Too many restaurants are cheating workers out of wages, tips, and overtime, investigators say

Restaurants might seem like simple operations when done right: Greet and seat, take orders, deliver good food and drinks, collect payments.

But in too many restaurants, the people taking care of us are cheated out of their pay, according to state investigators, private attorneys and advocates for workers' rights.

Recent wage theft investigations by the U.S. Department of Labor's Wage and Hour Division detailed how two South Florida restaurants set up illegal payment schemes to avoid paying overtime rates to workers who toiled more than 40 hours a week.

In the end, rather than saving money, South China Restaurant in Cooper City and Lallo's in Lauderhill were forced to cough up tens of thousands of dollars in back wages. Lallo's also paid $11,455 in civil penalties for the "willful nature" of the violations.

But they're far from the only restaurants caught cheating their workers.

In the Tampa area, the division conducted 350 investigations in 2018, finding more than $1 million in back wages and additional damages for more than 1,500 employees, that division announced.

"Restaurant workers are among the most vulnerable that we see," said Daniel White, the division's Jacksonville district director, in a news release about a 2016 wage theft investigation. "When these workers aren't paid every penny they have rightfully earned, it harms not just the workers, but their families, and their communities."

Laws and policies governing the ways restaurant workers get paid are anything but simple, says Laura Huizar, senior staff attorney for the National Employment Law Project, a nonprofit organization that advocates for protections for low-wage and unemployed workers.

"Systems in place now for calculating tipped wages and minimum wages are very complicated, not only for employers, but for employees to keep track of to ensure they are being paid fairly," Huizar said. "In many ways, it's a system designed to be abused, and that's what we're seeing."

In South Florida, charges of wage and tip theft by restaurant owners show up frequently in federal civil court filings and typically end with the owners agreeing to confidential settlements, says Peter Bober of the Hollywood-based law firm Bober & Bober P.A., which specializes in such cases.

Owners get in trouble because they think they can write their own rules for how workers get paid, Bober said.

"A lot of people think that because they own the business, they can pay less than minimum wage," he said. "That's not true."

A May lawsuit against Strathmore Bagel & Deli's parent company by former employee Neil Gitterman states that Gitterman sometimes worked 20 hours of overtime a week at the eatery's Wellington location. Although he would receive a paycheck for the first 40 hours of work, he would be paid in cash for the overtime at the normal hourly rate.

The restaurant denied the charges and said Gitterman never made managers aware he was working more hours than authorized.

Other ways restaurant owners cut costs is underpaying cooks and dishwashers and forcing servers to make up the difference by contributing a share of their tips.

Restaurants are allowed to require tip sharing only if they pay all of their workers — including servers and bartenders — the full minimum wage for each hour worked, under an amendment to the Fair Labor Standards Act enacted in 2018.

But the new amendment forbids management from claiming a portion of servers' tips for themselves or for the company. That means managers can no longer wait on a few tables to claim a share of a tip pool. And they can't make bartenders cough up tip money to cover cash register shortfalls or credit card transaction fees.