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Wage and Hour Division (WHD)

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Archived News Release — Caution: Information may be out of date.

Press Releases

Date:  March 6, 2013

Contact:  Michael D'Aquino

Phone:  404-562-2076

U.S. Department of Labor
Wage and Hour Division
Release Number: 13-255-ATL (48)

Three Hilton Head, SC, restaurants agree to pay more than $23,000 in back wages to 6 employees following US Department of Labor investigation

HILTON HEAD, S.C. -- Three restaurant establishments owned and operated by Downtown Hilton Head Inc., whose majority stakeholders are John and Sally Peterson and Franz Auer, have agreed to pay six employees $23,155 in back wages following an investigation by the U.S. Department of Labor’s Wage and Hour Division. The investigation found violations of the Fair Labor Standards Act’s overtime and record-keeping provisions at three Hilton Head locations: Alexander’s Restaurant Co., doing business as Alexander’s; Downtown Hilton Head Inc., doing business as Red Fish; and the Old Oyster Factory Restaurant.

The investigations were conducted under the division’s multiyear enforcement initiative focused on the restaurant industry in South Carolina, where widespread noncompliance with FLSA’s minimum wage, overtime and record-keeping provisions has been found.

“We find many low-wage, vulnerable workers employed in the restaurant industry. In this case, many employees worked long hours, but earned no overtime compensation,” said Michelle Garvey, director of the division’s Columbia office. “These workers deserve every penny of the wages they have rightfully earned. Through the effort of our ongoing enforcement initiative, the Wage and Hour Division continues to focus on South Carolina restaurants to protect workers against widespread labor violations and to ensure a level playing field for law-abiding employers.”

Investigators found that some employees had worked in both the restaurant’s kitchen and as servers and bussers, but those hours were tracked and paid separately, even when their combined totals exceeded 40 hours in a workweek. The employer similarly failed to combine hours worked at different locations for the same employer during a single workweek, resulting in failure to pay overtime at time and one-half employees’ regular rates of pay for hours worked beyond 40 in a workweek, as required by the FLSA. The employer also failed to maintain accurate records of employees’ work hours and wages, in violation of the FLSA’s record-keeping requirements.

In addition to paying the back wages owed, the restaurants agreed to maintain future compliance with the FLSA.

The restaurant industry employs some of our country’s lowest-paid workers who, due to a lack of knowledge of the law or an unwillingness to exercise their rights, are vulnerable to disparate treatment and labor violations. In addition to the initiative in South Carolina, the Wage and Hour Division has other ongoing enforcement initiatives throughout the U.S. to identify and remedy violations that are common in the restaurant industry.

The FLSA requires that covered, nonexempt employees be paid at least the federal minimum wage of $7.25 per hour 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 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 do 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, maintain accurate time and payroll records, and comply with restrictions that apply to workers under age 18.

Accessible and searchable information on enforcement activities by the department is available at

For more information about the FLSA and other federal labor laws, call the division’s toll-free helpline at 866-4US-WAGE (487-9243) or its Columbia office at 803-765-5981. Information also is available at


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