When the parties reached a settlement of the Gagliastre matter in December 2018, the parties’ agreement explained that the settlement resolved only the FLSA claims asserted and did NOT resolve the South Carolina Payment of Wages Act claims. Only the FLSA claims continued in the Gagliastre case. As a result, the plaintiffs re-filed their South Carolina claims in South Carolina state court in a case called Tarry v. The Court granted the defendants’ request. In the fall of 2018, the defendants asked the District Court to decline jurisdiction over the South Carolina claims and retain jurisdiction over only the FLSA claims. What HappenedĪs many of you are aware, the Gagliastre lawsuit was originally filed as a “hybrid class/collective action.” That means the original complaint asserted federal law claims arising from the Fair Labor Standards Act and South Carolina state law claims arising from the South Carolina Payment of Wages Act.
The original lawsuit alleged that these policies and practices violated both the FLSA and also the South Carolina Payment of Wages Act. Employers Failed to Notify Workers of Terms of EmploymentĪnd sixth, the plaintiffs allege the company failed to properly claim a tip credit because they did not meet all of the requirements for notifying the workers of the terms of their employment. Instead, the plaintiffs allege that the company simply multiplied the workers’ tipped wage rate by 1.5, resulting in the wrong overtime rate.
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Specifically, the company must multiply full minimum wage ($7.25) by 1.5, and then claim whatever tip credit they are trying to claim. When an employer claims a “tip credit” from workers’ wages, the rules for determining the right overtime rate are slightly altered.
Employees Were Paid Incorrect Overtime Ratesįifth, the plaintiffs allege the company paid the tipped employees overtime at the wrong rate. Because the company, and not the workers, needed rolled silverware, this practice also amounts to a diversion of wages and/or tip money. Employees Required to Contribute Wages to Non-employeesįourth, the plaintiffs alleged the company required servers to pay a set amount per shift ($3 to $7 per shift) which would be used to pay non-employees who the company brought in to roll silverware. Third, the plaintiffs alleged the company required servers, bussers, and buffet runners to pay for the cost of work uniforms, thereby dropping the workers’ wages even further below the minimum. Employees Were Required to Pay for Work Uniforms Instead of paying $2.13 per hour, Captain George’s paid thousands of workers over the years at $2.125 per hour, siphoning off a half penny for each hour worked. Second, the plaintiffs alleged the company paid the servers, buffet runners, and bussers less than the FLSA’s tipped minimum wage rate. The plaintiffs allege that this tip pool was illegal because (1) the defendants kept some of the tip money for themselves, (2) the defendants used some of the tip money to pay for its own business obligations, such as paying hourly wages to other employees, and (3) the defendants distributed some of the tip money to management employees who were not allowed to participate in the tip pool.
Each night, the servers were required to pay a portion of their tips to the restaurant that was calculated based on a percentage of their sales for the shift. The Claims Participating in an Illegal Tip Poolįirst, the plaintiffs alleged the company required servers to participate in an illegal tip pool. This lawsuit was filed against a restaurant that we alleged violated almost every wage and hour rule in the book.
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