$125,763 in Back Wages Paid by Restaurant for Overtime, Minimum Wage and Record-Keeping Violations

Thursday, August 16, 2012

Ocean Palace Inc., doing business as Ocean Palace Restaurant in Houston, has paid 61 current and former kitchen and wait staff, cashiers, hostesses, runners, cart pushers, busboys and dishwashers a total of $125,763 in back wages following an investigation by the U.S. Department of Labor’s Wage and Hour Division that found violations of the Fair Labor Standards Act’s overtime, minimum wage and record-keeping provisions.

An investigation by the division’s Houston District Office found that the employer improperly classified some employees as exempt from the FLSA and as a result paid them flat wages, regardless of the number of hours worked, that did not satisfy minimum wage and overtime requirements. For example, employees were not paid at time and one-half their regular rates for hours worked beyond 40 in a week. Also, tipped employees’ wages, in combination with their tips, did not always equal at least the federal minimum wage of $7.25 per hour. Finally, the employer did not maintain accurate records of employees’ work hours and wages as required.

Ocean Palace agreed to comply with the FLSA in the future. The back wages owed have been paid in full.

The FLSA requires that covered, nonexempt employees be paid at least the federal minimum wage of $7.25 for all hours worked, plus time and one-half their regular rates for hours worked beyond 40 per week. In accordance with the FLSA, an employer of a tipped employee is required to pay at least $2.13 an hour in direct wages provided that amount plus the tips received equals at least the federal minimum wage of $7.25 an hour. If an employee’s tips combined with the employer’s direct wages does not equal the minimum wage, the employer must make up the difference. Employers also are required to provide employees notice of the FLSA tip credit provisions, to maintain accurate time and payroll records, and to comply with restrictions applying to workers under age 18.

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