In a recent decision, Kirby v. Immoos Fire Protection, Inc., the California Supreme Court held that a prevailing party cannot recover attorneys’ fees in an action for an employer’s alleged failure to provide meal or rest periods brought under California Labor Code § 226.7.
What does this mean for California restaurants? Employees and plaintiffs counsel will be discouraged from filing class action lawsuits alleging violation of meal and rest period laws.
On April 25, 2012, the Equal Employment Opportunity Commission (EEOC) issued new Enforcement Guidance on the Consideration of Arrest and Conviction Records in Employment Decisions (“Guidance”). The Guidance largely reiterates the EEOC’s long-standing policy positions on employer use of criminal background checks. Here are five noteworthy highlights from the Guidance:
The EEOC’s Guidance isn’t the end of the story. Many states and municipalities also regulate employer use of criminal background checks. For example, Massachusetts and Philadelphia, PA prohibit employers from asking about convictions in employment applications, California prohibits certain questions, and many states prohibit asking about convictions that are more than 10 years old.
Bottom Line: In most cases, it’s ok to ask about arrests and convictions on job applications. However, extra caution is needed if you reject an applicant based on criminal history and you should always consult state and local law.
Last year, the NLRB passed a regulation requiring employers to display a poster describing employees’ rights under the National Labor Relations Act. With a few exceptions, the regulation requires all employers to display the poster (including employers that don’t have any unionized employees).
Earlier this year, a Washington D.C. Federal District Court upheld the NLRB’s authority to impose the poster requirement, but struck down certain penalties included in the regulation. After this decision, the poster requirement was on track to take effect on April 30.
On April 13, a South Carolina Federal District Court ruled the poster requirement invalid, holding the NLRB lacks authority to require the poster. After this decision, the status of the poster requirement was in flux.
Today, the drama thickened. This morning, the U.S. Court of Appeals for the District of Columbia issued an emergency injunction (effective nationwide) preventing the poster requirement from taking effect until the Court rules on its validity. Oral arguments are scheduled for this September.
Bottom Line: Employers need not display the NLRB poster. Due to the injunction, the April 30 deadline has been postponed again. We’ll keep you updated on developments in the NLRB poster saga.
Anecdotal evidence is that Denver's Department of Environmental Health has been busier than usual this year handing out violations to restaurants. Section 23-10 of Denver's Municipal Code contains the important information for those who want to appeal:
An initial fine might seem minimal ($250), and it might feel easier to pay the fine and be done with DEH. But remember, fines quickly escalate for second and third violations, and if word around town is any indicator, DEH will pay you several follow-up visits. Even an unsuccessful appeal sends the message that you won't be an easy target.
The California Supreme Court has issued an opinion in Brinker v. Superior Court. This opinion clarifies California law on meal and rest periods. It affects all California restaurants. A summary of key holdings is below. Please consult legal counsel with questions on how this opinion affects your restaurant.
1. Number of Rest Periods Required
Employees are entitled to 10 minute rest periods as follows:
2. Rest Period Timing
Employers must provide rest periods approximately in the middle of the work periods described above, unless practical considerations make it infeasible. There's a good argument that a lunch / dinner rush is such a practical consideration.
3. Making Meal Periods Available v. Requiring Meal Periods be Taken
Employers must provide a 30 minute meal period. This obligation is satisfied if the employer:
Employers do not have to police meal breaks and ensure no work is performed; bona fide relief from duty and relinquishing of control satisfy the employer’s obligations. But, employers can't pressure employees to work during meal periods.
4. Meal Period Timing
Employees who work more than 5 hours must be provided a meal period no later than the end of their fifth hour of work (unless the employee's total work period for the day is 6 hours or less and the employer and employee mutually consent to waiving the meal period).
Employees who work more than 10 hours must be provided a second meal period no later than the end of their tenth hour of work.
5. Off-the-Clock Claims
Without going into the details, the Opinion was favorable for defeating off-the-clock class action certification.
California restaurants - this is a special posting just for you.
The California Supreme Court is expected to issue a decision in Brinker v. Superior Court this Thursday, April 12. The Supreme Court's decision is expected to clarify the scope of an employer's obligation to provide meal and rest periods.
California restaurants should stay tuned for how the Court's decision will impact their operations. At the very least, we hope to have some much needed clarity on meal and rest period obligations.
A week of free ice cream? Go on tour with Blue Bell. [Denver Bargains]
R Bar opens on East Colfax. [Denver Post/Colorado Table]
New season, new nachos. Aramark revamps its ballpark offerings, including "S'mores nachos" at Coors Field. [Quick Service Restaurant Magazine]
Want to improve your food safety checklists? You guessed it, there's an app for that. [The Back Burner]
Wisconsin repeals legislation that had made it easier for employees to sue for gender-based pay discrimination. [Huffington Post]
The gender-based pay gap discussion is usually focused on the business world. In the restaurant world, employers might compensate wait staff equally, but differential pay for hourly or salaried management can still cause problems.
A handful of laws prohibit employers from paying men and women differently simply because they are men and women. Let's hope that's not a revelation. The Equal Pay Act has been around since 1963.
Most restaurants are setting pay rates based on experience and seniority, so they're safe, right?
Just because a restaurant doesn't use gender to determine pay rates doesn't mean that those differences don't exist. You might be surprised by the patterns that show up when you take a broad look at the pay rates for everyone you employ.
And when employees make allegations about discriminatory pay, it can be very difficult for an employer to prove its motivations. At the very least, those allegations can quickly develop into a lengthy and expensive lawsuit.
Robin Shea has an excellent breakdown of a recent lawsuit in which an employer struggled to defend the differences in its pay. The employer claimed that women had lower salaries because they generally started with less experience than men. The court didn't buy it.
Rather than be surprised by what your numbers as a whole look like, Shea offers this advice for spotting pay gaps and avoiding discrimination claims altogether:
[C]onsider doing all pay increases for employees in a given job category at the same time each year, rather than doing them on individual employees' anniversary dates. If you're doing them all at the same time, you will be much more likely to notice without even trying that Jane is getting a pittance in relation to John, so you can take whatever remedial steps are necessary. If you use anniversary dates, be sure you make the extra effort to compare the employee with his or her peers.
That's probably not something you're currently doing. But a minor adjustment could save the tremendous headaches and costs associated with a discrimination claim.
Mario Batali, one of America’s best known Chefs and Restaurateurs, recently settled a class action lawsuit alleging (among other things) that he and his associate illegally deducted 4%-5% of nightly wine sales from the tip pool to cover the cost of sommeliers and related wine expenses. The lawsuit covered approximately 1,100 employees at 8 restaurants. The settlement amount was $5.25 million.
I’ve spoken with some restaurateurs who sympathize with Batali, noting that waiters easily can earn a $20+ tip on a bottle of wine they had nothing to do with selling (and perhaps the guest would have bought a more expensive bottle if the $20 tip weren’t lurking in the background). At the same time, as any restaurant owner or operator knows, employees are protective of their tips. Perhaps more importantly, the law is protective of employees’ tips.
Just days before the settlement was announced, the U.S. Department of Labor issued a Field Assistance Bulletin advising that it will “enforce nationwide” its 2011 tip ownership regulation. Under this regulation: (1) a tip is the sole property of the tipped employee regardless of whether the employer takes a tip credit; and (2) an employer may not use an employee’s tips for any reason except as a credit against minimum wage or in furtherance of a valid tip pool. This regulation clarifies a long-standing ambiguity which had prompted some courts to conclude that, if an employer does not take a tip credit, the employer can include back of house employees in a tip pool.
Bottom Line: Failure to comply with tip laws can be very costly. Your best insurance against a costly lawsuit is understanding and complying with federal and state tip laws.
Big City, a prolific restaurateur, watches Food Network’s new show Restaurant Stakeout and decides he wants to hide cameras and microphones throughout his restaurants, both in the front of the house and the back of the house.
Should Big City consult a lawyer before doing this? YES.
This kind of surveillance potentially violates a number of statutes. For instance, depending on the specifics of Big City’s business, it is possible that this kind of surveillance violates the National Labor Relations Act because it could be seen as an attempt to desuade employees from engaging in concerted actions to change their working conditions. It could also violate the Electronic Communications Privacy Act or other state statutes relating to privacy.
Given the potential legal problems, Big City should discuss any surveillance plans (and especially those with audio) with an attorney before moving forward. Perhaps good old-fashioned in-person supervision would be a better idea.
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