Mario Batali Tip-Skimming Allegations Highlight the Prevalence of FLSA Violations

Mario Batali, one of the best-known Italian chefs in the United States, has agreed to pay a $5.2 million settlement to 1100 current and former employees over allegations that he and business partner Joseph Bastianich engaged in tip-skimming at eight of their restaurants.

According to the suit that was filed, Batali and Bastianich "misappropriated" four to five percent of wine and drink sales from worker's tip pools. It also alleged that the business partners took unlawful tip credits, pushing wait staff's salary down below minimum wage; they were additionally accused of failing to pay overtime for shifts that lasted longer than 10 hours.

While the biggest to date, the Batali settlement is not the first of its kind. In 2011, Lenny's Sandwich shop paid $5.1 million for wage violations that affected 800 workers in 11 different restaurant locations; in 2009, Sparks Steak House in New York City had to pay $3.15 million dollars to 200 current and former employees whom they shorted on tips.

The reason restaurant owners are having to pay up is because shorting waiters on tips isn't just mean—it's illegal. The Fair Labor Standards Act (FLSA) dictates that waiters and waitresses must be paid a base salary of $2.13 per hour. Wait staff must then report all the tips they receive; if their base salary and total tips do not equal the amount of current minimum wage, the employer is required to make up the difference. Any tips that they receive above minimum wage belong to the wait staff.

Waiters and waitresses are also entitled to overtime payments. The $2.13/minimum wage supplement plan only applies to the first 40 hours an individual server works in any given week. For every hour past the first forty, restaurant owners must multiply minimum wage by 1.5, start with a base salary of $5.12/hour and supplement the salary for every overtime hour to reach a total sum of 1.5 times current minimum wage.

If your employer has violated FLSA fair wage standards, you may be entitled to compensation. An experienced commercial litigation attorney can discuss your case during a free and confidential consultation to determine your best course of legal action. Contact a commercial litigation lawyer from Arnold & Itkin today to ensure a just outcome in your case.


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