Philadelphia Employment Law News

Chickie's and Pete's Hit With Wage and Hour Lawsuit

Talk about wage and hour violations, Chickie's and Pete's is facing some real problems when it comes to employee tips. Looks like they've had their hands in the coffers a little too much.

Andrew Laplante, a former bartender the restaurant, claims that he and other employees at the airport franchise had to pay their employer 2 percent of their total credit card receipts at closing time. They had to pay up in cash. They called it the "Pete Tax."

Now, Laplante and others are suing in Federal court.

It's not just a potential violation of federal wage and hour laws, but also a violation of municipal law. Philadelphia has a gratuity protection ordinance that prohibits employers from taking money from employees' credit card tips to pay for the processing fees, reports CBS News.

In restaurant practice, it's not unusual for waiters to get paid minimum wage or sometimes even less, as their tips are expected to bring them up over minimum wage.

But is it legal? The whole area surrounding waiter tips is not as easy to comprehend as most typical wage-and-hour legal issues, which just focus on issues such as wage amount, hours worked and overtime.

The waiters in the lawsuit are alleging that they had to pay back two percent of the entire check, rather than two percent of the tip received by credit card. That would sometimes result in a 10 percent loss of the employees wages in any given shift.

If that deduction takes the employee's wages below minimum wage (i.e. $7.25) on any given day, then the employer could find themselves in trouble. Federal and state wage and hour law is no joke and there could be some stiff penalties for the employer to face.

If the employee worked longer than eight hours in any given day and the wages are below minimum wage, Chickie's and Pete's could find themselves in even bigger trouble.

This will be an interesting lawsuit to follow.

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