News Brief
US Department of Labor recovers $159K in back wages for restaurant workers after employer takes their tips
Employer name: Izumi Sushi & Hibachi All You Can Eat LLC
Investigation site: 2844 Thousand Oaks Drive
San Antonio, TX 78232
Investigation findings: The U.S. Department of Labor’s Wage and Hour Division found the employer operated an illegal tip pool policy whereby employer kept the tips and gave them to the managers – an illegal action under federal law. As a result, the tip credit claimed by the employer became invalid and the employer was required to return the tips to employees and pay the full federal minimum wage in addition to the tips. Additionally, the employer failed to pay proper overtime compensation.
Back wages and damages: $159,525 in back wages to 26 employees
Quote: “Restaurant employers must ensure that tipped employees receive all the wages they earn – including tips. Employers may not keep tips provided to the employee, this includes not allowing a manager or supervisor to retain tips,” explained Wage and Hour District Director Cynthia Ramos in San Antonio, Texas. “We encourage employers and employees to contact the Wage and Hour Division with any questions or concerns regarding pay practices.”
Background: The Wage and Hour Division enforces laws governing pay practices and other labor standards, including the Fair Labor Standards Act, and determines if employers have misclassified employees as independent contractors, denying them critical benefits and worker protections.
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. Workers and employers can contact the division confidentially at its toll-free number, 1-866-4-US-WAGE (487-9243). The division protects workers regardless of immigration status and can communicate with workers in more than 200 languages.
