The U.S. Department of Labor obtained a judgment ordering the owner of La Tolteca Authentic Mexican Restaurant in Pennsylvania to pay $1.3 million in back wages, withheld tips, and damages.
Determines that La Tolteca Authentic Mexican Restaurant improperly withheld tips from employees.
WILKES-BARRE, PA (STL.News) The U.S. Department of Labor has obtained a settlement order that provides for the repayment of $1.3 million in unpaid wages, withheld tips and liquidated damages to 51 workers at a Wilkes-Barre restaurant and its owner whose wage practices illegally removed workers their full wages.
The ruling was handed down in the U.S. District Court for the Middle District of Pennsylvania and followed an investigation by the Department’s Wage and Hour Division and a lengthy litigation by the Department’s Office of the Attorney General, which found multiple violations of federal wage laws by La Tolteca Wilkes-Barre Inc.Operator of Authentic Mexican Restaurant La Toltecaand owner Carlos De Leon.
The Department found that La Tolteca Authentic Mexican Restaurant and its owner had violated the Fair Labor Standards Act by requiring servers and bartenders to give a percentage of their tips, based on their total sales, to the restaurant at the end of each shift rather than depositing them into a valid tip pool. The employers did not keep records of how the tips were used and therefore could not prove that the restaurant’s tip pool was valid. Investigators also found that the employers had failed to pay three non-exempt cooks overtime wages for working more than 40 hours per workweek, as required by law. Before entering judgment, the court agreed with these findings and granted the Department’s motion for summary judgment.
“Tips for good service belong to the people who earned them, not the employers,” said Jessica Looman, director of the Wage and Hour Administration. “Management misuse of all or part of the tip violates workers’ rights. This is a widespread problem in the food service industry, and the U.S. Department of Labor remains committed to ensuring that all workers receive the full wages they are entitled to and that companies do not gain an unfair advantage over law-abiding competitors.”
The ruling requires the restaurant and De Leon to pay the affected workers $651,778 in back wages and tips, as well as liquidated damages. The employer must also pay a civil penalty of $26,443 because the violations were willful. The consent judgment permanently prohibits the employers from future FLSA violations.
“The outcome of this investigation and litigation shows employers in the food service industry that illegal manipulation of their employees’ wages and tips violates their rights and can have costly consequences,” said labor attorney Seema Nanda. “The U.S. Department of Labor will use every tool available, including litigation, to prevent employers from withholding wages from their employees.”
The investigation was conducted by the Wilkes-Barre District Office of the Division of Wage and Hour. The Philadelphia Regional Office of the Solicitor conducted the trial.
The department is currently distributing amounts owed to the workers affected by this investigation. Current and former employees who believe they are owed wages are encouraged to use the department’s online “Employee Wages Owed” search tool to claim their unpaid wages or contact the department’s Wilkes-Barre district office at (570) 826-6316 with questions.
