Restaurant, Food Processing and Tipped Employees

The restaurant and food processing industries give rise to several unique overtime pay problems.

Typical Problems include:

  • tip credits
  • incorrect classification of some employees Managers or Assistant Managers
  • work off the clock.
  • deductions from employers wages for uniforms
  • deductions for customer walk-outs or bill skipping
  • deductions for incorrect orders
  • deductions for a disputed credit-card bill by the credit company
  • deductions for broken objects

Managers, Supervisors, Assistant and Associate Managers

Generally speaking employers are not required to pay managers and assistant managers overtime pay. As a result, many businesses attempt to fit employees into this category who really do not meet the requirements for exemption.

See also Managers, Supervisors, Assistant and Associate Managers.

  • If you spend a large part of your time performing tasks such as ringing up sales, preparing food orders or filling in for absent non-managers then you may not be a “true” manager or supervisor and could be due overtime.
  • Some employers will abuse so-called salaried assistant and associate manager employees, requiring them to perform a large amount of “fill-in” work for non-salaried employees who do not show up for work. This occurs more often when hiring is tight. This illegal practice works because the employer uses as an incentive the possibly becoming a manager with a much greater salary and eligibility for greater bonuses. Often, the salaried assistant and associate manager employees will work a very large number of overtime hours, resulting in a very large amount due the employee. The amount due could be in the tens of thousands of dollars. Unfortunately, this unfair practice is much more common than most people think.
  • Meat packers and poultry workers not paid for the time spent preparing equipment for the work day and putting on protective gear
  • Punishing employees for failing to complete assigned tasks within unreasonable time periods
  • Failure to give credit for meal time even when the employee works through it
  • Short breaks not included in paid time
  • “Closing work” that must be performed after “clocking out”
  • See Hospital and Residential Care Facility Employees, Work-Off-the-Clock, Weekend and Night Work for more detail

Businesses may take a credit against the minimum wage for tips received by employees if certain requirements are met. This means that your employer may pay you an hourly rate of $2.12/hour so long as the difference from the regular minimum wage is made up by tips.

  • A tipped employee means any employee working in an occupation where he or she regularly receives more than $30 a month in tips.
  • The employee must actually receive the tips in order for the business to receive a tip credit.
  • Employers run into trouble with this credit when they “skim” off the top of the tips or when they fail to make up the difference if wages plus tips do not equal minimum wage.

You cannot “volunteer” to work for free at the job for which you are normally paid. In other words, your employer cannot force or coerce you to work “off-the-clock,” you must be paid for all time spent doing your job. See Outside Sales, Charitable and Volunteer Work for more detail.

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