PITTSBURGH – A Pittsburgh restaurant improperly used its tip pool – requiring workers to share tips with managers, supervisors and other employees not usually tipped by customers – leading to violations of the Fair Labor Standards Act, a federal investigation has found.
The U.S. Department of Labor’s Wage and Hour Division determined Provision PGH LLC, operator of Provision PGH at the Federal Galley, violated the FLSA by claiming a tip credit and keeping tips to share with employees not eligible to participate in a tip pool. Tipped employees, such as cashiers, had their tips seized in order to pay the wages of non-tipped employees, including managers. The employer used a portion of the pooled tips to pay part of the salaries of managers, in violation of the FLSA.
The investigation led the division to recover $41,560 for 12 employees.
“Provision PGH LLC shortchanged its employees by retaining tips and not complying with the tip credit rules laid out in the Fair Labor Standards Act,” said Wage and Hour Division District Director John DuMont in Pittsburgh. “Restaurant workers are essential workers who depend on their tips to earn a living. They should be paid every penny of their hard-earned wages.”
The FLSA allows employers to pay tipped workers as little as $2.13 per hour in direct wages, while taking a credit against the tips earned by the employee to make up remainder of the federal minimum wage of $7.25 per hour. The employer, however, must notify tipped employees of any required tip pool contribution amount, may only take a tip credit for the amount of tips each tipped employee actually receives, and may not retain any of the employees' tips for any other purpose.
Since 2016, the Wage and Hour Division has conducted more than 25,000 investigations of food services establishments, recovering more than $195,000,000 in back wages for more than 195,000 workers throughout the nation. A compliance assistance toolkit is available for restaurant employers.
Learn more about the Wage and Hour Division, including a search tool to use if you think you may be owed back wages collected by the division. You may also call toll-free 1-866-4US-WAGE to speak directly and confidentially to a trained Wage and Hour Division professional. The division protects workers regardless of immigration status, and can communicate with workers in more than 200 languages.