HFA Files Wage Theft Lawsuit on behalf of Employees of Baltimore Restaurant, The Local Oyster

Aug 06, 2018

Handley Farah & Anderson filed a lawsuit in federal court on behalf of a class of current and former employees of The Local Oyster, a rapidly expanding restaurant in Baltimore, Maryland, alleging their employer failed to pay its workers minimum wages dating back to the restaurant’s opening in October 2015.

The lawsuit alleges that the Local Oyster paid Plaintiff and other similarly situated 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.  However, the lawsuit alleges that Plaintiff and other Local Oyster workers regularly spent in excess of 50% of their time performing non-tip producing work, such as washing dishes, cooking, shucking oysters, other food preparation, stocking condiments and cleaning the restaurant.  Federal and Maryland state law allow 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 lawsuit alleges that the Local Oyster’s unfair wage payment practices are actually detailed in their own employee manual, which dictates that during new employees’ training periods, the restaurant will pay such employees a sub-minimum hourly wage for all hours worked, with no access to tips to make up the difference.

This case highlights a pernicious model of restaurant management that is all too frequently adopted by restaurants in Maryland and around the country – namely, a business model whereby all employees perform all 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.  With over 14 million employees nationwide, the restaurant industry is one of the largest and fastest-growing private sector employers in the nation. Unfortunately, despite the growth and profitability of the industry, restaurant jobs provide largely low wages.

The named plaintiff in the lawsuit is a member of Restaurant Opportunities Center (ROC) United, whose mission is to improve wages and working conditions for the nation’s restaurant workforce.  ROC’s diverse membership includes over 25,000 people who work in restaurants, over 300 high-road employers, and thousands of engaged consumers, and they are united in support of raising restaurant industry standards.  ROC has campaigned for and won millions of dollars for workers whose tips and wages have been misappropriated by their employers.

Sheila Maddali, the Law and Organizing Director of ROC United, commented, “The two-tiered wage system, by which tipped workers in 43 states are paid a sub-minimum hourly wage, forces tipped workers to rely on customer whims to survive. Many restaurants, like Local Oyster, not only force employees to rely on customer tips when serving guests but also when performing non-tipped work to avoid paying a full minimum wage. That is not only unfair, it is illegal.”

Commenting on the scope of the wage theft scheme at issue in this case, Plaintiff’s counsel Matthew Handley said, “Our lawsuit alleges that the Local Oyster attempted to employ its entire workforce at sub-minimum wages in violation of clear state and federal law.  This case will hopefully send a message that such a business model is not only flawed, but illegal, and must be stopped.”

If you have any questions concerning this case or would like to share your experience working for the Local Oyster, please contact Matthew Handley, at 202-559-2411 or [email protected]. A copy of the complaint can be found HERE.

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