FORT WAYNE, IN – The operator of seven Fort Wayne area restaurants shortchanged 17 of its managers when the salary it paid was determined to be insufficient to relieve the employer of its overtime obligations. This led to a violation of overtime pay requirements when employees worked more than 40 hours in a workweek, a U.S. Department of Labor investigation has found.
An investigation by the department’s Wage and Hour Division at five Cebollas Mexican Grill locations in Fort Wayne, and two others in Angola and Auburn, determined the managers’ salary failed to meet the executive exemption requirement under federal law. The division’s investigation led to the recovery of $63,546 in unpaid overtime wages for the 17 managers.
“Before employers assume they do not have to pay overtime, they must ensure that the salary paid and the duties performed by managers are sufficient to relieve the employer of their legal overtime obligations,” explained Wage and Hour Division District Director Patricia Lewis in Indianapolis. “Simply calling an employee a manager and paying them a salary is not sufficient. This is a very common violation, and it can have a negative impact on recruitment and retention of workers. During the course of the pandemic, many essential workers, including those in food service, have sought other employment when their employer failed to pay the full and fair wages earned.”
In addition to the overtime violations, investigators found the employer failed to maintain accurate records of hours worked for managers.
The Bureau of Labor Statistics projects that, in the Midwest, 958,000 food and accommodation services workers left their positions in December 2021. BLS also projects about 41,400 openings for food service managers each year, on average, from 2020 to 2030.
“Amid this significant shift of workers away from the food service industry, employers should ensure they are paying workers properly. We encourage employers to seek guidance from the U.S. Department of Labor to prevent costly violations and remain competitive,” added Lewis. “Restaurant employers whose pay practices comply with the law can have an advantage when it comes to attracting and retaining workers. Those who shortchange workers may find themselves without staff to operate their businesses well.”
For more information about the FLSA and other laws enforced by the Wage and Hour Division, contact the division’s toll-free helpline at 866-4US-WAGE (487-9243). 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.
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