Companies are always looking for ways to cut costs and Darden, the corporate giant that owns popular restaurant chains like Olive Garden and Longhorn Steakhouse, has found a way to save itself approximately $5 million per year, according to a recent report conducted by Restaurant Opportunities Center (ROC) United, a worker organization. Unfortunately, the report alleges these savings for the company come from stiffing their workers, approximately half of whom are paid via debit card.
Debit cards have become a popular way to pay employees, especially those who earn minimum wage. It saves the employer millions and makes more millions for the company distributing the debit cards, all while milking more from the workers who earn so little to begin with that they often qualify for public assistance, even though they work full time.
Employers like Darden, who hire hundreds of thousands of low-earning employees, claim the debit card payment style is beneficial to both workers and employers because it saves workers from bank fees when they cash their paychecks. But the debit cards come with their own fees. According to the ROC United report, the debit cards used by Darden charged users $1.75 every time they withdrew money from an ATM that was out of their network, 99 cents when they used the card to pay utility bills, and 75 cents just to check the card’s balance. A worker who loses their debit card has to pay $10 to get a new one.
But the debit card company isn’t the only one charging fees. When employees get cash from an out-of-network ATM, the ATM itself adds another charge to the user’s cost of accessing their money. The ROC United report found that the ATMs were charging an additional $2.88 on average. This means employees are paying almost $5 every time they try to cash a check. Approximately half of the more than 70,000 workers Darden pays via debit card allegdly do not live or work near an in-network ATM, which means they have no choice but to pay the additional fees.
Many of the workers also reported having a hold placed on their cards after using them to buy gas at a gas pump. Gas stations adopted this practice a few years ago to avoid theft when gas prices went up to almost $4 per gallon. Gas stations typically freeze $50, but can freeze as much as $100 at a time. For workers earning minimum wage, this can mean the next time they try to pay for something with their debit card, it will show up as having insufficient funds. Then the debit card company will allegedly charge the employee another 50 cents for their card getting declined.
Darden denies the findings of the ROC United report except for the ATM fees and the fee of 50 cents for each time the card is denied. Darden says that, as of June 1, the 50-cent fees will no longer be charged and that 29,000 ATMs have been added to the network, which currently has 50,000 machines. Darden also denied that managers have told workers that they have to be paid via debit card, saying that directly contradicts the company’s payroll policy.
The Chicago class action and employment law attorneys at the Chicago Overtime Law Center have three decades of experience fighting to help employees who are victims of wage, overtime and tip theft by their employers. We have a team of Chicago unpaid overtime lawyers who concentrate on prosecuting state and nationwide class action lawsuits. Our attorneys work out of Chicago and Oak Brook offices and pursue claims for workers all over the Chicago area including Bartlett and Crystal Lake. We protect unpaid workers who haven’t received overtime throughout the Chicago area including in DuPage, Kendall, Lake, McHenry, Kane and Cook Counties.
Our Cicero and Joliet overtime and employment lawyers are intimately familiar with the issues that arise during wage claim litigation, and we know the laws that govern overtime cases well. Many employers mis-classify employees as being exempt from overtime laws and pay workers salaries instead of hourly wages in order to avoid paying them overtime. Some employers mistakenly classify employees as exempt and others intentionally do so in order to circumvent the law. In either case, workers do not receive the wages they should, and a lawsuit may be the only way to recover their earned wages.
The Chicago Overtime Law Center is based in Chicago and Oak Brook, and represents clients throughout the country who have unpaid overtime and other employment right claims.