REPORT FROM THE US DEPARTMENT OF LABOR – Roy’s Holdings Inc. has agreed to return $136,761 in tips and pay another $88,424 in back wages to 326 tipped servers employed at several of its Hawaii-based Roy’s restaurants for violating the wage provisions of the Fair Labor Standards Act.
Investigators with the Wage and Hour Division found that the employer reduced the cash wage of the tipped employees below the minimum wage of $7.25 per hour without allowing them to fully retain their tips during the two-year investigation period beginning in August 2011.
The employer unlawfully required the servers to pay a portion of their shift tips to the non-tipped hourly kitchen staff who were already paid at least the full minimum wage. The employer also was assessed a penalty of $1,550 for permitting a minor to load a trash compactor, which is considered a hazardous occupation for workers under the age of 18.
“Employers cannot take a credit against their minimum wage obligation to tipped staff if they require a portion of those tips to be shared with traditionally non-tipped staff such as kitchen employees,” said Terence Trotter, the division’s district director in Hawaii.