Restaurant Worker Wage and Hour Violations

  • Restaurant Worker Wage and Hour Violations

Tennessee Restaurant Worker Wage and Hour Violations

Representing clients illegally denied overtime because of misclassification and exemptions

In 2001, Treetop Enterprises, Inc., the company behind Waffle House, was ordered to pay almost $3 million dollars in damages after improperly classifying its managers in order to take advantage of overtime exemptions. That case was decided in the U.S. District Court for the Middle District of Tennessee: Cowan v. Treetop Enterprises, Inc., 163 F. Supp. 2d 930 (M.D. Tenn. 2001). Yet despite the historic ruling, Tennessee restaurants have continued the practice of misclassification for close to 20 years.

The Tennessee wage and hour attorneys at Gilbert McWherter Scott Bobbitt, PLC, represent employees who have been unfairly denied overtime pay in violation of the Fair Labor Standards Act (FLSA). We have secured significant awards for our clients, including:

  • $42,379.90+ in back pay and attorneys’ fees for an employee misclassified under the executive exemption
  • $30,326.48 in backpay, liquidated damages and attorneys’ fees for a client who was denied fair pay
  • 1,263 hours of unpaid overtime for a county official (total amount of money is confidential)

If you are a salaried employee whose title does not match your actual job duties, you may be entitled to backpay and additional damages. Please contact us in Nashville, Chattanooga, Memphis, Jackson or Knoxville to speak with an experienced FLSA lawyer about your needs.

Why restaurant employees are at a greater risk of misclassification

The costs associated with hourly employees are high. To reduce these costs, restaurants often create positions like “Floor Supervisor” or “Assistant Manager” for employees, and then reclassify those workers as salaried employees who are ineligible for overtime pay, due to exemptions allowed under the law. These newly-minted managers are then expected to work well in excess of a 40-hour work week, but because they are salaried, they are told they cannot collect overtime pay. In this way, restaurant owners can sometimes avoid paying hundreds of hours’ worth of overtime pay each year.

However, under the FLSA, an employee’s duties – not job title – are what dictate his or her eligibility for exemption. For example, if a restaurant worker is given the title of Kitchen Assistant Manager, but is still expected to perform all of the same duties as a line cook – food prep, cooking, clean-up, etc. – then he or she is not eligible for overtime exemption under the law.

A brief look at misclassification and exemptions

The Department of Labor (DoL) allows employers to avoid paying overtime to certain salaried employees by offering exemptions for certain types of work. Each sub-category has its own eligibility requirements, but generally speaking, these exemptions are allowed for employees who are either paid significantly more than the workers they supervise; earn their pay based on commission or fees; or perform job duties outside the scope of what other workers are expected to perform.

There are multiple categories of exemptions, but in general, only two are regularly applied to restaurant workers. This is the criteria for those exemptions, per the DoL:

Executive exemption

  • The employee must be compensated on a salary basis (as defined in the regulations) at a rate not less than $455 per week;
  • The employee’s primary duty must be managing the enterprise, or managing a customarily recognized department or subdivision of the enterprise;
  • The employee must customarily and regularly direct the work of at least two or more other full-time employees or their equivalent; and
  • The employee must have the authority to hire or fire other employees, or the employee’s suggestions and recommendations as to the hiring, firing, advancement, promotion or any other change of status of other employees must be given particular weight.

Administrative exemption:

  • The employee must be compensated on a salary or fee basis (as defined in the regulations) at a rate not less than $455 per week;
  • The employee’s primary duty must be the performance of office or non-manual work directly related to the management or general business operations of the employer or the employer’s customers; and
  • The employee’s primary duty includes the exercise of discretion and independent judgment with respect to matters of significance

There are restaurants which attempt to use the executive or administrative exemption for their salaried employees. However, if the Assistant Manager’s primary roles are the equivalent of any other non-salaried employee, then he or she is entitled to overtime pay for fulfilling the roles listed above in addition to his or her primary job duties.

Additional FLSA violations for non-salaried employees

Salaried employees are not the only restaurant workers who may be entitled to additional overtime, back pay or damages. Some restaurants will illegally misclassify their workers as independent contractors, who are not entitled to overtime pay. If you are given a set schedule, must perform your work under a stringent set of guidelines, are supervised or managed closely, are expected to work in one location regularly, and/or are given material to complete your work, you are an employee – not a contractor.

Servers may also be denied fair pay, as they are tipped employees. Tips are the property of the person who earns them, regardless of how much that server is paid per hour. This can become an issue if the restaurant has instituted a tip pool – where all tipped employees pool their tips, which are then divided in some way between the staff. Tip pools are valid and legal, but there are rules governing how they are instituted, and who may draw from the pool.

Legal recourse for FLSA violations

If you have been denied your fair pay or overtime for any reason, you do have legal recourse to pursue compensation from your employer. The Gilbert Firm routinely represents Tennessee workers who have been denied their fair pay. While we always aim for the most efficient resolution of your claim, our firm has the resources to handle complex litigation should the need arise. We may be able to help you secure:

  • All back pay for overtime
  • Up to twice the amount of that overtime in liquidated damages
  • Attorney fees

The state may choose to levy additional penalties based on the extent of the violations.

Experienced Tennessee FLSA violation attorneys

If you have been denied the overtime pay you rightfully deserve, you deserve a team who can help you secure what is yours. The Tennessee wage and hour lawyers at the Gilbert Firm are prepared to go to any lengths to fight your case. To learn more about our services, please call 888-996-9731 or fill out our contact form to reserve a consultation at one of our offices in Nashville, Chattanooga, Memphis, Jackson or Knoxville.

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Gilbert McWherter Scott Bobbitt PLC and its attorneys do not maintain a bona fide office in the state of Kentucky, and do not maintain a bona fide office within the area code listed. Bona fide offices are located in Jackson and Franklin, TN.
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