CHICAGO – A federal court has ordered the operators of a Huntley restaurant to pay eight employees more than $105,000 in back wages and damages, despite the employers’ attempt to interfere with a U.S. Department of Labor investigation that found they illegally denied the workers their earned overtime wages.

The action comes after the court issued a preliminary injunction in June 2022 to Papa G’s restaurant and its owners Steve and Rick Tsakalios to cease their attempts to obstruct an investigation by the department’s Wage and Hour Division. In the course of its review, the division learned the employers told workers they did not have to speak with investigators, questioned those who did and hindered workers’ cooperation. They also provided falsified payroll records to investigators.

Division investigators audited the employers’ payroll practices from Feb. 5, 2019 to Feb. 4, 2022, and determined they did not pay workers overtime for hours over 40 in a week; instead, they either paid the affected employees straight-time rates or “banked” the hours to cover employees’ time off requests for when they did not work 40 hours in a week.

After the employers provided falsified payroll records to the division that showed employees rarely worked overtime, investigators obtained a second set of records showing employees worked far more than 40 hours per week and that Papa G’s paid employees straight-time rates in cash for overtime hours. A warrant served on the employers’ accountant recovered additional records that confirmed this practice.

On Aug. 3, 2023, the department obtained a consent judgment in the U.S. District Court for the Northern District of Illinois requiring Papa G’s and its owners to do the following:

Pay $52,904 in back wages and an equal amount of liquidated damages to the affected employees.
Be forbidden permanently from preventing workers’ cooperation with a federal investigation.
Pay $5,992 in civil money penalties for their willful violations of the Fair Labor Standards Act.
Hire an independent accountant to audit payroll records for three years to ensure compliance.
Provide all employees with information about federal wage laws and their rights.
“A federal court has upheld the findings of our investigation that Papa G’s denied eight workers the overtime wages they earned legally and then obstructed a federal investigation,” said Wage and Hour Division District Director Tom Gauza in Chicago. “The court’s action will also lead to the recovery of more than $105,000 in back wages and damages for eight restaurant employees who worked long hours to put food on their own tables.”

The Huntley-based Papa G’s has offered breakfast, lunch and dinner to area customers for 25 years.

For more information about the FLSA and other laws enforced by the Wage and Hour Division, contact the division’s toll-free helpline confidentially at 866-4US-WAGE (487-9243). Calls can be addressed in over 200 languages, regardless of where a caller is from.

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. Download the agency’s new Timesheet App for free on iOS and Android devices in English or Spanish to ensure hours and pay are accurate.

Julie A. Su v. T.S.T.A., Inc., d/b/a Papa G’s, Rick Tsakalios, and Steve Tsakalios

Civil Action No. 3:22-cv-50141

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