Let’s face it, being a server is hard work. Although some servers earn well, the truth is that most waiters and waitresses are underpaid for the type of work they do. Unfortunately, some employers make it worse by using illegal pay policies. Sometimes it is because they don’t know any better … but sometimes it is intentional.  Whether it is accidental, out of ignorance, or on purpose, it is important that you fight for the money you (and your colleagues) are entitled to.

The following are some of the most common ways wait staff are underpaid:

SHARING TIPS WITH MANAGERS OR OWNERS

Restaurant owners, officers, or managers can’t share in tip pools or require servers to share tips with them. Servers or other workers holding positions that normally receive tips should not be required to “tip out” to managers. That’s taking what isn’t theirs!

DEDUCTING FOR MEALS YOU DON’T GET

Sometimes restaurants deduct a certain amount of money per shift for meals they provide to staff to eat on their breaks. When done right, this can be a great benefit of working at a restaurant! However, sometimes restaurants will make these deductions and then either not actually provide the food, or won’t allow you enough time to actually sit down and have a meal. When the deduction is consistently taken out from your pay each week but you’re not even getting a chance to eat the food you’re paying for, that can be considered illegal as well.

DEDUCTIONS FOR BREAK TIMES YOU DON’T TAKE

While we’re discussing your breaks, if your employer automatically deducts 30 minutes or even an hour for a meal break, but you end up working through your normal break, this is a form of wage theft, too. If your company requires you to take a meal break, you must be allowed to take it. If you aren’t, then you should get paid for this time.

IMPROPER MINIMUM WAGE

Minimum wages are calculated differently for restaurant staff than most other industries, which can make this confusing.  If you suspect that your hourly rate of pay (not including tips) is lower than the legal minimum wage, you are entitled to your lost compensation. If this was intentional, the employer may be required to pay a penalty … to you!

YOU ARE PAID TIPS ONLY, BUT NO HOURLY WAGE AT ALL

In many restaurant jobs, most of servers’ earnings comes from tips, not the hourly wage.  However, restaurants still have to pay the legal “sub-minimum wage” rate.  

• For instance, as of July, 2020 in New York City the “minimum cash wage” is $10.00. This much must be on your paycheck for every hour you work.  With tips you must make at least $15.00 per hour.  If the tips don’t add up to that, the employer must make up the difference.
• At the same time, in Colorado, the “minimum cash wage” is $8.98.  With tips you it must add up to $12.00 per hour.  Again, if the wage and tips don’t add up to that, the employer must make up the difference.
• These amounts are changing frequently.  You can check out the most up-to-date rateshere.

(One thing to note, is that is possible to have your whole “paycheck” eaten up with taxes if you earn good tips.  Make sure the gross pay is on there, though!)

NOT PAID FOR PRE OR POST WORK ACTIVITIES

If you are required to come into the restaurant to perform pre-work activities like cleaning up, learning the menu, or just about anything else, you should be getting paid for these hours. Similarly, if at the end of your shift you have to stay after to wipe down tables or perform other duties, this should be paid as well. If you’re working, you should be paid.

INCORRECT OVERTIME PAY

The overtime rate applicable to tipped employees is unusual, and employers frequently get it wrong.  If the “normal” minimum wage rate is $15.00 an hour and your “subminimum” wage rate is $10.00 an hour you are supposed to be making up the $5 difference in tips. That’s why restaurants are allowed to pay you less than $15 per hour.  But, when you work more than 40 hours a week, the overtime rate is NOT $15.00 per hour. It is a little complicated to calculate, but it is time and a half the “normal” minimum wage (so, $15 x 1.5 = $22.50), minus the “tip credit” amount ($5 in our example).  So, the correct overtime rate here would be $17.50 per hour Cash Wage. If your employer gets it wrong, you may be entitled to recover your unpaid wages.

PAID IN CASH

If you don’t know what your pay is for because you’re paid in cash with no paystubs it can be confusing.  There’s nothing inherently wrong with being paid in cash, but you do need to be provided enough information to determine if it’s the right amount. There’s a state law in New York that requires employers to give you a pay stub.  It doesn’t have to be fancy, but it does have to include all the important information: your rate of pay; the quantity of hours or units you worked; and then any deductions, and what they’re for.  If your employer is not giving you pay stubs, the employer might be liable to pay you a statutory penalty for this failure.

FAILING TO RECEIVE WAGE OR TIP NOTICES

Just like employers in New York are required to give you pay stubs, they also have to give you a couple of other kinds of notices.  First, they have to provide you with a Wage Notice.  This is a simple one page form that basically just lists your rate of pay and what your overtime rate is.  Second, if you are a tipped employee and the employer wants to pay you the “subminimum wage” rate or anything less than the actual minimum wage rate, then they have to give you a form notifying you of this and describing the “tip credit” – that is, the idea that the employer can pay you at the lower rate lower than minimum wage if you are earning the difference between that and minimum wage (or more!) in tips.  If they have not given you these notices, they may be liable for statutory penalties to be paid to you as well.

NO “SPREAD OF HOURS” PAY

In New York, when the time between the start of your shift and the end of your shift is more than 10 hours (even if you have a break somewhere in there), you are entitled to be paid for an extra hour’s worth of minimum wage pay for that day.

If you believe that any of these types of wage theft have occurred to you, contact our offices to set up a free, confidential consultation with an attorney.  We will review your case and help you to decide how you should proceed.