A United States Department of Labor investigation into Morgantown business Black Bear Burritos LLC has revealed minimum wage and overtime violations that will result in 105 workers receiving $232,295 in back wages from the restaurant.
When notified of the violations, the company agreed to pay all back wages and be compliant in the future, according to the DOL. Black Bear Burritos did not respond to 12 News following a request for comment regarding the violations, but posted a statement on its Facebook page, which reads in part:
"Prior to any communications with the department of labor, we split all tips taken in on any given day evenly amongst all trained employees, including managers, based on how many hours they worked on that day. We did this with the full knowledge and understanding of each and every employee that did and ever has worked for us in an attempt to create equality amongst our entire staff while keeping everyone working towards the same goal." (See below for full statement)
The U.S. Department of Labor Wage and Hour Division's Charleston Area Office investigation disclosed that Black Bear required servers to participate in an illegal tip sharing arrangement. Under the Fair Labor Standards Act, tips are property of employees who receive them although restaurant operators can benefit by claiming a credit based on the tips toward their obligation to pay employees minimum wage. An employer may not take an employee's tips for an invalid tip pool and if an employee's tips combined with the employer's direct wages do not equal minimum wage and the employer must make up the difference during the pay period, according to the DOL.
The investigation also revealed that salaried managers were unlawfully paid using money from the tip pool. Black Bear based overtime premium pay on employees cash wages instead of the regular rate, $7.25 an hour, minus the tip credit, plus the cash wage.
"Failure to pay legally required minimum wage and overtime poses a serious problem to workers who, in many cases, are already struggling to get by, and also undercuts those employers that choose to obey the law and pay their workers properly," said John DuMont, director of the division's Pittsburgh District Office in a news release. "Tipped workers rely on customers for the bulk of their income and are especially vulnerable to hardships caused by improper or illegal tip sharing arrangements, which deprive them of their hard-earned pay."
Some former Black Bear Burritos employees took to social media Thursday to dispute that they were deprived "of their hard-earned pay."
One such person, who did not wish to be identified, said "In fact, everyone loved it, myself included! It was great motivation for my kitchen staff, and encouraged cooperation and better service... No-one had any idea that it was illegal, Matt (Showalter) and Jason (Coffman) most of all.
"Black Bear Burritos includes this is its statement: "We did not pocket a penny of gratuity; we just distributed them incorrectly by including kitchen staff and general managers in that distribution."
The former employee added, "This is a wonderful Morgantown business, run by two honest and hard-working family men from WV."