Red Robin tip pool case to move forward in court — Business Management Daily: Free Reports on Human Resources, Employment Law, Office Management, Office Communication, Office Technology and Small Business Tax Business Management Daily
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Red Robin tip pool case to move forward in court

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in Compensation and Benefits,Human Resources

Two former servers at Red Robin Res­­­­taurants in Wilkes-Barre and Dick­­son City, Pennsylvania, can proceed with their Fair Labor Standards Act (FLSA) class action against franchisee, Lehigh Valley Res­­tau­­rant Group, Inc. The suit alleges Lehigh’s tip pooling scheme violates the FLSA because it includes workers who only have a de minimus interaction with customers.

Lehigh requires servers to contribute 3% of their sales to a tip pool that is distributed to bartenders, expediters and busboys. Expediters are staff who resolve customer disputes and help cook during busy times. The suit alleges expediters are not employees who “customarily and regularly” receive tips as the FLSA requires for workers to receive tips from a pool. A U.S. District Judge refused to dismiss the case so it will go to trial.

Note: The U.S. Department of Labor has targeted tip pools for enforcement actions in recent years. Employers should consult with counsel to determine whether their tip pool complies with the FLSA.

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