On February 1, 2019, U.S. District Judge James K. Bredar approved the settlement of a wage hour lawsuit against the Local Oyster, a rapidly expanding restaurant in Baltimore, Maryland. The lawsuit alleged that the Local Oyster unlawfully paid its employees a sub-minimum hourly wage of as little as $5.50 per hour, while requiring workers to make up the difference through tips earned and paid by restaurant patrons. The lawsuit also alleged that Local Oyster workers regularly spent in excess of 50% of their time performing non-tip producing work, such as washing dishes, cooking, other food preparation, stocking condiments and cleaning the restaurant. Maryland state law allows for payment of a sub-minimum wage to tipped employees only when the non-tipped work they perform is 20% or less of their job duties.
The settlement provides for compensation to the named plaintiff and has prompted a change in the labor structure at the Local Oyster, which will now ensure that no tipped employee is spending more than 20% of their time performing non-tipped work. Changes include assigning non-tipped duties only to non-tipped employees and instructing non-tipped employees to avoid performing non-tipped work.
Counsel for the Plaintiff, Matthew Handley, commented “We applaud the Local Oyster for making these changes to its labor structure. It happens all too frequently that restaurants in Maryland and around the country require all employees to perform multiple job duties in a restaurant and rely on tips to meet minimum wage, even though only a fraction of the work is traditionally tipped work. The controls that the Local Oyster has put in place will ensure a more equitable work place.”