oregon law is even more stringent than federal law, as the minimum wage in this state is $8.95 per hour as of January 1, 2013. Therefore, restaurant workers’ hourly pay plus tips must equal at least $8.95 per hour to comply with the law.
Since the investigation found that many of the restaurants are violating the federal law requiring $7.25 per hour, those restaurants are very far from complying with Oregon state laws. Investigators plan to continue to monitor the situation by making regular surprise visits to restaurants and ensuring that employees feel safe filing complaints for suspected violations. If you suspect your restaurant has violated state or federal labor laws, do not hesitate to contact us at HKM Employment Attorneys, PLLC.