It is common practice in the United States for certain service employees to receive tips, such as bartenders and waiters. Because these employees receive tips as part of their compensation, their employers are permitted to pay them at a rate below the minimum wage, although this only holds true if the employee’s wages and tips add up to at least the required minimum wage.
Banquet servers are usually not included in this category. Instead, they get paid a flat hourly rate which is usually above the minimum wage. This is legal so long as the customers are not charged for what they are led to believe are tips for the servers when, in fact, the servers do not receive tips.
This allegedly happened at banquet halls owned by Mallozzi Group. Ryan Picard, a former banquet server for the restaurant and banquet company, recently filed a class action wage and hour lawsuit against his former employer. According to Picard, Mallozzi Group allegedly charged is customers a “20 percent service personnel charge” when renting out banquet halls. Although the servers never saw any of that money, Picard alleges that any “reasonable” customer would be led to believe that the money was a gratuity charge for the waiters.
Picard further alleges that he and other banquet servers for Mallozzi Group were told to lie to customers. If a customer asked a server if they received tips, the server was “to respond, as instructed by the defendants, that they did receive tips.”
The complaint points to a recent decision by the New York Court of Appeals which states that, any “charge purported to be gratuity must be distributed in full as gratuities to the service employees or food service workers who provided the service.” Similarly, New York’s tip-appropriation law states that all tips are to be paid directly to the servers. Employers in the state of New York are not allowed to “demand or accept, directly or indirectly, any part of the gratuities received by an employee, or retain any part of a gratuity or of any charge purported to be a gratuity for an employee.”
Based on this New York law, and previous decisions reached by New York courts, Picard alleges that, as a result of the mandatory service charge, he and other similarly situated workers are entitled to more than $1 million in unpaid tips.
Bobby Mallozzi, one of the owners of Mallozzi Group, which owns and operates a banquet hall in Rotterdam, New York, a restaurant and banquet hall in Albany, New York, and food service operations at two golf courses in addition to a bakery and restaurant in Schenectady, New York, denies that the company has done anything wrong. Instead, he insists that the company has been including the charge in its bill for years, and that neither the word “tip” nor “gratuity” were ever used. He also stated that the servers’ wages started at $12 an hour and went up to $19 an hour. He said that Mallozzi Group makes it clear to their servers that they get paid a flat hourly rate without tips.
The Chicago class action lawyers at the Chicago Overtime Law Center are investigating unpaid overtime claims by waiters and bus boys and other restaurant and hotel workers against national restaurant chains including Chipotle, Red Lobster, Olive Garden, Outback Steak House, Taco Bell, Burger King, Wendy’s and hotels for misclassifying employees as managers or assistant managers, forcing employees to work off the clock at business, failing to share all tips, erasing or altering time sheets or time records, pressuring workers not to report or record overtime, and otherwise failing to pay workers for overtime and other wages. If you are the victim these wage theft practices call us at (312) 869-4095 or contact us online.
The Chicago class action 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 Aurora and St. Charles. We protect unpaid workers who haven’t received overtime throughout the Chicago area including in DuPage, Lake, McHenry, Kane and Cook Counties.
Our Hoffman Estates and Orland Park overtime 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 misclassify 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 represents clients throughout the country who have not been paid for the overtime hours that they worked. If you believe that you are owed overtime wages, contact one of our Chicago class action attorneys by phone at (312) 869-4095 or through our online form.