US Department of Labor obtains court judgment ordering Idaho Falls restaurant to pay $319K for illegal tip sharing,....

[Omaha Steve]

https://www.dol.gov/newsroom/releases/whd/whd20240228-0

COPYRIGHT EXEMPT.

Employer: Mackenzie River Pizza

1490 Milligan Road

Idaho Falls, ID 83402

Type of action: Consent Judgment and Order

Name of defendants: Granite Mountain Restaurants LLC; MRP Idaho Falls LLC; and Mark Thompson

Background: Aninvestigation by the U.S. Department of Labor’s Wage and Hour Division found Granite Mountain Restaurants LLC and MRP Idaho Falls LLC – owners and operators of a Mackenzie River Pizza restaurant in Idaho Falls – withheld a portion of servers and bartenders earned tips. The employer paid the servers and bartenders less than the federal minimum wage of $7.25 per hour by taking a tip credit and counting customers’ tips towards their hourly wage. The employer organized and oversaw the tip-pool arrangement, requiring employees to share their tips with back-of-the-house staff. Mackenzie River Pizza retaliated against one employee who spoke out against the practice. The employer also failed to pay overtime rates and violated federal child labor laws by allowing minors between the ages of 14 and 15 to work during school hours and later and longer than permitted by the Fair Labor Standards Act. Furthermore, the division found a 15-year-old performing baking activities, a prohibited occupation for minors.

Resolution: The consent judgment orders the employer to pay $139,981 in tips, unpaid minimum wage and overtime wages and an equal amount in damages to 69 workers and prohibits the employers from further violations. The court also ordered the payment of $5,000 in punitive damages and $34,077 in penalties.

Court: U.S. District Court for the District of Idaho

Docket Number: 4:24-cv-00059-DCN

Quote: “Illegal practices by restaurant employers such as Mackenzie River Pizza in Idaho Falls hurt employees and the entire restaurant employer community facing unfair competition due to prohibited labor practices, including wage theft and retaliation against workers exercising their rights,” said Regional Solicitor of Labor Marc Pilotin in San Francisco. “The resolution of this case should remind employers that we are determined to protect workers and bring bad actors into compliance.”

The division’s Portland Area Office conducted the investigation. The San Francisco Regional Office of the Solicitor reached the consent judgment at the court.

“In the last two years we recovered more than $1.7 million in unpaid tips for more than 1,000 workers in Oregon and Idaho” said Katherine Walum, District Director for the Wage and Hour Division in Portland, Oregon. “Wage theft is a major concern for restaurant workers, who are some of the most vulnerable employees in our community, and we will continue to protect workers’ rights and hold employers accountable by ensuring their workers receive all of the hard-earned wages, including tips.”

Learn more about the Wage and Hour Division, including a search tool to use if you think you may be owed back wages collected by the division. You can find other information on the agency’s website if you think you may have been misclassified as an independent contractor, or want to know how to file an online complaint. For confidential compliance assistance, employees and employers can call the agency’s toll-free helpline at 866-4US-WAGE (487-9243), regardless of where they are from.

Download the agency’s new Timesheet App for iOS and Android devices – also available in Spanish –to ensure hours and pay are accurate.

Agency
Wage and Hour Division
Date
February 28, 2024
Release Number
24-176-SAN
Media Contact: Michael Petersen
Phone Number
415-625-2630
Email
[e-mail]
Media Contact: Jose Carnevali
Phone Number
415-625-2631
Email
[e-mail]