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  • 75 cent charge per shift...in cash...legal??? Alabama

    I work in Phenix City, Alabama. I am actually a rather new employee at a restaurant here in town (it is a very large bar & grill chain). This particular establishment charges it's servers and no other employees, only servers, a fee of 75 cents per shift. This fee is supposed to go into a fund to buy more dishes (just in case we may have broken or thrown away any). I, personally, have not... as far as I know.

    This fee is paid in cash and, as far as I know, it is undocumented. I did some math and figured out that I am paying $18 a month, $216 per year...and I don't know exactly how many servers are employed, but if 25 pay this amount it comes to $5400 per year (which is a low estimate).

    I am wondering if this is a legal practice. My father says that it is definately illegal and unethical. If it were legal, it should come out as a payroll deduction. Could it also could be descrimination since it is only charged to servers and no other employees? Please advise

    Thank you for your time
    Pam in Alabama
    Last edited by alemap0072; 07-09-2007, 10:56 AM.

  • #2
    Pam it is the employers responsibility to pay the cost of operating a business, not the employees. I will see what I can find for you as per a specific labor/industrial law in Al. In the mean time google AL state laws and see what you can come up with. Eventually one of the other more senior members will be along and maybe one of them can point you in the right direction.

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    • #3
      I know zip about Alabama state laws, so this will be federal law specific only. Hopefully someone who actually knows something about Alabama will respond to those rules (if any) that differ from the federal rules.

      You raised several issues.
      - "Servers" are not a legally protected class and it is not against the law to discriminate against them. "Discrimination" per se as you describe it is not legally an issue.
      - The employer must pay minimum wage (MW) as modified by the tip credit and must pay overtime (OT). Recoveries initiated by the employer for whatever reason are not allowed to interfere with that. This is black letter law and the employer has no legal excuse what so ever to violate it.
      - Past that, the federal rules on recoveries can be found at the following website. The general rule that employers tend to cite is listed below. Breaking dishes are considered to fall under the "damages to the employer's property" clause.
      - The fact that we are not talking about actual damages but rather money being taken out in anticipation of possible damages gives me pause. I do not know how federal (or state) DOL would address that particular issue. I do know if we were to flip the issue and look at this from the employer's side, I would be a lot more comfortable putting together a policy which (communicated ahead of time) does something like pay the first hour of work for each shift by $0.75/hour as long as MW and OT is followed then I would be trying to support a deduction for "damages" that has not actually occured. Federal law generally does not care what gross wages are as long as MW and OT rules are followed.

      http://www.dol.gov/esa/regs/compliance/whd/whdfs16.htm

      Some examples of items which would be considered to be for the benefit or convenience of the employer are tools used in the employee's work, damages to the employer's property by the employee or any other individuals, financial losses due to clients/customers not paying bills, and theft of the employer's property by the employee or other individuals. Employees may not be required to pay for any of the cost of such items if, by so doing, their wages would be reduced below the required minimum wage or overtime compensation. This is true even if an economic loss suffered by the employer is due to the employee's negligence.
      "Reality is that which, when you stop believing in it, doesn't go away".
      Philip K. **** (1928-1982)

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      • #4
        Also, the OP did not mention "tips" per se, but if the fee is being paid for by withholding tips, then technically another rule is being violated.

        http://www.dol.gov/esa/regs/compliance/whd/whdfs15.htm

        Retention of Tips: The law forbids any arrangement between the employer and the tipped employee whereby any part of the tip received becomes the property of the employer. A tip is the sole property of the tipped employee. Where an employer does not strictly observe the tip credit provisions of the Act, no tip credit may be claimed and the employees are entitled to receive the full cash minimum wage, in addition to retaining tips they may\should have received.
        "Reality is that which, when you stop believing in it, doesn't go away".
        Philip K. **** (1928-1982)

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        • #5
          Thank you DAW I knew one of ya'll would know exactly where to go for this information. I was not able to locate anything for AL, but having the Fed regs that clearly states, they can not charge the servers, I suppose this includes any other employees, for the cost of doing business specific Al laws can't cause this reg to be less. Fed regs say that it is illegal to charge them for walk-outs, breakages, cash register shortages, and invalid tip pools just about covers all the areas that she was concerned with. I will bookmark this for future reference. Ya'll are the best.

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          • #6
            However, didn't the OP say this was being paid in cash and NOT being deducted from the paychecks?
            I don't respond to Private Messages unless the moderator specifically refers you to me for that purpose. Thank you.

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            • #7
              Now that I know it is illegal, what do I do next??

              The money does come out of our tips...that's the only cash that is in my apron at the end of the shift when I have to pay. I just read that:
              " The law forbids any arrangement between the employer and the tipped employee whereby any part of the tip received becomes the property of the employer. A tip is the sole property of the tipped employee. Where an employer does not strictly observe the tip credit provisions of the Act, no tip credit may be claimed and the employees are entitled to receive the full cash minimum wage, in addition to retaining tips they may\should have received. "

              Now I'm not trying to get my work place into any kind of trouble. I don't know if this happens at any of their other locations, just this one. I plan to talk to my General Manager and present her with my findings. I, at first, only questioned the ethics of this practice. Now, I know that it violates Federal Labor Laws too. It looks like they would have to pay every server minimum wage for every shift that they they have been taking money, but that's not what I'm after. I just don't want for us to be charged anymore. If nothing happens after our talk, they may just have to fire me because I'm not paying it again
              Pam in Alabama
              Last edited by alemap0072; 07-09-2007, 08:08 AM.

              Comment


              • #8
                Then report them to the federal DOL if you like. However, PLEASE remove the name of the restaurant from your post ASAP. My understanding is there have been employees fired for reporting violations (or even non-violations) on this and other public sites.

                You might want to call corporate first, though. They may not know this particular restaurant is doing this.
                I don't respond to Private Messages unless the moderator specifically refers you to me for that purpose. Thank you.

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                • #9
                  Originally posted by joec
                  Thats alot of dishes.
                  JoeC
                  That's a bigger lot of BS. This particular chain is one my son worked at while in college and believe you me they do some pretty shady crap here in Georgia as well. They record his tip allowance on the total take for his tables for his shift rather he makes enough to qualify for min wage or not. And of course with the at will that we work under they simply tell the employees if they don't like the way they do business to take it elsewhere. Their tip allocation procedures is just another way to keep from paying min wage to servers who have no control over business volume.

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                  • #10
                    I'd love to know if someone is keeping track of all of these "donations." Where is the cash being kept? Is there some kind of ledger? Are they spending all of the funds on new dishes? Like Joe said, that's a lot of dishes. Or are they buying fine antique china? or does the manager dip into it for other things? All that cash in small change could end up in anyone's pockets.

                    Comment


                    • #11
                      Originally posted by BnThrDnTht View Post
                      They record his tip allowance on the total take for his tables for his shift rather he makes enough to qualify for min wage or not. And of course with the at will that we work under they simply tell the employees if they don't like the way they do business to take it elsewhere. Their tip allocation procedures is just another way to keep from paying min wage to servers who have no control over business volume.
                      So, did he file a wage and hour claim?
                      I don't respond to Private Messages unless the moderator specifically refers you to me for that purpose. Thank you.

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                      • #12
                        He is in the process of working it out. I have most definately advised him to file. Unfortunately as an adult I can't make him do it.

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                        • #13
                          I know OP said deduction coming from cash tips but a just FYI: Al. has no law on paycheck deductions except employers may not require employees to pay union dues or fees as a condition of employment.

                          DAW gave federal laws.
                          Too often we underestimate the power of a touch, a smile, a kind word, a listening ear, an honest compliment, or the smallest act of caring, all of which have the potential to turn a life around. Leo Buscaglia

                          Live in peace with animals. Animals bring love to our hearts and warmth to our souls.

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                          • #14
                            I do not think the OP should forget the US DOL. Although he/she has that right under the 16(b) right of the FLSA. The US DOL may be able to correct the problem enterprise/nation wide, with a point that a private suit may not be able to do.

                            Take for example that the average worker is due x amount of money, with the liquidated damages then the employee is due xx amount of back wages. However, with a US DOL investigation, if the facts reflect that in fact the claim is valid, in this case, a deduction from tips received. The US DOL investigator has the authority to recover on behalf of all the employees nationwide the tips illegally deducted (say x amount) plus disallow the tip credit for the employer. In essence the employer is required to pay back to all tipped paid employees, the tip credit the employer used on the tip employees. Say for example, the employer paid $2.13 per hr, the employer now owes $3.02 for every hr this employee was employed at this establishment earning tip wages, (say xxx amount). In a nationally own enterprise this can be a lot of mula… In addition IRS will be contacted for possible IRS violation, ie: the deduction is considered income to the employer which probably was not reported to the IRS.

                            Just another option other than a private suit.
                            Last edited by ArmyRetCW3; 07-09-2007, 01:25 PM.
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                            • #15
                              Just another idea. Since this is a national chain restaurant, maybe going to the media might be an option. This might be an unofficial policy nation-wide,a nd would be quite embarrassing for them

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