Sweet Eats: Chicago Restaurant Forks Over $339K in Unpaid Wages, Damages in FLSA Action

2017 is ending on a high note for some Chicago area restaurant workers who had some catching up to do on their wages.

Fabulous Freddies Italian Eatery, a restaurant in Chicago’s South Loop, and one of its named owners, Stephanie Fitzpatrick, have paid 58 employees a total of $339,418 in unpaid wages and damages in a consent judgment following a U.S. Department of Labor Wage and Hour Division investigation.

Division investigators found the restaurant and Fitzpatrick failed to comply with the Fair Labor Standards Act’s (FLSA) minimum wage, overtime, and recording-keeping provisions. The judgment calls for payment of $169,709 in back wages and an equal amount in liquidated damages.

Investigators found Fabulous Freddies paid some non-tipped employees a “training rate” of $3.75 per hour until they proved efficient in the job, resulting in minimum wage violations. The company also failed to pay employees required overtime at time-and-one-half their hourly wage rates when they worked more than 40 hours in a week, in violation of the FLSA’s overtime provisions

“Failing to pay employees what they have legally earned allows companies to gain an unfair advantage over competitors that abide by the law,” said Wage and Hour Division District Director Thomas Gauza, in Chicago. “Wage violations can be avoided, and we encourage employers to reach out to us for guidance.”

Workers and employers with questions about the FLSA or any of the federal wage laws administered by the Division should call the agency’s toll-free helpline at 866-4US-WAGE (487-9243). All calls are confidential. More information is available online at http://www.dol.gov/whd/.

DOL Busy on Honoring, Safeguarding Miners

Did you miss National Miners Day? It’s never too late to honor the workers who at great risk go daily into the coal mines and retrieve the substance that keeps many a house warm.

Here’s the Labor Secretary’s Dec. 6 proclamation:

“On National Miners Day, we recognize and celebrate miners for all they do to maximize our natural resources and make our modern life possible. Mining is a source of good, family-sustaining jobs. At the Department of Labor, we are committed to ensuring miners have safe and healthy working conditions so they can return home safely to their loved ones at the end of each shift. Today, and every day, I thank our miners for their hard work and dedication, which strengthens our nation.”

And here’s a timely seasonal reminder to coal mine workers and operators.

The U.S. Department of Labor’s Mine Safety and Health Administration (MSHA) on Dec. 5 announced its annual Winter Alert campaign, reminding miners and mine operators of the increased hazards that colder weather creates at both surface and underground coal mines.

The Winter Alert campaign, which runs each year through March, emphasizes increased vigilance and adherence to safety principles during the winter months, when cold temperatures increase hazards for miners.  Throughout the Winter Alert campaign, MSHA personnel regularly visit mines around the country to heighten awareness of the changing conditions that occur during winter months, and will distribute materials that focus on best practices for safely performing miners’ jobs.

“The cold winter months bring an increased risk of underground coal mine explosions, as well as an increase in hazards associated with ice and snow that collect at surface facilities and preparation plants,” said Assistant Secretary of Labor for Mine Safety and Health David Zatezalo. “During the Winter Alert campaign, MSHA personnel will work to ensure miners and mine operators have information to maintain safe and healthful working conditions.”

When the barometric pressure drops during colder weather, methane can migrate more easily into the mine atmosphere, increasing the risk of an explosion. Dry winter air also results in drier conditions underground, allowing coal dust to become suspended in the mine atmosphere, increasing the danger of an explosion.

Examinations are the first line of defense underground and should include the following:

• Check for methane.
• Know the mine’s ventilation plan and maintain ventilation controls.
• Continually apply rock dust to prevent the propagation of an explosion.

At surface operations and preparation plants, hazards such as limited visibility, slippery walkways, and freezing and thawing highwalls may lead to accidents.

• Check highwalls and benches for stability.
• Examine vehicles for exhaust leaks and consider limiting engine idle time to reduce risk of carbon monoxide asphyxiation.
• Remove snow and ice on roadways, and apply sand to maintain traction.

Bad Customer Service a Boon for Your Competitors, For You a Very Bad Deal

In this holiday season–or for that matter, at any time during the year–the worse thing for your business is to send your customers to your competition. Our regular guest blogger Robin Paggi offers suggestions for avoiding that negative outcome

How to Send Your Customers to Your Competitors

“You can have everything you want, if you will help other people get what they
want,” said motivational speaker Zig Ziglar. If you’re in business, you want
customers. What do your customers want? Good customer service. In fact, according
to a Customer Experience Report by RightNow, 86 percent of consumers surveyed
said they stopped doing business with a company because of receiving bad service. I
know I have.

Here are some key elements to providing good customer service:

Make eye contact, smile, and greet every customer. Seems easy, doesn’t it?
However, lots of customer service representatives don’t do these simple things.

For example, I was recently at the grocery store and approached a check out stand
at which the checker was involved in a personal conversation with the store’s
security guard. I placed my groceries on the conveyer belt and the checker began to
scan them while continuing to talk to her co-worker. She didn’t make eye contact
with me nor acknowledge me until she finished her conversation. She then looked at
me and asked, “How’s it going?”

Perhaps the checker doesn’t know that a lack of eye contact demonstrates a lack of interest and creates feelings of annoyance or general disliking from the ignored
person. No doubt the checker thought that finishing her conversation with her co-
worker was the polite thing to do before she turned her attention to me. She should
be told that customers are more important than co-workers and to stop all personal
conversations when a customer approaches.

As for smiling, experimental data shows that smiling is not only expected during the
formation of new relationships (such as interacting with a customer), it is necessary.
Smiling indicates whether someone is friend or foe. Additionally, we instantly return
a smile, which causes the secretion of endorphins (our internal happy drug) and
makes us feel good about the person who smiled at us.

When we experience social pain – like being ignored – the feeling is as real as
physical pain. That’s why no eye contact, no smile, and no greeting often lead to no
repeat business.

Seek out customer contact. This means that customer service representatives
approach customers to offer help instead of customers having to solicit it. Here’s an
example of what not to do.

I was in an electronics store trying to buy a TV and couldn’t get someone to wait on
me. An employee rushed by and assured me that someone would be right there.
After a few minutes, another employee told me the same thing. Finally, a third
employee approached me and asked, “What’s up?”

Having to ask to be waited on was ridiculous, especially when I was about to spend
hundreds of dollars. Then being greeted so casually just added fuel to the fire. There
are plenty of other places in town to buy a TV the next time I want one.

Provide immediate fixes to problems. An experience I had at a local print shop
illustrates a poor attempt at that process.

I ordered hundreds of bookmarks from the print shop and made arrangements to
distribute them with some fellow Rotarians at a local elementary school on a Friday
about noon. When I placed the order, I was promised it would be ready that Friday.
When I arrived Friday morning around 10:00 to pick it up, the order was not ready.
My bad – I should have asked for a specific time. I told the print shop owner about
my predicament; he said my order would be completed that day as promised, but he
couldn’t tell me when. So, I cancelled with the school and the Rotarians and felt
stupid because of having to do so.

An hour later I received a call from the print shop telling me my order was ready. I
don’t know whether the owner felt bad after I left and decided to rush the order or
whether it would naturally have been completed by then. What I do know is that a
little effort on his part would have solved my problem and I wouldn’t have had to
cancel with everyone. Because he made no effort, I’ll go to a different print shop next
time.

Thank every guest. One of my favorite poor customer service stories happened at a
bookstore. After silently handing me my change, the cashier pushed my purchase
across the counter toward me and just looked at me. No “thank you,” “have a nice
day,” “don’t let the door hit you on the way out” – nothing. I finally said to her, “no
thank you?” She asked, “thank you for what?” She genuinely did not understand why
she should thank me for shopping at the store where she is employed. Although
there are not a lot of bookstores to shop at anymore, Amazon makes buying books
really easy and even thanks me for my business.

My husband thinks I’m too nitpicky about customer service because I teach
customer service classes. So, I conducted my own survey to see if the people in my
world have stopped doing business with companies because of receiving poor
customer service. Either the people I surveyed are too nitpicky too or receiving poor
customer service really does drive people away.

Business owners, managers, and their employees need to know that customers can
get similar goods at similar places all over town or on-line. The distinguishing factor
between businesses is usually only the service they provide, and failure to provide
good customer service is a sure way to send your customers straight to your
competitors.

Robin Paggi is the Training Coordinator at Worklogic HR.

She last wrote for us on Different Generations at Work and before that on Getting Professionals to Behave Professionally and prior to that on Brain Wiring, Personalities, and Careers and has also contributed articles on Accommodating Religious Beliefs, Politics and Work, Emojis-A Workplace Communications Menace and Alcoholism and the ADA in Employment. To read her previous columns, search Paggi in the search box at the top of this home page.

New Tipped Wage Proposal From DOL

If you work in a restaurant or other establishment where customers tip the workers, the Labor Department is proposing that the sharing of those tips among more employees be allowed.

The U.S. Department of Labor on Dec. 4 announced a Notice of Proposed Rulemaking (NPRM) regarding the tip regulations under the Fair Labor Standards Act (FLSA).  Under the proposed rule, workplaces would have the freedom to allow sharing of tips among more employees.  The proposal would help decrease wage disparities between tipped and non-tipped workers – an option that is currently restricted by a rule promulgated in 2011 that has been challenged in a number of courts.

The Department’s proposal only applies where employers pay a full minimum wage and do not take a tip credit and allows sharing tips through a tip pool with employees who do not traditionally receive direct tips – such as restaurant cooks and dish washers. These “back of the house” employees contribute to the overall customer experience, but may receive less compensation than their traditionally tipped co-workers.  The proposal would not affect current rules applicable to employers that claim a tip credit under the FLSA.

The Department of Labor promulgated tip regulations in 2011 that restricted this option. Since 2011, there has been a significant amount of litigation involving the tip pooling and tip retention practices of employers that pay a direct cash wage of at least the federal minimum wage and do not claim a FLSA tip credit.  There has also been litigation directly challenging the Department’s authority to promulgate the provisions of the 2011 regulations that restrict sharing of tips.

Moreover, in the past several years, several states have changed their laws to require employers to pay tipped employees a direct cash wage that is at least the federal minimum wage.  This means that fewer employers can take the FLSA tip credit.  The Department’s proposed new rule follows these developments, along with serious concerns that it incorrectly construed the statute when promulgating the 2011 regulations.

The NPRM was published in the Federal Register on Dec. 5, 2017, and is available for public comment for 30 days.  The Department encourages interested parties to submit comments on the proposed rule. The NPRM, along with the procedures for submitting comments, can be found at the Wage and Hour Division’s Proposed Rule website.

Tesla Sued for Racial Harassment

The company at the forefront of the electric car revolution tolerates racial harassment against African American employees, according to a recent lawsuit.

The complaint against the company was filed in California’s Alameda County Superior Court. The suit focuses on activity at the company’s auto assembly plant in Fremont, Calif., where the United Auto Workers launched a campaign to persuade workers to join the union.

The lawsuit was filed on behalf of Marcus Vaughn, who worked in the Freemont factory from April 23 to Oct. 31. According to the suit, employees and supervisors regularly used the “N word” around him and other black workers.

HR turned a deaf ear to his complaints, Vaughn, and instead he was fired “for not having a positive attitude.”

Salary History Bans Criticized as Ineffectual

Does prohibiting employers from asking employees how much they made in their last job help in closing the gender pay gap?

Some employers are skeptical that it would.  About two thirds of employers recently surveyed said they thought the measures would not help close the gender pay gap, or would only to do to a small extent improve any pay differentials that exist.

And why the skepticism? Some employers feel they already have rigorous pay systems in place to monitor for pay inequality or that the actual gap between male and female employees’ pay at their companies–accounting for position, experience, job level, and the like–is only in the single digits.

Whether they feel these laws are effective or not, more employers through the U.S. may feel their effects. That same survey of 108 companies revealed that nearly half, or 46 percent, said that will comply with the legal requirements in the most stringent location where they operate. As a consequence, workers outside of Massachusetts, California, or Oregon (which have laws banning questions on salary history) might no longer be asked about their salary history during job negotiations even if their local jurisdictions don’t have similar laws.

Nodding Off at Work? Try Napping on Job

Built-in nap time may be just what the doctor ordered for workers nodding off during their shifts.

According to a September 2011 study in the Journal of Sleep, employee insomnia cost U.S. companies some $63 billion a year in lost productivity.

In response, many large companies–Google, Ben & Jerry’s, Uber, Pwc and HuffPost, among them, have installed napping spaces for their workers.

Another concept is the “power nap,” which some road warriors avail themselves of. More than 7,000 visitors have made use of Recharj, a meditation and napping salon that opened a year ago in Washington.

Naps may provide a short-term boost in alertness and performance, but they aren’t a permanent substitute for lost sleep.

Gender Diversity Targets Urged for Amazon

Online giant Amazon is feeling the heat over its supposed lack of gender diversity . A letter from a group advocating for investors in Amazon sent a letter to the online giant pleading with it to include more women in its senior executive ranks.

The letter sent by CtW Investment Group, which works with union-sponsored pension funds, reads: “We believe that the evidence suggests that Amazon’s gender diversity gap creates significant risk for long-term shareholders, and that further delays in rethinking Amazon’s approach to human capital management may have dire consequences.”

The organization wants Amazon to set specific targets for how many senior women it would add, create a Stakeholder Advisory Council” that would meet on sustainability issues including sexual harassment, have a labor-law expert review employment contracts, and give more independence and authority to affinity groups–networks of employees such as women in engineering or LGBT workers.

Georgetown University: No Collective Bargaining Talks With Grad Students, Research Assistants

Georgetown University won’t support a bid by graduate students to unionize, the school announced in December.

The Washington, D.C. Jesuit-affiliated school said it considers teaching and research assistants as students, not employees.

University administrators said they will address issues affecting graduate students–but not through collective bargaining.

 

$173K Award for Fired Whistleblower

A NY company is paying steep price for violating the rights of a former employee who blew the whistle on its safety practices.

A jury and judge ordered Albany-based asbestos abatement and demolition company Champagne Demolition, LLC and its owner, Joseph A. Champagne, to pay $173,793.84 to a former employee who was fired in June 2010 after reporting improper asbestos removal practices at a school worksite in Gloversville, New York.

The judgment supports a U.S. Department of Labor lawsuit that found Champagne Demolition, LLC violated the employee’s whistleblower rights. The company must pay $103,000 in back wages, $20,000 in compensatory, and $50,000 in punitive damages.

On June 10, 2010, the employee informed company management of the improper practices. The employee was fired the next day and subjected to verbal threats and legal action. A complaint was filed with the Department’s Occupational Safety and Health Administration (OSHA), which opened a whistleblower investigation and found merit to the allegations.

“We are pleased with the jury verdict and the judge’s ruling to hold this employer accountable for violating the employee’s rights,” said OSHA Regional Administrator Robert Kulick, in New York. “Every worker has the right to report potential safety and health hazards without fear of harassment, termination, or retaliation.”

“This jury verdict and the judge’s ruling on this case underscores the Labor Department’s commitment to ensuring that the law is followed and employees’ right to a healthy and safe workplace is maintained,” said Regional Solicitor of Labor Jeffrey S. Rogoff, in New York.

OSHA enforces the whistleblower provisions of the Occupational Safety and Health Act and 21 other statutes protecting employees who report violations of various airline, commercial motor carrier, consumer product, environmental, financial reform, food safety, health care reform, nuclear, pipeline, public transportation agency, maritime, and securities laws.

Attorneys Allison Bowles, Amy Tai, and Darren Cohen of the regional Office of the Solicitor in New York litigated the case. The whistleblower inspection was conducted by OSHA’s regional Office of Whistleblower Protection Programs in New York.

Under the Occupational Safety and Health Act of 1970, employers are responsible for providing safe and healthful workplaces for their employees. OSHA’s role is to ensure these conditions for America’s working men and women by setting and enforcing standards, and providing training, education, and assistance. For more information, visit www.osha.gov.